|2 Year Fixed Rates||Our|
2yr fixed rates lowest in Red Deer
We’ve complied the list of the most frequently asked questions by our Red Deer mortgage customers along with the answers.
Why should I compare mortgage rates?
Not every Red Deer mortgage lender is going to offer you the same interest rate on your home loan. The interest rate will vary based on the risk they think your loan poses, your creditworthiness and their profit margin. Some banks offer a lower interest rate if you pay more up front. Others will offer a lower interest rate to you because they specialize in loans for the self-employed or those with less than perfect credit.
The mortgage terms can vary wildly, too. How much do you have to pay if you break the mortgage? How much do you need to pay in loan origination fees? How long is the mortgage term? These factors can determine how much you’ll pay over the life of the loan and may have to pay when life forces you to change directions.
How do fixed and variable rate mortgage differ?
Both fixed and variable rate mortgages will have an interest rate based on the Bank of Canada interest rates at the time the mortgage is issued. However, there will be less of a difference if you choose a variable rate mortgage, since lenders can increase your house payment as interest rates go up. You’ll pay a slightly higher interest rate on a fixed rate mortgage to offset the possible losses by the mortgage lender if interest rates rise. About two thirds of Red Deer mortgage customers have a fixed rate mortgage so that they know what their mortgage payment will be month to month.
Should I get a closed or open mortgage?
An open mortgage is one that lets you pay down the loan balance whenever you want and with whatever money you choose to throw at the mortgage. You’ll pay for it in the form of higher interest rates, fees or both. The open mortgage is the best choice if you expect to aggressively pay down the loan or receive a massive lump sum you’ll dedicate toward debt repayment.
A closed mortgage limits debt payments. They may limit how much you can pay toward the mortgage, when you can pay down the principal or both. Because the lender’s profits are guaranteed, they charge a lower interest rate and/or fees. They reinforce this by charging you with a penalty if you break these rules.
How often are your Red Deer mortgage rates updated?
We have two sources of data that feed into our daily Red Deer mortgage rates. Our mortgage lenders can manually update their offered rates. And we pull from the websites of various Canadian banks. So we can often see rate updates prior to them officially getting an update from the lender.
What is a mortgage rate hold?
When a mortgage lender quotes you an interest rate, this isn’t set in stone. It will eventually change to reflect market conditions. The mortgage rate hold or rate hold is how long they’ll honor that quoted interest rate. Depending on the lender, it is anywhere from 30 to 120 days. If interest rates rise, they’ll honor the lower, quoted rate. If interest rates fall, they’ll generally honor the lower, current interest rate. Call your top Red Deer Mortgage Brokers today to get the lowest mortgage rate.