Real Estate

The Official Mortgage Rates Thread

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Nov 30, 2014
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I got a pre-approval done last year (Jan 2018) but decided not to buy last year and to wait until this year.

Started looking for properties again, do I have to get another pre-approval done or will last years be sufficient?

Our finances have not changed since last year except for a slight increase in salary.
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masoud100 wrote: I still have not seen the information you sent. I also just found out your located in Ottawa as well so I can come in person if need be as well.
I sent you a private message and yes absolutely you can come in person

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Phil Cragg
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12andy12 wrote: I got a pre-approval done last year (Jan 2018) but decided not to buy last year and to wait until this year.

Started looking for properties again, do I have to get another pre-approval done or will last years be sufficient?

Our finances have not changed since last year except for a slight increase in salary.

You should get a new preapproval done with any of the trusted brokers on the forum

Phil
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Anyone willing to share 5 year fixed rates within the last month or two? Numbers from CIBC or RBC for 20% downpayments and firm offer purchase prices <1 mil would be fantastic - just wanted to compare.
I was quoted 3.64 - CIBC and 3.69 - RBC in December.
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palp75 wrote: Anyone willing to share 5 year fixed rates within the last month or two? Numbers from CIBC or RBC for 20% downpayments and firm offer purchase prices <1 mil would be fantastic - just wanted to compare.
I was quoted 3.64 - CIBC and 3.69 - RBC in December.
Lowest 5 year fixed with a 20% down payment would be 3.44% right now.
Paul Meredith
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PaulMeredith wrote: Lowest 5 year fixed with a 20% down payment would be 3.44% right now.
3.44% from the big banks (RBC/CIBC)?
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palp75 wrote: 3.44% from the big banks (RBC/CIBC)?
No, you won't get rates that low from big banks. It's actually best to avoid big banks for longer term fixed rate mortgages if possible, simply because the penalty to break a fixed rate mortgage with a major bank can be as much as 500% higher than most non-bank lenders. No one ever expects to break their mortgage before the end of their term, yet so many people do. The lowest 5 year fixed from a major bank would be 3.59%. You can also have a 30 year amortization at that rate. Maximum amortization on the 3.44% is 25 years.
Paul Meredith
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PaulMeredith wrote: Most of this was answered in my post directly above yours. Pricing for a home with a purchase price of $999,999 or less will be lower than one with a purchase price of $1,000,000 or greater. There are no extra headaches or any other additional costs other than a slightly higher rate. Really, what should be most important is buying the home you love, even if the rate might be a little higher.
This might be a silly question but what if I buy a home for $950K and city assess it as $1M. I get a 2-year mortgage and I'm up for renewal in 2021 (with amortization set at 25 years). At that time, let's say the city assessed it at $1.1M. Will I still be able to get the best rate even though the home is "worth" more than $1M?

Secondly, can I change my mortgage amortization so that it's back to 25 years? Is that even possible?
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Dec 22, 2018
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I have been at my current job from Sep 2017. My previous employment was in the same industry from Jan 2016-Sep 2017 years. My partner has been at his job for 2 years.
My income: 97K. Partner income: 29K.

-Purchase price: $650000-700000
-How much is the down payment? 15%
-Where it the property located? ON
-When is the closing date? April
-Will the property be owner-occupied or a rental? Owner occupied

What should be good rates, I am the first time home buyer both have a good credit score around 750?
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saurabhp88 wrote: I have been at my current job from Sep 2017. My previous employment was in the same industry from Jan 2016-Sep 2017 years. My partner has been at his job for 2 years.
My income: 97K. Partner income: 29K.

-Purchase price: $650000-700000
-How much is the down payment? 15%
-Where it the property located? ON
-When is the closing date? April
-Will the property be owner-occupied or a rental? Owner occupied

What should be good rates, I am the first time home buyer both have a good credit score around 750?
Congratulations on the first home best rates below

2.75% or prime - 1.20 % 5 yr variable

3.29% 5 yr fixed

Phil
Phil Cragg
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TuxedoBlack wrote: This might be a silly question but what if I buy a home for $950K and city assess it as $1M. I get a 2-year mortgage and I'm up for renewal in 2021 (with amortization set at 25 years). At that time, let's say the city assessed it at $1.1M. Will I still be able to get the best rate even though the home is "worth" more than $1M?

Secondly, can I change my mortgage amortization so that it's back to 25 years? Is that even possible?
Not a silly question at all! No such thing. :) The assessed value is always irrelevant as it's not a good indicator of value. Appraisals are usually used to determine value, however even if the appraisal were to come in high in this case, it would not make a difference as the purchase price is what would be used to determine rate.

If you were to take a 2 year mortgage, and if the value of the property was over $1 million in 2021, then you would no longer qualify for lower rates. They home would have to have been purchased prior to November 30, 2016 for current value to be a non-issue.

When renewing a mortgage at the end of a term, be it with the same lender, or switching lenders, the maximum amortization that can be used is the remaining amortization based on years passed on the calendar. So if you started with 25 years and two years has passed, then the maximum would be 23 years. Lower remaining amortization based on additional payments made, or accelerated payments would not be an issue. It's based on calendar years passed.

You always lower your amortization but you cannot increase it.

Let me know if this answers your questions or if there is anything I can clarify for you.
Paul Meredith
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3.24% 5-year fixed is available for insured purchases as of today. 2.75% 5-year variable is also available. Keep in mind, you can only get these rates after you have an accepted offer.
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Rental property vs 2nd home.
I am in the market to purchase a rental property, I have a friend telling me to get the mortgage as a 2nd home for a better rate and longer amortization. I have 2 main question....

1. Are interest rates higher on rental properties than on 2nd homes?

2. What is the max amortization on both products?

I would still register as a rental on my taxes, just trying to get the lowest rate and the longest amortization.
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stallion4life wrote: Rental property vs 2nd home.
I am in the market to purchase a rental property, I have a friend telling me to get the mortgage as a 2nd home for a better rate and longer amortization. I have 2 main question....

1. Are interest rates higher on rental properties than on 2nd homes?

2. What is the max amortization on both products?

I would still register as a rental on my taxes, just trying to get the lowest rate and the longest amortization.

To answer see below

1. Are interest rates higher on rental properties than on 2nd homes?

Rental properties have much higher rates than owner occupied / 2nd homes (same rates)

You can do the 2nd home with less than 20% down vs rental min 20% downpayment

2. What is the max amortization on both products?

With 20% down on either product you can do 30 yrs if you wish but on the 2nd homes prefered rates at 25yrs

Less than 20% down on the 2nd home max 25yrs

Phil
Phil Cragg
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rateconnect wrote: To answer see below

1. Are interest rates higher on rental properties than on 2nd homes?

Rental properties have much higher rates than owner occupied / 2nd homes (same rates)

You can do the 2nd home with less than 20% down vs rental min 20% downpayment

2. What is the max amortization on both products?

With 20% down on either product you can do 30 yrs if you wish but on the 2nd homes prefered rates at 25yrs

Less than 20% down on the 2nd home max 25yrs

Phil
So if I understand it correctly, although one will get a better rate if they put it as a "second home" they will still have to qualify based on their ability to carry both mortgages.

On the other hand, if they put it as a rental, depending upon the lender, some or all of the rental income may be used to qualify.

Something to consider.

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