TagMortgage Rates

Posted January 16, 2015 Interest rates

So, you think rates are gonna spike up this year? Who says?

Here we go again… The beginning of a new year, and the same annual forecasts for interest rates to go up! Before I share my thoughts.. Here’s some of the recent headlines that I’ve seen….

a report by CBC News sharing 4 ways to prepare.. including selling your home, waiting to buy and locking into a Fixed rate mortgage! (Can you say panic?)
Here’s another from The Globe and Mail telling us it’s “Bad News for Borrowers: The economy could improve this year”. Really? Tell that to the people in Alberta, Newfoundland and Saskatchewan.
And this one from last week says Get ready for Interest Rate Shock in 2015.

Wow, reading this means rates are certain to up this year…right? So let’s see.. we should sell our home, put off buying (yet again) and lock in our Variable rates into Fixed rate mortgages..

Now let’s look at the most recent headlines.. Continue reading “So, you think rates are gonna spike up this year? Who says?”

Posted December 31, 2014 Debt

Looking ahead to 2015 rates and trends

Seasons Greetings! Happy New Year! Quick thank you for making 2014 a great year! Hope yours was just as special. And I’m wishing you much success and happiness in 2015.

I’ll make this quick as I’m sure you have some New Year’s Eve celebrations to attend to.

QUICK YEAR IN REVIEW.

Interest rates haven’t really changed this year.
5 yr fixed rates are under 3.00%.
Variable rate pricing improved to around Prime less 0.60% (less in some cases and dropping).
In fact, looking at the big picture, interest rates haven’t really changed much in the last 4 yrs. Yet, you wouldn’t know it by reading the newspaper headlines….(sorry to my media friends…)

Let’s get to it. MY THOUGHTS ON 2015. Continue reading “Looking ahead to 2015 rates and trends”

Posted January 27, 20142 Comments Mortgage News

Bank of Canada says no rate hikes, but possible rate drops!!

Last week, the Bank of Canada governor, Stephen Poloz, held the first of 8 scheduled meetings to set the Target Rate. This is the rate used to set the Bank Prime rate which currently sits at 3.00%. No surprise, no change in the rate. It has been the same since Sept 2010.

From 2011 to 2013, the previous Bank of Canada governor, Mark Carney, continually announced of a pending rate increase. But late last year, Poloz changed the tide when he announced it could be a few years before rates go up. One of the key drivers for rate hikes is inflation. The BoC target for inflation is between 1% and 3%. If inflation goes above 3%, we can expect rate hikes.

Inflation is not a concern. In fact, there are concerns about deflation as the current inflation rate sit at 1.2%. Some experts believe we could see the BoC rate drop. Great news for anyone in a Variable rate. We are also seeing the govt of Cda bond yields drop. Friday’s close was down to 1.59% for 5 yr bonds. Haven’t seen that level since June 2013. This means Fixed mortgage rates will probably go down further. Continue reading “Bank of Canada says no rate hikes, but possible rate drops!!”

Posted July 4, 20132 Comments Interest rates

Banks maximizing mortgage penalties again… but there’s a bright side..

In case you haven’t heard, Fixed rates are up around 0.50% over the last 3 weeks. But the Banks haven’t increased their posted rates… How can that be?? And how does that affect you?

The BIG SIX BANKS have played the rate guessing game for as long as I can remember.. This time, they’ve added another twist to ensure you will be paying those inflated penalties even longer.. By not increasing the posted rates, they ensure themselves any existing BANK customer will pay the same inflated penalties.

Look back to 5 years ago when fixed rate discounts we around 1.10% off Bank posted rates.. Now fast forward to May 2013. Rate discounts reached an all-time high of 2.25%. And whether it was by design or not, this inflated your penalty by the same margin. (I’ll let you decide if this is just good old BANK luck… yeah, right.) Continue reading “Banks maximizing mortgage penalties again… but there’s a bright side..”

Posted June 20, 2013 Interest rates

When the U.S. sneezes, Canada gets a cold… I’m getting the sniffles…mortgage rates are headed up.

Yesterday, the U.S. Fed Chairman, Ben Bernanke, announced he ‘could’ start to ease their stimulation of the economy later this year. That small announcement has had a huge impact on the global stock markets and bond yields. Stock Markets are down around 2.00% around the world as of 2.30pm today.

The U.S. has been buying around $85billion worth of bonds every month in an attempt to keep interest rates low. And with that simple announcement yesterday, the world’s markets have reacted. Bond yields have started to climb…

Our own 5 yr Govt of Cda bond yield is up to 1.75%. That’s up around 10bps from yesterday, and up 60bps from the beginning of May. In fact, we haven’t seen these levels since October 2011 and again in March 2012. We already received warnings from our Lenders that wholesale mortgage rates are likely to go up. Remember, bond yields affect Fixed mortgage rates.. but they will have an indirect affect on Variable rates, too. Continue reading “When the U.S. sneezes, Canada gets a cold… I’m getting the sniffles…mortgage rates are headed up.”