You're not getting the full picture from RBC. First of all, they will charge you a discharge fee when you switch lenders, which is around $300. This is the case regardless of whether it's a collateral or standard charge mortgage. Often what banks will tell people is 'the only charge is the discharge fee of $300'. In this case, they aren't even being up front with you about that. What they don't say is that switching out of a collateral mortgage also requires a legal fee of approximately $800 and an appraisal of approximately $300. As these are not charges from the bank, they often don't mention them, which of course is not giving their client the full story.ramiissa wrote: ↑Dec 8th, 2017 7:53 pmI have a mortgage with a HELOC at RBC. The bank confirmed that this was a collateral mortgage, but when I asked them if there were fees associated with switching lenders at the end of the term, their answer was no. Is it possible that the rules are different in Quebec from the rest of Canada?
As mentioned in my post above, rates are often higher for refinances, which is typically what is required to get out of a collateral charge. Fortunately there are some lenders now offering switches out of collateral mortgages at lowest rates. Depending on the lender, you may still have to pay at least the legal fee however, which is around $800. Some lenders will cover all the costs for you, but the rates are often quite a bit higher.
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