Five things to watch for in your discounted variable mortgage

  1. Can you break the mortgage? In the case of new 1.99% variable rate mortgage from Investors Group, you must sell your home.
  2. How is much is the break fee and how will it be calculated? It’s normally three months interested based on the prime rate.
  3. Can you convert to a fixed rate product? If interest rates starts rising, you might want to lock in.
  4. If you decide to lock in, how will your new interest rate be calculated? Some contracts don’t spell that out and if your financial institution uses the posted rate, it will cost you a lot of money.
  5. Is the mortgage portable?Some products allow you to transfer your loan to a new home, should you sell your existing home and move.

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