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RBC Drains the Punch Bowl (Somewhat)

RBC-BankThe traditional #1 pacesetter in mortgage rates is slowing the rate party. RBC is raising three core rates, including its:

  • Posted 5-year fixed
    which rises 20 bps to 5.44%
  • Posted variable
    which rises 10 bps to prime + 0.20%
  • 4-year fixed special
    which rises 50 bps to 3.49%

These changes take effect Thursday, March 29.

And that date is not coincidental. It’s the day after BMO’s 2.99% 5-year rate ends. It’s also around the time when various competitors’ rate offers expire.

Barring a material drop in bond yields, RBC’s move could motivate other lenders to lift their own fixed rates.

It might also create a sense of urgency in borrowers to lock into long-term mortgages. That’s a side effect lenders would welcome.

As long as the 5-year yield keeps under 1.75%, however, there should be a few lenders left in the low 3% range on 5-year mortgages.

Rob McLister, CMT