Mortgage Rate News

Prime Rate, Going Nowhere

Another Bank of Canada rate meeting has come and gone with no shift in prime rate. Here’s pretty much the only line in the Bank’s 421-word statement worth repeating: “On balance, risks to the profile for inflation have tilted somewhat to the downside…” Deciphered, this means: The Bank is closer to dropping rates than raising them. And it could take multiple...

Negotiate Your Mortgage Rate: A Few Tips

It doesn’t matter what you’re buying. If there’s a salesperson involved, the price is almost always negotiable. That goes for mortgages too, so here’s some intel on how to win a better deal on your next one. Step #1 First off, understand what you have to gain. Spending an hour of your time to save 10 basis points (0.10%) off your rate is worth...

5-year Fixed Rates Break 2.00% Barrier

“Mortgage rates have bottomed.” That’s what some economists were proclaiming last year. The market then did what the market likes to do, confound and humble those who try to predict it. Earlier today, intelliMortgage (a brokerage related to this website) became the first mortgage provider in Canada, according to RateSpy.com records, with a five-year fixed rate under 2.00%. It’s a...

Rate-enomics: Fiscal Deliverance

Economic events that could move your mortgage rate, in no particular order… Frisky Fiscal Stimulators “…The bond market would react very badly to a sudden move to fiscal easing.”—J.P. Morgan Monetary policy isn’t working so well. Interest rates around the developed world are either negative or near-zero and still growth is stuck in a rut. That’s got some experts looking to fiscal...

Brokers Enforcing Cancellation Fees

If you’re considering using a mortgage broker for an approval and backing out at the last minute, check your contract first. It could cost you otherwise. One recent borrower learned this the expensive way after ditching his mortgage broker and going with another. He did so after the first broker, lender and lawyer expended considerable effort to secure his approval and close the mortgage under time constraints....

Weighing Down Rates: Oil, Jobs & Trade

Crude oil and mortgage rates have had a cozy correlation in recent years. More often than not, they move in the same direction. Last week oil dipped below $40—more than 20% beneath its June peak. That was enough to officially put it back in bear market territory, a quandary for Canada’s resource-dependent economy. Over the last few days, oil has bounced somewhat to $42-ish....

Mortgage Penalty Calculators

If you’ve ever broken your mortgage early, you know that figuring out the mortgage prepayment charge, or “penalty” as it’s commonly known, can be a hassle. Until recently, mortgagors wanting to sell their home or refinance with another lender before maturity had to jump through hoops to get an accurate penalty quote. They typically had to call their lender and listen to a sales pitch as the lender tried...

The Market’s Message: Go Short, or Variable

“What the inflation market is currently pricing is an incredibly benign inflation trajectory in the next 10 to 20 years.” Martin Hegarty, head of BlackRock’s inflation-linked bond portfolio in New York, told that to Reuters this week in a story entitled Markets predict decades of inflation frustration. “We are pricing a…rate that implies the Fed will miss its inflation target...

The Economic Ice Age & Mortgage Rates

Yesterday’s Bank of Canada Decision: Roses in a Weed-patch You’ve got to hand it to Bank of Canada head Stephen Poloz. He’s remained as optimistic as a dog before dinner. The problem is, the BoC’s undying economic optimism doesn’t jibe with its repeated cuts to Canada’s growth outlook. The BoC wants to stay positive because negativity doesn’t help recoveries. It wants us...

Higher Hurdles for Variable Rates?

This past week, Canada’s bank regulator (OSFI) told lenders to consider increasing the hypothetical interest rates they use when stress testing applicants’ mortgage payments. Currently, if you’re getting a variable or 1- to 4-year fixed term, lenders typically check to ensure you can afford a payment at the Bank of Canada’s “qualifying rate” — i.e., the mode average of the Big 6 banks’ 5-year posted...