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Mortgage Broker News | 13 Oct 2011, 08:00 AM Agree 0
Brokers are starting to see an uptick in the number of clients looking for rate holds after several lenders pushed select VRMs further into plus-prime territory, a broker channel player among them.
  • Angela Wong-Liao, Invis Inc | 14 Oct 2011, 11:46 AM Agree 0
    In view of the all times low fixed term mortgage rates and the reduction of the discount on variable rate mortgage, I have encouraged my clients to go with fixed term now as the interest rates will increase in future, some economists predicted in mid 2012 and some predicted in 2013, however, if my clients are planning to stay at their homes for at least 5 years, the fixed term mortgage products should be a better alternative for them.
  • Lior | 15 Oct 2011, 05:43 AM Agree 0
    The sovereign debt crisis in Europe has definitely pushed up the cost of funds for financial institutions. I wouldn't put too much faith in the US job numbers as they been quite volatile this year and this trend, based on current forecasts, is definitely going to last well into 2012 and probably getting worst before there's any *sustained* improvement.

    So with that said, mortgage rates will remain low as bond yields remain depressed. But again, the debt crisis in Europe and the anemic response of regulators over there to the contagion can morph into a full-blown credit crisis which could potentially push short-term credit rates way up.

    Just like disciplined investing, mortgages require you to think outside the box and concentrate on the long-term horizon. There has been a lot of noise (sic) as of late about fixed rates being more attractive than variable rates. While this is certainly true for short-term fixed rates, the long-term savings trend is stacked in favour of variable rates in the majority of the times. So, it may be worthwhile to ride out the volatility. Just because some banks are already ripping their clients off with prime plus variable mortgages doesn't mean there are no alternatives in the marketplace that are priced lower.
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