Real Estate

The Official Mortgage Rates Thread

  • Last Updated:
  • Oct 15th, 2018 8:45 am
Newbie
Dec 1, 2011
47 posts
2 upvotes
Toronto
Is the requirement to save from paying CMHC still a 20% down payment?

Also, will this affect potential interest rates?
Deal Fanatic
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Feb 2, 2014
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Toronto
rateconnect wrote:
Feb 12th, 2018 6:17 pm
Sorry Kevin but this rate is attainable

This is the original user post along with my response :

"Hi all,
I'm a first time home buyer and was offered 3.19 interest rate for a 5 year term. Do you think i can get a lower with Credit union or bank? "

There are definitely more competitive rates out there as low as 2.94% if insured

Hope this helps

Phil
Yes, I was referring to a collateral transfer. I misread and though let you replied to the poster with the collateral transfer. My apologies.

I replied with the same reply actually (2.99% conventional, even lower for insured).
Kevin Somnauth, CFA
Mortgage Agent and Real Estate Sales Representative
Member
Jan 31, 2018
432 posts
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CdnRealEstateGuy wrote:
Feb 12th, 2018 10:08 pm
Yes, I was referring to a collateral transfer. I misread and though let you replied to the poster with the collateral transfer. My apologies.

I replied with the same reply actually (2.99% conventional, even lower for insured).
Thanks Kevin appreciate the reply

Phil
Phil Cragg
Rateconnect
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Dec 1, 2015
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Etobicoke, ON
On a purchase, if you have anything below 20% down payment, the mortgage requires CMHC/Genworth/CG insurance and you often get the best rates. Having 20%, 25%, 30%, 35% may result in different rates. This is not the same with all lenders, as some of them wont differentiate insured or uninsured rates, while others may have slightly different rate brackets.
TheTechMan wrote:
Feb 12th, 2018 9:26 pm
Is the requirement to save from paying CMHC still a 20% down payment?

Also, will this affect potential interest rates?
Andre Oliveira - Mortgage Agent
FSCO # 10428 - Mortgage Intelligence
Jr. Member
Sep 12, 2007
158 posts
13 upvotes
Coquitlam
rateconnect wrote:
Feb 11th, 2018 11:37 am
Many of the rates you see quoted by brokers on the forum are for "live " deals meaning when you have a purchase and sale agreement in place. Once you have the aforementioned you can lock in the rates

Hope this helps

Phil
Is this current posted promo on BMO (3.19% 4 yr closed fixed) a conventional mortgage (uninsured) and not a collateral mortgage? (https://www.bmo.com/main/personal/mortg ... gage-rates)

Also being offered Prime - 0.95 (2.5%) for a variable 5 yr term. Thoughts?

I don't know how I feel about variable rates at this point.
Newbie
Feb 12, 2018
2 posts
Hello,

I'm looking for a renewal for 31 May 2018.

Location: Montreal, QC
Mortgage Amount : 190k
Home value: 240k
Remaining Amortization: 20 years
Term maturity: 31 May 2018
Credit: Above 800
Work: $90k/yr., 5+ yr. at current employer
Owner occupied
Insured

What kind of rates can I get for 5 years fixed and 5 years variable?

Thank you.
Deal Addict
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Sep 13, 2011
3868 posts
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Toronto
akalic wrote:
Feb 12th, 2018 11:49 pm
Is this current posted promo on BMO (3.19% 4 yr closed fixed) a conventional mortgage (uninsured) and not a collateral mortgage? (https://www.bmo.com/main/personal/mortg ... gage-rates)

Also being offered Prime - 0.95 (2.5%) for a variable 5 yr term. Thoughts?

I don't know how I feel about variable rates at this point.
Most BMO mortgages are standard charge, meaning they are NOT a collateral mortgage. If you were to add a HELOC or second component of any kind (have fixed, half variable for example), then it would become a collateral charge, regardless of the lender. Whenever considering a fixed rate mortgage from a big bank, it's always important to consider the penalty to break that mortgage early. Penalties can be as much as 4-5 times higher than most non-bank lenders, or sometimes even greater than that, which could result in the difference being into 5 figures. Most people don't expect to break their mortgage, yet about 60% break before the end of their term. Usually around the 3 year mark. Circumstances change.

