The Official Mortgage Rates Thread

For renewal/refinance

-How much is the mortgage owing? 262k but hoping to withdraw 20k more for home improvements
-Roughly, what is the current market value of the property? 500k
-Which city is the property located in? Boisbriand, Québec
-Is the property owner-occupied or a rental? Owner Occupied
-Who is your current lender? BMO
-Do you have a HELOC tied to the mortgage? No but that is something I’d like to have if possible if no increase in rate
-Is the mortgage CMHC insured? No
-When did you buy the property? August 2016
-When is your renewal date? August 2021 but renewal period starts in February

Hi - looking for some renewal rates. Will consider fixed or variable, 2 to 5 year terms.

-How much is the mortgage owing?
168K
-Roughly, what is the current market value of the property?
500k
-Which city is the property located in?
Mississauga
-Is the property owner-occupied or a rental?
Owner occupied
-Who is your current lender?
TD Bank
-Do you have a HELOC tied to the mortgage?
No
-Is the mortgage CMHC insured?
No
-When did you buy the property?
Nov 2017
-When is your renewal date?
Nov 1, 2022
- current rate: 2.89% fixed

-What is the purchase price? 890000
-How much is the down payment? 20%
-Where it the property located? Brampton, ON
-When is the closing date? March 1, 2020
-Will the property be owner-occupied or a rental? Owner occupied

Hello, can you please provide the rate for a 25 year and 30 year amortization? Thank you!

For a purchase of a property:

-What is the purchase price?
$560000

-How much is the down payment?
20%

-Where it the property located?
Toronto

-When is the closing date?
Mar 31

-Will the property be owner-occupied or a rental?
Owner occupied

Hello,

First time home buyer looking for some mortgage advice. I'm currently shopping around for a mortgage. How much does annual salary and condo fees impact the mortgage rate that is offered to someone? I see all these great rates but I'm not sure if I would be able to get them. I also have seen posts about cashbacks and appraisal fees being waived. How does one go about negotiating that?

So far I have been offered 5 year variable for 25 years at 1.45%, and 30 years at 1.47%.

Location: North York, On
Condo value: $540k
Downpayment: $150k
Owner occupied
Property taxes: $2k annual
Condo fees: $522/mth
Closing date: March 31st

Leaning towards variable and 25 year amortization.

I appreciate any advice I can get. Thanks!

Jlchat wrote: ↑Hello,

First time home buyer looking for some mortgage advice. I'm currently shopping around for a mortgage. How much does annual salary and condo fees impact the mortgage rate that is offered to someone? I see all these great rates but I'm not sure if I would be able to get them. I also have seen posts about cashbacks and appraisal fees being waived. How does one go about negotiating that?

So far I have been offered 5 year variable for 25 years at 1.45%, and 30 years at 1.47%.

Location: North York, On
Condo value: $540k
Downpayment: $150k
Owner occupied
Property taxes: $2k annual
Condo fees: $522/mth
Closing date: March 31st

Leaning towards variable and 25 year amortization.

I appreciate any advice I can get. Thanks!

Provided you qualify for a 25 year amortization, then the best rate available in your scenario would be 1.44% five year fixed. Most lenders only take 50% of the monthly condo fee into consideration when looking at qualifying you. 30 year amortization come with slightly higher rates in your situation.

professormeth wrote: ↑Hello, can you please provide the rate for a 25 year and 30 year amortization? Thank you!

For a purchase of a property:

-What is the purchase price?
$560000

-How much is the down payment?
20%

-Where it the property located?
Toronto

-When is the closing date?
Mar 31

-Will the property be owner-occupied or a rental?
Owner occupied

1.54-1.59% five year fixed available, or 1.40-1.45% five year variable.

DewDew wrote: ↑-What is the purchase price? 890000
-How much is the down payment? 20%
-Where it the property located? Brampton, ON
-When is the closing date? March 1, 2020
-Will the property be owner-occupied or a rental? Owner occupied

1.54% five year fixed or 1.40% five year variable available.

yondu21 wrote: ↑Hi - looking for some renewal rates. Will consider fixed or variable, 2 to 5 year terms.

