The most common question in the business is always this... What is your lowest interest rate? Often it is asked before an exchange of names has taken place. The simple answer is of course, "well, it depends." Here is a list of things that the interest rate depends on:

• The Loan To Value (LTV) of your home. If your home is valued at $500,000 and you currently owe $325,000 then your LTV is 65%. Generally, the lower the LTV, the lower your rate will be because it is a less risky investment for the lender since there is equity in the home. A High Ration mortgage (80% or higher LTV) MUST have default mortgage insurance. This costs the borrower money on insurance premiums, but secures a low interest rate because the lender's investment is protected by the insurance provider should there be a default.
• Credit Score: The higher your credit score, the more trustworthy you are to make your payments to the lender. Lenders often tier credit scores into certain rates. Example: 600-650 gets "X" rate and 650+ gets a more favourable rate.
• The Property: Location Location Location has always been a phrase most associated with real estate. A mortgage is secured against the property and what is affixed to it. Lenders like their investments to be protected by a property in or near a major urban centre with good resale potential.
• The Rate Specifics: The term length and type of mortgage also plays a role in determining your interest rate. Depending on the market, Lenders may find shorter term (such as a 2 year term) to be more favourable. Or they may be inclined to seek 5 year term mortgages and offer more competitive rates at that length. Fixed and variable rates are often changing and completely depend on the current outlook on the market.

As you can see, it is not an easy question to answer without first gathering some information. I am always happy to discuss mortgage and rate options. Give me a call today!

Sam Ahier - Equity Care Mortgages 519-212-4480 Email: samahiermortgages@gmail.com