5 Year Fixed 3.34%

5 Year Variable 2.70%

Rates aren't everything, don't forget to consider term!

Rates aren't everything, don't forget to consider term!

Date Posted: February 28, 2017

A majority of borrowers opt for a five-year mortgage -- about 54 per cent according to Mortgage Professionals Canada -- but experts say homebuyers need to consider how long they want to commit to when it comes to their loan.

While mortgages in Canada generally have terms of one to 10 years before the remaining balance needs to be renewed, refinanced or paid in full, Laird said the average Canadian will only have their mortgage for 3.8 years.

For those nervous that interest rates are going to be significantly higher in five years, it might make sense to take a longer term -- but that means making a prediction on where rates are headed in the future.

Frank Napolitano, managing partner at Mortgage Brokers Ottawa, says the rate difference between a five-year and a 10-year mortgage has been around 1.5 to two percentage points.

"That's a big jump in rate, especially in that initial five-year period, to have to pay just to get that rate for the following five years," he said.

Mortgage rates today are sitting near historic lows and while it's unlikely they will return to the high teens of the 1980s, a move higher five years from now is not out of the question.

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