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Variable Rate Mortgages
The choice between a fixed or variable rate should depend on your risk tolerance level as well as your ability to withstand increases in mortgage payments. You can sometimes expect a financial reward for going with the variable rate, although the precise magnitude will ebb and flow depending on the economic environment.
Aspects of Variable Rate Mortgages
- Suits less conservative individuals who can withstand fluctuations in interest rates over the mortgage term
- Usually are a lower interest rate
- Calculated based on the lenders' prime rate minus or plus a set percentage
- Good for those who plan to sell or refinance in the short term
- Good for investors who wish to take advantage of low interest rates
Contact us for a discussion on whether a variable rate mortgage is right for you.
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