Real Estate

The Official Mortgage Rates Thread

Deal Addict
Sep 18, 2008
1064 posts
352 upvotes
Woodbridge
i am still having trouble understanding how can same lender financial offer 2.15 (p-1.24) on new purchases and renewals and 2.85 (p-0.6) on refinances?
Why so much difference?

I think the best way for me to do is one of two
1. to refy the 800K through lowest variable rate I can get (2.85%) for 30 years, pay down the 470 with my current lander and get 330K as lump sum to be used forother house's closing.
2. to renew 470K with the lowest possible variable rate (2.21%) for 30 years, and get a heloc of 330K with p+0.5 for other house's closing.

The problem with scenario 2 is I was told by few agents the p+0.5 will happen only if the same lander gives you the mortgage and the HELOC, if the HELOC lander is different (second position) it will be p +1.5. If this is true, it drastically changes the game.

Also I was told that I need T1 general and that T2 income cannot be used for mortgage. Is this true? What line(s) are looked in T2 if it is usable at all for mortgage purposes?
Deal Addict
User avatar
May 1, 2017
1070 posts
227 upvotes
erexa wrote: i am still having trouble understanding how can same lender financial offer 2.15 (p-1.24) on new purchases and renewals and 2.85 (p-0.6) on refinances?
Why so much difference?

I think the best way for me to do is one of two
1. to refy the 800K through lowest variable rate I can get (2.85%) for 30 years, pay down the 470 with my current lander and get 330K as lump sum to be used forother house's closing.
2. to renew 470K with the lowest possible variable rate (2.21%) for 30 years, and get a heloc of 330K with p+0.5 for other house's closing.

The problem with scenario 2 is I was told by few agents the p+0.5 will happen only if the same lander gives you the mortgage and the HELOC, if the HELOC lander is different (second position) it will be p +1.5. If this is true, it drastically changes the game.

Also I was told that I need T1 general and that T2 income cannot be used for mortgage. Is this true? What line(s) are looked in T2 if it is usable at all for mortgage purposes?
The difference in the rate is due to the insurability of the mortgage products. Refinances are not considered insurable by mortgage default insurance companies. Mortgage default insurance companies protect mortgage lenders against borrower default. Since they can't be insured, they are more risky and more expensive for the lender to carry. Uninsurable mortgages also cannot be securitized. These factors lead to the products being priced higher. Switches are insurable.

You can get p+0.50% on the line of credit if the first mortgage isn't with the institution providing the heloc. Whoever told you otherwise was wrong.

Most lenders will want to see what income you're drawing from the corporation, not only what income the corporation made. The income drawn from the corporation will be reported as business income in your T1 general.

Regards,

Connor
_________________________________
Connor Green
Mortgage Awards of Excellence Winner
Concierge Mortgage Group
#12179
Deal Addict
Sep 18, 2008
1064 posts
352 upvotes
Woodbridge
GreenMortgages wrote: The difference in the rate is due to the insurability of the mortgage products. Refinances are not considered insurable by mortgage default insurance companies. Mortgage default insurance companies protect mortgage lenders against borrower default. Since they can't be insured, they are more risky and more expensive for the lender to carry. Uninsurable mortgages also cannot be securitized. These factors lead to the products being priced higher. Switches are insurable.

You can get p+0.50% on the line of credit if the first mortgage isn't with the institution providing the heloc. Whoever told you otherwise was wrong.

Most lenders will want to see what income you're drawing from the corporation, not only what income the corporation made. The income drawn from the corporation will be reported as business income in your T1 general.

Regards,

Connor
Never seen any T1 general from accountant? I get T5 under my name but not T1 general.
Newbie
Feb 1, 2018
2 posts
Hi,

I have a renewal coming up, I have $380,000 balance leaving a 2 year fixed for 2.49%.

I was happy to do another 2 year fixed at 3.09% with Tangerine but they are Collateral mortgages. I’m concerned about switching lenders at renewal with a Collateral Mortgage (lawyer and transfer costs).

Any experience with these types?
Deal Addict
User avatar
May 1, 2017
1070 posts
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MrPastyBarm wrote: Hi,

I have a renewal coming up, I have $380,000 balance leaving a 2 year fixed for 2.49%.

I was happy to do another 2 year fixed at 3.09% with Tangerine but they are Collateral mortgages. I’m concerned about switching lenders at renewal with a Collateral Mortgage (lawyer and transfer costs).

Any experience with these types?
Hi there,

You can use a collateral charge switch program to access the best rates in the market right now. Unfortunately there will be a cost of approximately ~$750 - $850 in order to facilitate the switch from collateral to standard. 3.09% isn't really a great rate for 2 years, as you can likely do similarly or even better for 5 years. It may be worth looking into getting out of the collateral charge now and into a low rate product.

