Mortgage rate: Canada deals with rate cut on 100 Mortgages

Confusion in Canada as some lenders now has to change their mortgage rates again after the surprise rate cut by the Bank of Canada. The lenders were already trying to deal with sky-high borrowing costs now they have to figure out how their mortgage products should be affected by the cut.

The cut by the central bank on its key lending rate comes just after Canadian Imperial Bank of Commerce made a decision to stop offering variable products to new mortgage applications through its FirstLine division until further notice.

The move from CIBI came after Toronto-Dominion Bank increased the rate on new variable mortgages prime plus one percent point. Some other lenders have eliminated variable mortgage discounts and now offering them at prime. Just a few have pushed their rates up by as much a TD. Mortgage Analysts have said that Canadian homebuyers should lock in at a current rate to give themselves a cushion against the current volatility and peace of mind on their monthly mortgage payment.

Toronto-Dominion variable rate at 5.5 percent, and a number of other lenders variable rate is 4.5 percent. The average five-year fixed rate mortgage is around 7.2 percent, if you get a discount you could get fixed as low as 5.5 percent.

Source: reportonbusiness

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