Quote:
Originally Posted by finnbow
If banks simply had to hold their own mortgages, none of this would have occurred (but rates would inevitably been higher IMHO). When will we ever learn that there's no such thing as a free lunch? If something appears to be a win-win-win situation, there's gotta be an unidentified loser somewhere (and it happens to be the taxpayer in this instance).
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That is the way it operates in Canada and I don't think the interest rates I paid were any higher than here. The mortgage is typically a 5/25 meaning the total term is 25 years but interest rates are negotiated every 5 years. That simply means you don't need a crystal ball to figure where rates will be over a term of 25 years.
Mortgage interest is not deductible but there is no capital gains tax on sale of your home either.