Montreal Real Estate Blog » interest rates

Mortgage Rates Going Up: five-year fixed goes to 5.54 %

Deya Bautista — Thu, 07 Jul 2011 11:38:27 +0000

An article by the Canadian Press:

Several of Canada’s big banks announced increases in their residential mortgage rates effective Tuesday.

Royal Bank (TSX:RY), TD Bank (TSX:TD) and Laurentian Bank (TSX:LB) all raised the posted rate for a five-year fixed-rate mortgage by 0.15 percentage points to 5.54 per cent.

Royal Bank raised its special offer rate for a five-year mortgage by 0.15 percentage points to 4.39 per cent, while TD and Laurentian raised their special offer rates for a five-year fixed-rate mortgage by 0.15 percentage points to 4.29 per cent.

Most other special and fixed rates at the banks were also going up between 0.10 and 0.15 percentage points.

Fixed rate mortgage rates are affected by the cost of borrowing in the bond market, where banks finance their home loan lending.

But, there is no reason to panic. If you’re looking for good rates, there are many options available for you. Here is a snapshot of today’s rates by RateDirect.ca – contact Danuta for more info

Posted By: Deya Bautista - Real Estate Broker working as part of the McGill Immobilier team. Specializing in high end condos in downtown and Old Montreal. For buying or selling contact Deya at: 514.917.7889 http://montrealrealestateblog.com/

Bank of Canada Boosts Prime Rate at 3%

Deya Bautista — Mon, 13 Sep 2010 11:00:22 +0000

Bank of Canada governor Mark Carney raised the overnight lending rate a 0.25% point on Wednesday morning.

CTV News reports:
The decision marks the third straight month that the central bank has boosted the rate, which was set at a rock-bottom 0.25 per cent during the recession.

The overnight lending rate affects short-term borrowing, such as variable-rate mortgages and some lines of credit.

The steady rise over the last few months suggests the Bank of Canada sees Canada’s economy rebounding and no longer feels interest rates need to be at virtually zero in order to stimulate recovery.

Well, considering that back in January 2007 the prime rate was at 6%, we are not doing so bad right now.

Fixed Rates Officially Going Up, Variable Rates going down.

Deya Bautista — Thu, 04 Jun 2009 12:43:12 +0000

Great deals only last for a limited time. We all knew it was coming, we just didn’t know how soon…
Canada’s biggest banks are increasing key mortgage rates. Royal Bank of Canada announced the change on five-year, fixed-rate mortgages to 5.45%, an increase of 0.2%.

Bank of Montreal, Toronto-Dominion Bank, Bank of Nova Scotia and Canadian Imperial Bank of Commerce are following. The changes at RBC and BMO took effect on Tuesday this week, while new rates at TD, Scotiabank and CIBC were to be posted yesterday. ( I haven’t checked the news yet)

And those “special offers” from RBC, BMO and Scotiabank on five-year closed mortgages at 4.15% will also be subject to change without notice, reflecting a 0.2% increase.

On the other hand, variable rates are decreasing from Prime+0.80% to Prime+0.40%.
More info on variable rates on Canadian Mortgage Trends

Canadian Interest Rates Morning Recap

Deya Bautista — Thu, 24 Apr 2008 11:26:43 +0000

Interest rates drop half a point – The Star.com
“Bank of Canada governor Mark Carney has signalled the need for lower consumer borrowing costs and hinted further interest rate cuts may be required to shield Canada from a worse-than-expected slowdown in the United States. For the second time in eight weeks, the Bank of Canada slashed its policy-setting overnight interest rate by half a percentage point, to 3 per cent.”
Read the complete article

Big banks slow to react to Bank of Canada rate cut – The Vancouver sun.
“The Bank of Canada slashed its key interest rate a further half point, and hinted at more rate relief to come in an effort to keep Canada from being dragged into recession by a deeper and more protracted than expected downturn in the United States.”
Read the complete article

Canadian Mortgages Getting Cheaper, Variable Rates Gaining Popularity - CEP News
“With the Bank of Canada’s easing of interest rates over the last several months, including the most recent half-point reduction Tuesday, variable rate mortgages are gaining in popularity as Canadians try to take advantage of lower credit.”
Read the complete article

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Interest rate cut will help Canadian home owners and buyers

Deya Bautista — Wed, 05 Mar 2008 22:58:24 +0000

The interest rate cut announced today by the Bank of Canada will help Canadian home owners and buyers, according to The Canadian Real Estate Association. The Bank of Canada cut its benchmark overnight lending rate by one-half of one percentage point to 3 1/2 per cent on March 4th, and signaled further cuts in the near future. The trend-setting Bank rate, which is set 0.25 percentage points above the overnight lending rate, now stands at 3.75 per cent.

