Fixed Rates Dropping

Tracy Head • December 19, 2022

Most years we see fixed rates start to drop towards the end of the calendar year as lenders try to boost their business to end the year strong. This year has been no exception.


Over the last few weeks I’ve seen fixed rates drop from close to six per cent about six weeks ago to 4.79 per cent and better as of this week. These rates vary depending on whether your mortgage is insured or not, but in relative terms we have seen close to a one per cent drop in many cases.


What does this mean in practical terms?


For one client I’m working with who is a single mom who is searching for a home to call her own, this increase in affordability has increased her purchase price by almost $20,000 which in her community puts her into a house rather than a condo.


For people who have upcoming renewals it may be time to connect and explore your options. If you are coming out of a fixed rate mortgage in the two per cent range, it is likely that you will be looking at a three month interest penalty to switch out of your current mortgage if you choose to do so before your actual renewal date.


I don’t advocate jumping ship really early in every case. Paying a prepayment penalty AND a higher interest rate isn’t always a great plan, but each situation is unique.


The next year is looking to be a bit bumpy with interest rates still, and from what I’m hearing rates will start trending down again towards the end of next year.


However, if you have a renewal coming up in the next four months I encourage you to reach out to explore your options now. With no historical research to support this, what I have seen for many years is interest rates pop up again as the new year starts.


I sat in on a call yesterday with the president of one of my favorite lenders. He had some interesting thoughts on the variable versus fixed conversation. Their firm has been watching delinquency rates carefully, and I was quite surprised to learn that the numbers of variable rate clients in arrears was actually far lower than the number of fixed rate clients in arrears.


I’m not sure whether that has to do with the proportionate split as to how many clients choose fixed over variable, or if there is something else that really affects these stats. I do know I am concerned for some of my variable rate clients as I know I am feeling the pinch with my own monthly mortgage payment increasing substantially.


I was also surprised to hear that most of the lender’s variable clients were choosing to stay the course

rather than lock into fixed rate terms.


If you are exploring whether locking in at this point makes sense for you, I encourage you to do your homework. Reach out to your mortgage person to run the numbers and see if this makes sense for you. With fixed rates now less than variable it may make sense, particularly if you are losing sleep at night.


However, if you are planning to make any changes over the next few years and are variable it most likely makes sense to stay the course.


Grateful to all who have reached out after reading my column to share their thoughts and feedback. Wishing you and yours a wonderful holiday season filled with love and laughter!!

Tracy Head

Mortgage Broker

GET STARTED

Changes Affecting Financing

By Tracy Head • November 14, 2025
I consider myself a lifelong learner, which is part of the reason I love my work. Every day there is something new and exciting to learn, or in some cases re-learn. When I first came back to the mortgage world a more seasoned broker gave me a copy of a handout she used with clients. It talked about the ten most important things NOT to do between removing your financing subject and finalizing the purchase of your home. At the time I remember thinking that the handout sounded patronizing and I assumed clients just understood they shouldn’t do any of the ten things. You know what they say about assuming things. Once or twice my clients have made decisions that have almost jeopardized their financing. The reason this came up for me right now is that I am working my way through a training course which is geared towards helping me re-design my team and my workflow, with the ultimate goal of providing even better support to my clients. One of the changes I am going to implement is adding a list very similar to the original ten things not to do list to my signing packages so that we are all on the same page and avoid any potential challenges down the road. What are the ten things? I won’t go over all of them, but here are a few of the things that have surfaced recently: If you change the closing date on your purchase or if you receive the Notice of Completion on a newly built home, advise your mortgage person right away. Never assume your realtor will do this for you. Do not go out and finance anything without checking with your mortgage person. If you are pushing the upper limit of your buying power even a small loan for furniture might put your financing at risk. Many lenders pull your credit again shortly before your mortgage finalizes. Along the same lines, make sure all of your payments are made on time. Do not co-sign a loan for anyone. Do not quit your job or change employers without talking to your mortgage person ahead of time. Do not spend any of the money you have tucked away for your down payment. If you have money sitting in higher-risk investment better to move them to something more stable in case of market fluctuations. Most people think that once they get the ok to remove their financing subject that their mortgage is a done deal. The small print on every mortgage commitment includes a clause that says something along the lines of “Your financing is based on your current situation. Material changes to your situation prior to the funding of your mortgage may affect your approval.” I’m currently working with a young lady that decided to purchase a boat between the time we had our pre-approval conversation and the day she wrote her offer to purchase. She had decided not to buy a home then found her dream property. We’ve had to look at a few options as the boat payment threw her ratios out of line. She is fortunate that her parents are very supportive and are going to gift her the money to pay off the boat loan, but if she didn’t have that back up plan the new loan would have reduced her borrowing power by over $100,000. The reason I added the comment “without checking with your mortgage person” in the bullets above is that every client’s situation is unique and some of those changes might be just fine. Some might not, and the last thing you want to do is find yourself scrambling to figure out a Plan B shortly before closing.  Best to have the conversation and be certain.

Mortgage Options

By Tracy Head • November 1, 2025
In past columns I’ve covered when no means no and when no means maybe there’s another option. There are many aspects of my work that I love. One is that I learn something new each and every day. No two clients are the same and no two applications are the same. Some are easier than others to put together. Another thing I love is that we have so many options to consider when working on our files. I do find immense satisfaction when I tackle a complicated file and find a great solution for my clients. I am working with an amazing young couple as they build their portfolio of rental properties. They are relatively young but both work incredibly hard and really have their ducks in a row. The plot twist they have is that they both transitioned from salaried positions to being self-employed over the last year. Their credit scores are both in the high 800s (900 is a perfect score), they are both making substantial income, and they have saved over $100,000 for their down payment.  Seems like a slam dunk right? Because they don’t have two years of filed tax returns as self-employed business people our options are a bit limited. There is a program we use in this situation but their scenario does not fit within the guidelines. Their dream home just came on the market so they are wanting to buy and convert their current home to a rental property. This particular home came up in the neighborhood they really want to be in, and homes don’t come up very often. It is immaculate and has a legal suite. They had originally approached their bank and been told it was a hard no. I work with their realtor fairly often and she suggested they give me a call. Within 24 hours we had the approval in place for them. We ended up taking the application to an alternative lender for a two-year term. The interest rate is about .5 per cent higher than a chartered back and there is a 1 per cent fee charged. We weighed out the pros and cons of going this route versus holding off until their next tax returns are filed before purchasing another property. After chatting with their financial advisor and accountant they felt it was worth the slightly higher interest rate to be able to buy the home now. I will say I love straightforward simple applications but in reality those are few and far between. Most of the applications I work on these days seem to have some sort of plot twist like this one so I am very grateful there are so many options available to help clients who may fall a little outside of the standard lending guidelines.