What You Really Need to Know About Fixed and Variable Mortgages


I have walked through many situations with clients over the years that were unexpected. For example: a separation occurred leaving both parties to divide their assets and liabilities while trying to keep a home as stable as possible for their kids and extended family. Or, a death in a family that left a spouse widowed and desperate to get out of her current home. There are many more examples I could give to you but I am sure these two are enough to give you an idea that we all live a life and sometimes it doesn’t go 100% as planned.

Can I just say it is not enough to simply talk about what a fixed mortgage rate is versus a variable mortgage rate when discussing potential options? You cannot choose your mortgage loan based on a great interest rate, the name of who your lender is or assumed stability.

It’s unfortunate but often people make their decisions based primarily on this, neglecting some of the other items that in my mind should be reviewed with greater care. Each mortgage will come with different options, freedoms, or boundaries. The mortgage you choose needs to be reflective of what you can handle today, while being mindful of what tomorrow might bring.

Did you know you have to be able to re-qualify when making a change to your mortgage under the banks current rules? Did you know payout penalties differ from one lender to another?

The homeowner that wants to become a financial expert doesn’t just look for the best rate; they dissect the whole thing for best and worst case scenarios making an informed decision for their financial wellbeing.

Before you decide whether a fixed or variable rate mortgage is for you—assuming you qualify for both— give me a call me so we can chat about some options that could be available without putting you into some extra restrictions you don’t want.

Talking about restrictions, next month we discuss a topic that is highly misunderstood. Standard charge versus collateral charge mortgages. These charges are quite different from one another!

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