HawthorneVillager.com

A mortgage rate war is enough to put a big smile on the face of anyone needing a mortgage for purchase, renewal or refinancing and that is exactly the situation we are in right now. It's actually crazy out there right now!

Bond yields, which are how fixed mortgage rates are determined, have been trending downward steeply once again and have been doing so since mid-march and are just now starting to level off. The drop in the yields has placed downward pressure on fixed mortgage rates and has sparked a new rate war amongst banks and other mortgage lenders.

The problem banks are having right now as they can't promote lower rates without coming under scrutiny by our beloved finance minister Jim Flaherty (okay, maybe 'beloved' is a little strong). He lashed out at Manulife Financial last month for offering 2.89% for 5 year fixed even though TD had dropped their 5 year fixed to the same rate weeks before and other lenders have had lower than the 2.89% even before that.

By castigating banks for dropping their rates below the three percent threshold, it forces them to keep their rates artificially high which of course comes at the expense of many unsuspecting consumers and can significantly boost profits for banks. I am sure the banks aren't complaining.

2.99% for a 5 year fixed is something that many consumers still get excited about, however this is a rate that has been available for over a year now and is nothing special in today's market. To the unsuspecting mortgage shopper, it can seem like their bank is giving them a 'discount' if they don't do their due diligence and at least take a small peak around. It isn't hard to find rates much lower than 2.99% and can currently be found as low as 2.64% on a 5 year fixed. The bond yields seem to be levelling off now taking the downward pressure off rates. Have they bottomed out? We'll see.

_________________
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

My closing is now the end of August, 2.64% on a 5year fixed sounds mighty interesting, can you swing that?

For a closing that far in advance the best would be 2.79% on the 5 year fixed for closings up to 120 days in advance. 2.64% is a 30 day quick close special.

_________________
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

Maybe I'll ask closer to my closing date then

I just need these rated to hold until my 120 days to renewal (which is Jan 1st). Still a bit away, but crossing my fingers.

Hard to say if they will be THIS low at that time, but I would be pretty surprised if we saw any serious increases before your 120 day mark.

_________________
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