-How much is the mortgage owing?
168K
-Roughly, what is the current market value of the property?
500k
-Which city is the property located in?
Mississauga
-Is the property owner-occupied or a rental?
Owner occupied
-Who is your current lender?
TD Bank
-Do you have a HELOC tied to the mortgage?
No
-Is the mortgage CMHC insured?
No
-When did you buy the property?
Nov 2017
-When is your renewal date?
Nov 1, 2022
- current rate: 2.89% fixed

Your very early to lock in to renewal rates, which are only for 120 day rate holds. With your renewal in 2022, do you know your penalty to break? Do inquire and let us know as we can then see if it makes sense financially to move the mortgage now provided the savings outweighs the costs to switch.

Thanks TazZaide! What would be the best variable? I'm leaving towards that for flexibility since I'm not sure what the next five years of my life will be like.

Jlchat wrote: ↑Thanks TazZaide! What would be the best variable? I'm leaving towards that for flexibility since I'm not sure what the next five years of my life will be like.

You would be looking at 1.40-1.45% five year variable.

Hello, looking for fixed or variable, 30year amortization.
-What is the purchase price? 2.0M

-How much is the down payment? 800k

-Where it the property located? Richmond Hill

-When is the closing date? March 15

-Will the property be owner-occupied or a rental? Owner occupied

Thanks in advance!

Kozy wrote: ↑ Hello, looking for fixed or variable, 30year amortization.
-What is the purchase price? 2.0M

-How much is the down payment? 800k

-Where it the property located? Richmond Hill

-When is the closing date? March 15

-Will the property be owner-occupied or a rental? Owner occupied

Thanks in advance!

Thanks for the info! You'd be looking at a 5 year variable at prime -1.05% (1.40%), or 5 year fixed at 1.59% which can be done through a major bank. Any of the regular posting brokers on this board should be able to help you out.

Jlchat wrote: ↑ Hello,

First time home buyer looking for some mortgage advice. I'm currently shopping around for a mortgage. How much does annual salary and condo fees impact the mortgage rate that is offered to someone? I see all these great rates but I'm not sure if I would be able to get them. I also have seen posts about cashbacks and appraisal fees being waived. How does one go about negotiating that?

So far I have been offered 5 year variable for 25 years at 1.45%, and 30 years at 1.47%.

Location: North York, On
Condo value: $540k
Downpayment: $150k
Owner occupied
Property taxes: $2k annual
Condo fees: $522/mth
Closing date: March 31st

Leaning towards variable and 25 year amortization.

I appreciate any advice I can get. Thanks!

Salary, condo fees, property taxes, and debts do not impact the rate that you are offered. You either qualify for the mortgage or you don't. There are many situations however where you need to increase your amortization to 30 years to qualify, in which case a higher rate would often apply.

It may help if you know how mortgages are qualified. Mortgage lenders use two different debt servicing ratios for qualifying your mortgage. The Gross Debt Service Ratio (GDS) and the Total Debt Service Ratio (TDS). The GDS is the total of your mortgage amount, property tax, and heat divided (and 50% of condo fees, if applicable) by the gross income of both borrowers. The TDS is the same, but also includes your other debt.

The maximum GDS is 39% and the maximum TDS is 44% in most cases. Some products may have tighter debt to income ratios, but the vast majority will fall into this format. These can be calculated based on monthly numbers or annual numbers. The answer is the same. I personally prefer monthly.

All applicants will need to pass the stress test, which means you'll need to qualify for the higher of the benchmark rate (currently 4.79%) or 2% above the contract rate (the rate your payments are based on). As the benchmark rate is higher than 2% above the contract rate in most cases these days, it's the benchmark rate that is most often used. If your mortgage is insured (less than 20% down), it would always be the benchmark rate that is used in every situation.

