Good news from the Bank of Canada this morning if you have a variable rate mortgage or line of credit. In their last meeting for 2010 the Bank of Canada has decided to leave the prime rate unchanged citing that while the global recovery is rolling out as expected there are some increased risks. You can read the full press report here.
What does this mean to you?
If you are in a variable rate mortgage or have a line of credit your monthly payments will not change. The retail bank prime rate will remain at 3.00%.
Should you lock in?
Although there was a slight increase to fixed rate mortgages last week, today it is still possible to lock into a fixed 5 year at 3.79%. Despite the low rates we don’t see any significant reason to convert a prime minus variable rate mortgage as the prime seems to be stable as well as fixed rates.
If have a variable rate mortgage at Prime + X then it would certainly be advantageous to consider refinancing into a Prime – 70 (2.30%) mortgage today.