Real Estate

The Official Mortgage Rates Thread

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Aug 8, 2012
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CdnRealEstateGuy wrote: If she's not 100% sure about selling the rental property, I would recommend going 5-year variable (as you mentioned to cap penalties at 3 months of interest). Best variable rate is 2.20% 5-year variable.
Is 2.2% with MCAP? I'm with them and noticed the penalty is based on prime (I believe).

Is that typical, I had originally assumed it would be at the current contract rate. What do other lenders do wrt this?

I understand IRD vary wildly from punitive rates or posted to possibly as low as contract? Or does nobody do contract rate for fixed penalties either?
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Feb 4, 2008
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ace604 wrote: Is 2.2% with MCAP? I'm with them and noticed the penalty is based on prime (I believe).

Is that typical, I had originally assumed it would be at the current contract rate. What do other lenders do wrt this?

I understand IRD vary wildly from punitive rates or posted to possibly as low as contract? Or does nobody do contract rate for fixed penalties either?
It is generally the big 6 that hose you on the penalty. Most monoline lenders are reasonable.
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ace604 wrote: Is 2.2% with MCAP? I'm with them and noticed the penalty is based on prime (I believe).

Is that typical, I had originally assumed it would be at the current contract rate. What do other lenders do wrt this?

I understand IRD vary wildly from punitive rates or posted to possibly as low as contract? Or does nobody do contract rate for fixed penalties either?
Most lenders use the contract rate for penalty on variable. The only one I can think of that uses prime rate is MCAP.

For fixed rate mortgages, most non-bank lenders will calculate your penalty based on your contract rate. As mentioned, the big banks have the harshest penalties for fixed rate mortgages of all lenders. No one ever expects to break their mortgage, yet so many people do. Often due to unforeseen circumstances.
Paul Meredith
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CityCan Financial Corp (lic. 10532)
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ace604 wrote: Is 2.2% with MCAP? I'm with them and noticed the penalty is based on prime (I believe).

Is that typical, I had originally assumed it would be at the current contract rate. What do other lenders do wrt this?

I understand IRD vary wildly from punitive rates or posted to possibly as low as contract? Or does nobody do contract rate for fixed penalties either?
No, not with MCAP. For rental properties, MCAP is not that competitive with rates.

Terms and conditions are standard with the 2.20%.

Most lenders use the contract rate to determine 3 month interest penalty. However on MCAP's promo product, they use Prime rate to qualify. Again, this is only on MCAP's promo product (Value Flex) where they use Prime rate...MCAP's normal product uses the contract rate.

Yes, IRD can differ from lender to lender based of the posted rate used to calculate IRD. Banks are pretty bad with this.
Kevin Somnauth, CFA
Principal Broker - First Toronto Mortgage - MA (Ontario #13176, BC #X301007)
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PaulMeredith wrote: Most lenders use the contract rate for penalty on variable. The only one I can think of that uses prime rate is MCAP.

For fixed rate mortgages, most non-bank lenders will calculate your penalty based on your contract rate. As mentioned, the big banks have the harshest penalties for fixed rate mortgages of all lenders. No one ever expects to break their mortgage, yet so many people do. Often due to unforeseen circumstances.
Again, it's only their Value Flex promo product that uses Prime rate to calculate 3 month interest penalty. All other MCAP products uses contract rate.
Kevin Somnauth, CFA
Principal Broker - First Toronto Mortgage - MA (Ontario #13176, BC #X301007)
Real Estate Salesperson - Century 21 Innovative
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Apr 1, 2009
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CdnRealEstateGuy wrote: Are both mortgage components maturing on Oct 15?

Do you know the remaining amortization on them?
Yes, both components mature on the 15th.
Original ammortization on the 2.84 was 60 months with 22 months remaining.
Original ammortization on the 2.29 was 300 months with 241 months remaining.
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Apr 1, 2009
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PaulMeredith wrote: Longest rate hold available on a switch is 90 days. It sounds to me as though TD will not just lock in your rate as of the 15th of June, but start your new mortgage then? All components of the mortgage mature on October 15th?
You're already paying 2.29% on $160,000 with the 2.89% on the additional $40K? I'm just trying to ensure I understand everything so I can properly advise.

