It’s not a surprise to anyone that mortgage rates are a reflection of bank of Canada’s rates; but one universal principle dictates if those rates increase or decrease.  Let’s take a refresher course in Economics 101; rates fluctuate based on the basic theory of supply and demand.  As home sales increase, rates tend to also increase and the opposite can be said if sales decrease.  Although this is a reliable model, there are TONS of other factors that can influence your mortgage rates moving it up and down, forwards and backwards, leaving you a little dizzy and a lot more nauseous, much like a monster rollercoaster ride!

Let us try to make a little sense for you amidst all this turbulent chaos.  Lower mortgage rates means that as a homebuyer you have the ability to buy something that cost a little bit more, awesome right?  Well not quite, this also means that the market switches to a seller’s market, hence the costs of homes can sky rocket as a result this will reduce the benefits of your low mortgage rate.  As home prices increase mortgage rates generally follow suit.  So as you can see waiting and timing to jump into a mortgage can be a vicious cycle!

When you purchase a home the big question is always asked: Fixed or Variable mortgage.  Simply put fixed mortgage rates on average are higher than variable rates, but keep in mind variable rates do not stay constant, so even if you lock in a low variable mortgage rate there is no guarantee that this rate will stay the same.

If you’re not yet ready to have a spin on the rollercoaster there are ways in which you can prepare yourself for the sometimes less than enjoyable ride. Understand that the key to a obtaining a good mortgage is to have a stable income as well as outstanding credit.  With this preparation when you are ready to plunge into a mortgage you will have the best economic condition achievable!

It’s hard for anyone to predict when and how mortgage rates are going to change, if you want to guarantee yourself a little security and take a break from the mortgage rollercoaster for a little while you catch your breath, lock into a fixed mortgage.  If you’re one for an exciting ride cautiously take a variable rate!  No matter what you choose and when you decide to commit to a mortgage it’s important to keep in mind that you should always spend less than you are really eligible for and have some cash reserve in your savings account in the case you do begin to fall off the mortgage rollercoaster!

There are several variables to consider when looking for a mortgage. One of them is selecting a mortgage term that’s right for you. The mortgage term is the length of time that the mortgage interest rate is fixed. Standard mortgage terms range from 1 -10 years. The choice is yours and depends on your particular financial situation, and whether you’re willing to take a bit of a risk, or you prefer security over potential savings.

In general the longer the term, the higher the rate.

Is a shorter mortgage term right for you?

• Do you plan to move in the next year or two?
• Do you estimate that rates will go up and want to protect yourself against a larger rate increase while taking advantage of the much lower interest rates on 1-3 year terms?

Is a longer mortgage term right for you?

• Do you feel that rates are pretty good now and want to hold on to them as long as possible?
• Do you prefer the security of knowing your payments and interest rate will be the same for a longer period of time?

SMP’s mortgage coordinators can provide you with the details you need to make a choice that works for you. Apply online at www.smpapplication.com.

Finder Financial Services Ltd. has entered into a strategic partnership with Home Trust Company, one of Canada’s leading trust companies, to offer numerous discounted mortgage products through the Sutton Member Program (SMP).

“We are very excited about these new products being offered through Finder Financial Services Ltd. as it ensures that more SMP members will qualify to receive the best mortgage rates in Canada.” says Rene Girard, President of Finder Financial Services Ltd.

With the addition of this partnership, SMP solidifies its third of three very strong lender relationships ensuring that SMP, through its distribution channels, continues to offer the best rate mortgages in the industry.

Visit www.suttonmember.com for current rates.

Finder Financial Services Ltd. announced today that it has expanded the Sutton Member Program to offer the best 1-5 year mortgage rates in Canada.

The Sutton Member Program now provides exclusive access to the best discounted rates on 1,2,3,4, and 5-year fixed term mortgages. The SMP also continues to offer the best variable 5-year mortgage rate in Canada at prime (2.25%).

Best 1-5 year rates in Canada.