# Mortgage Rates - 5 yr or 10 yr Amorts?



## Agape (Apr 3, 2009)

Question for you all regarding mortgage amortization periods. 

What are your thoughts regarding fixed vs variable in our current economy?

If you like fixed what are your thoughts regarding 5 year fixed at 3.79 vs 10 yr at 4.65?


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## Sampson (Apr 3, 2009)

Agape said:


> Question for you all regarding mortgage amortization periods.


you mean mortgage terms right? 

fixed rates seldom beat out variable rates, but that's not the only reason to select them. How vulnerable are you to interest rate fluctuations as it impacts either your monthly payments, or how long it takes to pay the whole thing off.


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## canadianbanks (Jun 5, 2009)

It depends on your situtation, as Sampson pointed out, but also depends on where do you think interest rates are going in the next few years. If you think they'll be much higher then locking in for 10 years @ 4.65% might make sense.


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## Rico (Jan 27, 2011)

A good rate for 10 years might be enticing but unless you know for certain that you won't be selling, you risk having to pay a penalty if you have to sell (unless you can find someone to assume the mortgage). 10 years is a long time and much can happen, even if you think it won't.


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## Easy Does It (Sep 24, 2010)

can I ask who is offering 4.65% for a 10Y term?

EDI


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## I'm Howard (Oct 13, 2010)

Will the Government reduce its' debt and its' need to print IOU's??

Can Rates go lower than current low rates, at Historic Lows??

If Rates hit 10%, would you lose your house???


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## Agape (Apr 3, 2009)

Sampson - you are correct about this being about the term, not the overall length of the mortgage.

EDI - the rate is offered by Caisse for Winnipeg, MB. However this is by ratesupermarket.ca

Rico - Good point about being locked in for 10 years and what might happen during that time.

If you listen to the BOC you would expect that rates will be increasing, but that will effect the variable interest rates. I think those rates will rise, in order to give us breathing room in case of another "recession". If we double dip, or triple dip who knows.

Could rates also stay in the basement for quite a few years... maybe with prolonged weakness in other countries that end up effecting our own economy.


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## Shayne (Apr 3, 2009)

Deciding between a 5 year and 10 year term is simply a matter of predicting what you will be renewing at after the first 5 year term.

The break even renewal rate is 5.93%. If you feel a 5 year rate will be higher after your initial 5 year term is over then take the 10 year term. If you don't think it will be that high, take the 5 year term.


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