Best,

Connor
_________________________________
Connor Green
Mortgage Awards of Excellence Winner
Concierge Mortgage Group
#12179
Newbie
Dec 12, 2007
38 posts
Connor and Phil thank-you for your responses. Can anyone recommend a good or pm information for a good mortgage broker. I am in the Hamilton area.
Deal Addict
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May 1, 2017
1070 posts
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Sweet_things1 wrote: Connor and Phil thank-you for your responses. Can anyone recommend a good or pm information for a good mortgage broker. I am in the Hamilton area.
Hi there,

Any of the frequently posting brokers on this forum would be happy to help you (Myself, Paul, Andre,Kevin). PM sent.

Connor
_________________________________
Connor Green
Mortgage Awards of Excellence Winner
Concierge Mortgage Group
#12179
Newbie
Feb 1, 2018
2 posts
GreenMortgages wrote: Hi there,

You can use a collateral charge switch program to access the best rates in the market right now. Unfortunately there will be a cost of approximately ~$750 - $850 in order to facilitate the switch from collateral to standard. 3.09% isn't really a great rate for 2 years, as you can likely do similarly or even better for 5 years. It may be worth looking into getting out of the collateral charge now and into a low rate product.

Best,

Connor
Sorry i might have been a little unclear, my fault for posting at midnight!

I have a standard mortgage currently and i'm adverse to renewing into a Collateral Charge mortgage.

You mentioned 3.09% isn't a great rate, are you able to assist in finding better rates? I'm looking for short term fixed rate, id like to know my payments and could possibly sell my place in the next few years.
Deal Addict
User avatar
May 1, 2017
1070 posts
227 upvotes
MrPastyBarm wrote: Sorry i might have been a little unclear, my fault for posting at midnight!

I have a standard mortgage currently and i'm adverse to renewing into a Collateral Charge mortgage.

You mentioned 3.09% isn't a great rate, are you able to assist in finding better rates? I'm looking for short term fixed rate, id like to know my payments and could possibly sell my place in the next few years.
Hi there,

Gotcha, now I understand. We'll as far as 2 years rates are concerned, 3.09% isn't too bad. You can transfer into non-collateral charge at 3.09% for 2 years. The reason I don't consider the 2 year rate very good is because there are 5 year products at the same rate and lower, which doesn't bode well for the short term product.

Now, if you require penalty flexibility because you intend to sell in the next few years, then perhaps taking the shorter term is best for you. Alternatively, there are some incredibly low variable rates available currently - if you decided to sell and not port the mortgage then the penalty would only be 3 months interest to do so.

Best,

Connor
_________________________________
Connor Green
Mortgage Awards of Excellence Winner
Concierge Mortgage Group
#12179
Deal Guru
User avatar
Feb 2, 2014
11203 posts
3334 upvotes
Toronto
MrPastyBarm wrote: Sorry i might have been a little unclear, my fault for posting at midnight!

I have a standard mortgage currently and i'm adverse to renewing into a Collateral Charge mortgage.

You mentioned 3.09% isn't a great rate, are you able to assist in finding better rates? I'm looking for short term fixed rate, id like to know my payments and could possibly sell my place in the next few years.
When you renew with a lender, they won't put you into a collateral mortgage. So if you currently have a standard charge with TD, you will be renewed as a standard charge.

Having said that, best rates start at Prime -1.19% and 2.94% 5-year fixed for a transfer.
Kevin Somnauth, CFA
Principal Broker/Owner - First Toronto Mortgage - MA (Ontario #13176, BC #X301007)
Real Estate Salesperson - Century 21 Innovative
Newbie
Dec 9, 2014
27 posts
3 upvotes
Toronto, ON
I am with CIBC and my renewal is coming in May 2018
Need to shop around Any advise?

I am paying currently really low rate 2.10 based on last 5 years
Looks like it’s way high according to what I am paying
Deal Addict
User avatar
Dec 1, 2015
1968 posts
927 upvotes
Etobicoke, ON
You can lock a rate once you are about 90 days from maturity date. For a mortgage expiring in May, you may need to wait a couple of days. When exactly is the maturity date?
Life can be good
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User avatar
Jan 31, 2018
6523 posts
1235 upvotes
pashish wrote: I am with CIBC and my renewal is coming in May 2018
Need to shop around Any advise?

