The Popularity of Hybrid Mortgages in Canada

Talk to any financial planner and almost the first wordAccording to RBC's 17th Annual Homeowners Survey,
out of their mouth will be diversification. If not putting allof those who plan on buying a home in the next 2
your eggs in one basket makes sense when financialyears 40% want a combination or hybrid mortgage.
planning, maybe we should think of that when makingCurrently Hybrids account for less than 10% of the
mortgage decisions. Hybrid mortgages are a greatmortgage market with the majority still selecting a
way to diversify your mortgage and get exposure tofixed mortgage. Though the 40% figure represents
both fixed and variable rates.what people plan on doing and of course many will not
Hybrid or combination mortgages are split 50/50, withfollow through. The figure still shows a growing trend
half the mortgage being a fixed rate and the other halfand interest in hybrid mortgages in Canada. This
being variable. Those who select a hybrid mortgageincrease in popularity could be due to increased
enjoy the safety and security that fixed mortgagepromotion by financial institutions as well as the
rates offer but still get a chance to save on interestuncertainty that many people have about the trend in
should variable rates remain stable or go down. Ininterest rates.
addition the terms of the mortgage can also be dividedNot all lenders offer combination mortgages but with
and renew at different dates giving even moremore people interested you can expect that many of
flexibility.them will be carrying the product in the future. Currently
(In some cases the mortgage can be divided 70/30 orScotia, RBC, Merix Financial, and HSBC are some of
even split into 3 different mortgages depending onthe lenders who offer combinations mortgages in
what the client wishes.)Canada.
The Trend Toward Hybrid Mortgages in Canada