Interest Rates Beginning to Stabilize

June 22, 2009  
Filed under Mortgage Rates

Over the last few weeks Home Mortgages Calgary has seen some significant increases in many of our lenders’ rates. This, of course, is attributable to the fact that bond yields have also been increasing.

As a consumer it is definitely wise to stay in the loop and watch rates when they are on their way up or down. An easy way to track whether rates will be increasing is to watch bond yields, such as the 5 year rate, and add 1.7-1.8 points to that number. This calculated number should be the expected 5 year rate. However, if you notice the actual rate is considerably lower than this target, then it is safe to assume that rates are likely to increase.

On the other hand, if the actual rate is higher than your calculated target you can bet that fixed rates are about to fall.

Like gas prices, interest rates increase quickly and take time to come down again. However, the good news is that the mortgage industry is definitely more competitive than the gas industry, so it is likely you will find a broker who is willing to give you a deal.

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