By Brian Madigan LL.B.
(Ontario Real Estate Source)
Mortgage rates in Canada are generally much lower now than they have been in the last 50 years, but they show a slight increase over the last few months.
This is still an excellent time to take advantage of the preferential rates.
Terms........ Posted Rates........ Preferential
6 MOS....... 4.60% (same)....... 3.85% (same)
1 YEAR...... 3.90% (up)...... ......2.49% (up)
2 YEARS..... 4.30% (up)..... ......3.20% (up)
3 YEARS..... 4.85% (up)..... ......3.75% (up)
4 YEARS..... 5.59% (up)..... ......4.24% (up)
5 YEARS..... 6.10% (up)..... ......4.59% (up)
7 YEARS..... 6.34% (down)....... .5.00% (down)
10 YEARS.... 6.65% (down)... ....5.34% (down)
Prime rate is 2.25%
The rates are compared to mid January rates from the same source. You will notice that the very short rates are the same, the longer term rates have gone down, and the medium term rates have all gone up.
It should be noted that the bank rate is 0.25%. That is the rate charged by the Bank of Canada to Canada's "Schedule A" banks, should they wish to borrow money.
Each bank then sets its own prime rate which varies from commercial to residential loans, both secured and unsecured. Actual interest rates charged to borrowers are based on a premium in excess of the bank's prime rate. However, there may already be another consumer prime rate which is several points higher. That rate is not cut in stone and borrowers with excellent credit may be able to negotiate an effective rate a few points less than "prime". But, that is of course "consumer prime".
Brian Madigan LL.B., Broker is an author and commentator on real estate matters, if you are interested in residential or commercial properties in Mississauga, Toronto or the GTA, you may contact him through Royal LePage Innovators Realty 905-796-8888
www.OntarioRealEstateSource.com
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