Ratewatch-Sept 11th
As expected the Bank of Canada announced this morning that they would leave the prime interest rate unchanged, citing economic development to be proceeding as expected. The Bank of Canada has also reiterated it’s commitment to keep the prime rate unchanged until at least July 2010,
pending controlled inflation. Click here to read the full Press Release.
What does this mean to you?
Your monthly mortgage payment will remain unchanged. There is very little risk of the prime rate changing over the next 9 to 12 months.
Should I lock in?
Surprisingly, very few people heeded our words of warning offered in the last Ratewatch to lock in. Rightly so! Although fixed rate mortgages spiked at the beginning of June, up to 4.49%, today you can lock-in around 4.19% and lenders are offering 3.99% on new mortgages. This means that it is only a matter of time before we will see the standard fixed 5 year rate below 4% again. With a very clear downwards trend of fixed rate mortgages and low risk of the prime rate changing, there is no need to lock in your variable rate mortgage at this time.
