Interest rates have remained incredibly low because of the pandemic. Recently, however, a vaccine developed by Pfizer showed some promising results for its COVID-19 vaccine efficacy.
Some people wonder if Canadian mortgage interest rates will increase because of this development.
It’s likely Canada’s five-year mortgage rate will increase. Some brokers and economists predict that rates will jump approximately 10 to 20 basis points soon. For example, if current rates are 2%, borrowers could expect rates to jump to 2.20%.
Once the Pfizer vaccine is proven to be safe and is approved by Health Canada, lenders will feel more comfortable increasing their interest rates which would set them on a path for further rate increases.
What does this mean for you? If you’re currently shopping for a mortgage and wondering what term to take, consider the five-year fixed rate. Although variable rates have proven to be cheaper over the last 30 years, five-year fixed rates protect against economic volatility.
If you’re considering refinancing your mortgage to complete debt consolidation or to access the equity in your home, it’s wise to take advantage of record-low interest rates today. We may not see them again for a very long time.
Call or write today. Consultations are always free.
Sarah A. Colucci
Mortgage Agent Lic. M14000929
Mortgage Edge, Broker 10680
Direct: (647) 773-4849
By: Sarah Colucci