Recommendations From A Red Deer Mortgage Broker Regarding The Current Mortgage Rates

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On October 23, the Bank of Canada announced that the interest rates for the country were going to hold steady at 1% due to a variety of global economic factors and conditions. This rate has remained the same since September, and will likely remain stabilized even after the Bank’s next announcement on December 4. In light of these historically low rates, Axiom Mortgage Solutions has several recommendations and tips for new lenders.

Navigating today's low interest rates as a borrower...

Although rate hikes have been predicted by financial experts since July, it is now looking as if such an increase in the overnight rate will be deferred until 2013 and may take much longer to roll out.

Periodically the Bank of Canada issues a trendsetting interest rate, and for the past several months it has been extremely low. Although rate hikes have been predicted by financial experts since July, it is now looking as if such an increase in the overnight rate will be deferred until 2013 and may take much longer to roll out. This is mixed news for a lot of people, but it has specific implications for the mortgage marketplace in particular.

Mortgage rates throughout the country remain historically low, and those who chose a variable rate for their mortgage plan are likely feeling vindicated right now. Although these low rates are in some ways most advantageous to those who have been working with a variable rate for some time now, there are also ways for a new borrower to take advantage of the marketplace and ensure that they secure a long-term fixed-rate mortgage at a minimal cost.

The Lender Guy, a division of Axiom Mortgage Solutions and a company that is active throughout Western Canada, has some advice when it comes to approaching banks and credit unions. For one thing, there is a strong emphasis on finding a mortgage broker and securing a mortgage plan through a brokerage instead of a bank or credit union. Even if that broker isn’t from Axiom Mortgage Solutions, it is still a hugely important step, as a broker will operate as an intermediary, a role that is more important now than ever.

Mortgage brokers in Red Deer have long been the allies of borrowers, and explicitly work on their client’s behalf to get the best deal possible from the bank. This function is more important than ever in the post-recession era that is currently underway. Banks and lenders everywhere have become skeptical about providing mortgages to those who cannot prove a steady income, and although the rates they’re offering are consonant with the Bank of Canada’s posted recommendations, it is no guarantee that a prospective borrower is going to be able to access or acquire a loan at that rate.

Another thing that these Red Deer mortgage brokers are pressing borrowers to keep in mind is to remain educated on all of their options. There is an attitude circulating among borrowers right now that these incredibly low rates are sufficient to ensure a great mortgage plan, and that no additional research is particularly necessary. Even the Bank of Canada predicts that the rates will remain low until well into 2013, and complacency is an easy place to default to in light of all this positive news.

The fact is, banks and credit unions are still looking for ways to conduct a business that is viable for themselves first and foremost, and that means borrowers should be on their guard and should enter any negotiation with a solid plan of action with the help of their mortgage broker.

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