Fixed Rate Mortgages have increased from their lows of 2.49% to their current level at 2.79%. Variable Rate Mortgages were recently being offered at rates as low as 1.85% or Prime (2.70%) minus 0.85%. Now customers are lucky to find them at 2.2% or Prime (2.70%) minus 0.50%. We managed to signal to our clients that mortgage rates were on the rise in our September 30th, 2015 newsletter (which you can read here).
The reason for today’s newsletter is twofold. First, it is to inform you that you should not rush to lock in a variable or fixed rate in today’s market. Secondly, it is to provide some explanation as to why we have seen both variable and fixed rates increase.
It is important to understand that fixed rates and variable rates move for different reasons. Although Bond yields and Bankers’ Acceptances Rates are up over the summer and fall, this doesn’t fully explain why we’ve seen such an increase in variable and fixed rate mortgages. Continue reading →