Quote:
Originally Posted by Rerun
I don't think down is an option. Bank of Canada prime won't drop lower than 0.25%
Rates will go up when the Bank of Canada raises the prime rate. With the current recession, I don't see that happening in the next 12 months. I figure rates will remain static until next summer and then you may see a 0.25 to 0.5% increase.... but not more than that (the Bank of Canada won't want to kill any economic turn around that the country will hopefully be enjoying by next summer).
So my plan is, as I said before, to lock in the all time low rate of 2.9% rate for 1 year and then at the end of the year renegotiate my mortgage into a 5 yr term and lock it in at the best 5 year rate I can get (hopefully it will be the same as it is now).
Anybody think the Bank of Canada will be raising its prime rate withing the next 12 months? I don't think they will....
If you were getting a new mortgage right now, what would you do and why?
All your help and your opinions will be greatly appreciated. My mortgage will be approx. $250,000 and a few percentage points makes a big difference in interest paid over the lifetime of a mortgage.
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The thing is, 5 year fixed rates have less to do with what the key overnight rate is as set by the government (and/or prime rate), and more to do with what the rate is on 5 year bonds. Just because the government has committed to keeping the overnight rate at 0.25% doesn't mean that the 5 year rate will stay where it is now.