The most important rate in the mortgage industry has dropped. Better late than never. The benchmark posted 5-year fixed rate has fallen from 5.34% to 5.19%. It’s the first change since May 9, 2018. And it’s the first decrease since Sept. 7, 2016, despite a 106-basis-point nosedive in Canada’s 5-year bond rate since November 8. Why it Matters The benchmark rate...

Here are seven things you may not know about Canada’s mortgage market. The source: CMHC’s insightful new Residential Mortgage Industry Report. 1) Variable Rates Looked Good (Keyword Being “Looked”) Almost 3 in 10 borrowers (29%) went variable in the first quarter. That’s 12 percentage points higher than two years prior. And that’s despite the historically narrow gap between fixed and variable...

In 18 days the Fed is expected to do what it’s virtually never done: inflate the U.S. economy with a rate cut — despite 50-year lows in unemployment and record highs in stocks. Some argue the Fed is dangerously veering off its normal course, that Trump’s browbeating of Powell is working. The risk is clear: more inflation. And inflation is...

Canada’s rate czars stunned no one this morning. They left the country’s most important rate unchanged. Here’s a quick look at the BoC’s statement: Rate Decision: No change Overnight rate: Remains at 1.75% Prime Rate: Remains at 3.95% Market Rate Forecast: No change to prime through 2020 BoC’s Headline Quote: “…the Canadian economy is returning to potential growth. However, the outlook is clouded by...

Ever since decade-long mortgages slipped under 3% for the first time in May, those offering such rates have fielded more inquiries than ever before. And today, we saw another record breaker, with Sigma Mortgage offering the lowest 10-year fixed of all time: 2.89% (details below). But the more interesting aspect may be this: The company who just advertised that rate...

motusbank just launched the lowest fixed rate in Canada for an uninsured mortgage: 2.49%. It’s the cheapest widely available 2-year fixed since September 2017. Compare that to the lowest nationally-available conventional variable (2.84% from HSBC) and it begs the question: Why bother floating your rate? For default insured borrowers in Ontario, this question is even more imperative. That’s because DUCA...

The latest intel from Canada’s mortgage market… Rates Bounce Bigly Canada’s 5-year bond yield catapulted to 1.53% on Friday. Its 11-basis-point gain was the biggest since June 2017. That establishes at least a short-term bottom and suggests the best fixed mortgage rates probably won’t drop much more near-term. In fact, if yields close up in the 1.60’s, the lowest 5-year fixed...

In a normal universe, people who lock in a floating-rate mortgage lock into a fixed rate. And that fixed rate is almost always higher than their current variable rate. But this is not a normal universe. In the world we now live in, variable borrowers are actually locking into five-year fixed rates that are lower than their current rate. For...

Back in 2016 some poor souls were getting variable-rate mortgages with unsavoury discounts. We’re talking prime – 0.50% or worse in some cases. That compares to prime – 1.00% or better today. If you’re in this boat, you need to do some math because breaking your mortgage early may be your best option. Here’s a simple example. Assume you’ve got...

…You’re older, a lone-parent, making a modest income and living in the Prairies. That’s a sampling of insight from this new StatsCan study. Newer lenders could find this report interesting, given they always want to know who’s most likely to miss a mortgage payment. StatsCan’s research also downplays the highly publicized “debt-to-income ratio,” which makes news headlines every quarter. The agency writes...