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Bank of Canada slashes rates. ⇒

   22 April 2008, mid-morning

My variable rate mortgage has turned out to be an awesome idea.

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Comments

  1. Rates are probably going to come down, so getting a variable mortgage at this point in time is probably a good idea. (Even if rates go up a little bit in the short term, your variable rate will probably still be lower than what you would get if you got a fixed rate.)

    I wrote this last year. I can’t remember why exactly I was convinced rates were going to go down. I probably assumed back then that the US economy would turn to shit. Of course, I wouldn’t take financial advice from myself.

    Anyway, you need only look at what rates were like in the 70s or 80s to get over the feeling you are paying to much. Rates are SO low now.

    by Ramanan on April 22 2008, 3:24 pm   #

  2. There’s a popular (popular amongst personal finance bloggers in Canada, that is) article written by a York professor about the historical advantages of variable rate mortgages. Basically, from 1950 to 2000 Canadians were better off with a variable versus a 5-year rate 88.6% of the time.

    by tyler on April 22 2008, 3:45 pm   #

  3. oh ya, it’s also worth mentioning that the big banks haven’t followed the rate cut yet.

    by tyler on April 22 2008, 6:53 pm   #

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