What is a Good Mortgage Rate in Canada in 2023?

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What is a Good Mortgage Rate in Canada in 2023?

When it comes to securing a mortgage in Canada, understanding what constitutes a good mortgage rate is of utmost importance. The mortgage rate you obtain can have a significant impact on your financial well-being, making it crucial to be well-informed and make informed decisions. 

At John Antle Mortgages, we are committed to providing our clients with expert advice and guidance throughout their mortgage journey. In this blog, we will delve into the key factors that influence mortgage rates in Canada and discuss what makes a mortgage rate considered “good.” By the end, you will have a clearer understanding of what makes a mortgage rate favorable and how John Antle Mortgages can assist you in finding the best mortgage for your needs.

What is a Mortgage Rate?

A mortgage rate refers to the interest rate charged by lenders to borrowers for borrowing funds to purchase a property. It is essentially the cost of borrowing money. Mortgage rates are expressed as a percentage and play a vital role in determining the overall cost of your mortgage. They can be either fixed or variable, each offering its own set of benefits and considerations.

Fixed-rate mortgages offer stability and predictability as the mortgage interest rate remains unchanged throughout the term of the mortgage. This means your monthly mortgage payments will also remain constant, providing a sense of security and easier budgeting. On the other hand, variable rate mortgages are subject to fluctuations based on changes in the prime lending rate or other predetermined factors. While this type of mortgage may initially offer lower interest rates, there is the possibility of rates increasing over time.

Choosing between fixed-mortgage rates and variable-rate mortgages depends on your personal circumstances and risk tolerance. If you prefer stability and want to lock in a specific rate, a fixed-rate mortgage may be suitable for you. However, if you are comfortable with potential fluctuations and believe rates may decrease in the future, a variable rate mortgage might be more appealing. If you are looking to refinance your mortgage, the guidance of a John Antle mortgage professional can help you figure out which type makes the most sense for you. 

Factors Influencing Mortgage Rates in Canada

Several factors contribute to the determination of mortgage rates in Canada, creating a complex landscape of influences. The Bank of Canada holds significant influence over mortgage interest rates, as it sets the country’s monetary policy.

Economic conditions, such as inflation levels and employment rates, also play a substantial role in shaping mortgage rates. Market forces exert their impact on rates as well, with supply and demand dynamics and competition among mortgage lenders affecting rate fluctuations. It is essential to become familiar with these factors to gain a comprehensive understanding of mortgage rates in Canada and make informed decisions when navigating the mortgage market.

Understanding Good Mortgage Rates

Defining what constitutes a good mortgage rate depends on various factors, including individual preferences and financial goals. While low mortgage rates may seem attractive, it’s important to assess the overall financial picture. Factors to consider include the current average mortgage rates in Canada, your long-term plans, and your ability to manage mortgage payments comfortably.

In Canada, the average mortgage rates vary depending on the type of mortgage and the lender. According to recent data in June 2023, the best five-year fixed-mortgage rates across Canada’s big 6 banks range from about 6.34-6.53%. On the other hand, the best five-year variable mortgage rates are roughly between 6.47-7.15%. These figures provide a general benchmark, but it’s essential to consult with a mortgage broker to assess your specific circumstances.

Finding a Good Mortgage Rate

Navigating the mortgage market can be overwhelming, which is why working with a mortgage broker is highly recommended. A mortgage broker, like the experts at John Antle Mortgages, can provide invaluable assistance in finding competitive mortgage rates tailored to your needs. They have access to a wide network of lenders and can negotiate on your behalf to secure the best terms and rates available.

At John Antle Mortgages, we understand the importance of finding a good mortgage rate that aligns with your financial goals. We take the time to understand your unique circumstances and provide personalized advice to help you make an informed decision. Our team of experienced mortgage brokers will guide you through the process, help you compare mortgage rates, and ensure you have all the information you need to choose a mortgage rate that suits you best.

Tips for Securing a Good Mortgage Rate

While working with a mortgage broker is crucial, there are steps you can take to improve your chances of securing a good mortgage rate:

  1. Maintain a strong credit profile: Every mortgage lender will consider credit history when determining mortgage rates. Paying bills on time, minimizing debt, and managing credit responsibly can positively impact your credit score.
  2. Save for a substantial down payment: A larger down payment demonstrates financial stability and reduces the loan-to-value ratio, which can result in more favorable mortgage rates.
  3. Consider the term and type of mortgage: The length of the mortgage term and the type of mortgage you choose can affect the interest rate. Understanding the options available and their implications is key to finding the right mortgage rate.

Negotiating and Locking in a Good Mortgage Rate

Once you’ve found a favourable mortgage rate, it’s important to consider negotiating with lenders. They may be open to offering more favourable terms based on your financial profile and borrowing needs. Consider the option of rate lock-ins, which can provide protection against rate increases during the mortgage application process.

Choose John Antle Mortgages for Expert Guidance and a Good Mortgage Rate

Understanding what constitutes a good mortgage rate is essential when embarking on the journey of homeownership. By considering various factors, working with a reputable mortgage broker like John Antle Mortgages, and implementing sound financial strategies, you can increase your chances of securing a mortgage rate that aligns with your goals.

At John Antle Mortgages, we provide personalized assistance and expert advice whether you’re looking to refinance your mortgage or are interested in mortgage renewals or pre-approved mortgages. Let us guide you toward a good mortgage rate and help you achieve your homeownership dreams.

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