[throwaway19423]

I need to tell you something about Canada (and maybe the rest of the world except the US) .. we're F'ed. Most of the world does not have 30 year fixed rates. That's a unique American gift. (I guess because of how Fannie May/Mac work).

[tonyarkles]

To clarify for those who are interested, in Canada you can still get a home mortgage with a 25-year amortization period (or 30-year in some circumstances), but the repayment terms are generally renegotiated on a regular basis: generally on a 5-year cycle, but with options between 1-7 years. For most people, they’re generally just making a choice between fixed- or variable-rate and open or closed (early repayment without or with a penalty). Looking at today’s rates, I’m quite thankful we locked in at a low 5-year fixed rate right before rates started to climb, but there’s a lot of folks who are going to be having a rough time here…

[bradleyjg]

I don’t have a good intuition for when it’s prudent to take a mortgage if only ARMs are available. Off the cuff, I’d think you’d want to have a significantly lower DTI to start with so you can survive some interest rate increases.