Canadian Mortgage Rates 2014

Everyone stays attuned to the rate announcement from the bank and more so the home buyers. This time the announcement is in favor of variable rate borrowers. Mortgage rates of 2014 in Canada and United States are likely to increase by a small number. There is no reason to worry though, as the marginal increase will be limited to going up by only 75 basis points (bps). One bps is equal to a hundredth of a percent, which means the increase in Canadian mortgage rates would be a little more than 0.5%. On the other hand it is also likely to dip, so it is not a major cause for concern for home buyers at the moment.

Pro Variable Rate Borrowers

The chances of hike and drop are almost same in the future mortgage rates as the U. S. economy is gaining its balance after the recession. This change in rates poses to be good news for the ARM (adjustable rate mortgage) or variable-rate borrower as Bank of Canada indicates possibility of dropping rates too.

The year 2013 witnessed a steady fixed rate for new mortgages. This stood true for long term (30 years) as well as short term (five years) investment plans with the latter’s average of 3.29 per cent. The five year investment plan will now be available at an interest rate of 3.06%.

Mortgage Rate Increase Cause

The U. S. Federal Reserve’s monthly bond purchase is cut down by a neat U.S. $10 billion. The Chairman Ben Bernanke attributed the reason to the dipping employment and low inflation. Employment percentage dropped to seven, which is reportedly the lowest in the last five years. However, the last three months in U.S. of the recent quarter has seen some positive changes in this sector by creating 200,000 jobs.

Low inflation and unemployment are always a concern for economies and these two factors remain to be causes of concern for the U.S. but this decision of cutting down a huge chunk of monthly investment is sufficient to instill confidence in citizens that their economy is fighting back. Bank of Canada governor Stephen Poloz expressed concern on the low inflation rate of Canada. The current figure 0.9% is quite low compared to the targeted two percent.

Mortgage rates can remarkably change your economic condition and decisions like this from Bank of Canada can give you an insight to your future. Stay tuned for the next rate announcement which is due on March 5^th, 2014.

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Advantages Of Refinancing Your Mortgage

Considering the prevailing low-interest mortgage rates in Canada, many homeowners are wondering whether refinancing their mortgage can be beneficial for them. Digital and print media has taken a liking to the low interest rates, and they have diligently dished this news to many Canadian homeowners. Amidst all the brouhaha surrounding mortgage refinancing, if you look at it prudently, you will find that refinancing can actually work well for a lot of people. However, saying that refinancing your mortgage will work for every Canadian homeowner will not be apt because every homeowner has different set of assets, liabilities, financial goals, etc. In the following paragraphs, we will take a look at the advantages that refinancing a mortgage can have for the homeowner.

Low Interest Rates

Homeowners who took out a mortgage when the housing market was at a high can definitely save some money by paying lower interest rates. Before the sub-prime crisis gained notoriety, it was not uncommon for lenders to charge an interest rate of 6.5%. With interest rates hovering at 3.5%, refinancing your mortgage can give you an interest reduction of around 3%. Although there are a lot of other factors that you need to look into before you give refinancing a serious thought, but a saving of more than 2% has always been thought of as a financially wise decision.

Eliminate High Interest Debt

Mortgage loan is not the only debt that takes a pie out of our paycheque. Most Canadians have to deal with high interest rate debts such as credit card debts, student loans, auto loans, etc.

 

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Residential Mortgages Rates At Canadalend

Residential mortgages one such scheme that provides you, the borrower, with the funds required for owning a house of your reverie.

In this scheme, the lender loans you the amount you want for the house on certain terms and conditions. This is done only after the lender is assured that you will pay the borrowed capital within the time interval specified by the creditor.

The most important requirement is a good credit score. If your credit report contains any negative record like missing out the monthly payments, delayed obligations, and bankruptcy you may have to put in extra efforts in finding a lender for your loan. Conversely, borrowers with good credit rating have numbers of options to choose from.