Current Mortgage Interest Rates Ottawa Feb 22, 2011               
                                          Term          Bank Rates    Attractive Rates
                                          1 YEAR           3.50%            2.64%
                                          2 YEARS         3.75%            3.29%
                                          3 YEARS         4.35%            3.59%
                                          4 YEARS         5.14%            3.84%
                                          5 YEARS         5.44%            3.94%
                                          7 YEARS         6.34%            4.94%
                                          10 YEARS       6.65%            5.15%
  • Let me comment on the two highlighted rates; the one year and the ten year rate. It’s a long time ten years and you notice the rate of interest doubles over that period. You will have paid more than twice the interest over the longer term if you choose the longer term. 

  • The monthly payments don’t appear to differ that much; one year $948. per month as opposed to the ten year monthly payment $1065. that’s about $100 dollars difference. So? You say; I can afford to pay more for peace of mind! Like,” I don’t want to loose my house if I run into difficulty or the rates skyrocket !” I understand your concern… and think about this…

  • So at the end of two years you’d have paid $4,803. interest and after the same period of time you’d pay $9,416. with the ten year rate. If $5000 is a lot of interest money then $10,000 is really a lot more money to have paid when it doesn’t buy much except a feeling of security and a great account balance for the lending institution. This is after two years only. Condider after eight more years the potential interest differencial could be astounding! Would it not be smart in the begining to pay double the monthly payment at the lowest rate so you pay off the principal sooner?

  • Ok, I know you say there’ll be changes in the rates every year and they will be going up so my simplistic comparison is inaccurate. You’re right, and if you always choose the lowest rate and after ten years you still choose the lowest rate then you’ll have paid off more principal owing and be better off financially. That’s the way I see mortgage decisions!

  • Some people may have personal circumstances. When it comes time to renew your mortgage call me. Let’s talk…