3.19 interest rate for 5 years (vs 3.39 most are offering)

[Travis Munroe]

My mortgage broker contacted me today to inform me of a 3.19% interest rate over 5 years he can lock in for 90 days.
Even if there is a chance you might buy something, I would suggest getting this rate locked in. It takes very little time to do so!

message/email me if you want more information!

[Sinny Darino]

I just got a mortgage not to long ago of prime minus .4%. You should tell your broker that he can do better!!!

Edited because I thought it was prime minus .26% ,when in fact it is prime minus .4%

[bizaro86]

I just got a mortgage not to long ago of prime minus .4%. You should tell your broker that he can do better!!!

Edited because I thought it was prime minus .26% ,when in fact it is prime minus .4%

3.19 is a super 5 year fixed rate, anything tied to prime is variable rate, totally different ball game.

[albertGQ]

I just got a mortgage not to long ago of prime minus .4%. You should tell your broker that he can do better!!!

Edited because I thought it was prime minus .26% ,when in fact it is prime minus .4%

You can get P-0.45% now & even P-0.50% in some cases

[Sinny Darino]

We are locked in at 2.6%, I was just saying it was Prime minus .4%!!! :)

[MillerTime GFG]

We are locked in at 2.6%, I was just saying it was Prime minus .4%!!! :)

I really doubt you're locked in at 2.6%. When you lock in, you would be locked into whatever the current fixed rates are, which are currently between 3.09% - 3.39% depending on the lender. Most likely, you are on a 5 year variable rate at prime minus 0.4%. This doesn't mean that you are locked into 2.60%, but instead, you are going to be 0.4% less than whatever prime is for the 5 year period. Therefore, if the Bank of Canada decides that the prime lending rate was to increase to 4%, your rate would then be 3.6%.

I would speak to your broker to clarify, but feel free to send me a message as well.

[lorenavedon]

I really doubt you're locked in at 2.6%. When you lock in, you would be locked into whatever the current fixed rates are, which are currently between 3.09% - 3.39% depending on the lender. Most likely, you are on a 5 year variable rate at prime minus 0.4%. This doesn't mean that you are locked into 2.60%, but instead, you are going to be 0.4% less than whatever prime is for the 5 year period. Therefore, if the Bank of Canada decides that the prime lending rate was to increase to 4%, your rate would then be 3.6%.

I would speak to your broker to clarify, but feel free to send me a message as well.

the entire fake economy would collapse if they raised rates %1 so don't sweat it. Canadian rates are tied to US rates. If the US keeps rates low so will Canada regardless of what's going on here. The US is never raising rates again. It's impossible without completely collapsing their banking system and throwing the government into default. I would be more than comfortable holding a variable rate for the next 5 years over closed. If anything, I wouldn't be surprised if the BOC lowers rates further.

[Philly06Cup]

Just got approved for Prime - 0.65. Variable is definitely the way to go.

[Deegee]

Anyone know the cheapest rate open mortgage available?

Excuse the cheap plug, HELOCs can be had at 3% through Mountain View Credit Union based in central Alberta who I work for (1 year floating term before moving to market pricing with a maximum 75% LTV in a HELOC) or through ATB (again a 1 year term with a maximum 65% LTV in a HELOC).

Maybe some CP brokers can speak to their HELOC pricing and LTV terms?

I don't know precisely how the ATB HELOC works. I know with ours we attach it to a free chequing account with unlimited transactions (similar to a Manulife One product).

Don't recall seeing an open variable blended payment mortgage option for cheaper then 3% nor have I had to compete against a broker for an open blended payment so I don't believe the lowest rate for one of them is at 3%.

[Flabbibulin]

I really doubt you're locked in at 2.6%. When you lock in, you would be locked into whatever the current fixed rates are, which are currently between 3.09% - 3.39% depending on the lender. Most likely, you are on a 5 year variable rate at prime minus 0.4%. This doesn't mean that you are locked into 2.60%, but instead, you are going to be 0.4% less than whatever prime is for the 5 year period. Therefore, if the Bank of Canada decides that the prime lending rate was to increase to 4%, your rate would then be 3.6%.

I would speak to your broker to clarify, but feel free to send me a message as well.

2 year fixed at 2.59% is the number today for a lot of lenders.

Not sure many people are doing only 2 year fixed terms? Are they a bad idea?

