When purchasing a pre construction condo, finding an interest rate that 1) is not only good but 2) works in your favour can be somewhat hard to come across. Generally you will find yourself shopping just as aggressively for a great interest rate as you are shopping for a pre construction condo.
Unfortunately finding an interest rate that works in your favour, seems to be something of the past – now interest rates have increased so dramatically, that it begs to question who exactly isn’t getting the short end of the stick.
But – interest rates can work FOR you. How you ask? – Let me tell you…
Let’s assume that you are comparing interest rates – one lender has a lower interest rate than the other, but the other has options that will accumulate to significant cost and spending if you do not stay the duration of the fixed term (as many people – especially first time home owners do). Interest rates, just because they are lower upfront, do not always mean they amount to money savings in the long run. Choose an interest rate that works for your particular situation, not necessarily the lowest one that you can find.
Another thing that you can help get interest rates working for you is by understanding the impact that the economy and inflation has on interest rates. Being able to identify trends, and changes in the economy you can predict (not always accurately) where on the spectrum the interest rates will fall. While this method takes a little bit of analysis of the market, and the guarantee is only 50/50 that you will get an interest rate that will work in your favour.
Another way to get interest rates to work for you is to lock in to a guaranteed rate. When you get a pre approved mortgage – you also get a guaranteed interest rate (that wont go up) for 90 days. This gives you 3 months to shop around, and find your dream property without too much pressure.
While interest rates do fluctuate, that is just something as a property shopper that you have to take into consideration. If you are interested in purchasing a pre construction condo in Toronto, there are many financing options, with low and very attractive interest rates.
Knowing which interest rates will work in your favour is something that a professional will be able to help you understand what the benefits in your particular situation could be. It can be deceiving to see really low interest rates, and you shouldn’t jump into something just based on lower numbers.
Let me help you understand what the different interest rates mean – how they can help you or hurt you, and how you can negotiate a better rate and a better deal that in the long run will help you save your hard earned money.
Property shopping is hard, there are ins and outs that not everyone knows about – contact me today and let me help you get the inside information so that your decisions benefit you and your situation.
Sherry Dabir is a real estate broker with HomeLife, and specializes in Pre Construction Condos within the GTA. She is currently ranked in the top 5% in Canada and has exclusive VIP access to and experience with Pre Construction Condo projects. Contact her today to learn more.