Fixed or Variable? Here's Why Banks Charge You More

Fixed or variable? It was the single most asked question at the Toronto Home Show this weekend, so we decided to answer it properly.

In this episode of Make Money Count, Marcus and Justin break down exactly how each rate is priced, what just flipped the odds on an October 28 Bank of Canada hike, and why Marcus is betting against his own rate chart.

We break down:

• How variable rates are priced off the Bank of Canada's overnight rate, and how fixed rates are priced off government bond yields
• What changed the odds of an October 28 rate hike from near certain to under 50% in just a few weeks
• A chart pricing in 110 basis points of increases over the next year, and why Marcus still isn't convinced
• Why banks charge you more to break a fixed rate mortgage, and what that means if you're considering one
• The simple move Marcus recommends if you've got a renewal or purchase coming up, even a year or two out

Current rates: variable around 3.4%, fixed just above 4%. Watch till the end for the full breakdown.

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