Fixed-Rate vs. Variable-Rate Mortgage: A Quick Comparison π‘π°
With a fixed-rate mortgage, you'll have a consistent monthly payment, offering stability throughout your term. πΌπ However, breaking this type of mortgage can result in unpredictable penalties, sometimes exceeding 4.5% of your outstanding balance. π°πΈ
On the other hand, a variable-rate mortgage starts with lower initial payments, but it fluctuates in tandem with the prime rate. ππΉ If you need to break this mortgage, you can expect a predictable penalty of approximately 3 months' worth of interest, roughly equal to two and a half payments. πΌπ
Ultimately, the goal is to minimize the overall cost of borrowing for your mortgage. π²π Fixed-rate mortgages provide payment stability, while variable rates offer flexibility when life's unexpected events occur. ππͺ
If you have any questions or need further guidance on these options, feel free to reach out. I'm here to assist you in making the best choice for your situation. π€π¦
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