Is this a good rate?
Lender PCF (cibc)
VRM – 5 year closed at prime – 0.75%
Quote:
Originally posted by quest
Is this a good rate?
Lender PCF (cibc)
VRM – 5 year closed at prime – 0.75%
Dont go with Variable. - Go with Fixed for 5 years- its time to fix the rate... rate will jump every now and then ....
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'Some goals are so worthy, it's glorious even to fail.' (Param Vir Chakra awardee Lt. Manoj Pandey)
This is a very unqualified statement..
Historically variable has always been better than fixed and at todays prime variable is still very attractive.
1>
Going variable depends on once ability to take and absorb risks.. If u go and do a averaging of the rates for the past 10 years compared with todays fixed rate u will probably find the difference is only marginal..
2>
At prime minus 0.7 i will go variable because the spread between fixed and variable is around 2% and for the prime to move up 2 % it will take well over 2-3 years by which time u would have made enough in the difference.
3>
Variable mortages can be closed by paying 3 months interest where as fixed mortagage u may end up paying interest differential which may work out to 5000$ per 100000 in mortgage.
If u like the house go get it dont delay because u expect the variable to fall prime minus -.9 .. if anything go to a mortgage broker he may be able to give u a better deal than the bank
Quote:
Originally posted by Blue_Peafowl
Dont go with Variable. - Go with Fixed for 5 years- its time to fix the rate... rate will jump every now and then ....
Thanks ashedfc, have 1 question regarding "fixed monthly payment with a variable rate "
so if I take the max amortization for 35 years with a fixed variable rate, and if the interest rate goes up, will the amortization be more than 35 years?
U cannot ask for a fixed monthly payment with variable..
The bank automatically tries to keep ur payment as fixed as a possible, without changing amortization.
What i mean is your payment is interest + principle. so the bank changes the principle component as the interest changes.. If the interest rate drops priciple payment is increased and only a part of the benefit is passed back , if the interest increases the principle is decreased.
Quote:
Originally posted by quest
Thanks ashedfc, have 1 question regarding "fixed monthly payment with a variable rate "
so if I take the max amortization for 35 years with a fixed variable rate, and if the interest rate goes up, will the amortization be more than 35 years?
Quote:
Originally posted by dudewheresmycar
This is a very unqualified statement..
Historically variable has always been better than fixed and at todays prime variable is still very attractive.
1>
Going variable depends on once ability to take and absorb risks.. If u go and do a averaging of the rates for the past 10 years compared with todays fixed rate u will probably find the difference is only marginal..
2>
At prime minus 0.7 i will go variable because the spread between fixed and variable is around 2% and for the prime to move up 2 % it will take well over 2-3 years by which time u would have made enough in the difference.
3>
Variable mortages can be closed by paying 3 months interest where as fixed mortagage u may end up paying interest differential which may work out to 5000$ per 100000 in mortgage.
If u like the house go get it dont delay because u expect the variable to fall prime minus -.9 .. if anything go to a mortgage broker he may be able to give u a better deal than the bank
Quote:
Originally posted by Blue_Peafowl
Dont go with Variable. - Go with Fixed for 5 years- its time to fix the rate... rate will jump every now and then ....
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'Some goals are so worthy, it's glorious even to fail.' (Param Vir Chakra awardee Lt. Manoj Pandey)
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