Real Estate

The Official Mortgage Rates Thread

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Aug 20, 2020
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Scarborough
harveer wrote: -What is the purchase price? $1500000
-How much is the down payment? 50%
-Where it the property located? Brampton, ON
-When is the closing date? July, 2021
-Will the property be owner-occupied or a rental? Owner

Just moving homes and currently have 2.59% fixed with Meridian with 3 years remaining. Can either Port the mortgage or looking at paying the penalty and take on a new rate. Looking at something with a HELOC
You can get 1.35% variable 5-year with an attractive pricing on the HELOC. Additional cash back also available.
Neil Joseph
Mortgage Agent, Broker Lic #10530
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Scarborough
sat981 wrote: Hello MA's,
looking for help on mortgage:
Purchase Price 1,100,000
Down Payment 20% but can go to 30% if needed.
Property in Stoneycreek
Closing 45 days
Rental Property ( dual unit)
You can get 1.55% variable 5-year with 30 year amortization to keep the monthly payments low/improve cashflow.
Neil Joseph
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blady wrote: Hi Looking for best options for my mortgage renewal. Currently with scotia offering 1.39 variable
Thank you!

For a mortgage transfer/renewal:

-How much is the mortgage owing?-480000 (But Looking for either HELOC or larger mortgage for 100K)
-Roughly, what is the current market value of the property?980000
-Which city is the property located in?Burlington
-Is the property owner-occupied or a rental? Property owner
-Who is your current lender?Scotia--offering 1.39 variable
-Do you have a HELOC tied to the mortgage? Y
-Is the mortgage CMHC insured?N
-When did you buy the property? 2011
-What was the purchase price?380 000
-When is your renewal date? Sept 2021
For a transfer you can get 1.25% variable 5-year for a full-feature mortgage with 20/20 prepayment options. Legal and appraisal is covered by the lender.
If you are looking to pull money out, then you can get 1.35% variable 5-year from a Big 5 bank. Additional cashback possible depending on final structure of the deal.
Neil Joseph
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Jun 17, 2007
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Thank you Paul. This was extremely helpful advice!
PaulMeredith wrote: This is a great question that is on the mind of many mortgage shoppers. Also, depending on your situation, you may be able to get lower rates than what you're being offered.

Whether to go fixed or variable really depends on the person and there is no right or wrong answer here. What might be right for one person, might not be right for the next. I don't believe there is any one size fits all mortgage advice. One of the main things to consider is your tolerance for risk. When taking variable, you have to be comfortable with the fact that your rate and often your payment could increase at any time.

Until recently, the Bank of Canada had been firm on their stance of maintaining prime rate until sometime in 2023. The economy has been outperforming original projections, and they are now planning to increase their rate sometime in the second half of 2022. This is not necessarily a reason to go fixed however. Another major consideration is the spread between fixed and variable, which in your case 1.05%. This is a very large spread. The largest we've seen in years. As the Bank of Canada generally moves in increments of 0.25%, there would need to be five increases before your variable rate moves above your 5 year fixed option. While it's likely that increases to prime rate will be slow, anything can happen. It's also possible that the Bank of Canada could revert back to their original stance of holding the rate until 2023. However, if the economy continues to be resilient to the pandemic, and continues at its current pace, then this is unlikely .

Even IF the prime rate were to move up above you 5 year fixed option, you would still not be losing. In fact, you wouldn’t even be breaking even at that point. You would still be ahead, but would just start giving back some of your savings. In your situation, you could potentially sustain as many as 10 rate increases , and still come out ahead with the variable rate. The large spread gives you plenty of protection. This is an unlikely scenario however.

Regardless of predictions, anything can happen. There are many that feel uncomfortable with the possibility of their rate changing at any time during the term. They prefer the peace of mind in knowing that they have a low rate locked in and guaranteed for the full 5 year term. Again, it really comes down to your tolerance for risk. There is nothing wrong at all with 5 year fixed options, and they are well suited to many people. Again, there is no clear right or wrong answer, and it really depends on the person.

The best choice is not always the one that saves you the most money. It's the one that allows you to sleep soundly at night.

If you are still unsure, then one strategy I often suggest is to go variable, but set the payments to match that of the 5 year fixed option since you were prepared to make the higher payment anyway. The additional will go straight to your principal and will significantly accelerate the payoff of the mortgage. If you were to take the fixed rate, the difference in payment would be going 100% towards interest.

