Fixed mortgage rates vs Bond yields

The Financial Post recently published and article describing the relationship between fixed rate mortgages, Government Bond Yields and the Bank of Canada Prime interest rate.

We’ve talked about this relationship frequently, and think it is useful for our clients to understand this relationship in some detail.  Rest assured that we do watch bond yields regularly, and alert our clients to potential fixed rate increases (see previous posts).

We use this advance notice of fixed rate increases to seek fixed rate holds for our clients prior to actual mortgage rate increases.  We’re able to secure rate holds for as long as 180 days, and protect our clients from rate increases before they occur.  Awareness of the bond yield (and more specifically, changes in the bond yield) is a valuable tool for those in the market for a fixed rate mortgage!

Please contact us if you have any questions!


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