I am paying currently really low rate 2.10 based on last 5 years
Looks like it’s way high according to what I am paying
You can lock in with some lenders and get a 120 day rate hold better rates usually come with the shorter rate holds of 90 days ... when is your renewal date in May
Phil Cragg
Mortgage Agent
Mortgage Outlet Inc Broker License #12628
Member
Jan 24, 2008
292 posts
134 upvotes
Scarborough
Hi,
I have a mortgage with CIBC, 3 years on variable at 2.95%. My wife is keep saying that we should switch to fix so I asked CIBC and they offered 3.25% for 3 years fixed. Amount of mortgage is 249.000. I have 2 years left in this term but I was wondering if I can get a better rate if I switch to a different lender. Was not an insured mortgage, house value is over 1 mil. I also have a HELOC but there is no borrowed money on it.
I am interested in a 3 year fixed.
Deal Fanatic
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Sep 13, 2011
6996 posts
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Toronto
rulerman wrote: Hi,
I have a mortgage with CIBC, 3 years on variable at 2.95%. My wife is keep saying that we should switch to fix so I asked CIBC and they offered 3.25% for 3 years fixed. Amount of mortgage is 249.000. I have 2 years left in this term but I was wondering if I can get a better rate if I switch to a different lender. Was not an insured mortgage, house value is over 1 mil. I also have a HELOC but there is no borrowed money on it.
I am interested in a 3 year fixed.
Lowest 3 year fixed for your situation would be 3.14%. As you would have to pay 3 months interest penalty to leave CIBC, I would try to get them to come down a bit on their rate. Tell them you are being offered 3.14% and see if they will match it. While all the costs can be covered for you to refinance mid-term, the small difference in rate would not be enough to justify paying the penalty. Not even close. You'd be much better off just taking the 3.25% from CIBC. That doesn't mean you can't press them to see if they can do a bit better for you ;)
Paul Meredith
Mortgage Broker, Author - CityCan Financial Corp
(lic. 10532)
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Sep 13, 2011
6996 posts
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Toronto
pashish wrote: I am with CIBC and my renewal is coming in May 2018
Need to shop around Any advise?

I am paying currently really low rate 2.10 based on last 5 years
Looks like it’s way high according to what I am paying
Rates can vary depending on property value, original purchase price, amount of equity in the home, and whether or not the original mortgage was insured with CMHC (or another insurer). Right now, there are variable rate mortgages as low as prime -1.24% (2.21%).
Paul Meredith
Mortgage Broker, Author - CityCan Financial Corp
(lic. 10532)
Jr. Member
Sep 23, 2005
189 posts
5 upvotes
Hi all. Me again, with an updated request.

Are there any brokers out there that can help me find a lender to underwrite my US income on a refinancing of my (Canadian) property? HSBC, my current lender, won't do it. TD will. But I want to shop around a bit.
meetmeinouterspace wrote: Hi team. I haven't been on RFD for AGES — nice to see the community's still thriving, and that people are still generous with their expertise. Here's my situation.

Background:
+ I live in the US, but have a condo in Vancouver that's been rented since I bought it (Nov 2011)
+ Mortgage has always been with HSBC (I know, I know). Renewed Nov 2016 for 2 years.
+ I now want to pull out some equity for a down payment on a condo in the US. I bank with HSBC there too.
+ I'd love to go with someone other than HSBC, but not sure if that makes sense for me. Can't believe Premier members don't get better rates at the moment!

Details:
Purchase price: $710k
Current value: $1.1m+
Mortgage principal balance today: $375k
Rate: 2.14% (closed, variable)
Additional equity desired: $400k

My options?
a) Refinance everything now with HSBC now for 5 yrs fixed @ 2.99% (I believe if I switch to a closed fixed loan of equal or greater term, there are no prepayment fees)
b) Refinance everything now with someone other than HSBC (I believe my rates would be higher since the property is > $1m)
c) Take a second loan (HELOC?) now
d) Cool my jets and wait until maturity to do a) or b)

+ How should I evaluate my options? Am I missing other options?
+ How does the fact that I'm not currently a Canadian resident factor into the rates and LTV restrictions I'd get if financed outside of HSBC?

Happy holidays and thanks for your help!
Deal Addict
User avatar
Apr 12, 2013
2924 posts
1908 upvotes
Moon
Got a friend who is looking to renew their mortgage, their mortgage is about 120k, their house is worth 1.5 million. They can pay it off ASAP but want to take advantage of the low interest rates to use that capital to invest. What rates should we be looking at? ATM the lowest from a reputable institution is 2.95 % from Tangerine, I have seen as low as 2.65 % for smaller firms. Preference is a bigger institution because they are old fashioned and prefers a sit down.
Koodo, Public Mobile, Lucky Mobile Customer
Newbie
Jun 20, 2009
82 posts
46 upvotes
From the last few posts it looks like right now for 5 yr variable it is p-1.05 to 1-1.15 for uninsured. What do you need to get the lower rate, a higher house value?
Deal Fanatic
Jan 17, 2012
5397 posts
474 upvotes
Toronto
BMO just contacted my mother to ask if she wanted to switch her variable to a fixed rate mortgage for he rental property. We have not been too worried about rates in the past because rates have been low and it is tax deductible...would. Just end up giving the money to government!

With rates starting to increase I've begun thinking about it more and about some stability. What would the best 5 or even 10 year fixed rate be today?

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