Calgary Mortgage Broker

Fixed Rate VS Variable Rate

When if comes time to select the right mortgage terms that suite your needs the questions sometimes arises, Which is better, Fixed Rate or Variable Rate? First, lets discuss the differences. A fixed rate would be the rate that your mortgage would be financed at for the length of the term you choose (see the link to 5 year terms for more info). A variable rate would fluctuate over that same length of term. It could go higher, it could go lower, depending upon the economy and markets.

So taking a variable rate mortgage is basically a gamble that the economy and markets will not force a rise in interest rates during your mortgage term. Taking a fixed rate is like either gambling that rates will trend upward or else avoiding the gamble all together and just locking into a comfortable and manageable payment for the length of your term.Are you a gambler?

Variable Rates Beat Fixed Rates!

The interesting thing to note is that over recent decades of watching interest rates go up and down, most of the consumers who have opted for the variable rate mortgages have saved more money than those who have locked into fixed rate mortgages! This is pretty amazing although it is no guarantee that this will be true for the future. We still recommend that first time mortgagees take a fixed rate for simplicity purposes, but do recommend variable rates for those who are financially astute and actively manage their own money, investments, and debts.

Give us a phone call or use the handy TEXT MESSAGE form to send us an instant message. Please be sure to include your contact info so we can call or text you back too.