[Travis Munroe]

Not a bad idea - as discussed so often on this board it all depends on the borrower.
Some might like the 2.59 fixed while others might be interested in the 10 year fixed.
I cant see much happening with interest rates over the next 2-3 years!

[MillerTime GFG]

Exactly what Travis said. It's really borrower dependent. 2.59% is a great rate, but it is only for 2 years. Generally I'm only doing 2 year terms with B lenders for people with income/credit/debt issues as a short-term solution to get them back on the A-side.

5 year fixed is definitely the most popular, with rates anywhere from 3.09-3.69% on the A-side.

[Travis Munroe]

^ are you seeing the 10 year become any more popular? Rates seem pretty competitive

[MillerTime GFG]

I was seeing a fair bit of interest in them when there were lenders offering it at 3.99%. Haven't really seen that much interest lately, but I do have a lender with a 10 year at 4.39%, so still pretty good...and great for peace of mind knowing you're going to have the same payment for 10 years.

[Flabbibulin]

I have my renewal coming up fairly soon (coming off a 5 year), but have the intention of buying a new home in a year or two- and hopefully selling current one; don't think I will want to rent it out. Does it make sense then for me to consider a short term? Not sure how penalties work, but I think we are penalized 3 months if we sell while on a closed, but not on an open?

[albertGQ]

It's usually IRD or three months interest. Whichever is higher. But depends on the lender

[MillerTime GFG]

I have my renewal coming up fairly soon (coming off a 5 year), but have the intention of buying a new home in a year or two- and hopefully selling current one; don't think I will want to rent it out. Does it make sense then for me to consider a short term? Not sure how penalties work, but I think we are penalized 3 months if we sell while on a closed, but not on an open?

Penalty would be the greater of 3 months interest or interest rate differential on a fixed. Going with a 2/3 year term isn't a bad choice at all, but penalties are higher on the fixed side. Why not look at doing a 3 year variable? Penalties are much lower with VRM's.

[Flabbibulin]

One last question- is it true that you cant make extra payments or request an increase in your monthly payment if you are on a fixed rate? Or perhaps you can, but there are conditions? ie. has to be a certain minimum amount, can only do it so many times per year etc??

edit- at least this is the understanding I am getting from my contract. A little confusing for the layman though. Perhaps I should ask my mortgage broker to dumb it down for me??

[brocoli]

One last question- is it true that you cant make extra payments or request an increase in your monthly payment if you are on a fixed rate? Or perhaps you can, but there are conditions? ie. has to be a certain minimum amount, can only do it so many times per year etc??

edit- at least this is the understanding I am getting from my contract. A little confusing for the layman though. Perhaps I should ask my mortgage broker to dumb it down for me??

It depends who your mortgage is through, but yes you can. Talk to your lender and find out there specific rules. I know with ATB at least you can increase your payment by up to 20% of the original payment amount and 20% per year lump sum on the principle.
Just make sure that increasing is the thing you want to do as sometimes situations change and reducing them can sometimes be a pain. Sometimes it just makes sense to do lump sums.

[MillerTime GFG]

One last question- is it true that you cant make extra payments or request an increase in your monthly payment if you are on a fixed rate? Or perhaps you can, but there are conditions? ie. has to be a certain minimum amount, can only do it so many times per year etc??

edit- at least this is the understanding I am getting from my contract. A little confusing for the layman though. Perhaps I should ask my mortgage broker to dumb it down for me??

Brocoli explained it well. Talk to your broker, he should be able to give you more info as to what your prepayment privileges are. They should also be in your mortgage documents. Prepayments are a great way to pay your mortgage down quicker and save interest along the way. Accelerated bi-weekly payments are pretty effective too.

[topfiverecords]

We have just been pre-approved for a mortgage and have a 120 rate hold. I'm wondering if I should be negotiating now to ask for a better rate, or wait until we've put an offer on something and are closer to a closing date?

[brocoli]

We have just been pre-approved for a mortgage and have a 120 rate hold. I'm wondering if I should be negotiating now to ask for a better rate, or wait until we've put an offer on something and are closer to a closing date?

I always tell my clients to get full preapproval before making an offer an a house. Have everything set up the way you want it, so that when it comes time to making an offer, the financing condition is minimal because it will only depend on the condition of the house. If you are expecting to be purchasing within the 120 days, then get the exact rate that you want. Just makes it easier for you and the lender

[MillerTime GFG]

We have just been pre-approved for a mortgage and have a 120 rate hold. I'm wondering if I should be negotiating now to ask for a better rate, or wait until we've put an offer on something and are closer to a closing date?

