As you know, your variable rate
mortgage, line of credit and/or student loans are all based on the Prime Rate
and here is your personal update from me on the recent Bank of Canada
announcement on changes to their Overnight Rate which in most cases impacts your
Prime Rate.
At 10:00 am EST, Wednesday October
22nd, 2014 the Bank of Canada again did what we expected them to
do, they continue to maintain their overnight rate and in fact are not likely
to make any change until possibly 2016 now!
So if you or anyone you know just got a little carried away and have
some high interest credit card debt that you can’t
seem to pay off in full each month, now is a
great time to chat about options with rates so low. Maybe you are planning a renovation project
soon or purchasing a second home or rental property – chat to me about your
options so we can work on how much unnecessary
interest we can save you but also get you closer to that Mortgage Burning Party!
It’s never too late to start planning.
The Bank still
feels that they won’t consider increasing rates to as far out as 2016! They continue to wait and see economic growth
continue on a more upward direction and sustainable long term. Remember, that any increase to the prime rate
since 1992 has only been by 0.25% at any ONE time, so you won’t see a large
significant increase all at once.
Fixed rates haven’t changed much at
all since the last announcement and are around 2.99% to 3.09% for a five year
fixed term.
Based on this recent announcement, and
the anticipation that the prime rate will still remain low for a while now,
unless you feel otherwise, I’d recommend that you remain with your current
variable rate product as the interest is lower than a fixed term rate right
now. However, if having a fixed payment is important to you, call me so I
can calculate what your new payment would look like and also if it is suitable
for you. The next announcement on any change to the prime rate is December 3rd,
2014 at which time I’ll be in touch again.
I wonder if I can ask a favour, going
with my theme of “Let
the sun set and the leaves fall along with Canadian consumer debt with our help”
if you hear a friend or family member talk about going through a
financially tough time – maybe I can help with some budgeting,
credit counselling and debt consolidation options for them. In either of these cases, would you
mind passing my contact information on to them – this is very much appreciated.
