How low can they go?
There was an article at the end of the week that discussed the ills of variable rate mortgage and suggested that consumers should shun them mainly because variable rates now have a premium attached to them instead of discounts.This is the classic case of cutting your nose to spite your face. What about the fact that the Bank of Canada has virtually guaranteed that the prime lending rate will be cut sharply throughout the next few quarters? We could feasibly see the banks prime lending rate well under 4%.Consumers would do well to find a great deal in Real Estate right now, as they are everywhere, and using a variable rate mortgage to allow them to afford it, and then look to lock in by the end of 2009 to avoid the bounceback of short term rates due to expectations of significant inflation.