Depending on who your pre-approval is with, they will automatically give you the lower rate between your pre-approval rate and whatever their best rate is once the deal goes live. (ie - You have an accepted offer on a house)

Some lenders will honor that only at request though - which would be up to your broker/mortgage specialist. Of course, having a pre-approval with a lender doesn't mean you have to stick with that lender if you're confident you'd get approved elsewhere as well.

[topfiverecords]

Depending on who your pre-approval is with, they will automatically give you the lower rate between your pre-approval rate and whatever their best rate is once the deal goes live. (ie - You have an accepted offer on a house)

Some lenders will honor that only at request though - which would be up to your broker/mortgage specialist. Of course, having a pre-approval with a lender doesn't mean you have to stick with that lender if you're confident you'd get approved elsewhere as well.

They will give us the lower rate if rates go down.

However, for arguments sake lets say they gave us 3.39 on pre-approval and their advertised rate is 3.49.
If I negotiate now, say I get them down 0.1% to 3.29. But what if within the 120 days rates drop 0.2%. They come back and say the original 3.39 is now 3.19.
If I negotiate later, I'm better off as I should be getting 0.1% down to 3.09.

If rates don't drop I can still likely get 3.29. Thoughts?

[albertGQ]

You can get 2.99 right now on live deals.

[Hugh Jahrmes]

I was bored last night checking rates and saw true north or something like that (can't be bothered to check now haha) offering 2.98 I believe. A few sites I was on linked to them showing 2.98/99

I still have three years left and am just hoping things don't go wild between now and then

[topfiverecords]

You can get 2.99 right now on live deals.

Not with comparable terms, penalties, etc.

[MillerTime GFG]

Was just going to mention the same thing topfive. True North has very competitive rates, as they buy down their rates. They also work somewhat exclusively with a select few lenders, so their product line is very limited. Not everyone will qualify with them, as they don't have the ability to choose between many lender. Things like terms, pre-payment privileges, penalties and all around service level are lacking with someone like True North.

[albertGQ]

Was just going to mention the same thing topfive. True North has very competitive rates, as they buy down their rates. They also work somewhat exclusively with a select few lenders, so their product line is very limited. Not everyone will qualify with them, as they don't have the ability to choose between many lender. Things like terms, pre-payment privileges, penalties and all around service level are lacking with someone like True North.

True North has many lenders as their disposal. They just choose their favourites. Which many brokers do as well.

The lender True North gets the 2.99% 5 year fixed rate from does have some restrictions (no ports or blends). But that same product is also available to all brokerages too. But those brokerages offer 3.09% for the exact same product. True North's 3.09% rate is the full service one that others offer 3.19% for.

[MillerTime GFG]

They don't have near the same variety as a broker would in terms of lenders. True North made arrangements with a select few lenders to guarantee a certain amount of volume in return for status with those lenders...ie - access to their best rates.

I believe 1st Nat is the lender you're referring to?

[albertGQ]

They don't have near the same variety as a broker would in terms of lenders. True North made arrangements with a select few lenders to guarantee a certain amount of volume in return for status with those lenders...ie - access to their best rates.

I believe 1st Nat is the lender you're referring to?

They do have a certain level of commitment to certain lenders but the number of lenders that individual brokers use are roughly the same too.

I'm sure you also have a small number of lenders that you consistently go to?

[MillerTime GFG]

Yes, of course I do. See what Dan Eisner (founder of True North) did was go to those select few lenders that they do the majority of their business with and negotiate top tier status with them in return for guaranteed volume. This is why they funnel a huge chunk of their deals through said lenders. The lenders outside of those, they don't have top tier status with, and don't have access to their best rates.

[albertGQ]

Yes, of course I do. See what Dan Eisner (founder of True North) did was go to those select few lenders that they do the majority of their business with and negotiate top tier status with them in return for guaranteed volume. This is why they funnel a huge chunk of their deals through said lenders. The lenders outside of those, they don't have top tier status with, and don't have access to their best rates.

But lots of small, medium and large brokers also do not have top tier status with all the lenders.

With the way you wrote your post, it sounds like True North is the only one that deosnt have access to the best rates from all lenders.

[MillerTime GFG]

Well generally speaking, the larger the brokerage, the higher the status they have with a larger amount of lenders. I'm not saying that True North is the only one that doesn't have access to the best rates across the board.

