Mortgage rates in Canada continue to be slashed. Banks are doing all that they can to help spark interest in the housing market while still battling low inflation. Thankfully, this is good news for people who are looking for the best mortgage rates. However, there are a few things that you should know when it comes to finding the best mortgage rates in London, Canada.
Borrowing rates in London are at an all-time low thanks to the Bank of Canada. The bank is currently holding its low benchmark interest rate at 1 percent. This affects your mortgage rate because this benchmark sets the tone for lending rates among the other banks in Canada, including London. There is even speculation right now that the Bank of Canada might cut its already low rates to help jump-start Canada's sluggish economy.
So what does this have to do with finding the best mortgage rates in Canada? It means that would-be homeowners should act now to take advantage of low mortgage rates before the Bank of Canada spurs on the economy. Once the economy picks back up, expect to see mortgage rates in London rise as well.
A number of banks in London are dropping their fixed five-year rates on all home loans. Most banks are doing this to keep up with the competition. As one bank cuts its fixed mortgage rates, it is only natural for other banks to follow suit for fear of losing customers. Industry experts have suggested that banks in London are cutting their fixed mortgage rates as a result of their own funding rates falling in recent weeks. To take advantage of this, people who are looking for low rates should act before the funding rates increase. Once they do, mortgage rates are likely to rise as well.
With banks battling for your business, it is important to compare rates at different banks. Start with your current bank and work your way out from there. Some banks have great mortgage rates that are not advertised as well as they should be. The only way to find these rates is to shop around and compare interest rates. You may be able to find a mortgage rate that is lower than what your current bank is offering. This goes double if the bank is in the middle of a price war with another bank.
Before you borrow from any bank in London, you need to be aware of hidden costs that some banks or lenders might not be upfront with you about. Some of these hidden costs include your closing cost, land transfer taxes or legal costs. To find the best rate requires that you also compare fees and other hidden costs.