3 ms·

Does anyone get floating rate mortgages any more? I thought (could be very wrong) that these had mostly gone the way of the dodo due to exactly what you're des

• mabbo 8y ago
  In Canada, most mortgages have to have their rate renegotiated every few years. For example, mine was amortized over 30 years, but on a five year rate. When five years are up, I have to renegotiate an interest rate. "Renewing" the mortgage. This has interesting properties economically. It's a bit like a floating rate in that it will change, but like a fixed rate in that you don't have to worry about next month having an unexpected high bill. The banks give better rates because they only have to estimate the near-future and not the next 30 years. Big question: what happens when all the people who could barely afford their mortgage five years ago come to renew with rates higher?
• nasalgoat 8y ago
  In Canada, you have the option of taking a fixed rate or variable rate mortgage, with the latter offering a more attractive rate (for example 3-year fixed was 3.14% while 3-year variable was 2.85%). You can roll the dice on increasing interest rates but I locked in on a fixed rate because I knew the rates would be going up 3-4 more times in the next 3 years.