You can save thousands, if not tens of thousands of dollars on a mortgage if you choose the right loan strategy (prts hypothcaires). Even on a $100,000 mortgage, the savings can be considerable.
So the real question is what should I be doing in addition to looking at interest rates?

How do you choose the right loan strategy to suit your situation? That's simple. Get in touch with a mortgage broker (prts hypothcaires) who is able to analyze all of the options available and make the right recommendation for you. Why do you need an expert for this?
- We don't know what interest rates are going to do, go up, down or stay in a narrow range.
- We don't know enough about economic situation and its impact on interest rates.
- Each borrower needs a strategy designed for him alone, since each of us has our own needs and long range plans.

In order to be able to address these issues, you have to have the experience and knowledge to be able to examine all of the options available. Only a experienced mortgage expert is able to do that.

To choose the right mortgage strategy you must:
know the strengths and weaknesses of available mortgage products;
identify where you are in the interest rate cycle; and
assess the probability of an increase or decrease in rates over the next 10-15 years.

Volumes and volumes have been written about interest rates, interest rate cycles and the economic climate in general and it is a complex subject. A basic synopsis of historic interest rates is as follows:
-There was a general upward trend in interest rates between 1950 and 1980.
-There was a general downward trend in interest rates between 1982 and 2003.
-Interest rates have remained fairly flat from 2003 to 2006.
If you didn't understand that interest rates trend, you would not have been able to design successful interest rate strategies. Designing an interest rate strategy meant for falling interest rates when the rates are trending upward will spell disaster.

In order to understand and work with these trends, two economic rules need to be applied:

1. Interest rates typically follow the inflation rate. This means that if we see the CPI (Consumer Price Index) go up, we can expect an increase in interest rates.
2. Interest rates reflect the health of the economy. In a strong economy, interest rates will be higher because there is more demand for money, and when the economy is weaker, interest rates will be lower.

We cannot predict interest rates with real accuracy, but we know that interest rates over the last thirty years were averaging 9.6%, while they are now around 5%. (pour un prt hypothcaire)

There are a number of basic mortgage strategies available, and then combinations of each of them that yield us a variety of options. Picking the right strategy or combination of strategies is critical to choosing the right mortgage package for each borrower. Only an accredited mortgage professional has the experience and expertise to do this for each borrower.

The basic mortgage strategies:

5 times 5 renew a mortgage five times with a fixed term of five years.
Long-term a fixed-rate mortgage for 15, 18, or 25 years.
Variable rate mortgage whose rate varies with the base rate of the Bank of Canada.
Smith Maneuver' and the cash flow dam a strategy that allows you to eventually deduct interest paid on a private house from your personal taxes (salaried or self-employed worker).
More retirement an efficient manner of using the equity in your home to supplement retirement income.
No down payment This strategy allows one to estimate the savings and buy right away without a down payment, rather than rent an apartment while you accumulate the minimum down payment of 5%.
Less than perfect credit help repair a poor credit rating in order to obtain an excellent rate in the future.

An expert mortgage broker will look at all of these types of loans and, combining that information with the personal information of the borrower, devise the perfect strategy for the borrower - prts hypothcaires. That is why getting the best loan strategy is so much more important than just getting the lowest interest rate on a loan.

All of this points to only one thing-you really need a professional who is looking out for your best interests in order to find the perfect home loan strategy. The advantage of this approach is that you will learn a lot about your situation and the economy, and this education is all free!