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Originally Posted by heep223
All good points except don't agree with what you're saying that in 2009 or 2010 that people were worried about yields increasing. That was not the case. I agree with you, I don't want to take risk with payments - especially when rates are at historic lows. It just seems irresponsible to me that people are taking out variable mortgages, and that brokers are selling variable mortgages, in this type of interest rate environment. Though I was saying that 2 years ago when I took out my mortgage and I would have "won" if I went variable....I still would not have done anything differently.
In the 80s (well before my time) rates were in the mid-high teens. People would be salivating over the current rates. Lock them in - that's the best advice, which is my opinion only of course.
Then there's the whole issue of how brokers are compensated (no offence to OP - this is a big issue in my industry as well in terms of creating conflicts of interest). If brokers are compensated more for selling variables in this environment, which of course the lenders want and that's why they provide incentives to do so, well then....it's inevitable that the brokers will be biased, no matter how well intended they are in terms of client suitability (as OP seems to be).
Anyways didn't mean to litter this thread but it's an interesting subject. Again I'm not a mortgage professional but if the professional is compensated more for selling certain types of product it certainly can create a conflict.
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Good point regarding 2009, I went a bit too far back. The 3.29s in 2010 were considered a gift though compared to historical rates.
Brokers arent compensated by type, more by term. 10 yr pays better than 5, and 5 than 3, etc.Any profession can put themselves in a conflict, it's the good people that are upfront and honest that you work with. I think most of the brokers I've seen on this site seem pretty good.