Months of Wasted Fed-Speak Summer Fed hikes are dead. But not before the economy was misread, leaving many borrowers mislead — wishing the Fed left its rate-hike calls unsaid. The U.S. Federal Reserve is having trouble seeing through the economic mist and, as this little ditty conveys, it’s confusing the heckout of borrowers. Amid its ongoing rate-hike forecastscomes last Friday’s...
Somebody poke us when the Bank of Canada has a rate meeting of consequence. At the moment, the BOC is doing the same thing as everyone else, watching see-saw economic data for inflation clues. That’s sort of like watching a TV full of static and trying to make out a picture. Despite hints of stronger inflation, the tentative economy gave...
When it comes to the best variable rates, the trend has becomeour friend. Floating ratescontinue to creeplower after spiking at the end of 2015. Much of the improvement is thanks to shrinking credit spreads. In other words, lenders have beenpaying less to access short-term capital in the financial markets than a few months ago. Another part of the equation is...
Down payments are the entry fee tohome ownership, and in some cities that fee has shot upbig time. But while rising pricesand government rule-makinghave forced homebuyers to save a bigger ante, modest income gains and the lowest rates in alifetime have kept monthly payments tolerable, in all but a fewboom towns. And you probably know which ones. Thistable paints the...
Not So Fast… A slew of lenders have hoistedfixed mortgage rates in the last few weeks. Their motivation was the recent spike in government bond yields, which hit multi-month highs and (temporarily) boosted banks’ funding costs. Meanwhile, numerouslenders simply absorbed those higher yields and kept their rates as-is. For mortgage providers, staying price-competitive is not optionalinthe March through June stretch,...
Borrowers have been blessed with mortgage rates that look like promotional savings rates: 1.99%, 2.25% and the like. But now, sadly, those rate bargains are in jeopardy, at least for a while. The tide of bond yields is rising, and when that happens, so go fixed mortgage rates. Five-year fixed rates below 2.34% may be on the endangered species list,...
An Idle Bank of Canada If you forgot about the Bank of Canada rate meeting yesterday, you’re one of many. Nobody made a big deal about it because nobody expected anything earth shattering fromPoloz’s lips. The takeaway is that prime rate remains stuck at 2.70% and it could stay that way for months. The Bank did liftits Canadian growth estimate,...
Put Down Less, Get a Better Rate Lenders want insured mortgages…badly—and they’re still slashing rates to attract them. The best insured 5-year fixed mortgage rates are now 15 basis points below uninsured rates (uninsured rates apply to mortgages with 20% or more equity). That’s not normal. Prior to the last few months, the spread between the two was running closer...
Floating Rates Getting Cheaper We’ve seen modest improvement in variable mortgage ratesover the last two weeks. Nothing ground breaking—about 0.05 percentage points of extra discounting—but it’s a start. Big banks are currently averaging prime – 0.35% if you ask nicely or negotiate, while non-banks and brokers are at least a tenth to one-quarter point cheaper. Financial markets stillanticipate one more...
The latest mortgage rate reconnaissance… Prime Sticks at 2.70% Poloz and Co. issued another snoozefest rate announcement this week. The BoC delivered the same narrative we’ve heard for months: Canada’s economy is tenuous, U.S growth is positive, upside inflation risk is limited, federal stimulus may obviate the need for near-term rate cuts, debt and housing risk are at Defcon 5,...
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