Real Estate Terms and Definitions

Interest Rate Unchanged
The Bank of Canada announced on Tuesday it will be leaving the overnight rate unchanged. The central bank stated the Canadian economy and the inflation rate is still within its projected targets inspite of the recent sell offs in the stock market. The overnight rate remained at 4.25%. Canada's economic growth is operating at, or just above, production capacity and is expected to stay that way through this year and next.

Mortgage Rates
There are two types of mortgage rates: Fixed and Variable. Then within these types of mortgages you have two options either closed or open rate mortgages. The majority of Canadians hold a closed rate mortgage since its lower than an open mortgage.

Variable Rate Mortgage
For most lending institution the variable rate mortgage is determined by the prime rate less a discount. The prime interest rate is the rate banks charge their best and most credit worthy clients. A variable rate means your mortgage rate and monthly payments may differ from month to month.

Fixed Rate Mortgage
The fixed mortgage rate is determined bond market yields. With a fixed rate mortgage your rate and monthly payment will be the same for the length of your mortgage term.