10 YEAR mortgage going for 3.89 percent

[MortgageQueen]

I was just talking to another SCer about this, so I thought i'd post about it because it IS a good deal for a lot of people and i think very few people actually know it exists.

So who is this good for?
It's absolutely ideal for anyone who thinks they will stay in same place for 10 years. The best thing about this is that after 5 years, your penalty for breaking the mortgage is only 3 months interest (as opposed to the massive IRD penalty) So, even if you're sure you'll be at current residence for 5 years and not 100 percent sure about the following 5 years, it's still good.
It's an educated guess that by time we pass 5 or 7 years or so, rates will probably be double what they are now, so you really just can't beat this kind of long term rate.

[aaliasmith]

Take advise of some expert person , you must attend a counseling .

[MortgageQueen]

Take advise of some expert person , you must attend a counseling .

Sorry?? What are you referring to????

[Shwa Girl]

I was just talking to another SCer about this, so I thought i'd post about it because it IS a good deal for a lot of people and i think very few people actually know it exists.

So who is this good for?
It's absolutely ideal for anyone who thinks they will stay in same place for 10 years. The best thing about this is that after 5 years, your penalty for breaking the mortgage is only 3 months interest (as opposed to the massive IRD penalty) So, even if you're sure you'll be at current residence for 5 years and not 100 percent sure about the following 5 years, it's still good.
It's an educated guess that by time we pass 5 or 7 years or so, rates will probably be double what they are now, so you really just can't beat this kind of long term rate.

Thanks for this info.

Who is offering this mortgage?

[MortgageQueen]

Thanks for this info.

Who is offering this mortgage?

As far as I know you can only get it through a broker but I think you can get 3.99 at many banks as well, which is a negligable difference. I'd still recommend a broker though. . .to make sure the contract is in your best interests. The terms vary from Lender to Lender.

[chillys-willy]

I have a variable with ING for 2.3%. I know I am taking some risk but saving $1000's of dollars each year. Last time I went fixed, I eventually paid $2000 to change it to a lower variable rate and it has saved me alot. It is worth talking to a mortgage broker to get all your options although this is a great rate.

[MortgageQueen]

I have a variable with ING for 2.3%. I know I am taking some risk but saving $1000's of dollars each year. Last time I went fixed, I eventually paid $2000 to change it to a lower variable rate and it has saved me alot. It is worth talking to a mortgage broker to get all your options although this is a great rate.

2.3 is a very good variable rate. It's unlikely I would encourage you to change that unless it's almost up. Bank of Canada is unlikely to raise (prime) rate til 2013 at earliest. I can't guarantee that but that's what most economists predict.
Variable is sitting at 2.8 right now, so you're already saving half a percent just by getting the rate when they were the best.
Just keep in mind that when your term is up, your payment will be a fair bit more and plan for that.

[marstec]

We went fixed for the first part of out mortgage and then variable after that. I think historically, variable will give you the best rate in the long run, but you have to be comfortable with the uncertainty of rates fluctuating. It's much like buying equities versus fixed investments, if you hate the idea of losing any money, then you'll probably go for the "safer" vehicle even though the returns are minuscule.

If paying off the mortgage is a priority, then do what I did: pay weekly (52) and pay the same amount or more, even when rates drop...we paid it off twelve years early on a 25-year term.

[aaliasmith]

Very frankly i do not have much knowledge about leads , that is why i joined this forum , so i can get some knowledge .

[lucy16076]

I see that a credit union in town is offering 2.99% & my own broker offers me 2.4% right now, variable (Prime minus .6%). I got a great deal on my mortgage in 2008 & have watched it fluctuate very little since it began.
I pay weekly & have managed to put the maximum overpayment for the last 2 years. (fluke from an inheritance...won't happen this year)
I hope to have it paid off in 5 years (might be a pipe dream...but I'll try), so hoping I'm doing the right thing all around!

Thanks for all the info on this link!

[MortgageQueen]

I see that a credit union in town is offering 2.99% & my own broker offers me 2.4% right now, variable (Prime minus .6%). I got a great deal on my mortgage in 2008 & have watched it fluctuate very little since it began.
I pay weekly & have managed to put the maximum overpayment for the last 2 years. (fluke from an inheritance...won't happen this year)
I hope to have it paid off in 5 years (might be a pipe dream...but I'll try), so hoping I'm doing the right thing all around!

Thanks for all the info on this link!

Lucy,
If your broker is offering you Prime-.6. .. . .Take it and RUN. This broker REALLY wants your business and would have had to make a massive cut in their fee (from the bank) to offer this. I actually feel sorry for them, because they're literally making next to nothing. Next thing I would ask is WHY? We all need to make a living. . .so what kind of service are you getting from this broker? Which bank is this variable rate with? Be careful about the fine print. That scenario makes me a little nervous. . .
OR
if you are REALLY confident nothing will happen in the next 5 yrs that will cause you to have to break your mortgage, then you could try the 2.99 but I'm guessing it is a "no Frills" mortgage with a LOT of restrictions, such as. . .Low limits on the percentage you can "increase payments" and low limit on "xtra principal payments"option. That and the fact that you probably can't break the mortgage term unless you die. . . would be areas I would caution you about.