As for your rental home consider putting the 0 your parents pay you towards the mortgage, as an extra payment.
The assumption here is that the savings account where you are currently putting this monthly 0 is not generating 5% or more in returns—the break even point when it comes to invested money (3% cost of borrowing 2% inflation).
Questions arise: How do you defend against debt lawsuits and fight wage garnishment?
How much of your hard earned money can a creditor take from earnings?
For that reason, I’d currently recommend renewing with a fixed rate mortgage.
The savings probably would not outweigh the penalty.
Truth be told, the savings may not offset the penalty and fees.
You may be better off keeping the mortgages separate and hammering down this second mortgage with prepayments (assuming that’s the best use of your discretionary cash).
The spread—or the difference between the fixed rate and the variable rate—is around 0.25%.Not only would it require another economic shock, according to the Bank of Canada, but banks would have to be willing to pass along lower overnight rates to borrowers.As we saw with the January and July 2015 cuts, banks are becoming less keen on doing that since they make less profit as rates approach zero.Recently the federal bank indicated it’ll take a few years for low oil prices to work itself through the economy which is a good indicator of how slow the benchmark (prime rate) will move up in the next few years.If you do opt for a fixed rate, consider the extra each month as an insurance policy to protect you from rising mortgage rates and higher payments in the future.