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First Rate
E-Newsletter for April 2009
Dear
John,
If you are a homeowner, potential homeowner
or a real estate investor, you know that your mortgage is the single
largest expense you'll ever have. Keeping abreast of interest
trends, mortgage innovations and credit strategies will help lower
your mortgage costs and possibly build wealth for you and your
family.
I have a unique approach to
the mortgage business and that is, to provide my customers with the
most comprehensive information and options available so they can
make the best mortgage and home buying decision. I don't use
any slick sales techniques or negotiation strategies. It's all
about providing the right information and letting you make the
decision- My job is done when you know your
options.
In this
issue:
- Market commentary & interest
rate trends
- Monthly Review of Interest Rate
Forecasts from the Major Banks
- Should You Break Your
Mortgage?
- Understanding Your Home Purchase
Closing Costs
Market commentary & Interest
rate trends
The Bank of Canada (BoC) reduced
the overnight rate by 1/2 % on March 3, 2009. This brought
down the prime rate to 2.5%. The BoC's press release stated
that the "overnight rate can be expected to remain at this level
or lower at least until there are clear
signs that excess supply in the economy is being taken up".
Most economists don't expect another rate cut in April 2009.
However, the BoC left open the option to lower interest rates
further depending on how they see market
conditions.
As we've recommended in the past,
a variable rate strategy is a safe bet if your looking to lower your
housing costs. With such low interest fixed interest rates,
you're probably not going to go wrong if you were to lock-in.
I would not rush in to do this, however. If you can wait until
the summer, you could lock-in at a lower interest rates as fixed
rates are still unstable and may come down some more.
Rates and Charts
Specials (limited time offers; OAC &
E&OE)
10 yr @
5.25% / 5 yr @
3.99% (30 day
close / not for pre-approvals)
Prime @
2.50% (next announcement on April 21, 2009)
|
Term |
Feb
20
|
Feb
27
|
Mar
6
|
Mar
13
|
Mar
20
|
Mar
27
|
Today |
|
3 year
|
4.75% |
4.75%
|
4.75%
|
4.19% |
4.19% |
4.19% |
4.19% |
|
5
year |
4.39%
|
4.39% |
4.39% |
4.29% |
4.19% |
4.05% |
4.05% |
|
10
year |
6.35% |
6.35%
|
6.35% |
6.35%
|
5.25% |
5.25% |
5.25% |
Table shows
the discounted residential mortgage rates for 3, 5 and 10 yr
closed fixed rate mortgages (these are standard rates - i.e., what
most lenders are offering for prime
clients)
For a longer term view, click
here to see the 3, 5 & 10 year best residential
rate since September 2003 (updated
monthly)
Click to view other
relevant graphs
Monthly Review of Interest Rate
Forecasts from the Major Banks
The last interest rate drop is
expected on March 3, 2009. As least, that’s what the Big 5
Canadian Banks are forecasting (for now). With the exception
of BMO, the major banks are not expecting the overnight rate to
change until the economy recovers sometime next year. Click here to read more.
Should You Break Your
Mortgage?
With dropping interest rates,
there’s a lot of talk these days about whether to break your current
mortgage and switch to a lower interest rate mortgage. Click
here are the issues you need to
consider.
Understanding Your Home Purchase
Closing Costs
Many home buyers are startled to learn that after they
arrange their mortgage they have to pay a range of additional fees
to finalize the deal. It pays to be informed, and we can
advise you on these closing costs and on how you might be able to
lower them. Click here to learn what you costs you need to prepare
for.
Are you working with a
professional?
What exactly is a professional?
Here's my definition:
1) An expert in his field
2) Responds quickly to all emails and
phone calls
3) A person with the highest level
of integrity - Will only recommend products and services that
are in your best interest. If I do not have the right product
for you, I will point you in the right direction.
4) No pressure, hype or mind games -
only honest advice.
Relevant
Links
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