Fixed Rates UP, Variable Down?

The Royal Bank is the first of the big 5 to raise its rates. They have set thier benchmark posted rate for a 5 year fixed at 5.45% up 20 basis points. This brings their "discounted" specials to 4.15% . http://www.globeinvestor.com/servlet/story/CNW.20090601.C9687/GIStory/

Most of us have expected this due to the rise in the bond yield which has hit 2.56. It is olny a matter of time til the rest follow.

Don't worry, we have plenty of lenders still holding below 4.00% and I am still able to put my cients in at 3.60% OAC, but I would suggest anyone looking to purchase or renew to get an application in now and hold your rates for the next 90 -120 days depneding on your bank or broker.

If you are still feeling lucky or just love the variable products, rates are coming down! Short term money is getting cheaper as the stimulus packages take effect, and with the BOC expected to hold the rate at 0.25% on Thursday, we have lenders dropping these to bank prime plus 0.40%. 2.65% for a closed 5 year VRM!

Going to be a great summer for real estate and finance!