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Bank of Canada Raises Rates The Prime Rate - September 08, 2010

Blog by Tridac Mortgage | September 9th, 2010

Today the Bank of Canada announced that it is raising the prime rate by one-quarter of a percent for the third time in a row. The bank has observed that economic recovery is continuing to move forward but remains very uneven and they are expecting growth to happen very slowly. To read the full press release click here
What does this mean to you?
If you are in a variable rate mortgage your monthly mortgage payment will increase over the next couple of weeks. Expect a letter from your lender indicating the new rate and payment amount. The prime rate charged on your mortgage will increase to 3.00%. This will also effect your lines of credit that are based on prime as well.
Should I lock in?
While the prime rate is slowly creeping up, it is widely expected that further increases aren't possible given weak economic data, therefore we don't think it is necessary to panic or rush to convert a variable rate mortgage into a fixed rate mortgage. 
Fixed rate mortgages have come down to their historic low levels again last week. Fixed 5 year money is available for 3.69% (closings before Oct 31st). 

If your mortgage is coming up for renewal or you are considering purchasing in the coming months don't hesitate to give us a call. Also remember that your referrals are always greatly appreciated.
Mortgages are very dynamic and the guidance that we offer is based on the circumstances of each individual. If you would like to review your mortgage to make sure that you are still on track please call us to have a quick chat.