Matthew Gottfried Mortgage Broker - Listowel
Fixed or Variable-Rate Mortgage? If you are rate shopping, you’ll notice that the lowest available rate will be for a variable mortgage, which is why I’m often asked “what does variable mean and how is it different from a fixed-rate mortgage?” With a variable mortgage, your mortgage rate will move in conjunction with your lender’s Prime lending rate, which in turn tracks the Bank of Canada’s benchmark rate, and will typically be quoted as Prime minus a specified percentage. I t can be difficult to predict our economic future so you won’t know for sure what kind of rate ups and downs might be ahead of you. With a fixed-rate mortgage, your payments are fixed for the term of the mortgage, which offers stability. Fixed-rates are usually better suited to first-time buyers or those who haven’t owned a home for a very long period. Ask yourself these questions: Do you like or need to know exactly what your payment is going to be over a longer period of time? Do you want to avoid the...