If you need a 2nd mortgage there are a few important points to consider. The interest rate, fees and any penalties to payoff the mortgage. As mortgage brokers we can arrange a 2nd mortgage for you that has a reasonable interest rate. Please call or send us an email to see if you qualify for a 2nd mortgage.
If you are looking at a 4-5 year variable 2nd mortgage, you are likely to see higher interest rates in the years ahead. Rising interest rates could cost homeowners who have variable 2nd mortgages rates a significant amount of money. You never truly know what is going to happen. The economy can change on a dime and the Bank of Canada could keep interest rates the same or dramatically raise them.
As a homeowner you need to know how much mortgage you can afford as well as how much risk you are willing to take. Sometimes people take too big of a risk and therefore need help with options such as paying for 2nd mortgages rates. To be eligible for a variable rate mortgage you now prove that you can also afford to pay the interest on a 5-year fixed mortgage rate. This recent change was designed to prevent borrowers from taking out the largest variable mortgage possible. A large variable mortgage could result in the loss of the property if interest rates rise.
On February 7, 2011, TD Canada Trust announced a raise on residential mortgage rates. Homeowners who are looking for 2nd mortgages rates may find that the cost of borrowing is going up. The current mortgage rates Ontario on a 5-year closed fix rate mortgage are predicted to increase to 5%. Presently the TD bank has been the only bank to announce an interest rate increase but it is expected that other financial institutions will make similar statements soon.
The trend towards higher 2nd mortgage rates can make buying a new home somewhat of a gamble. You could be missing great low interest rates if you are not buying a home right now. You also need to consider the costs and risks associated with fixed or variable 2nd mortgages rates. Doing research as well as working with financial institutions can help you make the right decision. 2nd mortgage rates are not always going to stay the same. With that said, you should get the best advice possible regarding second mortgages. Our agents can help even if you need a 2nd mortgage with bad credit. Give us a call today.