Having your mortgage application accepted is not the end of your home ownership process. Once accepted, you have to plan your monthly budget to ensure that you are able to cover your monthly mortgage payments as well as your needs. A fixed interest rate is more suitable than variable if you want your monthly payment to be the same all throughout your amortization period. This can help you set your budget more accurately. But if you opt for a variable rate, you will need to understand how the central bank’s interest rate hikes can affect you.

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Featured Rates

FIXED

LenderRateTerm
Mortgage Lendwise RateLendwise

3.40%

5-Year
Mortgage First National Bank RateFirst National Financial

3.59%

4-Year
Mortgage RMG RateRMG Mortgages

3.29%

3-Year
Mortgage Street Capital RateStreet Capital Bank

3.19%

2-Year
Mortgage TD Bank RateTD Bank

3.19%

1-Year

VARIABLE

TermRate
5-Year Variable

2.75%

3-Year Variable

3.35%

OTHER

TypeRate
Line of CreditStarting at

3.00%

Equity LoansStarting at

5.99%

Private MortgagesStarting at

5.99%

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Advantages of Variable Interest Rate

Before dwelling on its effects, it is worth knowing the pros of choosing variable interest rate over a fixed one. In previous years, there had been incidents wherein the rates dropped significantly to the delight of debtors who went with variable interest rates. Basically, you may also enjoy this advantage in the coming months or years.

The best part with this option is that when the interest rates are low, you may shift to a fixed interest rate for the rest of your amortization period. With the fixed one, you are not allowed to change into a variable interest rate when the rates are advantageous.

 

Disadvantage of Variable Interest Rate

 The problem with variable interest rate is that you lack assurance. The factors influencing the interest rates are out of your control. Worst, you might end up paying a loan with a higher interest rate in the future. Private lending institutions are not always the ones that trigger the hike. It may actually be the country’s central bank.

Reasons Behind The Hike

Central banks usually impose interest rate hikes as a precautionary measure against risks of an economic crisis. In countries where there is a housing boom, the interest rates for mortgages are raised to help slow down the demand. Otherwise, too much debt can take a toll on the lending institutions and further result in a national crisis.

However, some experts also believe that the hikes may be implemented for the government and banks to generate revenues. They may impose them during the times when the expected interests are quite high due to the number of debtors.

Not all lending institutions are going to implement interest rate hikes the way the central bank intends to. If you have a loan with a variable interest rate, the amount you pay each month on your mortgage may remain the same. However, your lender will just adjust the amount that is considered as your payment for the interest rate and the amount for the principal. What you will see is that the percentage that goes for your interest increases while the percentage that goes for the principal amount goes down.

Your mortgage is one of the biggest loans you will incur. You should seek a mortgage broker to help you determine the type of interest that will suit your situation and spending habits the most. It also pays to know whether or not the central bank are introducing hikes in the coming months.

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My wife and I recently purchased our first place, so we started to look for a mortgage broker. Neither of us really knew what we were doing, so it was important to us that we could find someone who could guide us through the whole process. After some searching we finally stumbled upon the guys at certified mortgage broker We worked with leon and his team, got a great rate and they took their time to explain and guide us through the whole process. Great rates and great service. Would absolutely recommend.
Linderman Beadles
Linderman Beadles
06:16 26 Feb 18
Got tired of sow service and mediocre rates from my bank, so I started looking for a mortgage broker. Had some family friends recommended Leon and his team, so decided to check them out. Was very impressed with Leon, he guided me through step by step, recommended a mortgage and I ended up switching to him. My rate is better and he always answers call and emails right away.
Gina Carroll
Gina Carroll
05:06 28 Feb 18
Was looking for a new mortgage broker, my old one moved so had to find someone else to work with. Didn't really know how to go about it so just started googling. After some searching and talking, decided to go with the guys at certified mortgage broker. No one could match their rates, plus their customer service is honestly some of the best i’ve seen.
Deane Laflamme
Deane Laflamme
04:40 27 Feb 18
My wife and I recently purchased our first place, so we started to look for a mortgage broker. Neither of us really knew what we were doing, so it was important to us that we could find someone who could guide us through the whole process. After some searching we finally stumbled upon the guys at certified mortgage broker We worked with leon and his team, got a great rate and they took their time to explain and guide us through the whole process. Great rates and great service. Would absolutely recommend.
Stephnie Boyles
Stephnie Boyles
13:59 15 Nov 17
Got tired of sow service and mediocre rates from my bank, so I started looking for a mortgage broker. Had some family friends recommended Leon and his team, so decided to check them out. Was very impressed with Leon, he guided me through step by step, recommended a mortgage and I ended up switching to him. My rate is better and he always answers call and emails right away.
Billye Peralta
Billye Peralta
13:38 19 Nov 17
Was looking for a new mortgage broker, my old one moved so had to find someone else to work with. Didn't really know how to go about it so just started googling. After some searching and talking, decided to go with the guys at certified mortgage broker. No one could match their rates, plus their customer service is honestly some of the best i’ve seen.
Moore Hoover
Moore Hoover
02:25 16 Nov 17
We worked with Leon and he provided a thorough and a professional process in re-financing our mortgage. Communication was consistent, he was easy to reach and documents were processed quickly. Most importantly, we got a great rate that has us savings hundreds of dollars per month on our home. These guys really know what they're doing.
Melissa Brown
Melissa Brown
00:12 18 Jul 17
As third time home buyers we couldn't be happier with the service we got from Certified mortgage broker. The team did a great job working on our loan. Everything was fast, easy and transparent. Probably the best mortgage experience i’ve ever had.
Riley Clements
Riley Clements
15:27 20 Jul 17

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