Here is how both calculations look like for a $300,000 mortgage amortized over 25 years:

GDS
Gross monthly income: $5,500
Mortgage payment (principal and interest): $1,751.65 (@ stress test rate of 5.04%) (The actual stress test rate right now is 4.79%, but was using 5.04% in this example).
Property tax: $200 / month
Heat $100 (While this can vary slightly from lender to lender, $100 per month can generally be used for heat, although some lenders are using $125 or higher on larger homes above 2,000 sq. ft.)

Total monthly expenses associated with the property = $2,051.65 divided by gross monthly income of $5K = a GDS of 37.30%.

In this example, the applicant would qualify on GDS as it is under 39% (assuming solid credit)

TDS
TDS using the same monthly expenses of $2,051.65 + some debts:

Credit card: $3,000 balance with minimum monthly payment of $90 (note that if you pay your credit cards off in full each month then $0 can be used).
Car payment: $350 / month

Any revolving credit such as a credit card or unsecured line of credit would get calculated at 3% of the outstanding balance. This is why $90 is used. It does not matter what the actual minimum payment is.

We add these monthly payments to the $2,051.65 for a total $2,491.65. We then divide that by the gross monthly income of $5,500 and you get a TDS of 45.30%. This would not qualify as the TDS is over 44%. However, if the applicant were to pay off her credit card, then that would bring the TDS down to 43.67. The applicant would then qualify as the TDS would then be under 44%. The applicant would not be required to close the credit card either.

Hope you find this helpful.

Paul

Barnstormer wrote: ↑ Curious to know why none of the experienced brokers on this thread are recommending the longer term 7yr fixed-closed mortgage option?

I understand the IRD penalty risk (with the longer term fixed tenure) but wouldn't a 7yr fixed-closed conventional (non-collateral) mortgage option at say 1.6%-1.7% compare favorably against a 5-year fixed @1.44% or even a variable @ Prime - ~ 1%+ discount rate?

We generally quote 5 year terms on this board as that's the ideal length for most people. 5 year terms also carry the lowest rates in most cases. However, there is no 'one size fits all' mortgage advice and what might be right for one person may not be right for the next.

The right term length really depends on the person, and a 5 year year fixed mortgage IS NOT the right product for everyone. No one can unequivocally state that a 5 year fixed is better than a 4 year fixed, or a 3 year fixed, or even a 1 year fixed for that matter. It really comes down to your plans, needs, and goals. What are your long term plans with this property? What are the chances of your situation changing within the next 5 years? More than 50% of homeowners end up breaking the mortgage before the end of their term, so choosing the wrong term can be extremely costly. Particularly if you are with a big bank where the penalty to break a fixed rate mortgage early can be as much as 5 times higher than that of most non-bank lenders, so term length needs to be given careful consideration. Getting a low rate is meaningless if you ended up breaking the mortgage before the end of the term since penalty could be substantial, which would of course significantly add to the cost of your mortgage.

That being said, I generally don't recommend longer term mortgages for most people. The reason being is that more than 50% of mortgage holders don't make it through to the end of 5 years, let alone 7 (or 10). If you break your mortgage early, then you'll have paid all that extra interest for nothing. May I ask where you're getting quoted rates of 1.60% - 1.70% for a 7 year mortgage?

Emmelle wrote: ↑ First time poster here but finding the reading very informative. Not sure I can read through all the posts to find answers to my questions so may repeat previously asked ones.

• Costs involved in changing lenders?
• How to compare penalties and terms (things other than just the rates) between the existing offer and potential new lender?
• Retired couple, any issues with obtaining financing? Excellent credit rating from what I've been told.
• Special concerns as we're not sure if we'll even be at our current location in 5 years or downsized to smaller place and impact of having to end mortgage early
• Considering rates will likely go up in the next few years - once Covid is under control - what's the thoughts on locking in now or going variable with plans to lock in when rates start to rise?
• Other things we should consider?

Never dealt with a broker before, little wary of moving into a new sandbox. RBC has had our business for almost 40 years but they are offering us 1.82% on a 5 year fixed, 30 yr amortization which is actually higher than the rate we got 5 years ago (although that was a variable)! So much for loyalty.

