The only warning I have for people who want to get into variable rate mortgages now is this. Right now banks are offering variable rate mortgages at Prime plus .8%. So effectively you would be paying 3.05% which is great. However as we were discussing this is virtually as low as rates are going to get. They pretty much have no where to go but up from here. It might take a while for them to start to climb but once they do when you are in a Prime plus .8% situation they can get expensive really quick.
You can generally lock in whenever you want with a variable but by the time the rates start climbing the fixed rates that you can lock into could also potentially be a lot higher than they are now as well. You could miss out locking in for 5 years at under 4%.
People who have been in variable rate for 8 months or longer likey have a Prime LESS .6% or something similar. They are in a far better position obviously. Not only because they are paying 1.65% right now but with a variable rate at less than Prime it really doesn't hurt them as quickly when rates to start to rise again.
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