Great article for understanding why mortgages are so cheap!! it's taxpayer money......http://ping.fm/NhapM

More Canadians using Mortgage Brokers.....
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Inflation rate low, bond yields ease

The annual inflation rate rose a less-than-expected 1.3 per cent in December, said Statistics Canada, and core inflation stayed at 1.5 per cent - a half a percentage point below the Bank of Canada's target rate.

In addition, consumer prices dropped last month.

"The way markets look at it is that because inflation remains subdued, it puts even less pressure on the Bank of Canada to raise interest rates and that softens the currency," Bank of Montreal chief economist Douglas Porter told The Canadian Press. He added that business can't raise prices due to the weakness of the economy and the strength of the Canadian dollar has quashed import prices.

Bond yields continue their decline and are hovering around 2.55% this week.

What does this mean? Inflation is the driver for the short term lending rates set by the BoC so there is no reason for the bank rate to move up. 5 year bond yields drive the fixed term rates, indicating the long term rates should hold steady as well.

There is still time to take advantage of the low rates!

peter_mckinnon@centum.ca
http://www.peterlmckinnon.com

BoC holds steady,no rate moves til June. 5yr Bond yields easing from highs so 5yr rates should hold for now. http://ping.fm/yuDGZ

Variable rate special PRIME MINUS 0.40%!!! only 1.85% with a Nov 2012 Maturity. Click today http://www.peterlmckinnon.com

Variable rate drops to prime minus .20% on 5yr,
3yr special at prime minus 0.30%!! More to come!
http//:www.peterlmckinnon.com

Interest Rate Update - majors lower variable rate

We have had 3 AAA lenders drop their variable rate mortgages.

One is a 3 year term at prime minus 0.30%, that's 1.95%!!
the other 2 are offering a 5 year term at prime minus 0.20% or 2.05%!!
Both lenders have great prepayment options of 20-25%

Will this lead to more "variable rate drops"? I believe it will, simply because it makes good business sense. They gain market share with the "sale" price with the intention of moving you into the higher rate fixed products once the rates start to move up which of course we know they will, just a question of time!


Current interest rates for Thursday, January 14th, 2010

Fixed Rate
1 year 2.35%
3 year 3.25%
5 year 3.89%
5 year Quick Close 3.74%

Variable Rate
3 year Special 1.95% prime minus 0.30%
5 year 2.05% prime minus 0.20%

http://www.peterlmckinnon.com/
peter_mckinnon@centum.ca

Peter McKinnon
cell 604-506-6789

Great article on Bank of Canada, the housing market and its effects on interest rate hikes
http://ping.fm/vNih6

Jobs data may lead to higher interest rates....
http://ping.fm/eJ7ia

Rates on the way up?? Jobs may tell the story...

After the rise in bond yields during December, lenders have started to rattle the chains on 5 year rates. 5yr yield is hovering precariously below the 15 month highs set in September/ October at 2.74%. See the following chart:

http://www.bloomberg.com/apps/quote?ticker=GCAN5YR%3AIND

This will be the third attempt at crossing the 2.90% mark as as most investors and chart analysts will tell you, the third times a charm! So how do we know which way things will run?

Most lenders are waiting for the US and Canadian jobs reports due out on Friday morning.

If the job numbers are good, rates will be going up!
If they are bad, rates will probably hold steady.

If I were in the market right now I would be asking my mortgage professional for a rate hold on Thursday just to hedge your bet.

Peter McKinnon
peter_mckinnon@centum.ca
www.peterlmckinnon.com
604-506-6789

What will rising rates look like and what can you do now to protect yourself?? http://ping.fm/bDMEg

Happy New Year!! Well it's time to get back at it. Any mortgage renewals coming up?? Great article..http://ping.fm/YZvFO