Bank of Canada Rate Drop

Continuing good news for those in the mortgage market ... especially variable rate mortgages ... the Bank of Canada announces a drop in their overnight rate by .75%.

As we've said here before in the Your Mortgage Matters Blog, the overnight rate is the key indicator for the other lenders in the marketplace to set their prime rate as well as fixed mortgage rates.

Usually, except for once recently when many felt that some of the banks were trying to cheat their customers, a drop in the Bank of Canada prime rate signals an equivalent drop in the prime lending rate of the other lenders. Currently, the consumer prime rate is at 4.00% so we would hope that by this time tomorrow that the market lenders pass on that .75% reduction to their customers and drop their own prime rate to 3.25%.

We remind you to also pay attention to the fixed rates as well since the cost for those funds will drop slightly which may translate into savings for those with mortgages coming up for renewal in the next while.

Don't forget to take advantage of the services of a licensed mortgage broker who can lock in these lower rates for up to 120 days ... that means purchases taking place between Dec 9, 2008 out as far as approximately April 9, 2009 PLUS those with mortgages renewing during that time period should get their mortgage professionals working for them today.