Capped Rate Mortgages
A Capped Rate Mortgage is a mortgage where a ceiling rate or upper limit is set on your payments for a specified period of time. Your interest rate will not be fixed, and may fluctuate up or down, but will never rise above a predefined interest rate cap limit during the deal period. The benefit is that an upper limit will be set on your mortgage payments for a specified period of time - this will provide peace of mind and allows for effective budgeting of your mortgage finances (you will know the maximum you will have to pay for a period of time). An added benefit (over fixed rate mortgages) is that should interest rates fall, your rate and hence your payments will fall also.