How much is the mortgage owing? $219k
-Roughly, what is the current market value of the property? Likely in the $900k - $950k range
-Which city is the property located in? Bowmanville ON (waterfront)
-Is the property owner-occupied or a rental? O/O
-Who is your current lender? RBC
-Do you have a HELOC tied to the mortgage? Not sure? Homeline Plan has credit line included. New mortgage will consolidate outstanding mortgage and credit line for better rate on LOC
-Is the mortgage CMHC insured? No
-When did you buy the property? 2016
-When is your renewal date? March 9, 2021

Thanks in advance for any responses.

Thanks for the post and the great questions! I'll address each in order for you:

Costs involved in changing lenders?
If switching lenders at the end of your term, the only cost would be the discharge fee from your current lender, which is generally around $300-$400. This can be included into the new mortgage. As you have a collateral charge mortgage (RBC Homeline Plan), there are some additional costs as well. There is a legal fee of approximately $800, as well as an appraisal fee of roughly $300. There are some lenders who will cover some or even all of these fees for you, however rate can be a little higher (not always though).

How to compare penalties and terms (things other than just the rates) between the existing offer and potential new lender?
Variable rate mortgages are almost always 3 months interest. Fixed rates are always written as the higher of three months interest or the IRD (Interest Rate Differential). How the IRD is calculated can vary drastically from one lender to another. The big banks have the harshest formula for calculating penalty, which can result in a penalty of up to 900% higher than most of the non-bank lenders such as MCAP, First National, RFA or XMC for example. The only way to really know is to ask your mortgage professional. If dealing with someone who works for a bank, they can only sell mortgages from that bank (understandably), which means they may not tell you that their penalties can be higher. They may not give you the information you are looking for, so you need to be careful here. Really, this can be the case with any mortgage professional. Bank or broker. This is why it's important to choose the right person to handle your mortgage for you. There are many (if not most) who won't necessarily give you the advice that has your best interests in mind.

Retired couple, any issues with obtaining financing? Excellent credit rating from what I've been told.
Credit is not enough to get you qualified for a mortgage. It would need to qualify on income alone. If you're retired, then i'm sure you're receiving a pension? The new mortgage would need to qualify based on your pension income. (see my post above on how mortgages are qualified).

Special concerns as we're not sure if we'll even be at our current location in 5 years or downsized to smaller place and impact of having to end mortgage early
Better to choose either a shorter term mortgage, or a variable rate in this case. You can get a 3 year fixed rate for 1.44%, or a 5 year variable rate as low as 1.40% (prime -1.05%).

Considering rates will likely go up in the next few years - once Covid is under control - what's the thoughts on locking in now or going variable with plans to lock in when rates start to rise?
It really depends on your long term goals. I would not expect mortgage rates to start skyrocketing as soon as COVID is under control. Our economy has taken one heck of a beating. Yes, they will start going up and they won't always be at these levels. But it will take time. If I had to bet, I would say that rates will be 'a bit' higher in 3 years, then higher again in 5. But that is all speculation, and we really don't know for sure. It will take 10+ years before we dig ourselves out of this economic mess. You could always go with a 5 year fixed with a fair penalty lender. Then if you move before 5 years, you could look at porting that mortgage over to the new property to preserve the rate (should rates be higher at the time).

Other things we should consider?
Never dealt with a broker before, little wary of moving into a new sandbox. RBC has had our business for almost 40 years but they are offering us 1.82% on a 5 year fixed, 30 yr amortization which is actually higher than the rate we got 5 years ago (although that was a variable)! So much for loyalty.

I suggest speaking with both a bank and a broker. Get a feel for the way each operate and get pricing quotes from each. Just keep in mind you should never have to fill out an application and do a credit check just to receive a mortgage rate quote. There is no need to fill out multiple applications with different banks and brokers. Do your shopping first, make a selection, then fill out your application with that person.

Here are some key things to keep in mind when making your final choice. 

When dealing with a bank, they can only talk about their products and their services. They are not going to tell you if there is another option available through a different lender that may be better suited to you. Brokers deal with non-bank lenders as well as major banks, so they can tell you specifics about each lender and what makes one better than another. In a sense, a broker is more of a one stop shop. You can shop many lenders with just a single credit check. 

