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Fixed Rates Trend Below 5%

Many big lenders are now offering 5-year fixed rates at just under 5.00%.  In fact, 4.99% seems to be a pretty popular number nowadays. 

By contrast, most 5-year variables are still at prime + 1.00% (or 4.50%).

bond-yields There are exceptions of course.  For example, there are certain deeply discounted fixed rates out there that we haven’t seen since May 2007. 

This drop in fixed rates follows a steep fall in bond yields, which are down considerably in the last month or two.  The 5-year bond closed today at just 2.11%–another multi-decade low.

If you’re hunting for a fixed rate, find a good mortgage planner to do the legwork.  Not only is it free, but most brokers have access to unpublished rate specials you won’t find elsewhere.  Just make sure to find a planner who shops all lenders–including each of the big 5 banks. A few of the big banks are currently on a market-share kick and have good promotions running.

Chart Source:  Bank of Canada