Home Mortgage Rates
Real home mortgage rates! The phrase is referring to the actual mortgage interest rate you pay after you complete the transaction and start paying your mortgage installment on regular basis.
Am certain you have heard of Mortgage rates. It is a term that is known by every single Canadian old enough to vote, and quite possibly the most infamous term out there. In fact, there are several types of interest rates: real, nominal, effective etc. but for this segment, we will focus on Nominal and Effective Rates.
Which home mortgage rates out of these 2 are real?
I’ve been getting a lot of questions about these mortgage rates, regarding rates from both banks and private lenders; so let’s start off by taking a look at Nominal Rates:
These are the mortgage interest rates of a given bank at a given time. These mortgage interest rates tends to be higher than what you actually sign up for.
These mortgage rates are seldom spoken about with the clients however these benchmark mortgage rates are what is used to calculate the mortgage penalties on all fix mortgage rates aka IRD.
Advertised home mortgage rates are the rates which are advertised to public at any given point.
These mortgage rates varies from lender to lender because every lender has their own risk tolerance and preferences on whom to lend to.
BOTTOM LINE
When looking for best home mortgage rates, always check with your bank about their benchmark rates for fix mortgage rates for the specified term period.
After reading my various BLOGS about home mortgage rates and what to look out for, you will be the very few who knows to look beyond the heavily advertised rates, and see whether it really fits your objectives.
Check out more on fix mortgage rates and variable rate mortgages.
Learn the differences and most importantly how to evaluate what rate is better for your next mortgage.
Things can get tricky along the way – believe me. Looking to work out some rates yourself? Give my Mortgage Calculator a try or check out a guide to mortgage interest calculations.