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Tag2016 mortgage tips

Short term fixed products are still in…

SHORT TERM RATES ARE STILL IN

A few months ago, I said Variable was out, Fixed rates were in.   I recommended going with a short-term fixed rate products.  The reasons are simple:

  • You can get the same or better in a 2 and 3 yr fixed rate term.  That eliminates the Variable rate for me.
  • 2 yr is 2.19% and 3 yr is 2.29%.
  • Variable is 2.30% today.  Why choose a fluctuating rate when you can get a guaranteed better rate for the next few years?
  • I also don’t like the current Variable rate pricing that’s out there.
  • Prime less 0.40% isn’t good enough.. I like to see Prime less 0.50% or better.

Historically, we’ve always done better by choosing short-term rates.  And that’s what Variable rates are…A mortgage product priced from short-term funds.  The only difference today, is that it makes more sense to lock into 2 or 3 yr fixed term vs choosing a Variable rate.

WARNING

( you’ll see lower rates advertised.. but be careful.  There are so many NO FRILLS products or products that carry inflated penalty calculations, limited repayment options and other hidden fees.. stay away from those)

MORTGAGE TIP

Hey, want to know which Mortgage Advisor to use?  Check out their historical recommendations and forecasts.  That should tell you all you need to know about that advisor.   And if you can’t readily find those historical forecasts, then walk away and look elsewhere.

Your best interest is my only interest.   I reply to all questions and I welcome your comments.  Like this article?  Share with a friend.

Steve Garganis 416 224 0114 steve@mortgagenow.ca