You can also take it one step further and increase the payment a bit more each year. Also, this way when rates do increase, you’ll already be making a higher payment so you wouldn’t really notice the increase as you are already in ahead of it. You're already making the higher payments and are now ahead of the game. You're increasing your payments when YOU want to and not when you're forced to. This way, YOU are the one in control, not the Bank of Canada. Note that your payment will (often) still increase further when there is a rate increase, however you can easily lower it back down to where it was before so your payment doesn’t need to change.

Hope you find this helpful. :)

Paul
Sr. Member
Jan 24, 2015
603 posts
94 upvotes
Oakville, ON
PaulMeredith wrote: This is a great question that is on the mind of many mortgage shoppers. Also, depending on your situation, you may be able to get lower rates than what you're being offered.

Whether to go fixed or variable really depends on the person and there is no right or wrong answer here. What might be right for one person, might not be right for the next. I don't believe there is any one size fits all mortgage advice. One of the main things to consider is your tolerance for risk. When taking variable, you have to be comfortable with the fact that your rate and often your payment could increase at any time.

Until recently, the Bank of Canada had been firm on their stance of maintaining prime rate until sometime in 2023. The economy has been outperforming original projections, and they are now planning to increase their rate sometime in the second half of 2022. This is not necessarily a reason to go fixed however. Another major consideration is the spread between fixed and variable, which in your case 1.05%. This is a very large spread. The largest we've seen in years. As the Bank of Canada generally moves in increments of 0.25%, there would need to be five increases before your variable rate moves above your 5 year fixed option. While it's likely that increases to prime rate will be slow, anything can happen. It's also possible that the Bank of Canada could revert back to their original stance of holding the rate until 2023. However, if the economy continues to be resilient to the pandemic, and continues at its current pace, then this is unlikely .

Even IF the prime rate were to move up above you 5 year fixed option, you would still not be losing. In fact, you wouldn’t even be breaking even at that point. You would still be ahead, but would just start giving back some of your savings. In your situation, you could potentially sustain as many as 10 rate increases , and still come out ahead with the variable rate. The large spread gives you plenty of protection. This is an unlikely scenario however.

Regardless of predictions, anything can happen. There are many that feel uncomfortable with the possibility of their rate changing at any time during the term. They prefer the peace of mind in knowing that they have a low rate locked in and guaranteed for the full 5 year term. Again, it really comes down to your tolerance for risk. There is nothing wrong at all with 5 year fixed options, and they are well suited to many people. Again, there is no clear right or wrong answer, and it really depends on the person.

The best choice is not always the one that saves you the most money. It's the one that allows you to sleep soundly at night.

If you are still unsure, then one strategy I often suggest is to go variable, but set the payments to match that of the 5 year fixed option since you were prepared to make the higher payment anyway. The additional will go straight to your principal and will significantly accelerate the payoff of the mortgage. If you were to take the fixed rate, the difference in payment would be going 100% towards interest.

You can also take it one step further and increase the payment a bit more each year. Also, this way when rates do increase, you’ll already be making a higher payment so you wouldn’t really notice the increase as you are already in ahead of it. You're already making the higher payments and are now ahead of the game. You're increasing your payments when YOU want to and not when you're forced to. This way, YOU are the one in control, not the Bank of Canada. Note that your payment will (often) still increase further when there is a rate increase, however you can easily lower it back down to where it was before so your payment doesn’t need to change.

Hope you find this helpful. :)

Paul
Thank you for your helpful advice. I got an early renewal offer from CIBC:
1.94, 3 years fixed
1.99, 4 years fixed
2.19, 5 years fixed
1.39 (p-1.06), 3 or 5 years variable

I have no plans to sell or refinance. The early renewal offer is available until May 31. My current mortgage is 1.45 (variable) and the maturity date is Sep.13.
There would need to be 3 increases before the variable rate moves above the fixed 3 or 4 years options, and 4 increases for 5 years fixed.
What could be the best choice to save me more money? 3 or 5 years variable? Should I accept it now or wait till Sep.? Thank you.
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Jun 24, 2020
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Alexander1306 wrote: Hi there,