“The threat of inflation is being eclipsed by concerns about slower economic growth, so the Bank of Canada cut its trend-setting bank rate to boost growth,” said CREA Chief Economist Gregory Klump. “Financial market turmoil will remain a downside risk to growth for some time. This means the Bank will probably continue lowering interest rates.”

Lower lending rates will help offset the effect of tightening credit conditions and allow homeowners to obtain better mortgage terms. This will also benefit Canadian homeowners dealing with variable rate mortgages.

“The Bank of Canada today acknowledged that the U.S. economic slowdown was likely to be deeper and more prolonged than it projected less than six weeks ago,” said CREA President Ann Bosley. “When the Bank decided to lower interest rates today, the advertised five-year conventional mortgage rate stood at 7.29 per cent. This is less than one per cent above where it stood at
the beginning of last year. Competition among mortgage lenders remains stiff, which continues to help many borrowers negotiate discounts from advertised rates.”

Declining interest rates and a rebound in economic growth are factored into the CREA MLS(R) 2008 market forecast. “MLS(R) sales activity will stay strong and reach the second highest level on record this year. Residential MLS(R) prices are also expected to continue rising. Additional cuts to mortgage interest rates are good news for housing affordability and Canadian housing demand,” Klump added.

Interest rates news headlines

Deya Bautista — Mon, 03 Mar 2008 15:16:38 +0000

Scotiabank Forum Predicts Another Healthy Year Ahead For Canadian Real Estate Markets (Exchange Morning Post)
TORONTO – Canadian real estate markets remain remarkably buoyant, especially in light of the deepening housing downturn in the United States and the generally softening conditions in most other advanced economies globally, according to experts who presented today at Scotiabank’s Canadian Real Estate Outlook and Trends Forum 2008.
>>> Read complete article
Bank of Canada sets interest rate, Tuesday. (Globe and Mail)
Bank of Canada makes its interest rate announcement. Economists expect the target for the key overnight rate to be set at 3.75 per cent, down from 4 per cent.
>>> Read complete article
Interest-rate cut expected, question is how much. (Financial Post)
OTTAWA — It’s no longer a question of to cut or not to cut for the Bank of Canada, but of how low will it go. Canadians will find out Tuesday.
>>> Read complete article

Subprime mortgage news update

Deya Bautista — Tue, 26 Feb 2008 15:30:03 +0000

Canada economy to slow, risks to downside – IMF (Reuters)
Canadian economic growth will slow to 1.8 percent this year and there is a risk of an even sharper downturn as weakness in the U.S. economy spreads beyond the housing sector, the International Monetary Fund said in a report on Monday.
After growing about 2.5 percent in 2007, Canada’s healthy economy and fiscal standing will help it withstand the global turbulence but external risks will pose a challenge. >> read more
…….
Canadian institutions expected to make writedowns (Exec Canada)
Some of Canada’s five biggest banks are expected to report headline-catching writedowns when they announce first-quarter earnings. The banks have so far escaped with remarkably little damage from the credit market turmoil. >> read more
…….
Storm clouds threaten to rain on bank profits (Globe and Mail)
Canadian Imperial Bank of Commerce said in January that it will take $2.46-billion (U.S.) in pretax writedowns for the two months ended Dec. 31 because of its exposure to the U.S. subprime mortgage market. >> read more

…….
UPDATE IMF lowers growth projections for Canada on back of US economic downturn (Forbes)
Canada’s growth will likely decelerate further in 2008 and 2009 as a result of the sharp downturn in the US economy, the International Monetary Fund (IMF) reported. >> read more