These are historical times.

As you probably have already heard, the Bank of Canada announced another rate cut lowering its lending rate to .25%. As expected the retail banks lowered their Prime rate to 2.25% which is good news for home buyers. The Bank of Canada also expressed its commitment to keep the .25% rate at that value until June of 2010.

Riding on this commitment this suggests that home buyers could realize a consistent variable rate of 3.0% (or possibly lower) for a full year. For a mortgage of $275,000 that's a one year savings of $2,600.00 when compared to a regular fixed rate of 3.95%.

So does it make sense to ride a variable rate until next year and then convert to a fixed? Food for thought for sure!

For more information please contact:

Beata Kosc  Sales Representative Re/max Ultimate Realty Inc., Brokerage

416-487-5131 or beatakosc@rogers.com