Mortgage Rates going Up? Down?

[Super_Geo]

Hey guys, I recently conditionally bought a condo in Eau Claire park and the date for dropping conditions is this Friday at 6:00PM. I haven't signed on with a mortgage yet and was wondering whta the trends were.

I've approached two mortgage brokers and one has come back with 5.15% locked for 5 years with TD, while the other has 5.14% locked for 5 years with an unknown bank (I haven't asked her who it's with yet).

This is my first property purchase so I was hoping to get your guys' opinions on how long I should lock down for, or if I should go variable. Are mortgage rates dropping? Rising? The mortgage is for $360,000 so every percentage point counts!

[nos_efx]

I've heard conflicting stories. Early this year I read an article that said they anticipated mortage rates to drop during the summer time, possibly anywhere between 3.5 - 4.0 percent.

Again I really do not have too much insight on where the mortgage rates are heading but just from what I've heard.

Anyone else have any insights?

[Weapon_R]

Those are pretty good rates, i'd lock in for 5 years.

[el-nino]

5 year locked is a pretty safe bet! Right now the rates have been high due to RRSP season. Customers take an RRSP loan out and the bank needs to lend that money from somewhere so they increase intrest rates in the beggining of Jan. Now that RRSP season is over we will see rates drop again. I doubt it will drop to 4% but if it does than I will be buying homes like crazy!!!
Have you considered a open variable mortgage? There are some really aggresive products out there as well as aggressive rates and as a mortgage agent I think all product co-incide with life style. For example; how long do you plan to live there? If you plan to live there for a while lock in at 5 years at the 5.15% If you plan to stay there shortly you may want to consider other products that will not ding you for selling or paying out early!
Talk to your mortgage broker and see what she has to say about products. Keep in mind that not 1 broker knows all!
My 2 cents

[nos_efx]

Whoops I got my figures wrong, its 4.5-5 percent

Apologies.

Originally posted by nos_efx
I've heard conflicting stories. Early this year I read an article that said they anticipated mortage rates to drop during the summer time, possibly anywhere between 3.5 - 4.0 percent.

Again I really do not have too much insight on where the mortgage rates are heading but just from what I've heard.

Anyone else have any insights?

[Aleks]

I locked in at 4.25 in fall of 05 so that wasn't that long ago. Hope to see them come down to that again when it's time to renegotiate.

[sputnik]

If I had to renew my fixed mortgage this year I would lock in for only 1 year.

Most analyst see the prime rate dropping 0.75-1.0% over the next 12 months.

[TrevorK]

Originally posted by sputnik
If I had to renew my fixed mortgage this year I would lock in for only 1 year.

Most analyst see the prime rate dropping 0.75-1.0% over the next 12 months.

Dodge seemed hesitate at his last conference with his wording to indicate he would drop the rates. Last year his wording indicated he would, however this year he seemed to indicate that everything was on course (inflation, etc...).

Obviously there are many external factors that contribute to the prime rate, however unless we start to feel the effects of the US slowdown more dramatically I don't know if rates will go down much more than 0.25-0.5 this year.

[s2k_boi]

Rates came down today by .10% for 1 - 4 year terms and .15 for a 5 year.

[in*10*se]

because the housing market is doing so poorly down in the states, i'd predict that canada will be following the US banks and dropping prime to encourage the stagnant US housing economy.

the states a good indication of where our house market will go, (calgary being an exception)

[googe]

Originally posted by sputnik
If I had to renew my fixed mortgage this year I would lock in for only 1 year.

Most analyst see the prime rate dropping 0.75-1.0% over the next 12 months.

id go variable. id also say making any financial decisions based on beyond poster speculations is a really bad idea.

[in*10*se]

[Rav4Guy]

Originally posted by googe





id go variable. id also say making any financial decisions based on beyond poster speculations is a really bad idea.

but then again... you're making a "beyond poster speculation" as well.

[88CRX]

Originally posted by Rav4Guy


but then again... you're making a "beyond poster speculation" as well.

The general consensus from “educated” financial analysts seems to be that rates will go down.

[in*10*se]

Originally posted by Rav4Guy


but then again... you're making a "beyond poster speculation" as well.

[Rav4Guy]

Originally posted by 88CRX


The general consensus from “educated” financial analysts seems to be that rates will go down.

Thanks. 33% chance of guessing what will happen and with the US POSSIBLY heading into a recession... they would need to decrease interest rates to increase the money supply.

Got any good reading materials?

[in*10*se]

http://www.usatoday.com/money/econom...age-apps_N.htm

http://www.bankrate.com/ust/static/rti.asp

just a few.

i'm currently in houston, but i can't find this article in the USA today paper online... ghey..

[Super_Geo]

Just got a call from my broker, 5 year rate has been lowered from 5.15% to 5.04%...

She instructed me to wait a few more days before signing off cause the rate might drop a bit more.

[riceboi]

I would say go with variable and take the approach of wait n see. Historically, variable has been a much better choice than locked in rate. I can tell that from my experience for the last 5 yrs

The best thing about variable is that you will have an option to lock it in if required.