Calgary Mortgage Rates: Understanding Your Options

When it comes to securing a mortgage in Calgary, understanding current mortgage rates is crucial for making informed decisions. The mortgage rates can vary significantly based on the type and term of the mortgage. Let's dive into the latest mortgage rates and what they mean for you as a homeowner or potential buyer.

Current Calgary Mortgage Rates

Here's a snapshot of the current mortgage rates in Calgary as of May 31, 2024:

-  5 Year Fixed:  4.79%
-  4 Year Fixed:  5.04%
-  3 Year Fixed:  4.99%
-  5 Year Variable:  6.15%
-  Prime Rate:  7.2%

Fixed vs. Variable Rates: What's the Difference?

Understanding the difference between fixed and variable mortgage rates is key to choosing the right mortgage for your financial situation.

Fixed Mortgage Rates:

Stability:  Fixed mortgage rates offer stability as the interest rate remains the same throughout the term of the mortgage. This means your monthly payments will stay consistent, making it easier to budget.

Predictability:  With a fixed rate, you'll know exactly how much interest you'll pay over the term of the mortgage, protecting you from potential rate increases.

Example:  If you choose a 5-year fixed mortgage at 4.79%, your interest rate will remain 4.79% for the next five years.

 Variable Mortgage Rates:

Flexibility:  Variable rates can fluctuate based on the prime rate set by the Bank of Canada. While this can lead to lower initial rates, there's a risk of rates increasing over time.

Potential Savings:  If interest rates decrease, you could save money with a variable rate. However, if rates rise, your payments could increase.

Example:  A 5-year variable mortgage at 6.15% means your rate could change based on market conditions, impacting your monthly payments.

Prime Rate: What You Need to Know

The prime rate, currently at 7.2%, is the interest rate that commercial banks charge their most creditworthy customers. It serves as a benchmark for various loan products, including variable-rate mortgages. When the prime rate changes, it directly affects variable mortgage rates, lines of credit, and other loans.

How to Choose the Right Mortgage

Choosing the right mortgage depends on several factors, including your financial situation, risk tolerance, and future plans. Here are some tips to help you decide:

Assess Your Financial Situation:  Consider your current income, expenses, and how stable your financial situation is. If you prefer predictable payments, a fixed-rate mortgage might be the best choice.

Consider Your Plans:  If you plan to stay in your home for a long time, a fixed-rate mortgage offers stability. However, if you might move or refinance in a few years, a variable rate could save you money initially.

Evaluate Market Trends:  Keep an eye on market trends and economic forecasts. If interest rates are expected to rise, locking in a fixed rate now could be advantageous.

Consult a Mortgage Professional:  Speaking with a mortgage broker or financial advisor can provide personalized advice based on your unique circumstances.

Understanding the current mortgage rates in Calgary and the differences between fixed and variable rates can help you make an informed decision. Whether you opt for the stability of a fixed rate or the potential savings of a variable rate, make sure to evaluate your financial situation and future plans. For more detailed information and personalized advice, consider consulting with a mortgage professional.

If you're ready to explore your mortgage options or need further guidance, don't hesitate to contact us. We're here to help you navigate the mortgage landscape and secure the best rates for your needs.