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The Bank of Canada decided to decrease their lending rate by 25 bps - December 5, 2007. This will result in a Prime Rate of 6.00%.

For those in variable rate mortgages this is good news. As well, people with Line of Credit Mortgages can take advantage of this cut as this particular product - if secured - floats with prime.

This cut puts variable rate mortgages as the same effective interest rate we saw in the summer. When you consider that fixed rates increased by 25 bps, the gap between variable and fixed rate mortgages is beginning to make the variable rate much more attractive again.