Dear Clients,
Now I know why the stores start so early, it would feel like they just did the decorations and now there is just a week to go!
I thought it would be good to do a recap on this year's mortgage bonus packages that most of you are on.
There are three Variable Rate categories in our firm now.
- The Old Timers: those of you who have below prime mortgages from before the "Collapse". Congratulations to those who took our advice and stayed put even during the 6.25% prime rate. It certainly has paid off. Now almost 2\3rds of your payment is directly against principal. You can send a couple of thanks to your favorite deity this holiday season.
- The Collapse Clients: who financed during and shortly after the "Collapse" who are above prime. Prime has been moving down from 3.5% since the first of January 2009. You have dropped about 1.25%.
- Newbies : those who have come in recently and we are now edging to just below prime.
Congratulations to the Old Timers as it looks like you are going to reap the benefits for the next year or two. Also if your renewal is coming up in the next couple of years you will still be below prime!
Watching closely for Collapse Clients. Yes those of you well above prime like +.80% to +1.25% over prime it is definitely time to pay the penalty and drop into the low prime rate. For those at +.60% over I would like to see another .10% drop in the variable rate to make the penalty pay. Those under +.60% over just sit for now.
Newbies- hopefully you are going to make it to the Old Timers Category!
You are hearing a lot of hullabaloo in the news about the danger of low interest rates and you may have seen a couple of interviews on CHCH that I did last week concerning this.
Unfortunately people are not getting more than a 30 second clip and the point is either lost or misinterpreted.
Here at The Personal Mortgage Group we do look into the future of our clients and prepare you for the unexpected by building in the flexibility you need to stay safe in the event of change in circumstance or interest rates. We are also contacting you regularly to make sure you understand the risks of developing or maintaining debt outside your mortgage. This is what the Bank of Canada was warning about and will continue to do so. For those who still do not want to listen they could pay dearly.
In the above article they are noting that because of the high dollar along with a high unemployment rate recovery will be well into 2011. When unemployment stays below 8% we may see things start to change.
Again, one of the best Christmas gifts you can give someone in your circle of Family and Friends is share with them your good fortune of resetting your financing to save you thousands or making the right financial decisions when buying your home.
Lock in Rates (not suggesting locking in at this time)
Prime still at 2.25%
3 yr. 3.55%
4 yr. 3.89%
5 yr 3.99%
All the best!
Suzanne Boyce
