CategoryMortgage Rates

Posted May 28, 2013 Interest rates

5 yr Bond yields up significantly.. expect fixed rates to go up..!

5 yr Govt of Canada bond yields are up over 30bps in May. We should expect fixed mortgage rates to increase if they hold at this level. If you are thinking of buying, refinancing or if your mortgage is coming up for renewal, I suggest you contact your mortgage broker and get some rates held. This could be the beginning of the long-awaited mortgage rate hikes.

There is another chart you should look at if you want to see where Fixed mortgage rates are headed over the next 6 months. The 2 year Govt of Canada bond yields are a good 6 month indicator of where rates are going…. and this chart shows the 2 year bond yields jumped over 25bps in May.

We’ll report any changes as they get announced.

Your best interest is my only interest.

As always, I welcome your comments, calls and questions.

Steve Garganis 416 224 0114 steve@mortgagenow.ca

Posted May 13, 2013 Bank News

Fixed mortgage rates could move up this week.

Guess I shouldn’t have talked about the record low interest rates last week… Today, 2 small lenders increased their fixed mortgage rates and another Lender warned of a potential increase coming sometime this week. What’s driving the higher rates? A jump in the 5 year bond yields. Fixed mortgage rates are directly affected by the Govt of Canada bond yield.

With bond yields jumping 20 basis points in the past 1o days, it’s only logical to assume mortgage rates will go up. click here to see bond yields. But hey, with interest rates at record low levels, it’s no reason to panic. Rates are still great…. if you want to protect yourself against a possible increase, get a rate hold… it’s free and there’s no obligation. Most Lenders will hold rates for 120 days..

Need help to get a rate hold? Call me. I can help.

Your best interest is my only interest.

As always, I welcome your comments, calls and questions.

Steve Garganis 416 224 0114 steve@mortgagenow.ca

Posted March 27, 2013 Consumer Debt

BMO caves in to Federal govt pressure and raises mortgage rate.

It was bound to happen. BMO announced their so-called ‘low-rate’ (NO FRILLS) 5 yr fixed rate mortgage would be increasing to 3.09% from 2.99%. This comes shortly after the Federal Minister of Finance, Jim Flaherty, said that he called BMO and asked them to pull their 2.99% ads. Last week, the Minister’s office asked Manulife Bank to withdraw their recent ad promoting a similar low rate.

While, 2.99% isn’t the best rate today, it was the lowest advertised rate from the BIG SIX BANKs. It was somewhat symbolic. Of course, Mortgage Brokers have access to even lower rates through the wholesale mortgage market, but these lenders don’t have the deep advertising pockets that BMO or the other BIG SIX BANKs have. So the publicity surrounding this rate and the increase will get much more air-time. You can actually find full-featured 5 year mortgages at 2.89% today, through a good mortgage broker (a word of warning.. I’ve seen lower rates offered, and I have access to these products… but these products are not full-featured and come with some limitations that make them less attractive… just be careful when choosing your mortgage and your mortgage broker)… Continue reading “BMO caves in to Federal govt pressure and raises mortgage rate.”

Posted March 21, 20133 Comments Consumer Debt

Canadian Govt doesn’t want you to find the lowest mortgage rate.

Yesterday, we saw our Federal Minister of Finance, Jim Flaherty, admit to having his office phone up Manulife Financial and ask them to stop advertising their 2.89% 5 year fixed rate mortgage special. An unprecedented move for a government official… Yes, it’s true! But wait, it gets better (or worse). Flaherty admitted to calling up BMO personally, to ask them to stop advertising their 2.99% 5 year fixed rate (NO FRILLS mortgage). click here for the article.

Now, just a comment about these products and rates…. if you are a regular visitor to CanadaMortgageNews.ca then you’ll know the BMO low-rate (or NO FRILLS to be more accurate) is a terrible product with too many restrictions and limitations… Manulife has a decent product….rate is competitive, however, like most other Bank’s, there is some mystery about what their best rates really are… so once again, you can’t rely on a website or bank advertising when it comes to finding the best mortgage…a mortgage broker is the best way to get unbiased advice with access to dozens of Lenders. Continue reading “Canadian Govt doesn’t want you to find the lowest mortgage rate.”

Posted January 24, 2013 Interest rates

Interest rates to stay low for longer than expected…

The, soon to be, ex-Bank of Canada Governor, Mark Carney, is leaving us with a present… During yesterday’s Rate Announcement, the first of eight regularly scheduled rate meetings this year, Carney said the economy is growing at a slower pace than expected…. we having a cooling housing market….. inflation remains low and is not an immediate concern…. Last but not least, he expects the economy will not reach it’s full capacity in late 2014 and that withdrawing any monetary policy stimulus is less imminent than previously anticipated.

End result, no rate hikes are expected til 2014… These comments come as a bit of a surprise given the Bank of Canada has wanted to raise rates for the past 2 years. Well, maybe it’s Carney’s way of giving us a departing present….Let’s not look a gift horse in the mouth. Continue reading “Interest rates to stay low for longer than expected…”