My wife and I are first time home buyers. Our annual income is $122,000.
We have a of downpayment $50,000
We went through several mortgage brokers, the biggest what we got pre-approved for was $680,000.
Is that a maximum what we can get pre approved for.
We dont have any debts or credits. We only have a car lease, which is $300 a month. Our credit scores are 826 & 796
Looking to purchase a home in Clarington / Bowmanville
We were thinking to get 5 year fixed, but unsure if maybe we should go with variable.
Does lower interest rate allows to get a bigger mortgage.
We’re very new to this, so I am completely clueless on what to do and where to go. How to pick the best mortgage broker, etc...
Whilst they may have given you the correct mortgage amount you can be pre approved for, they based this off a 30 year amortization it seems and did not take your down payment into account, which will indicate you are putting less than 20% down and so can only qualify for a 25 year amortization. In this scenario, around $610,000 would be your maximum mortgage amount, assuming the new homes property tax is around $4500 and no condo fees(we have to use these in our calculations when preapproving you). This means your maximum purchase price would be approximately $638,000.
Provided you qualify, you can still get a very competive rate irregardless of the mortgage amount. Reach out to any of the regular posting brokers to help to get pre qualified.
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Sep 13, 2011
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Toronto
ChristineY wrote: Thank you for your helpful advice. I got an early renewal offer from CIBC:
1.94, 3 years fixed
1.99, 4 years fixed
2.19, 5 years fixed
1.39 (p-1.06), 3 or 5 years variable

I have no plans to sell or refinance. The early renewal offer is available until May 31. My current mortgage is 1.45 (variable) and the maturity date is Sep.13.
There would need to be 3 increases before the variable rate moves above the fixed 3 or 4 years options, and 4 increases for 5 years fixed.
What could be the best choice to save me more money? 3 or 5 years variable? Should I accept it now or wait till Sep.? Thank you.
Happy to help, and thanks for the added info! Given the rates provided, I would not be in a rush to early renew. You already have a great rate, and the rates you're being offered are not that great. Banks love to play these games though. They make it sound like you're being offered a 'special deal', but you need to act fast! I'm surprised they even gave you until May 31st. haha.

If you wanted to switch away from CIBC, there are currently variable rates as low as prime -1.25% (1.20%), 5 year fixed as low as 1.79%, or 4 year as low as 1.64%. Significantly lower than what you're being offered. If you can provide the following info, I can confirm the rates you would be eligible for. Some of these questions I already have the answer for, but easier if you repost them in your response which saves me from having to search back through the thread:

- when is the exact maturity date on your mortgage?
- How much will you owe on the mortgage at renewal?
- What is the approximate market value of your home?
- what was the original purchase price?
- which lender are you currently with?
- How long have you had your mortgage with this lender?
- how long have you owned your home?
- When you bought the home, did you pay CMHC insurance?
- Do you have a Home Equity Line of Credit or any other component attached to your mortgage?

Let me know and I can further advise.

Thanks!

Paul
Paul Meredith
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Feb 2, 2014
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specialized444 wrote: What is the purchase price? $469,000
-How much is the down payment? 20%
-Where is the property located? Victoria, BC
-When is the closing date? May 25, 2021
-Will the property be owner-occupied or a rental? Owner-Occupied

Mortgage broker just said to go with 30 year 1.55% variable.

Thoughts?
1.25% 5-year variable would be the best rate, but your closing date is really tight.

Do you have an approval in place already?
Kevin Somnauth, CFA
Principal Broker/Owner - First Toronto Mortgage - MA (Ontario #13176, BC #X301007)
Real Estate Salesperson - Century 21 Innovative
Newbie
Nov 15, 2007
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Hi what is the 4/5 year fixed rate I can expect for renewing mortgage on a rental property?
Newbie
May 10, 2021
1 posts
Hello Mortgage Experts, I’ve had an offer accepted this week subject to financing. Here’s my situation.

- What is the purchase price? $945k
- How much is the down payment? 90k
- Where is the property located? Barrie, ON
- Finance arrangement due? June 14th, 2021
- Will the property be owner-occupied or a rental? Owner-occupied
- Family income $125k
- No debts
- Property Tax - $5k

I’ve had a friend mention that the affordability might be an issue. Is he correct or just being over cautious ?
What are the rates I can achieve ?
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Jan 31, 2018
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sid2041 wrote: Hi what is the 4/5 year fixed rate I can expect for renewing mortgage on a rental property?
Rentals are priced higher

2.39% 5 yr fixed
1.60% 5 yr variable

Phil
Phil Cragg
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specialized444 wrote: What is the purchase price? $469,000
-How much is the down payment? 20%
-Where is the property located? Victoria, BC
-When is the closing date? May 25, 2021
-Will the property be owner-occupied or a rental? Owner-Occupied

Mortgage broker just said to go with 30 year 1.55% variable.

Thoughts?
You can get the below rates with 25 yr am

1.59% 3 yr fixed
1.79% 4 yr fixed
1.84% 5 yr fixed

5 yr variable 30 yr likely 1.40-1,45% with additional cash back major bank

Phil
Phil Cragg
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leungsta wrote: If someone can advise on the best rates, that would be great!

