10 Jan

Dominion Lending Edmonton: Variable Rate vs Fixed Rate

General

Posted by: John Beard

Dominion Lending Edmonton – John Beard

Dominion Lending Edmonton - Fixed Rate vs Variable Rate

As a mortgage broker part of the Dominion Lending Edmonton team, I am committed to helping my clients find the right mortgage – no matter what their specific situation is.

When clients come to me to obtain a mortgage, they are faced with the option of choosing between two types of rates: a variable interest rate or a fixed interest rate.

Each type has their own benefits and downfalls, and the choice should be made solely on what your unique situation requires and what your personal preference is. To help you get a better understanding of what each is, who it’s an ideal fit for and why it may be good for you, I’ve outlined some information for you to reference when you’re making the decision if you’re looking to get a mortgage in Edmonton.

Variable Rate

Also known as an adjustable rate, variable mortgage rates are designed to adjust from time to time based on the market conditions. A variable rate will fluctuate with the current rates of the market and thus end up being lower than a fixed rate. However, should the normal market rate increase, so will your variable rate.

This type of rate is attractive because it can be lower than a fixed rate. When the rate drops, more of your payments will go towards the principal amount of your mortgage rather than to interest, thus shortening the amount of time it takes to pay off your mortgage. However, this works both ways. On the other hand, the rates could rise and as a result, extend the time it takes to fully pay off your loan.

One way for you to determine if a variable rate is right for you is to see if you would be able to afford an increase in the interest rate. Evaluating factors such as income, expenses, and potential earnings should all be considered during this time.

Pro: Have proven to be less expensive than fixed rates over time

Con: Financial uncertainty

Fixed Rate

A fixed mortgage rate is essentially the opposite of a variable rate. Fixed rates are locked-in at the rate that you and a lender agree on for the duration of your term.

The biggest attraction to fixed rates is the ability to accurately and comfortably budget. With a fixed rate, a person will know exactly how much they will be paying each month and when they can expect their mortgage to be fully paid off.

A fixed rate is popular for people who prefer to know how much they are going to be paying and do not wish to risk things. Even if the prime interest rate rises, you will still be locked in at the rate you originally received.

Pro: Don’t have to worry about what you will be paying each month

Con: Prime rate could drop lower than fixed rate and end up being more expensive

Conclusion

In the end, the decision is yours. Are you more of the risk-reward type? Or, are you the kind of person who prefers the comfort of knowing the exact amount you will be paying in interest each month?

As a broker part of the Dominion Lending Edmonton team, I am here to help you make the decision that best fits your lifestyle. Whatever your mortgage needs require, I can guide you. For more information on how I can help, contact me today!

 

10 Jan

Dominion Lending Edmonton Market Update: December 2016

General

Posted by: John Beard

Best Mortgage Broker Edmonton – John Beard

Best Mortgage Broker Edmonton

 

Whether you’re a current homeowner or someone considering purchasing a home in the new year, being a homeowner is a big deal. If you’re looking for great mortgage broker rates Edmonton, a broker such as myself can help ensure that you get the deal that you deserve.

The end of 2016 also meant the end of yet another year in the Edmonton real estate market. As 2016 ended, the Edmonton Census Metropolitan Area experienced overall stability over the past 12 months, seeing stable prices and slight decreases throughout.

Overall, a total of 16,170 residential homes were sold last year, a decrease from the 17,325 experienced in 2015. The average number of days that a home spent on the market was also six days longer in 2016 compared to 2015, increasing to an average of 57.

Per the Chair of the REALTORS Association of Edmonton, the economic uncertainty played a role in the number of units that were sold in addition to inventory despite the prices being steady overall.

Looking at December 2016, the number of residential homes sold fell to 1,067 units in comparison to 1,278 from December 2015. Despite the slight dip in sales, the sales-to-listings ratio increased to 67% last month from 58% in the same month in 2015.

The average sale price for a residential home in Edmonton was $357,916 in December 2016, down slightly from the $364,438 average we saw in December 2015. This was a decrease of 2.27%.

Leading the way were single family detached homes with 424 units sold in December 2016, followed by condominiums and duplex/rowhouses with 202 and 69 sold units, respectively. 

The total sales volume from 2016 was $6.03 billion, a decrease from 2015 when $6.45 billion was generated and 2014 when a sales volume of $6.98 was experienced. However, with the 2016 holiday season now concluded, both home sales and listings are expected to jump once again.

If you’re interested in buying or selling a home in the area in the new year, consulting a mortgage professional such as myself can greatly benefit you. Using my professionalism, experience and knowledge of the local area, I can help ensure that you get the right mortgage for your specific situation.

As I continuously strive to be the best mortgage broker Edmonton, I am always looking out for any information that may help my clients secure the mortgage they need.

For more information on how I can help, contact me today!

Source: http://www.ereb.com/News&Events/LatestMarketStatistics.html

Source: http://www.ereb.com/pdf/MonthlyStats.pdf