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Fixed Rates Up Again

With the leap in bond yields yesterday, a bunch of lenders are once again raising fixed mortgage rates.

TD was the first of the Big 5 today to announce a rate increase.  Canada’s second largest bank is hiking rates as follows:

  • 5-year posted fixed rate:  5.85%, up 0.40%
  • 4-year posted fixed rate:  5.14%, up 0.30%
  • 3-year posted fixed rate:  4.65%, up 0.50%


That 5-year move is the biggest increase in almost a year.

TD also announced it is lowering its 1-year rate by 0.15%.

If history is a guide, the other large banks will likely announce their own increases in the next 24 hours.

Assuming the banks all move their 5-year posted rates to 5.85%, that will amount to a 0.60% increase in the last nine days.  On a $200,000 5-year mortgage with 25-year amortization, that equates to over $5,700 more interest over five years.

If there’s one bright side, it’s that IRD penalties will potentially fall for certain people who are breaking their fixed-rate mortgages early.