Fixed Rate vs. Variable Rate
The decision to choose a fixed or variable rate is not always an easy one. It should depend on your tolerance for risk as well as your ability to withstand increases in mortgage payments.
Fixed vs. Variable Rates | Patricia Kirkham, Senior Mortgage Broker with Dominion Lending Centres Clarity Mortgages
YOU CAN SOMETIMES EXPECT A FINANCIAL REWARD FOR GOING WITH THE VARIABLE RATE, ALTHOUGH THE PRECISE MAGNITUDE WILL EBB AND FLOW DEPENDING ON THE ECONOMIC ENVIRONMENT.
Fixed rate mortgages often appeal to clients who want stability in their payments, manage a tight monthly budget, or are generally more conservative. For example, young couples with large mortgages relative to their income might be better off opting for the peace of mind that a fixed-rate brings.
A variable rate mortgage often allows the borrower to take advantage of lower rates – the interest rate is calculated on an ongoing basis at a lenders’ prime rate minus or plus a set percentage. For example, if the current prime mortgage rate is 5.5 percent, the holder of a prime minus 0.5 percent mortgage would pay a 5.00 percent variable interest rate.
As a consumer, the best option is to have a candid discussion with your mortgage professional to ensure you have a full understanding of the risks and rewards of each type of mortgage.
About Patricia Kirkham, AMP, Senior Mortgage Broker with Dominion Lending Centres Clarity Mortgages
Patricia Kirkham has been actively assisting clients in the mortgage industry for over 25 years! In 1991, she partnered with Dennis Petersen to become the Vice-President and Broker of Record at Dominion Lending Centres Westcor which has most recently merged with Dominion Lending Centres Regional Mortgage Group in 2016 (now Dominion Lending Centres Clarity Mortgages). Over the years she has thoroughly enjoyed helping many clients obtain their dream homes, refinance mortgages for investments, home improvements and consolidating debt. Her wealth of knowledge and experience has enabled her to grow as a professional, and she is even a certified reverse mortgage specialist with Home Equity Bank, and a mortgage debt consolidation specialist. This means that regardless of your situation, Patricia will have a solution to help.
With access to more than 230 lending institutions, including big banks, credit unions and trust companies, our licensed team of mortgage professionals is familiar with a vast array of available mortgage products – ranging from first-time homebuyer programs to financing for the self-employed to financing for those with credit blemishes.
And, best of all, Dominion Lending Centres’ mortgage professionals work for you – not the lenders – to ensure you receive the best rates and products available in today’s marketplace. Whether you’re looking to purchase your very first home or upgrade to a new home, renew your existing mortgage, refinance your mortgage to free up some equity, purchase investment properties or vacation homes, or lease business-related equipment, Dominion Lending Centres has a variety of products available to meet your unique needs. Our mortgage professionals are experts in their field and many are ranked among the best nationally. Launched in January 2006, we were named Best Newcomer (Mortgage Brokerage Firm) at the prestigious CMP Canadian Mortgage Awards 2008 – the Oscars of the mortgage brokering industry. At the 2009 CMAs, we received the Best Branding Award, and again in 2010, with the addition of the prestigious title of Mortgage Brokerage of the Year and Best Advertising. At the 2011 Awards, we again walked award with Best Advertising, and in 2012 we were honoured with: National Broker Network of the Year; Best Advertising; and Best Branding. Dominion Lending Centres is also honoured to be ranked 32nd on the 2012 annual PROFIT 200 ranking of Canada’s Fastest-Growing Companies by PROFIT Magazine. Ranking Canada’s Fastest-Growing Companies by five-year revenue growth, the PROFIT 200 profiles the country’s most successful growth companies. PROFIT 200 is Canada’s largest annual celebration of entrepreneurial achievement. In both 2009 and 2010, Dominion Lending Centres also earned spots on the PROFIT HOT 50 List of Canadian Emerging Growth Companies. The PROFIT HOT 50 ranks the top 50 young businesses in Canada by two-year revenue growth. Dominion Lending Centres’ mortgage professionals are available anytime, anywhere, evenings and weekends – and we’ll even come to you!