{"id":1217,"date":"2019-05-14T16:31:04","date_gmt":"2019-05-14T16:31:04","guid":{"rendered":"https:\/\/mymortgagepros.com\/?p=1217"},"modified":"2024-02-08T05:46:04","modified_gmt":"2024-02-08T05:46:04","slug":"mortgage-rates","status":"publish","type":"post","link":"https:\/\/mymortgagepros.com\/mortgage-rates\/","title":{"rendered":"Fixed or Variable rate mortgage, that is the question"},"content":{"rendered":"\n
\n Spring\n has arrived and we\u2019re starting to get a better sense of the real estate market\n in Canada this year. Sales and listings have been on the decline, but we\u2019re\n still seeing small price increases in parts of the country. This isn\u2019t a huge\n surprise since sales are typically slow during the winter so we may see some\n movement in the near future. \n \n Recognizing\n that affordability is still an issue for many first-time home buyers, the\n federal government proposed a $1.25-billion incentive program that would help\n finance five to ten per cent of a prospective buyer\u2019s mortgage as part of a\n shared equity program as long as they have a minimum down payment for the\n home purchase. They also plan to increase the amount that first-time buyers\n can withdraw from their RRSPs, from $25,000 to $35,000, per individual. \n This news may help new buyers,\n but there are many other factors that all potential buyers need to consider\n when they start looking for a home.\n Fixed\n vs Variable rate mortgages.<\/strong> \n \n \n \n Studies going back to 1950 show that, in general, borrowers\n tend to save money when they choose a variable rate mortgage instead of a\n fixed rate mortgage. A five-year fixed rate mortgage \u2013 by far the most common\n mortgage term in Canada \u2013 typically comes with a higher interest rate than\n variable rate mortgages or shorter term fixed rate mortgages. \n \n Fixed rate\n borrowers pay a premium for predictability, knowing their mortgage payments\n won\u2019t be upset when the Bank of Canada hikes interest rates. \n \n \n <\/td><\/tr><\/tbody><\/table>\n\n\n\n |