Whether it’s a fixed or variable mortgage, there are wide variances when it comes to interest rates. And there’s also more to consider when getting a mortgage than just those rates
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(PRWEB) March 18, 2015
Canadalend.com, the leading low-cost, private mortgage solution provider in Canada, is commenting on the recent Bank of Canada decision to keep its key lending rate at 0.75%. Canadalend.com is also weighing in on the impact it will have on first-time home buyers.
The Bank of Canada announced recently that it was keeping its rate at 0.75%, saying no further cuts or increases were necessary. The central bank surprised investors in January when it cut its lending rate from one percent, where it had been pegged since September 2010, to 0.75%. The bank said the cut came as a result of slumping oil prices and slower economic growth. (Source: “Bank of Canada maintains overnight rate target at 3/4 per cent,” Bank of Canada web site, March 4, 2015; http://www.bankofcanada.ca/2015/03/fad-press-release-2015-03-04/.)
“The Bank of Canada said further cuts were unlikely as the Canadian economy is expected to gain steam in the second half of the year. At the same time, there is no indication that the bank will be raising rates, which drives up borrowing costs, any time soon, either,” says Bob Aggarwal, president of Canadalend.com. “This is especially encouraging for first-time home buyers as we head into the busy spring home buying season.”
Aggarwal explains that historically, prime interest rates rise and fall in conjunction with the Bank of Canada’s lending rate. Those with a fixed mortgage will not be impacted by any moves by the central bank because their interest rates are locked in; however, Canadians with variable mortgage rates, which constitute roughly 25% of mortgages, are impacted by changes in prime interest rates.
“In an effort to attract new clients, Canada’s lending institutions could offer discounts off of prime interest rates. Banks see this as a better option because lowering the overall prime rate would give existing customers a break,” he adds. “Right now, first-time home buyers can find five-year variable mortgage rates for as low as 1.95%, which is 0.90 off from the prime. Five-year fixed mortgages are available from 2.44% up to 4.79%.”
“Whether it’s a fixed or variable mortgage, there are wide variances when it comes to interest rates. And there’s also more to consider when getting a mortgage than just those rates,” Aggarwal concludes. “At Canadalend.com, our independent, licensed agents help those looking to get onto the property ladder find the best rates and financial products for their financial and lifestyle needs. And best of all, because Canadalend.com is independent, our agents have access to hundreds of different lenders.”
Canadalend.com is one of the largest, most trusted private mortgage brokers in Canada, with skilled, independent, licensed professionals helping Canadians coast-to-coast. Canadalend.com provides its clients with residential and commercial mortgages, home equity credit, debt consolidation, and assistance with financing concerns. To learn more about Canadalend.com, visit the web site at http://www.Canadalend.com.