Dave Dry

Mortgage rates on the way up.

TD Canada Trust and CIBC are raising some of their fixed-term rates by as much as one-quarter of a percentage point Tuesday.

This is the first increase in mortgage rates since the change in mortgage rules decreasing the maximum amortization period from 40 to 35 yrs. 

But Kelly Porter, the owner of the Mortgage Alliance franchise in Edmonton, doesn't believe home owners should be concerned.

"At this point, the mortgage rates are still at a 40 year low," remarks Porter. "The fixed rates, all be it are moving up...the variable rate controlled by the Bank of Canada and the prime rate is not changing at this point. So I personally don't believe that they should be concerned about a quarter point move in any way."

Both TD Canada Trust and CIBC are raising their five-year mortgage, one of the most commonly chosen by homeowners, to 5.44 per cent.

Porter says a quarter point increase on a $300,000 mortgage will add around $75 a month to the bill. Adding it's still a great time for first time home buyers or for those who own a home looking for a better interest rate then what they had.

"Even going back a couple of years, rates were in the 5 percent mark. So we start going back to the original talk about what a quarter point would do on a $300,000 mortgage...well, if we start talking about that same $300,000 mortgage on a 1 percent savings of an interest rate, we could be talking $300 plus on a monthly mortgage payment as a savings

 RBC and other lenders are sure to follow this lead. 

 Please call me if you have any questions or concerns on how this may effect you and I would be happy to provide you with reliable up to date mortgage rates.