Mortgage Rate News

Red Alert on Fixed Rates

Borrowers have been blessed with mortgage rates that look like promotional savings rates: 1.99%, 2.25% and the like. But now, sadly, those rate bargains are in jeopardy, at least for a while. The tide of bond yields is rising, and when that happens, so go fixed mortgage rates. Five-year fixed rates below 2.34% may be on the endangered species list,...

Rate Surveillance: Another BoC Non-Event

An Idle Bank of Canada If you forgot about the Bank of Canada rate meeting yesterday, you’re one of many. Nobody made a big deal about it because nobody expected anything earth shattering from Poloz’s lips. The takeaway is that prime rate remains stuck at 2.70% and it could stay that way for months. The Bank did lift its Canadian growth estimate,...

Rate Surveillance: Insured Rates on Sale

Put Down Less, Get a Better Rate Lenders want insured mortgages…badly—and they’re still slashing rates to attract them. The best insured 5-year fixed mortgage rates are now 15 basis points below uninsured rates (uninsured rates apply to mortgages with 20% or more equity). That’s not normal. Prior to the last few months, the spread between the two was running closer...

Rate Surveillance: Mortgage Rates Dip

Floating Rates Getting Cheaper We’ve seen modest improvement in variable mortgage rates over the last two weeks. Nothing ground breaking—about 0.05 percentage points of extra discounting—but it’s a start. Big banks are currently averaging prime – 0.35% if you ask nicely or negotiate, while non-banks and brokers are at least a tenth to one-quarter point cheaper. Financial markets still anticipate one more...

What’s Moving Mortgage Rates

The latest mortgage rate reconnaissance… Prime Sticks at 2.70% Poloz and Co. issued another snoozefest rate announcement this week. The BoC delivered the same narrative we’ve heard for months: Canada’s economy is tenuous, U.S growth is positive, upside inflation risk is limited, federal stimulus may obviate the need for near-term rate cuts, debt and housing risk are at Defcon 5,...

Tease Me Not: CIBC’s New Rate Special

This Week in Rates The big promo launched this week was CIBC’s 4-year teaser special. You get 1.99% for the first nine months and 2.83% for the next 39 months, for a 2.69% APR. But does anyone really like a tease? Compare this offer to 4-year terms at 2.39% or less, which have better penalty provisions to boot. Teasers rarely make sense unless: a)  the APR...

Rate Surveillance: Fixed Rates Improve

Don’t pop the Dom Pérignon just yet, but rates on Canada’s most popular term—the 5-year fixed—have dropped in the last two weeks. And it’s high time they did. Government bond yields have trended below their three-month average since December. (Bond yields and mortgage rates have a cozy relationship since lenders commonly price fixed mortgages against bond rates.) As usual, the Spy’s crack intelligence team brings you the...

Rate Surveillance: Yields Drop, Forecasts Drop, Rates Barely

It got sort of ugly out there this week. Oil prices sank to dozen-year lows, swap rates (which guide fixed mortgage rates) fell to record depths and stocks tanked, before eventually recovering. Often times, market action like this leads to cheaper mortgages. But these days lenders aren’t about to drop their pants on rates. They have other problems. Investors are getting scared. Check out this measure of credit risk in the interest...

A History-Making Day for Rates

It finally happened. After a year of bouncing off the 0.50% range, the 5-year government bond yield finally closed below it. The last time that happened was…never. Canada’s 5-year government yield (which guides fixed mortgage rates) closed even lower than the Bank of Canada’s overnight target. In other words, the rate to lend for five long years is less than...

Why Do Mortgage Rates Vary by Province?

When it comes to getting the lowest mortgage rate, where you live matters. Someone searching RateSpy.com from Halifax, for example, sees 2.49% as today’s lowest 5-year fixed mortgage rate. Meanwhile, someone in Vancouver with the exact same qualifications sees 2.32%. Both of those rates are clearly exceptional, but 0.17 percentage points is still 0.17 percentage points. We’re talking about $1,593 of interest differential on a standard $200,000 five-year...