-What is the purchase price? 950,000
-How much is the down payment? 20%
-Where is the property located? Carignan, QC
-When is the closing date? July 2021
-Will the property be owner-occupied or a rental? Owner-Occupied
5 yr variable is the best deal at 1,25%

Phil
Phil Cragg
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TangoAlpha1 wrote: Hello Mortgage Experts, I’ve had an offer accepted this week subject to financing. Here’s my situation.

- What is the purchase price? $945k
- How much is the down payment? 90k
- Where is the property located? Barrie, ON
- Finance arrangement due? June 14th, 2021
- Will the property be owner-occupied or a rental? Owner-occupied
- Family income $125k
- No debts
- Property Tax - $5k

I’ve had a friend mention that the affordability might be an issue. Is he correct or just being over cautious ?
What are the rates I can achieve ?
Unfortunately qualifying will be an issue, your friend is correct. Are you able to put 20% down or add a co-signer?
Newbie
Apr 12, 2011
52 posts
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Hi guys, I'm looking for help/advice in getting a 5Y variable closed mortgage for a pretty expensive new build. Tax rate is not available yet and assumed rate 1%++ is throwing ratios off. Real tax rate is expected to be around 12k. Combined T1: $109,462.74

-What is the purchase price? $2,090,990
-How much is the down payment? $1,590,990
-Where it the property located? Vaughan, ON
-When is the closing date? June 30, 2021
-Will the property be owner-occupied or a rental? Owner Occupied
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Jan 31, 2018
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TangoAlpha1 wrote: Hello Mortgage Experts, I’ve had an offer accepted this week subject to financing. Here’s my situation.

- What is the purchase price? $945k
- How much is the down payment? 90k
- Where is the property located? Barrie, ON
- Finance arrangement due? June 14th, 2021
- Will the property be owner-occupied or a rental? Owner-occupied
- Family income $125k
- No debts
- Property Tax - $5k

I’ve had a friend mention that the affordability might be an issue. Is he correct or just being over cautious ?
What are the rates I can achieve ?
Your magic number is $48750 for annual expenses to include the below:

Mortgage payment at the stress test + property taxes + 1200 approx for heat annually

Max mortgage would be approx 625k

Can you get a cosigner on the deal or increase to 20% down

Phil
Phil Cragg
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Jan 31, 2018
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Eug9n9 wrote: Hi guys, I'm looking for help/advice in getting a 5Y variable closed mortgage for a pretty expensive new build. Tax rate is not available yet and assumed rate 1%++ is throwing ratios off. Real tax rate is expected to be around 12k. Combined T1: $109,462.74

-What is the purchase price? $2,090,990
-How much is the down payment? $1,590,990
-Where it the property located? Vaughan, ON
-When is the closing date? June 30, 2021
-Will the property be owner-occupied or a rental? Owner Occupied
1.35% 5 yr variable is available with additional cash back major bank

Reach out to any of the pros on the forum we may be able to use the city tax rate vs the 1%

Phil
Phil Cragg
Mortgage Agent
Mortgage Outlet Inc Broker License #12628
Jr. Member
Sep 22, 2015
105 posts
30 upvotes
Toronto, ON
Just sharing info with the RDF community as a data point.

I got approved this past Friday at TD bank for 1.28% variable, 5 year closed, 30 year amort. It required a rate exception (which is a submission to some special department that approves mortgage rates as one-time exceptions).
+ I qualify for TD's current promotion of cash back for getting a mortgage https://www.td.com/ca/en/personal-banki ... ge-offers/

My mortgage is not a high ratio mortgage, and it is a personal residence (not a rental property) in case this matters.

Good luck shopping!
Member
Feb 29, 2016
412 posts
105 upvotes
Mississauga
Asking for my brother:

What is the purchase price? $2.8 million
-How much is the down payment? $1.5 million
-Where it the property located? Etobicoke, Toronto
-When is the closing date? July 29, 2021
-Will the property be owner-occupied or a rental? Owner Occupied

Family income in excess of $250k per year with my brother working in a crown corporation at a senior level.

He is looking for the best variable rates. Please let me know and I will connect him to you.
Jr. Member
Dec 23, 2009
198 posts
91 upvotes
Looking for a rate on rental property

Variable, 30 year amortization prefered

-What is the purchase price? $650000
-How much is the down payment? 35%
-Where it the property located? Downtown Toronto
-When is the closing date? July 2021
-Will the property be owner-occupied or a rental? Rental

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