Prime -0.95% is a good rate. Depending on your situation however, there could be lower. Over the past 30 years, people of traditionally come out ahead with variable rates. This however doesn't mean that everyone should be going variable, as it's not for everyone. You have to feel comfortable with the possibility of your rate and payment changing. How would you feel if it were to increase one or two more times by the end of the year? And then again next year? Not saying this will happen, but this is something you would need to feel comfortable with. If the thought of an increasing rate and payment creates scares you, and if you are going to become flushed with anxiety every time they even hint at a potential rate increase in the news, then a variable rate mortgage might not be right for you. The best choice isn't always the one that saves you the most amount of money... it's the one that allows you to sleep soundly at night.
Paul Meredith
Mortgage Broker, Author
CityCan Financial Corp (lic. 10532)
Member
Jan 31, 2018
432 posts
62 upvotes
zarquon14 wrote:
Feb 13th, 2018 12:37 am
Hello,

I'm looking for a renewal for 31 May 2018.

Location: Montreal, QC
Mortgage Amount : 190k
Home value: 240k
Remaining Amortization: 20 years
Term maturity: 31 May 2018
Credit: Above 800
Work: $90k/yr., 5+ yr. at current employer
Owner occupied
Insured

What kind of rates can I get for 5 years fixed and 5 years variable?

Thank you.
Based on the information provided you would have some great rates available

5yr fixed in the 3.04% range

5yr variable 2.25% or prime- 1.20%

Hope this helps

Phil
Phil Cragg
Rateconnect
Broker License #12626
Newbie
Dec 21, 2017
4 posts
2 upvotes
Hi everyone,

I wanted to take a minute to thank everyone on this forum for providing insights into mortgage-related details (learned a lot when reading the thread!) and give a special thank-you to Paul Meredith who took care of our switch in January. We were pretty disappointed with our previous lender that raised our 5-year fixed interest rate to 3.25%. I contacted Paul and he arranged a 2.79% deal for us (late December). My only wish is that I should have contacted him earlier! (lesson learned:) Thank you, Paul, for being so responsive to customer’s needs, for taking time to answer my questions and address concerns, and for doing your job so professionally. I will (and already have) recommend you to anyone who will need mortgage advice/assistance.
Jr. Member
Sep 12, 2007
158 posts
13 upvotes
Coquitlam
PaulMeredith wrote:
Feb 13th, 2018 7:12 am
Most BMO mortgages are standard charge, meaning they are NOT a collateral mortgage. If you were to add a HELOC or second component of any kind (have fixed, half variable for example), then it would become a collateral charge, regardless of the lender. Whenever considering a fixed rate mortgage from a big bank, it's always important to consider the penalty to break that mortgage early. Penalties can be as much as 4-5 times higher than most non-bank lenders, or sometimes even greater than that, which could result in the difference being into 5 figures. Most people don't expect to break their mortgage, yet about 60% break before the end of their term. Usually around the 3 year mark. Circumstances change.

Prime -0.95% is a good rate. Depending on your situation however, there could be lower. Over the past 30 years, people of traditionally come out ahead with variable rates. This however doesn't mean that everyone should be going variable, as it's not for everyone. You have to feel comfortable with the possibility of your rate and payment changing. How would you feel if it were to increase one or two more times by the end of the year? And then again next year? Not saying this will happen, but this is something you would need to feel comfortable with. If the thought of an increasing rate and payment creates scares you, and if you are going to become flushed with anxiety every time they even hint at a potential rate increase in the news, then a variable rate mortgage might not be right for you. The best choice isn't always the one that saves you the most amount of money... it's the one that allows you to sleep soundly at night.
Thanks for the thoughtful advice. So basically with a variable rate, they can increase by any increment at any time, and as many times as they like. That is indeed variable.

I would like to go with bmo but I would like them to sweeten the deal in waiving the appraisal fee. Would this be realistic ? I feel more likely than an independent broker...?
Deal Addict
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Sep 13, 2011
3868 posts
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Toronto
akalic wrote:
Feb 13th, 2018 10:45 am
Thanks for the thoughtful advice. So basically with a variable rate, they can increase by any increment at any time, and as many times as they like. That is indeed variable.

