^ The poster was referring to the penalty to break a fixed rate mortgage, which is significantly higher with a big bank than with a non-bank lender. While your rate is good when compared with today's rates, if you had a renewal coming up with BMO now, you might get offered prime -0.10 to prime -0.25% at best compared with the lowest variable of prime -0.60% with a non-bank institution. At the end of your term, you can leave them to go with another lender, but you will still pay your discharge fee of about $300 with BMO (same with any lender) providing your credit is sufficient at the time (as per the other thread I was helping you on).
It can be next to impossible to predict what their plans are going to be over the next 5 years. A good broker will always present different terms to their clients. Some people state with certainty that they will not be breaking their mortgage for 5 years, yet so many people end up doing just that. Many people prefer the piece of mind of having a rate fixed for 5 years. It call comes down to what the individual feels comfortable with. No one has a crystal ball unfortunately.
Not sure what you mean by 'most of the fees' considering there are zero additional fees for going through a broker. The rates are also quite a bit better these days then just slightly. Lowest 5 year fixed with a big bank these days is 2.74% compared with 2.39% with a non-bank institution, or prime -0.60% vs. prime -0.10 - prime -0.25% with a big bank. On a $300,000 mortgage, this equals a savings to the borrower of over $5,000. This is money that would be staying in your pocket as opposed to the banks.
Also, some people prefer to meet face to face which is something that most brokers will accommodate if thats what the client wants.
It can be next to impossible to predict what their plans are going to be over the next 5 years. A good broker will always present different terms to their clients. Some people state with certainty that they will not be breaking their mortgage for 5 years, yet so many people end up doing just that. Many people prefer the piece of mind of having a rate fixed for 5 years. It call comes down to what the individual feels comfortable with. No one has a crystal ball unfortunately.
Not sure what you mean by 'most of the fees' considering there are zero additional fees for going through a broker. The rates are also quite a bit better these days then just slightly. Lowest 5 year fixed with a big bank these days is 2.74% compared with 2.39% with a non-bank institution, or prime -0.60% vs. prime -0.10 - prime -0.25% with a big bank. On a $300,000 mortgage, this equals a savings to the borrower of over $5,000. This is money that would be staying in your pocket as opposed to the banks.
Also, some people prefer to meet face to face which is something that most brokers will accommodate if thats what the client wants.
Paul Meredith
Mortgage Broker, Author - CityCan Financial Corp
(lic. 10532)
Mortgage Broker, Author - CityCan Financial Corp
(lic. 10532)