Having access to so many different lenders allows us to get lenders competing for your business. I you walk into BMO for example, they aren't going to tell you if Scotiabank has a lower rate than they do. Why would they? Brokers can take you to the lenders that have the lowest rates, right from the beginning, which is what the regular posting brokers on RFD specialize in (not every broker does this... yet they all say they do). 

With a broker, the entire process can usually be done by phone, fax and email. 99% of the time, there is no need to even have a face to face meeting. 

Some advantages to banks are that they have branches on every corner, but with today's technology, it's becoming less and less important to more and more people. Millennials in particular. If you have your other accounts with them, you can view them all on the same page. 

Lastly, they have a recognizable brand name, which really doesn't do anything for you at all.

For many brokers, it's not just our job. It's a career. And it's even more than just that. For many of us, it's our calling. It's what we are passionate about, and this passion will not go unnoticed by you. This is why so many of us can be reached evenings and weekends and we're usually pretty quick to answer your questions. 

Hope you find this helpful

Paul

jackleverm wrote: ↑ Thanks Paul. I've brought this up with my bank and they are looking into options.
Why would they give me a 20% rebate on the prepayment? I shouldn't have to ask for that should I? It should be in good faith right?

Nothing like being with a bank for 40+ years to have them nickel and dime me to pay them more.

My pleasure! Glad I could provide you with some value.

Scotia's policy is to give a 20% discount on their penalty if you keep the mortgage with them. This should be given automatically and you should not have to ask. It's likely there already, but better to ask just to be safe. For many mortgage borrowers, their loyalty to their bank is much stronger than the bank's loyalty to them unfortunately.

Hi all,

Not sure if this thread is the right place, but looking to secure a HELOC. Current mortgage is with Scotia. Looking to do my due diligence before finalizing. Everything seems to be P + 0.5%. Looking to see if I can get better.

How much is the mortgage owing? $360k
-Roughly, what is the current market value of the property? Likely in the $1.1M
-Which city is the property located in? Mississauga
-Is the property owner-occupied or a rental? O/O
-Who is your current lender? Scotia
-Do you have a HELOC tied to the mortgage? No
-Is the mortgage CMHC insured? No
-When did you buy the property? 2018
-When is your renewal date? Nov, 2021

If I'm missing any info, please let me know.

Thanks,

Hi experts here, I know I'm a bit early, but wanted to get a sense of what I should expect or try to negotiate (or ideally go with someone here and make it super simple and easy).

I'd also like to know if its with a big lender/bank. I want to have the ability to do large yearly lump sums (10-20% of my balance)
I'd like to have a HELOC for any emergencies
I'd like to have bi-weekly payments

For a mortgage transfer/renewal:

-How much is the mortgage owing? 677K
-Roughly, what is the current market value of the property? 1.6M
-Which city is the property located in? Mississauga
-Is the property owner-occupied or a rental? Owner-Occupied
-Who is your current lender? Scotiabank
-Do you have a HELOC tied to the mortgage? no
-Is the mortgage CMHC insured?yes
-When did you buy the property? Sept 2016
-When is your renewal date? Sept 2021

FightCanada wrote: ↑ Hi all,

Not sure if this thread is the right place, but looking to secure a HELOC. Current mortgage is with Scotia. Looking to do my due diligence before finalizing. Everything seems to be P + 0.5%. Looking to see if I can get better.

How much is the mortgage owing? $360k
-Roughly, what is the current market value of the property? Likely in the $1.1M
-Which city is the property located in? Mississauga
-Is the property owner-occupied or a rental? O/O
-Who is your current lender? Scotia
-Do you have a HELOC tied to the mortgage? No
-Is the mortgage CMHC insured? No
-When did you buy the property? 2018
-When is your renewal date? Nov, 2021

If I'm missing any info, please let me know.

Thanks,

Tangerine has a great HELOC rate below Prime right now and they are also owned by Scotia.