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 I hope you are having a wonderful summer so far.
Mortgage rates are top of mind for many people these days given how much it's in the news.
While the variable rate has held steady for months, fixed-rate mortgages are far more difficult to predict. Fixed mortgages are primarily priced off of the five-year bond, and as a result are subject to volatility in the bond market, which is being whipsawed by the European sovereign debt crisis.
With so much volatility in the market, should you lock in your mortgage?
It's hard to say, but studies have concluded you are better off holding a variable mortgage. Then again, those studies also include periods of extremely high interest rates, but with rates now at historic lows they would only go marginally lower.
One thing is certain. If you hold a variable mortgage, you can breathe a little easier knowing Carney won't be raising rates any time soon. Ian Lee, director of the MBA Program at Carleton University, says this is because of the ongoing failure by the European leadership to address, let alone resolve, the growing Eurozone debt crisis and the ongoing inability of the U.S. political leadership to seriously address their annual $1.5 trillion deficit and $14 trillion debt.
"This clearly suggests," says Lee, "that Governor Carney will think many times before raising interest rates now or in the fall."
The Bank of Canada's next scheduled rate announcement is set for Sept. 7.
Please click here for my latest mortgage rates!
Michelle
Michelle Brienza, AMP (Lic # M0806298)
Senior Mortgage Agent
Lending Logic Financial Inc.(Broker # 11782)
Direct: (416) 410-5761 Fax: (416) 410-5761
www.michellemortgages.ca
michelle@michellemortages.ca
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