Some interesting posts raised in today’s Globe and Mail article. The gap between the two types of mortgages is smaller than it has been for quite some time causing many to consider opting for a fixed rate mortgage.
In a fixed rate mortgage, the interest rate, and hence periodic payment, remains fixed for the term of the loan. Therefore the payment is fixed and payments for principal and interest should not change over the life of the loan. With a variable rate mortgage, on the other hand, the interest rate ‘floats’ and this may result in a fluctuating monthly payment.
The considerations for home owners have not changed? How much risk can you tolerate? How long is your time frame for owning the property? Where do you see the prime rate going and when, etc?
I welcome any questions you may have about selling or buying.
Feel free to comment here or contact me directly.