Hi Davin, there is a rate for everyone. Based on your risk appetite, needs and what you want to do in the future with your mortgage or your property.
For reference purposes, today’s rates are (on average):
SIBOR based rates are 1.05%-1.3%, depending on loan size
Fixed rates are 1.15% - 1.5%, depending on loan size
In theory, based on the economics modules I took (back in the day when policemen wore shorts), during a recession interest rates should fall and stay low for a period of time.
If you agree with that view of the market, then you would choose to take a SIBOR rate for at least the next 3 years and benefit from the lower interest rates.
However the global economy today is very volatile, and weird things can and may happen. So understanding the risk is important before you commit to a SIBOR rate.
Fixed rates are typically at a premium compared to floating rates, thus they are generally 0.1%-0.2% higher. You're paying for the security after all
Since you mentioned private property, should your loan say be above $1 million you can get a fixed rate package at 1.18% for three years. Whereas the best SIBOR rate for a similar loan size should be at around 1.10%.
The difference between them is so minimal, that personally, I will just choose the fixed rate for the added security.
Ultimately the decision is up to you, and your own personal view on the market and how you view the risks of fluctuation, due to the economy.
Hi Davin, there is a rate for everyone. Based on your risk appetite, needs and what you want to do in the future with your mortgage or your property.
For reference purposes, today’s rates are (on average):
SIBOR based rates are 1.05%-1.3%, depending on loan size
Fixed rates are 1.15% - 1.5%, depending on loan size
In theory, based on the economics modules I took (back in the day when policemen wore shorts), during a recession interest rates should fall and stay low for a period of time.
If you agree with that view of the market, then you would choose to take a SIBOR rate for at least the next 3 years and benefit from the lower interest rates.
However the global economy today is very volatile, and weird things can and may happen. So understanding the risk is important before you commit to a SIBOR rate.
Fixed rates are typically at a premium compared to floating rates, thus they are generally 0.1%-0.2% higher. You're paying for the security after all
Since you mentioned private property, should your loan say be above $1 million you can get a fixed rate package at 1.18% for three years. Whereas the best SIBOR rate for a similar loan size should be at around 1.10%.
The difference between them is so minimal, that personally, I will just choose the fixed rate for the added security.
Ultimately the decision is up to you, and your own personal view on the market and how you view the risks of fluctuation, due to the economy.