The Bank of Canada has increased the overnight rate by a quarter point, as of yesterday’s meeting.

What does this mean to you if you have a variable rate mortgage?

It means that the Bank of Canada Prime rate, which most lenders adopt as their Prime rate, has increased from 3.45% to 3.70%. With 5 year terms offering anywhere from Prime -.75 % (currently 2.95%) to Prime minus 1.00% (currently 2.70%) this still represents a far wiser option than the fixed rate mortgages for a 5 year term. This video is fantastic in explaining the risks/ benefits of taking a variable rate versus a fixed rate mortgage.

If you have a variable rate mortgage, or are considering one: YOU SHOULD WATCH THIS!

Image retrieved from Yahoo Canada.