Mortgage Interest Rates for 5 Year Fixed products have gone down in the last few days at a a few of the big 5 banks. Most other lenders will follow suit. It’s time for you to take action.Take advantage of this unexpected decrease and lock in your mortgage pre-approvals. Take a look at your current mortgage to see if you need to look at a mortgage refinance or mortgage renewal in the next few months! Mortgage Rate Holds are good for 3-4 months!!! Take action today & potentially save thousands on your next mortgage term.

As of April 19, 2010 certain mortgage products are required to qualify at the Bank of Canada’s Qualifying Rate. This video explains how the Qualifying Rate works and what mortgage products are affected by it.

Today, June 1, 2010 the Bank of Canada increased the Prime Rate by .25% from 2.25% to 2.5%…Learn how this affects Variable Rate Mortgages and other financial transactions you may have!

The Bank maintained its forecast that stronger growth will likely be reported for the final quarter of 2009, after a disappointing third-quarter performance, with the economy forecasted to build momentum throughout 2010. Most experts maintain that 2010 will see stronger growth including an improved employment outlook, increase in investment in machinery and equipment, and large gains in the leading indicators index.

However, the strengthening in the Canadian dollar and weak  U.S. demand may cause a slight risk to Canada’s recovery. Last week’s reiteration that overall risks are “tilted slightly to the downside” as a result of policy operating at the lower bound indicates that the bank’s policy plan remains intact and it is unlikely that there will be a change in the overnight rate before the end of the second quarter of this year. However, this cannot be written in stone.  Huge employment gains and strong 2009 fourth quarter numbers could change the timing of the rate increase.

Many forecasters are still expecting Canada’s economy to gain strength; perhaps though, more slowly than earlier recoveries.  This may in turn likely delay raising the overnight rate until the summer of 2010.

It is our hope at Silverman Mortgage Group that everyone enjoyed a great holiday season and you are all ready for an amazing 2010!

We are starting the new year off with historically low interest rates. This being said, with the loonie rising to the highest level since October and the spread between today’s low interest rates and the bond yields, rates will be trending upwards in the near future.

If you or anyone you know are in the market to purchase a new home, refinance your current mortgage, renew your current mortgage or pull some equity from your current home now is the time!!

If you are actively in the market, get your pre approval’s in ASAP as you can hold today’s rates for up to 180 days.

Click on the rate  link to see today’s rates.

August 17th – Canadian 5 yr bond yields -.03bps to 2.58. The spread, based on 5 yr rate of 4.29% is 1.71.

August 13th – Canadian 5 yr bond yields -.05bps to 2.61. The spread, based on 5 yr rate of 4.29% is 1.68.

What does this mean?  Essentially, the yield, or rate of return on a bond, can be read through a yield curve: a pattern of yields on bonds.  The increase in bond yields is what experts watch.  If the bond yield continues to increase, the spread will continue to shrink and this could be a trigger for interest rates to rise.  Typically, lenders are looking for a new spread between 1.80 and 2.00.

]]> http://themortgageblog.ca/2009/08/canadian-bond-yields-may-signify-an-increase-in-interest-rates/feed/ 0 http://themortgageblog.ca/2009/07/357/ http://themortgageblog.ca/2009/07/357/#comments Sun, 05 Jul 2009 02:25:41 +0000 Mike Morisset http://themortgageblog.ca/?p=357 We are now into the swing of full summer, the weather in the Lower Mainland is beautiful, people are taking vacations, and the housing markets seem to be recovering.  While many people are taking a vacation from worrying about the markets, the economy, and the general well-being of our country’s economic well-fare, here are a few quick bytes to go by.

According to John Bordignon, Executive VP of Strategic Development with MERIX, there isn’t a lot of changes expected in mortgage rates in the near future. While the economy is recovering, it isn’t recovering as fast as initially expected.

In order for the economy to continue to recover, a number of factors need to improve, including :

• A decrease in unemployment rates and job-loss statistics
• A stabilization in oil prices
• The TSX is still fairly volatile, and needs to stabilize
• Stabilization of oil and other commodities at a price that will stimulate the economy
• Overall world economic stabilization

However signs of stability in Canada’s economy are evident in the bond and rate markets:

• Bond yields have improved over the last month
• The yields and spreads are now within the “comfort zone” of 1.8 to 2.0%.  The banks are comfortable with the spreads and will likely not change rates unless the spreads rise above 2.0%.
• Variable rate mortgages are settling in at between Prime +35 and +45

For all intents and purposes, we are on the road to recovery, how quickly we will actually get there and what the long-term consequences for the last 8-10 months will be is yet to be known.

OTTAWA – The Bank of Canada today announced that it is maintaining its target for the overnight rate at 1/4 per cent. The Bank Rate is unchanged at 1/2 per cent and the deposit rate is 1/4 per cent.

Information received since the Bank’s April Monetary Policy Report (MPR) is broadly consistent with the Bank’s medium-term outlook for output and inflation in Canada. The economy is undergoing major restructuring in a number of sectors. The already significant output gap will continue to widen through the third quarter, putting downward pressure on inflation. The Bank continues to expect that the global and Canadian recoveries will be more muted than usual.

In recent weeks, financial conditions and commodity prices have improved significantly, and consumer and business confidence have recovered modestly. If the unprecedentedly rapid rise in the Canadian dollar (which reflects a combination of higher commodity prices and generalized weakness in the U.S. currency) proves persistent, it could fully offset these positive factors.

The outlook is subject to considerable uncertainty. While the underlying macroeconomic risks are roughly balanced, the Bank judges that, as a consequence of operating at the effective lower bound, the overall risks to its inflation projection remain tilted slightly to the downside.

Conditional on the outlook for inflation, the target overnight rate can be expected to remain at its current level until the end of the second quarter of 2010 in order to achieve the inflation target.

The Bank retains considerable flexibility in the conduct of monetary policy at low interest rates, consistent with the framework outlined in the April MPR.

The next scheduled rate announcement is July 21, 2009.