The 10-year fixed-rate   mortgage has generated renewed interest lately as borrowers look to lock in   for the long term and enjoy the security and peace of mind this brings.

With mortgage rates at all-time lows, it turns out that   fashion isn’t the only thing that comes back into style! In fact, 10-year   fixed mortgage rates have never looked so tempting.

Following are three key reasons to consider a 10-year mortgage   term:

1. After five years, you only have to pay three months’   interest to get out of the mortgage. This is currently the lowest penalty   available for a fixed rate – much more attractive than facing a much higher   interest rate differential (IRD) penalty!

2. If you’re on a fixed income, taking advantage of a longer   term fixed-rate mortgage can definitely be beneficial. Currently, with our   historically low interest rates, a five-year fixed rate is around 3.19% and   10-year is around 3.89%. So, if after five years rates have risen to 4.6% or   higher (which is very likely), you would have been ahead taking the current   10-year at 3.89%. Instead of guessing how much longer rates will remain at   historic lows, if you’re on a fixed income, you know you’ll be paying the   same rate for 10 years.

And, chances are, after 10 years are up, you’ll be in better   shape financially and have more equity in your home.

3. You don’t need the equity out of your home for your next   purchase as you can buy again with a 5% down payment. For instance, if you   purchase with 5% down, your property would have to go up more than 25% for   you to get equity to use as a down payment for a second home, which is not   likely in five years. But, you can turn your current condo into a rental and   buy your next home with 5% down (with a combination of savings or a gift).   Rental mortgages usually require a 20% down payment, whereas primary residences   typically require just 5% down. Purchasing a condo to live in until you’re   ready to buy another home, and then renting out the condo, is a great way to   become a real estate investor without having to come up with a 20% down   payment.

The return of the solid 10-year means you have options. It may   not be the best option for everyone, and the market may change in a few   months to make it less attractive. Let me show you how all the products apply   to your specific situation to ensure you receive the best product and rate to   meet your unique needs.

As always, if you have questions about mortgage terms, or   other mortgage-related questions, I’m here to help!