variable rate – Pennysaverblog

Debt

Should I Go For a Fixed Rate Mortgage?

If you are are in an open variable rate mortgage like we are right now, you may want to consider if it’s better to move into a fixed rate mortgage before the prime rate goes up. The Bank of Canada will likely be raising interest rates soon and although prime is at an all time low right now, it won’t stay there forever. Some major banks have already raised their fixed mortgage rates, so if you are thinking of switching, now is the time to do it before the rates go up even higher.

For my husband and I it makes the most sense for us to stay where we are as we are likely going to be selling our home within the next year or so. For those of you who are not planning on selling your home anytime soon, you may find it more affordable within your budget to take advantage of a fixed rate.

April 24, 2010

Banking

Fixed Rate & Variable Rate Mortgages

Recently with the prime rate being so low, my husband and I decided to change our mortgage from a fixed rate to a variable rate. We still had about 3.5 years remaining on our existing mortgage so we were subject to some hefty penalties. I wouldn’t necessarily recommend doing what we did, although we do hope to recover our penalties and at least save some money in the process. However, if you are planning on buying a home in the near future, you may want to consider choosing a variable rate while the rates are low and then you can always fix the rate later when the prime rate goes up. Whatever you decide, don’t rule out the possibility of a variable rate. Statistics indicate that more than 85% of people who have variable rate mortgages save money. When you visit your mortgage lender, be sure to ask about their variable rate mortgage options. It is better to be fully informed of your options in the beginning rather than wish you had later.

April 13, 2009