Why Choose A Variable Rate? Alert Important To Read

Dan had just bought his new home and was going to move his new wife and port his current variable rate to the new dwelling. At the time they asked why choose a variable rate? Thankfully, the adjustable rate mortgage has served him well.

Imagine his thoughts when he received a five-year variable rate at 3.4%. This story did happen to our client at Robert Floris’ Mortgage Architects office and needless to say, Dan I had mortgage rate interest shock. We had a great discussion and he thought it would be a great idea to break his current variable rate and take a five year fixed rate at 2.79%.

Inverted Yield Curve

Several weeks back we discussed the inverted yield curve. This is rare in the mortgage market where Canadian long-term rates are lower than short term rates. Dan’s purchase was fortuitous during this period. But can it be good timing event for our current clients? Yes, if you are currently in an adjustable rate mortgage or if your current mortgage renews this year.

If your mortgage renews this year you may be pleasantly surprised that your renewal rate should be the same or lower this year.

If you are currently in a variable rate mortgage, call your lender and ask what the current fixed rates are currently. Good chances are you may get a lower rate and be able to lock in.

For many variable rate lovers, with the talk of a recession, many are betting on future rate cuts. Whichever way you may play your mortgage, take the time to investigate your choices. This may be a good time to save money.

Robert Floris is a Mortgage Broker. His office is located at 651 Fennell Avenue East in Hamilton, Ontario. If you would like to speak with Robert, he can be reached at 905-574-9200 #215. Alternatively, you can contact Robert here.

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