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Fixed Rate or Variable Rate Mortgage

The dilemma of deciding to go fixed over variable is on the mind of many borrowers and, it has lots of people talking. Recently, the Globe & Mail featured the following article “Possible Rise In Mortgage Rates Pitting Couples Against One Another” .

Here's one way of looking at the situation. The spread between fixed (4.59%) and variable (1.75%) is significant, at about 2.80%. We also know that in the coming months the Bank of Canada will increase the prime rate. However, with the latest report from Statistics Canada indicating that inflation was down in March it's questionable how quickly the prime rate will move up.  Variable is looking like the better option these days but if you can’t make up your mind there is always the Merix 50/50. (3.25%).

If you'd like to discuss your situation or explore your options, feel free to contact me. Chris Molder, Toronto mortgage broker. 416.461.0204

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