Understanding how to get the best current mortgage rates Ontario will help you to decide whether you should have a variable, fixed short term or fixed long term mortgage. As of January 2011 the interest for all mortgages have been held below the normal level by the Canadian central bank. The present Bank of Canada rate is very low at around 1%.
The major banks in turn charge their customers a small amount (around 2-3%) above the 1% they pay the Canadian central banks. Therefore as a customer of a large Canadian bank you would presently pay about 3% for a variable mortgage.
The challenge is to determine what will be the best current mortgage rates Ontario will be in two to five years. A good indicator of the best mortgage rates Ontario is to look at mortgage rates over the past 40 years. Over this time period the range for current mortgage rates Ontario was a low of 3% to a high of 21% in Ontario. Based on this information Canadians can expect mortgages rates to rise back to the normal range in the future.
To get a better idea of where the best mortgage rates Ontario will be in the future there a numbers of sources that can help you. First listen to what the Bank of Canada thinks the short to longer term interest rates will be heading. At the present time they do not foresee the mortgage rates in Ontario moving up till the second half of 2014. This is a very good signal that a variable mortgage might be the best option for most Canadians. The borrower can get a low rate open variable mortgage that can be converted to a fixed mortgage at some point in the future. Borrowers can save money with the lower variable interest and still have the option to lock in a fixed mortgage.
Current mortgage rates Ontario are also affected by economic activity inside and outside of Canada. Although, you should pay closer attention to the economic activity within the country. If the economy is starting to pick up the central bank may feel that the economy can withstand higher interest rates.
You should also be aware that inflation and the growth in gross domestic product can affect decisions regarding current interest rates. The Bank of Canada has a range for inflation around 2% -3%. Inflation rates above this level usually mean that you can expect interest rates to rise. The range for growth in gross domestic product can be higher. If the growth starts to reach above 5% you can also expect the bank to raise interest rates.