5 Years Fixed or 5 Years Variable? Which one is the better option?
This a question many home owners & home buyers will be asking
themselves this Spring when figuring out their mortgage situation. There is no right or wrong answer, the better option is, IT DEPENDS
Both options have their “pros” & “cons”: 5 Year Variable
• rate is based on Bank of Canada Prime (currently 2.25%) but, this
rate can change when the Bank of Canada feels it is appropriate, it
can increase or decrease and your payment may be impacted
• variable rate has been lower than the 5 year fixed rate for the past
20 years
• you have an option to ‘lock-in’ your interest rate at any point during
the 5 years 5 Year Fixed
• stable interest rate for the term but, high penalties to break the
mortgage mid-term
• protection against rate increases but, if rates drop you’re still paying
the higher rate
• with the current rate environment, rates are still at all time lows! As you can see both options have a set of positives that some may
value more than others. Some people prefer to pay the lower variable
interest rate & increase their payments to pay off their mortgage faster
while others prefer having a fixed rate and not having to worry about
what their rate is going to do next month. At the end of the day making the decision doesn’t have to be
something you do on your own. Speak to a specialist like myself
and we will figure out together what is the best option that meets
your needs. Already have a specialist? That’s ok, I give free second
opinions! With over 15 years of experience I am confident we can pick the
better option for YOU!
Wayne Marks, Mobile Mortgage Specialist
Manager, Residential Mortgages
T: 416-294-9704 E: wayne.marks@td.com
This a question many home owners & home buyers will be asking
themselves this Spring when figuring out their mortgage situation. There is no right or wrong answer, the better option is, IT DEPENDS
Both options have their “pros” & “cons”: 5 Year Variable
• rate is based on Bank of Canada Prime (currently 2.25%) but, this
rate can change when the Bank of Canada feels it is appropriate, it
can increase or decrease and your payment may be impacted
• variable rate has been lower than the 5 year fixed rate for the past
20 years
• you have an option to ‘lock-in’ your interest rate at any point during
the 5 years 5 Year Fixed
• stable interest rate for the term but, high penalties to break the
mortgage mid-term
• protection against rate increases but, if rates drop you’re still paying
the higher rate
• with the current rate environment, rates are still at all time lows! As you can see both options have a set of positives that some may
value more than others. Some people prefer to pay the lower variable
interest rate & increase their payments to pay off their mortgage faster
while others prefer having a fixed rate and not having to worry about
what their rate is going to do next month. At the end of the day making the decision doesn’t have to be
something you do on your own. Speak to a specialist like myself
and we will figure out together what is the best option that meets
your needs. Already have a specialist? That’s ok, I give free second
opinions! With over 15 years of experience I am confident we can pick the
better option for YOU!
Wayne Marks, Mobile Mortgage Specialist
Manager, Residential Mortgages
T: 416-294-9704 E: wayne.marks@td.com
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