MORTGAGE RATE NEWS
Bank of Canada (June 4th) has announced to maintain the prime rate at 2.25%. In recent weeks, financial conditions and commodity prices have improved significantly. Consumer and business confidence have recovered modestly and the underlying macroeconomic risks are roughly balanced. Conditional to the outlook for inflation, the rate can be expected to remain at its current level until the end of 2nd quarter of 2010. Next rate announcement is July 23rd 2009.
Frequently Asked Questions (FAQ)
Q. How does “prime rate” affect my mortgage?
If you have a variable mortgage, your rate will be adjusted according to the prime lending rate, which in most cases Canadian major banks follow. The current best 5 year variable is prime + 0.40%
Q. Why am I hearing the “rates are going up”?
This applies to “fixed rate mortgages”. Canadian fixed mortgages depend on the bond rate. We are seeing Canadian bond rate on the rise, which directly resulted in the recent week rate rise. Don’t wait to get your rate hold if you are switching, renewing, or planning to purchase a property.
Filed under: FAQ, General Mortgage News
