The 5.2% number was just an estimate, based on observations over the years. I was referring to Canada's bond 3, 5, 10-year yields.

http://www.bankofcanada.ca/en/rates/bonds.html

Fixed rates change along with changes in bond yields. Usually, the spread between bond yields and fixed rates is about 1.75%, which means since bond yields now is around 3.5%, fixed rates should be around 5.2%. But again, there's no rule set in stone regarding this matter, it was merely economic observation.

Banks are expecting for another cut in prime rate on March 4. We'll see how much it decreases this time.

If someone is looking for a mortgage in the next 30days what do you advice variable rate or fixed rate?

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Live and Let Live

Right now, I would suggest you to go with variable, so that you can take the advantages of a low rate for now, and later on when the fixed rate has decreased, you can always convert into fixed rate.

As I mentioned above, fixed rates should have been lower than what they're currently at. Banks are reluctant to decrease its fixed rates, because they need to compensate for losses caused by the decrease in prime rate (variable rate).

Thanks for your insight mortgageexpert.

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Live and Let Live

Quote:

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Originally posted by mumdxbcan

I have pre-approved Mortgage at 5.25% variable rate

My closing date is after 2 months

Just wondering, shd I continue with Variable rate or while closing go to Fixed rate.

I heard Fixed rate is always higher than Variable.
How much differnence always will be ?

What is preferable, fixed or Variable?
Can some one tell me advantages & disadvantages of both?

If I am not wrong, one can go from Variable to fixed, but can't go back from fixed to Variable, correct?

Thanks

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