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PostPosted: Wed Apr 18, 2018 9:55 am 
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Posts: 525
The Bank of Canada announced this morning that they will be maintaining their overnight rate, which means no change to prime rate. The announcement came at 10am this morning, April 18th, 2018.

Prime rate will remain at 3.45%.

This one was a little tougher to predict, although this would have been my guess. The Bank of Canada wants to increase prime rate, and given that bond yields have been increasing over the past week (creating upward pressure and causing some increases to fixed rates), it seemed as though an increase to prime rate was anticipated. Given this announcement, we'll likely see bond yields start to settle back down, which would create downward pressure on fixed mortgage rates.

You can follow the bond yields here: https://www.investing.com/rates-bonds/c ... bond-yield

Economic growth was weaker than expected in the fourth quarter of last year, continuing into the first of this year, which is what was making it difficult for the BOC to increase rate this time around. If the economic outlook starts to improve, then another increase to prime rate will likely be coming at some point this year. However, as long as there is uncertainty, we can expect status quo.

While it's always possible that the prime rate could decrease, I would say that is not likely in the near future. But of course, anything can happen and the BOC has shocked us before.

The deepest discount on variable rate mortgages right now is prime -1.29% (2.16%). This rate however is only available to thosee with 35% or greater equity / down payment. Property value must be under $1 million (or at least must have been under $1 million at time of purchase).

You can read this mornings full announcement here:
https://www.bankofcanada.ca/2018/04/fad ... 018-04-18/

The next interest rate announcement will be on May 30, 2018.

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Paul Meredith
Mortgage Broker
CityCan Financial (est 1976)
416-409-8009
http://www.easy123mortgage.ca
paulm@citycan.com
Lic#10532

Follow me on Twitter! http://www.twitter.com/paulmeredith


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PostPosted: Wed Apr 18, 2018 12:03 pm 
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Joined: Fri Feb 17, 2006 9:14 am
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Is the prime -1.29% a teaser rate? Seems too good to be true.

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Hunter Obee
Sales Representative
Royal LePage Meadowtowne Realty
Diamond Award Winner - Top 3% in Canada
http://www.TheHomeHunter.ca
905-878-8101


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PostPosted: Wed Apr 18, 2018 12:11 pm 
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Joined: Fri Feb 01, 2008 2:35 pm
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The Home Hunter wrote:
Is the prime -1.29% a teaser rate? Seems too good to be true.

Hey Hunter, hope all is well with you!

No, not a teaser at all. You just need to have 35% down payment, or 35% equity if the home (if switching lenders), then this is the lowest rate available. With 20% down payment rate would be prime -1.05% (2.40%) or prime -1.24% (2.21%) with less than 20% down payment and therefore CMHC insured. Property value has to be under a million (or original purchase price had to be under $1 million). The option has full 20% prepayment privileges. The only real restriction is that there is a bonafide sale condition. This just means that the mortgage cannot be paid in full before the end of the term unless you sell the home. You also can't refinance to a different lender before the end of the 5 years, however you can refinance with the same lender. Other than that, it's a great product!

_________________
Paul Meredith
Mortgage Broker
CityCan Financial (est 1976)
416-409-8009
http://www.easy123mortgage.ca
paulm@citycan.com
Lic#10532

Follow me on Twitter! http://www.twitter.com/paulmeredith


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PostPosted: Wed Apr 18, 2018 12:15 pm 
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Joined: Fri Feb 17, 2006 9:14 am
Posts: 674
Sounds great!

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Hunter Obee
Sales Representative
Royal LePage Meadowtowne Realty
Diamond Award Winner - Top 3% in Canada
http://www.TheHomeHunter.ca
905-878-8101


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