Posted 9.10.12 @ 11:50 by: Mike McEwen
Canada’s central bank has held five year mortgage rates at a steady 5% (give or take a few points) since May, but other banks have been offering lower rates. RBC rose rates for its mortgages by about 1/5 of a point in late August… does this mean that other banks will follow suit? What does this mean for you if you want to refinance your home or buy Oakville real estate? Is a tiny raising in interest rates really that much of a big deal?
Why do Interest Rates Matter?
When you’re thinking about selling or buying Oakville luxury real estate, interest rates matter. It doesn’t even matter if you’ve already bought a property or you haven’t sold yet, they still affect you. If interest rates are low, that means buyers will be able to get credit much easier and will be willing to borrow more money, or pay more for a house. If you’ve already bought a home interest rate changes can affect you when your mortgage comes up for renewal as well. You’ll want to talk to a financial professional to get good rates and terms from the outset.
Lower Interest Rates Mean It’s Easier to Borrow
The lower the interest rates are, the easier it is to borrow the money you need to buy a home. It’s also much easier to pay back your mortgage when you buy Oakville real estate too! It’s important to note that while the Central bank has interest rates at 5%, you’ll find many other lenders have them as low as 2.75%. What rates you get will depend on what lender you choose to do business with. Always compare offers from different lenders to ensure that you’re getting the lowest rates possible.
If mortgage rates do spike in the next 12 months, you’re going to want to get pre-approved for your mortgage. When you have pre-approval you’ll be able to lock in those low rates for up to six months after you have applied, and you’ll have ample time to find your dream home (or condo!). When you know how much money you can spend on your home, that will help us as your Oakville real estate agents to know what kind of home you’re looking for. It’s always great to be prepared, and when you know how much you have to spend you’ll be able to make the right decisions for you.
It’s Not All About Interest Rates
As much as we talk about them, everything doesn’t boil down to interest rates. Buying and selling Oakville real estate is a multifaceted process, and you want to work with the best to make sure things happen for you. When you choose the Goodale Miller team as your Oakville realtor, you get all of our expertise and the benefits of our experience.