What I am trying to say is that they specialize in offering low rates...but I'm not just speaking in my own opinion that they generally aren't known for their overall "full service" and variety of products/product knowledge.

[albertGQ]

Well generally speaking, the larger the brokerage, the higher the status they have with a larger amount of lenders. I'm not saying that True North is the only one that doesn't have access to the best rates across the board.

What I am trying to say is that they specialize in offering low rates...but I'm not just speaking in my own opinion that they generally aren't known for their overall "full service" and variety of products/product knowledge.

Well, True North is a large broker so they have the same access as all other large brokers.

They specialise in lower rates because they buy down all their rates and deal with volume. That's how they make their money. The products they offer are indentical to what other brokerages offer. They're just at lower rates because they take a hit on the commissions. Something all/most brokerages refuse to do.

I know Dan Eisner is not a popular man in the broker world due to his business model, but it works. Smaller margins but high volumes.

[MillerTime GFG]

They are the Rhino Realty of mortgage brokerages essentially. It's a sound business model, I'll give him that, but no - not overly popular.

Are you a broker with True North? Perhaps you can give more insight then, as I'd be interested to know what their portfolio of lenders looks like. From all the industry people I know, I understand that they don't have the same options...but it's all kind of 'hush-hush'. And if they do have the same portfolio of lenders, I stand firm that they would not have the same status as other large brokerages would.

[albertGQ]

I am not a broker and do not work for True North so I don't know what their portfolio of lenders are. So can't help you there.

From what I know though, they do have virtually the same access as all the other brokers. They just pick and choose what fits best for their clients. They prefer to go with their small trusted circle of lenders, but all brokers do that. When someone has a comfort level with their dedicated underwriter, they tend to work with that person/lender more frequently.

[MillerTime GFG]

Well it sounds like we have conflicting info. Would love to get an actual look at who they have access to. I think you should send them an email asking!

[albertGQ]

Well it sounds like we have conflicting info. Would love to get an actual look at who they have access to. I think you should send them an email asking!

Meh. I don't care enough to ask. Plus, I doubt they'd give me any info

Maybe you should ask. LOL

[MillerTime GFG]

Well I care enough for you to ask!

[Deegee]

Brokers typically sell their services on rate over anything else, or at least have in my interactions with them. Sounds like True North has found a business model that works for them for people who only care about rate and nothing else. Good on them.

[albertGQ]

True North provides great service to their customers. It's not just about rate for them. It's rates and service. You don't have to sacrifice one for the other. When my mortgage is up in 30 months, I'll be taking my mortgage over to them

They're more approachable and easier to get a hold of then other brokers that I've dealt with. Much faster response times as well too.

[MillerTime GFG]

That's a rather blanketed statement Deegee, but that wouldn't be your first time.

Of course rate is important to brokers as that's what potential clients are generally looking for. However, I'd argue that most brokers these days sell their services on their actual service level, or teaching people that rate isn't everything.

If you look at my CP page, my OP is all to do with a product that doesn't have the best rate, but outperforms mortgages with the lowest rates by far. I take a financial planning approach to mortgages, and I know for certain I'm not the only one.

[albertGQ]

I'm probably a bit bias as I deal with True North a lot more than other brokers. I'm sure there are much more that provide better service than True North.

30 months is a long time. I'm not married to True North so when my mortgage is close to renewal, I'll be shopping my business around for sure

[MillerTime GFG]

What is it that you do? Been trying to figure it out for a while now. Are you an advisor?

[albertGQ]

No, not an advisor.

Not a fan of them either. Don't know why anyone would go to a bank's advisor over a broker.

Good to see Travis no longer has that relationship with that TD (or was it Scotia?) advisor here. I'm sure he's a top notch realtor so I would think he'd provide his clients with a broker over a bank's mortgage advisor.

[MillerTime GFG]

No, I meant a financial advisor. They're called mortgage specialists for the most part I believe.

[albertGQ]

Well, CIBC changed theirs from mortgage specialists to mortgage advisors about three years ago. Hard to keep up nowadays.

[bubbsy]

i'm being offered 2.5 variable vs 2.87 fixed over 4 years....

What you guys think?

[MillerTime GFG]

I can tell you that there are better rates out there even on a 5 year term, and I may or may not know someone who can do so...:whistle:

[bubbsy]

Interesting. I live in Toronto... if you care to share :)?

[MillerTime GFG]

PM'd