Fixed Or Variable Rate?

We are getting this question a lot these days as the variable rate is about 1.35% lower then the current five year fixed rate. there is now a new product that allows you to have the best of both worlds. The 50/50 mortgage is exactly as it name states. you have your mortgage split into two portions, one variable and the other fixed. This gives you peace of mind as well saving you money at the same time with the variable option. The best of both worlds as they say.

Bond Rates On Mortgages

Banks Continue To Profit On Mortgages

Since my last blog, we have seen the bond yield on the 5 year rate drop in the consumers favor. The banks have not followed suit as the spread is very profitable for them at the current levels. If the bond trend continues to go lower,the banks will be very slow to pass on the savings to the consumer.

Five Year Rate Rises

Since our last blog, i was able to take some time with my family to England. We had a great trip and was an excellent experience for your kids. Well, in that time we seen the five year mortgage rate rise more then.60%. These increases are due to in my opinion to two factors. One the bond spread did rise increasing the cost of funds. The second is that everyone was refinancing their mortgage's at very low rates, which is costing the banks a lot of money. Even with charging large penalties, the banks were losing interest charges for a lot of mortgages. Rates themselves are still at very historic low levels. variable rate mortgages are currently starting at 2.65% and 3 year terms from 3.45%. Now is still one of the best times i have seen to be having a mortgage.

Mortgage Rates Rising??

The five year bond rate has been rising on the heels of the stock market rise. We have seen the five year bond rate rise from 1.89 to 2.14 over the last four weeks. There have been no changes in the rates to date and the spread is still a healthy 1.75% for the banks. It is something to note that we could be at the bottom of interest rate low for fixed rates.

Refiance Your Mortgage?

Time To Refiance Your Mortgage?