5-year bond yields have jumped to 2.27%–up 40 basis points in the last 30 days. As a result, mortgage funding costs are spiking (fixed mortgage rates are generally linked to bond yields).
A few smaller lenders have already raised, or plan to raise, their 5-year fixed rates. As reported a few weeks ago, this may be a precursor to further, more wide-scale, rate increases.
If you’re a homeowner considering refinancing into a fixed rate, now may be the time to act.
If you’re a broker floating a fixed rate for a client, you may want to consider locking it in.
Attribution: Special thanks to the Bank of Canada for the data used in this chart.
The Mandatory Disclaimer: Accurately and consistently forecasting interest rates long-term is virtually impossible. This is not a prediction or recommendation. Market conditions can change at any time. Contact a mortgage planner for recommendations suitable to your particular circumstances.