I would like to go with bmo but I would like them to sweeten the deal in waiving the appraisal fee. Would this be realistic ? I feel more likely than an independent broker...?
In theory, yes, a lender can increase their prime rate whenever they like. In reality however, this does not happen. The Bank of Canada makes 8 scheduled rate announcements per year. It's at this time when the prime rate will move, or remain unchanged. In 3 of the past 4 announcements, we've seen an increase. Prior to that, we did not see an increase since September 2010, where it had also increased three times in a few months. Anything can happen here of course, but this is something you need to feel comfortable with. You don't need to worry about a lender arbitrarily increasing their prime rate. While this is extremely rate, I cannot say it has never happened. A couple years ago, TD introduced a new 'mortgage prime rate', which resulted in a 0.15% increase. Aside from this one instance, I don't believe this had every happened before.

It is not unrealistic to have them waive the appraisal, or cover it for you. It never hurts to ask.
Paul Meredith
Mortgage Broker, Author
CityCan Financial Corp (lic. 10532)
Newbie
Apr 26, 2012
26 posts
8 upvotes
VERDUN
I have a rental property in Montreal, with TD (so with collateral charge), currently at 2.9% variable (p-0.7). Originally bought as insured mortgage. Bought at 200k, current market value approx 230k, 157k remaining balance (30 years amortization). I am half-way into the 5-year term, so I am looking to switch to a fixed rate in order to avoid further variable rate hikes.

TD is offering an early renewal with no fees at the following rates:

3 yr - 3.29
4 yr - 3.39
5 yr - 3.49
6 yr - 3.47

Would it be cheaper for me to completely switch to another lender and pay the relevant fees and penalties?
Newbie
Dec 1, 2011
47 posts
2 upvotes
Toronto
valuemortgage wrote:
Feb 12th, 2018 11:01 pm
On a purchase, if you have anything below 20% down payment, the mortgage requires CMHC/Genworth/CG insurance and you often get the best rates. Having 20%, 25%, 30%, 35% may result in different rates. This is not the same with all lenders, as some of them wont differentiate insured or uninsured rates, while others may have slightly different rate brackets.
Is there a reason why the rates wouldn't be just as good when putting 20% or more down?
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Sep 13, 2011
3868 posts
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Toronto
TheTechMan wrote:
Feb 13th, 2018 1:13 pm
Is there a reason why the rates wouldn't be just as good when putting 20% or more down?
For the most part, there are lower rates available with less than 20% down payment. Sometimes there are exceptions to this. From the sound of it, it makes no sense at all. The reason being is that most non-bank lenders (even the larger institutions) insure their mortgages through one of the three insurers (CMHC, Genworth or Canada Guaranty) wherever possible, regardless of how much you are putting down. It's just that when you have 20% or more down payment, they cover the insurance premium. This is why you will usually see lower rates that apply to high ratio mortgages only.

It all has to do with the cost of funds to the lender. As you start increasing your down payment above 20%, rates will often start to drop since a higher down payment results in a lower cost of funds to that lender. In most cases however, the lowest rates will be with the insured mortgages.
Paul Meredith
Mortgage Broker, Author
CityCan Financial Corp (lic. 10532)
Deal Addict
User avatar
Sep 13, 2011
3868 posts
1255 upvotes
Toronto
Lily2018 wrote:
Feb 13th, 2018 10:27 am
Hi everyone,

I wanted to take a minute to thank everyone on this forum for providing insights into mortgage-related details (learned a lot when reading the thread!) and give a special thank-you to Paul Meredith who took care of our switch in January. We were pretty disappointed with our previous lender that raised our 5-year fixed interest rate to 3.25%. I contacted Paul and he arranged a 2.79% deal for us (late December). My only wish is that I should have contacted him earlier! (lesson learned:) Thank you, Paul, for being so responsive to customer’s needs, for taking time to answer my questions and address concerns, and for doing your job so professionally. I will (and already have) recommend you to anyone who will need mortgage advice/assistance.
Thanks so much for the post and for the kind words! It was a pleasure working with you! :)
Paul Meredith
Mortgage Broker, Author
CityCan Financial Corp (lic. 10532)

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