*Updated* Ongoing Bank of Canada Benchmark Rate Announcements

[bizaro86]

Originally Posted by PaperBagger'14

What are my options when it comes to renewing a very small mortgage? My mortgage is up next July, a sizeable amount of money would be put down and the remaining mortgage will be <50k. Obviously the intent is to wipe off the remaining balance ASAP, what is the best way of renewing a mortgage to do that?

If you're renewing to small amount and are paying it off quickly I'd go with a HELOC. Should be cheaper than an open mortgage and more convenient to make payments to as well.

[Fuzz]

When I was close I renewed for a 3 year floating. I was assured there would be no early penalties to pay off sooner, and there wasn't(if you follow the rules). I was able to do bulk payments at the 10% rate of the original mortgage(not the renewal amount remaining), plus the double up payments, which avoided any over-payment penalties.


Once the last payment was made and the balance is zero, there is a small discharge fee. I think it was under $100. Plus the celebration party, which was probably more than $100.

[PaperBagger'14]

Originally Posted by Fuzz

When I was close I renewed for a 3 year floating. I was assured there would be no early penalties to pay off sooner, and there wasn't(if you follow the rules). I was able to do bulk payments at the 10% rate of the original mortgage(not the renewal amount remaining), plus the double up payments, which avoided any over-payment penalties.


Once the last payment was made and the balance is zero, there is a small discharge fee. I think it was under $100. Plus the celebration party, which was probably more than $100.

So there’s no penalty for “breaking” the mortgage early by paying it off with my yearly lump sum 10% of OG mortgage value? Aside from that $100 fee which whatever who cares.

You bet your ass there’s gonna be a mortgage burning party when that’s done.

[Fuzz]

There wasn't with Royal Bank. I'd definitely confirm with your lender though.

[Engine09]

This thread is giving me nightmare flashbacks to my ScotiaBank ordeal 5 years ago, I posted about it the time, got some advice, etc.

I sent in a form weeks in advance requesting Scotia to convert to open as I would not be renewing with them. The date came and they automatically renewed at a terrible rate.

I started making calls, first they claimed to not receive the form then finally admitted they did but it was ignored, I continued to argue with them until I went up the chain and finally spoke to a bulldog of a woman who told me ScotiaBank require verbal instructions to convert so they do not care about the request I sent in even if it was sent by myself and signed officially askign them to not renew.

Basically I was supposed to call and ask them in person. Scumbags. Eventually they sent me less than half of my money back, the penalty I paid to break at full term. Posted in hopes it will save someone else the headache.

[CorsiHockeyLeague]

Yeah, I'd be suing if that happened to me. For like, boatloads of money.

[chemgear]

No change in rates today.

[Old Yeller]

Originally Posted by PaperBagger'14

What are my options when it comes to renewing a very small mortgage? My mortgage is up next July, a sizeable amount of money would be put down and the remaining mortgage will be <50k. Obviously the intent is to wipe off the remaining balance ASAP, what is the best way of renewing a mortgage to do that?

There was a 6-month fixed rate hovering around 2 to 2.5% rate I've seen, but that may be horribly inflexible and not worth the hassle... FYI anyway.

[MillerTime GFG]

Originally Posted by bizaro86

If you're renewing to small amount and are paying it off quickly I'd go with a HELOC. Should be cheaper than an open mortgage and more convenient to make payments to as well.

This. Or you could even do a variable rate, depending on timeline to pay it off in full. A HELOC would be ~1% higher than a variable, but no penalty to break. A VRM has the lower rate, but the penalty would only be 3 month's interest. So even if you broke the mortgage at $50,000 balance, assuming an interest rate of 4.20% (estimated) at the time, that would yield a $525 penalty. Slight variances depending on the lender however, as some lenders will base their penalty on prime rate instead of contract rate, but it should be in that range.

[CorsiHockeyLeague]

God dammit just give me my 3.8% five year fixed rate so I can lock in my damn HELOC already.

[Shazam]

You're not going to see sub-4% unless the economy megatanks. Even then it might not happen due to the amount of gov't debt.

[CaptainYooh]

Originally Posted by Engine09

…

I started making calls, first they claimed to not receive the form then finally admitted they did but it was ignored, I continued to argue with them until I went up the chain and finally spoke to a bulldog of a woman who told me ScotiaBank require verbal instructions to convert so they do not care about the request I sent in even if it was sent by myself and signed officially askign them to not renew….

Nothing passes the muster in their response. If you think you’ve lost more than $2,000 in withheld penalties, I suggest filing a claim in Alberta Court of Justice (used to be Small Claims Court) for the amount wrongly charged plus court costs. You can file yourself without a lawyer by paying a small application fee. They must respond within a short deadline. If they do, hire a junior lawyer to represent you. But you’ll be surprised how fast they’ll settle.

[Slava]

The US held rates today, but the most interesting part is that there were two dissensions for the first time in the last 30 years. Both of those two are hoping to replace Powell, which just goes to show the power that Trump has at this point.

[TorqueDog]

Originally Posted by Shazam

You're not going to see sub-4% unless the economy megatanks. Even then it might not happen due to the amount of gov't debt.

[Pedant]I'm sitting on mortgage a pre-approval of 3.99% right now.[/Pedant]

Unless you're counting 3.99% as 4% since it's as-near-as-makes-no-difference.

[Shazam]

Rates ticked up a smidge since you got that pre-approval.

[CorsiHockeyLeague]

Ratehub shows lowest rate at 3.89%, I just need TD to give me that.

https://www.ratehub.ca/best-mortgage-rates/5-year/fixed

[opendoor]

Originally Posted by CorsiHockeyLeague

Ratehub shows lowest rate at 3.89%, I just need TD to give me that.

https://www.ratehub.ca/best-mortgage-rates/5-year/fixed

Do you have CMHC insurance on your mortgage? A lot of times the absolute lowest rates are only available for those because they're essentially risk free for the lender.

[PaperBagger'14]

Originally Posted by bizaro86

If you're renewing to small amount and are paying it off quickly I'd go with a HELOC. Should be cheaper than an open mortgage and more convenient to make payments to as well.

HELOC seems to make a lot of sense, the rate will be a bit higher than a traditional mortgage but it would be very easy to chisel away at that remaining balance. That flexibility could almost make things cheaper as it would be very easy to dump lump sums of money on it like I did when I used the HELOC for home renos. Good idea.

[DeluxeMoustache]

Originally Posted by CorsiHockeyLeague

Ratehub shows lowest rate at 3.89%, I just need TD to give me that.

https://www.ratehub.ca/best-mortgage-rates/5-year/fixed

Yeah I sent my lender posted rates and they said tough #### instead of matching

[ken0042]

Originally Posted by opendoor

Do you have CMHC insurance on your mortgage? A lot of times the absolute lowest rates are only available for those because they're essentially risk free for the lender.

Why is that? I can see it when the amount you are borrowing is close to the 80% threshold. But when I renewed my mortgage a couple of years ago I was just under 50%. Isn't that also risk free for the lender? The economy would have to tank so bad for my house to lose that much.