[jj12345]

Hey All,

I had a question if anyone may know... I know 5 year mortgage rates are tied to 5 year bond rates, but 1 year mortgages are tied to.....? I don't think there is a 1 year bond specifically?

Thanks!

 

[Mockingbird]

I don't think there is a 1 year bond specifically?

No 1-year Bond. Anything 1 year & under is traded in Treasure Bills (1,3,6 months & 1 year)

FYI:
Rates for Bank of Canada Treasure Bills
Rates for Bank of Canada Benchmark Bond Yields
Canadian Business Bond Market News

 

[lvxihan]

I just got a 1.99% 1 year fixed closed offer from a major bank. Is it a good deal?
my mortgage is 360k.

Thanks

 

[specialk]

Why would you bother with a 1 year mortgage?

 

[Ben]

Why would you bother with a 1 year mortgage?

To play devil's advocate: why would you not?

 

[specialk]

To play devil's advocate: why would you not?

cash is 0 percent?

 

[stephenheath]

Why would you bother with a 1 year mortgage?

If you are at the end of the mortgage term and have less than two years left to go, it might be the best way.

If you have a number of years left and want to maximize low interest rates (ie, 6 years left at current rates, do a 1 year mortgage at current low rates, then lock in for 5 years at presumably low rates, if you think they are going to go up a lot in 2 or 3 years).

If you expect the days of prime minus .75-.9 to be back in a year, it might be worth it to get a one year variable mortgage now which is only around prime or prime - .1.

If you are thinking of moving and want to keep terms to a minimum so that if you do decide to move you won't be paying a massive interest penalty.

I'm sure there must be others, those are just the only three reasons I've ever considered/recommended one.