The savings between 2.89% and 2.29% on $40K over for months will be minimal. It sounds like it will probably make more sense to renew with TD at the 2.29%, but can further advise once you have clarified the points outlined above.
Yes, the agent said I could start the new mortgage then, the only issue being I would still have two separate FRAOs where if I waited till Oct.15, they would be combined.
Yes, both mature on the 15th.
Yes, 2.29 on the larger balance and 2.84 on the smaller balance.
Original ammortizations on the larger balance was 300 months with 241 remaining and 60 months with 22 remaining on the smaller balance.
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Jan 23, 2008
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Can any of you mortgage specialists offfer advice on our situation?
We purchased a $375,000 home last month without a mortgage - all cash sale. This was with the help of a relative who loaned us $110,000. We will need to repay the relative soon, what are our options? We are considering a secured line of credit/heloc for $110k or more. Or should we get a mortgage for the $110k, or a combo of both? We will not be selling our home for maybe 20 years.
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ultraslow wrote: Can any of you mortgage specialists offfer advice on our situation?
We purchased a $375,000 home last month without a mortgage - all cash sale. This was with the help of a relative who loaned us $110,000. We will need to repay the relative soon, what are our options? We are considering a secured line of credit/heloc for $110k or more. Or should we get a mortgage for the $110k, or a combo of both? We will not be selling our home for maybe 20 years.
You should be able to borrow the $110k quite easily.

It would have been more convenient if you had got the mortgage when you purchased the home. But maybe you had to use your relative's help then because of special circumstances?
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ultraslow wrote: Can any of you mortgage specialists offfer advice on our situation?
We purchased a $375,000 home last month without a mortgage - all cash sale. This was with the help of a relative who loaned us $110,000. We will need to repay the relative soon, what are our options? We are considering a secured line of credit/heloc for $110k or more. Or should we get a mortgage for the $110k, or a combo of both? We will not be selling our home for maybe 20 years.
A mortgage would be a lot cheaper than a HELOC. HELOC's are quite expensive by comparison being around a full 1% higher than what you can get on a mortgage. If you wanted to add a HELOC as well, this can be possible. However, it really depends on your particular situation. Is there a reason why you chose to borrow money from friends instead of getting a mortgage to complete the purchase?
Paul Meredith
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robattoronto wrote: My mortgage renewal date is June 1st, in two days time. Unfortunately I left it to the last moment. Is there anything else which can be done at this point or I will have to go with renewing with TD? I'm at Variable Prime - 0.8 %. Thanks very much for the help guys.
If the TD renewal offer is OK you might as well take it, especially if you have a collateral charge. How much is the mortgage balance?

If you are sure you want to leave TD, then renewal an open term with TD to buy some time to move to other lenders.
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While there is no time to do a switch in 2 days, it can still be done and close in a few more days. If you renew with TD as an open term, the mortgage can be transferred to another institution at anytime. Depending on the specifics, it could be as little as 10-12 days.
robattoronto wrote: My mortgage renewal date is June 1st, in two days time. Unfortunately I left it to the last moment. Is there anything else which can be done at this point or I will have to go with renewing with TD? I'm at Variable Prime - 0.8 %. Thanks very much for the help guys.
Andre Oliveira - Mortgage Agent at Valuemortgage
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Clarky wrote: Yes, the agent said I could start the new mortgage then, the only issue being I would still have two separate FRAOs where if I waited till Oct.15, they would be combined.
Yes, both mature on the 15th.
Yes, 2.29 on the larger balance and 2.84 on the smaller balance.
Original ammortizations on the larger balance was 300 months with 241 remaining and 60 months with 22 remaining on the smaller balance.
So you can refinance and close on October 15th. Because you have a collateral charge mortgage, you will have to pay for legals and an appraisal. Good news, is that you will not have to pay any penalties since they both mature on the same date.
Kevin Somnauth, CFA
Principal Broker - First Toronto Mortgage - MA (Ontario #13176, BC #X301007)
Real Estate Salesperson - Century 21 Innovative
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brutus99 wrote: Is 2% variable not available anymore as per your website??
It's not available for rental properties. Has to be owner-occupied.
Kevin Somnauth, CFA
Principal Broker - First Toronto Mortgage - MA (Ontario #13176, BC #X301007)
Real Estate Salesperson - Century 21 Innovative

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