4-year rate specials have started coming down the pipe recently. For those looking for a 5-year fixed mortgage, you may find some value by giving up a year of “security.”
Most 5-year fixed mortgages are in the neighbourhood of 5.65% to 5.79% at the moment. However, if you’re open to a 4-year term there are a few lenders below 5.40%. Assuming a 1/4% interest rate difference, the interest savings is roughly $1900 after 4 years–based on a $200,000 mortgage with a 25-year amortization.
Is that worth giving up a year of rate assurance? Quite possibly.
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Last modified: April 29, 2014
3-years are looking good as well. We’ll do a separate article on those soon…
Just received renewal offer from RBC for 4 years at 5.34%. Five years is at a crazy 5.90%.
Hi Jim, That’s not bad. If you’re interested, there’s a few better deals out there too. And you’re right, 5.90% for a 5-year seems pretty high. – Rob
We just got pre-approved for 5.25% for 5 years fixed 2 weeks ago – the day after the lender went to 5.69%.
BMO announced today a 5 year fixed at 5.25%. Click my name for story