If one good thing came out of Greece's economic hardship, it's low interest rates.
Just when it looked like rates were going to start their expected rapid upward climb, the EU announced its trillion-dollar plan to help its struggling members. The result? Scared investors fled to the safety of US and Canadian bonds, which in turn lowered fixed rates.
While variable rates are influenced by the Bank of Canada's Prime rate announcements, fixed rates are tied to the bond market. Demand for government bonds pushes yields lower and reduces the borrowing costs for banks and other lending institutions. This makes it cheaper for them to fund mortgages.
Within the last week or so, most banks cut their five-year fixed mortgage rates by approximately 10 to 15 basis points. So something that was posted at 6.25% two weeks ago is now likely sitting at 6.10%. That being said, the lowest discounted rate we could find is much lower at 4.39%.
If you haven't already, it would make sense to get your rate hold now. It will guarantee you the lower rate for the next 90-120 days as rates inevitably rise again.
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