Historically in Canada, those who opt for adjustable rate mortgages tend to pay less than those who opt for the more common fixed rate mortgages. An adjustable rate mortgage is one that has an interest rate that fluctuates with the Bank of Canada’s interest rate.
So if you do choose an adjustable rate mortgage, how do you know that you are getting the best possible deal.
Here are a few of our top tips on how to get the best adjustable rate mortgage in Canada.
1. Work with a mortgage broker.
Is it possible to shop around and do all the legwork yourself when it comes to comparing mortgages? Yep. But will doing that give you the best overall picture of what’s available? Nope.
While you might be able to take the time to compare the rates of a handful lenders, mortgage brokers have access to dozens of lenders – some of whom only work with brokers. And, since your mortgage broker already has established relationships with those lenders, it is likely that they can get you a better deal than you would be able to get on your own.
2. Consider the terms, not just the rates.
While it is natural to want to get the best possible interest rate, that should not be your only consideration when it comes to choosing an adjustable rate mortgage. For example, what if interest rates were to go up? Would you want the option to be able to lock-in a portion of your mortgage to a fixed rate? Some lenders offer that opportunity with adjustable rate mortgages. So be sure to look at the features of the mortgage and not just the interest rate.
3. Ask for a better rate.
It may sound simple, but too many people accept that the advertised rate is going to be the lowest. While not every lender is going to be willing to negotiate, some will. So it never hurts to ask. When you find a lender and mortgage terms that you feel comfortable with, ask the question, “is this the absolute lowest rate you can give me?” If you are offered a better rate, perfect! If not, then you will have to make the decision of whether or not to go with that lender.
So are you ready to see what kind of adjustable rate mortgage you qualify for? Then contact Akal Mortgages today!
When we say YES! We stand behind our promise.®™