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1-year fixed mortgage rates described for Grande Prairie Home Owners
Most Grande Prairie residents are unfamiliar with the 1-year fixed rate mortgage. That’s understandable given that just over one in twenty mortgage holders have this type of mortgage, though around two thirds have a fixed rate mortgage.
What is a 1-year fixed rate mortgage?
It is a mortgage that has a 12 month duration. At the end of that year, you’re able to renew, refinance, switch lenders and do everything you can normally do when a five year mortgage comes up for renewal. Yet it is the five year mortgage that is the most popular mortgage product in Canada.
Who should get a one year fixed rate mortgage?
Do you think you could relocate to a new home in the next year? Get a one year fixed rate mortgage. Then you won’t be hit with a penalty for breaking the mortgage. If you think mortgage rates will decline in the next year, a one year fixed rate mortgage is the ideal balance between predictability and flexibility. You can refinance in a year, but your house payments can’t spike if the economy shifts. If your credit significantly improves, you’re able to get more favorable loan terms, too.
Note that you can renew a one year mortgage for another one year mortgage. You can continue to do this as long as you want. And you can’t get hit with a three month interest penalty because you wanted to refinance an adjustable rate mortgage to a fixed rate mortgage at today’s low interest rates. On the other hand, the shift from a variable rate mortgage to a fixed rate mortgage is cheaper than refinancing a fixed rate mortgage.
One year mortgages are a good choice for those who want to avoid mortgage penalties if they may break or refinance the mortgage. Call us today to lock in the lowest 1 year fixed mortgage rate today, your top Grande Prairie Mortgage Brokers.