# Mortgage Rates



## rl1983 (Jun 17, 2015)

What's the general consensus on a decent interest rate these days?

Royal Bank just offered me 2.4% ( from 2.5% ) Which moves my payments up $10/month. Variable 5 Year Closed.


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## dougboswell (Oct 25, 2010)

rl1983 said:


> What's the general consensus on a decent interest rate these days?
> 
> Royal Bank just offered me 2.4% ( from 2.5% ) Which moves my payments up $10/month. Variable 5 Year Closed.


Way too high! 2.08 (high ratio) and 2.1% available from several lenders for convential


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## OurBigFatWallet (Jan 20, 2014)

I renewed in December at 1.90% (variable)


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## Mortgage u/w (Feb 6, 2014)

dougboswell said:


> Way too high! 2.08 (high ratio) and 2.1% available from several lenders for convential


Don't get confused with what mortgage lenders are offering and what mortgage brokers are offering. Brokers undercut everyone by buying down the lender's rate. They focus on volume so they often neglect customer service and tend to use small lenders who have limited mortgage benefits. Bottom line, buyer beware.

The rate you obtained by RBC is very much in line with what all other lenders are offering. If you want to stick with RBC, you are getting a fair rate. The rates have increased recently so those who renewed up to the end of 2015, would have gotten a much bigger discount, -0.70% to -0.90% from prime. The jump is evident but still reasonable.

I've mentioned many times in other threads, we are in a point in time with historically low interest rates. Anything below 5% is considered outstanding therefore don't go crazy for a spread of 10bps when we are well below the 5% bench mark.
Stick with a lender you trust and understand. My only advice is not to take a fixed rate with any bank since their penalty fee calculations are outrageous. Stick with a variable at all times.


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## rl1983 (Jun 17, 2015)

Mortgage u/w said:


> Don't get confused with what mortgage lenders are offering and what mortgage brokers are offering. Brokers undercut everyone by buying down the lender's rate. They focus on volume so they often neglect customer service and tend to use small lenders who have limited mortgage benefits. Bottom line, buyer beware.
> 
> The rate you obtained by RBC is very much in line with what all other lenders are offering. If you want to stick with RBC, you are getting a fair rate. The rates have increased recently so those who renewed up to the end of 2015, would have gotten a much bigger discount, -0.70% to -0.90% from prime. The jump is evident but still reasonable.
> 
> ...



Thanks for this, this is exactly what the RBC rep explained. I have a HELOC as well, and all that stuff will disappear if I move to a broker.

Given the BOC rates, I do think this increase is unwarranted, but thy with the gold make all the rules.


One more question, doesn't your payments generally go down after you renew? Given that the renewal is based on the remaining balance?


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## heyjude (May 16, 2009)

rl1983 said:


> One more question, doesn't your payments generally go down after you renew? Given that the renewal is based on the remaining balance?


Only if you want them to. What I want is to continue the same payments to get the mortgage paid off faster.


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## dougboswell (Oct 25, 2010)

Mortgage u/w said:


> Don't get confused with what mortgage lenders are offering and what mortgage brokers are offering. Brokers undercut everyone by buying down the lender's rate. They focus on volume so they often neglect customer service and tend to use small lenders who have limited mortgage benefits. Bottom line, buyer beware.
> 
> The rate you obtained by RBC is very much in line with what all other lenders are offering. If you want to stick with RBC, you are getting a fair rate. The rates have increased recently so those who renewed up to the end of 2015, would have gotten a much bigger discount, -0.70% to -0.90% from prime. The jump is evident but still reasonable.
> 
> ...


Buyers do NOT have to beware mortgage brokers and customer service is certainly not neglected. Consumers have access to some of the largest lenders in the country including National Bank, TD Canada Trust, Nova Scotia and access to many others so that they can obtain the terms and rates that they want. They are given a choice of products which they do not have by using a large bank. There is nothing wrong with consumers being given a choice with lower rates and a chance to save $1000s of dollars over a term.
At least 1 lender dropped their rate on a 5 year term today.


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## dougboswell (Oct 25, 2010)

rl1983 said:


> Thanks for this, this is exactly what the RBC rep explained. I have a HELOC as well, and all that stuff will disappear if I move to a broker.
> 
> Given the BOC rates, I do think this increase is unwarranted, but thy with the gold make all the rules.
> 
> ...


If you are with RBC your HELOC will be registered as a collateral charge. Did the rep tell you this? Your HELOC at RBC would have to paid out. You are free to go to another lender and yes you can get HELOCs from other lenders out there ie: National Bank. The RBC rep wants to keep you with them so before resigning check your options out and talk to other lenders to see what they have to offer.


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## My Own Advisor (Sep 24, 2012)

OurBigFatWallet said:


> I renewed in December at 1.90% (variable)


You got me, I got 1.95%! But did you get 20/20 prepayments?


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## latebuyer (Nov 15, 2015)

Can someone clarify if you stay with the same lender if they check your credit or if you are still employed? I'm wondering if there is some validity to choosing a lender with consistently good rates so you can stay with that lender in case your salary changes/unemployment.


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## OurBigFatWallet (Jan 20, 2014)

My Own Advisor said:


> You got me, I got 1.95%! But did you get 20/20 prepayments?


Yup, but I don't have any plans to use that feature though - too busy working on the TFSA


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## OurBigFatWallet (Jan 20, 2014)

latebuyer said:


> Can someone clarify if you stay with the same lender if they check your credit or if you are still employed? I'm wondering if there is some validity to choosing a lender with consistently good rates so you can stay with that lender in case your salary changes/unemployment.


In my experience most lenders send out a renewal letter which you can use to negotiate a better rate. I've never had a lender do a credit check or income verification on a renewal but all that has to be done if you switch lenders of course.


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## Mortgage u/w (Feb 6, 2014)

rl1983 said:


> Thanks for this, this is exactly what the RBC rep explained. I have a HELOC as well, and all that stuff will disappear if I move to a broker.
> 
> Given the BOC rates, I do think this increase is unwarranted, but thy with the gold make all the rules.
> 
> ...


If you continue with the remaining amortization and loan balance, your payment will stay relatively the same (depending the new interest rate only). If you increase your amort back to 25 or 30 years, then your payments will be lower since your balance is lower than when you started. 
Your bank rep was right except for 1 major point. Staying with a bank is NOT necessarily your best choice. There are numerous mortgage brokers out there that are fantastic and can obtain you better rates and mortgage conditions/benefits. They deal with a multitude of financial institutions and will have an advantage over a bank rep. My point in stated to beware is that the ones that advertise ridiculously low interest rates are often just trying to get you to call them. They may then explain the rate comes with certain restrictions and you end up with a regular rate anyways. When the average lender is offering -0.30% yet a broker is advertising they can get -0.70%, there is cause for concern. A broker commission is cut in half if they buy down the rate by 10bps. Buying down 20bps wipes out the commission. Buying down 40bps, well, you get the picture. 



latebuyer said:


> Can someone clarify if you stay with the same lender if they check your credit or if you are still employed? I'm wondering if there is some validity to choosing a lender with consistently good rates so you can stay with that lender in case your salary changes/unemployment.


Credit or employment is not verified as long as you do not refinance to pull out additional equity. Renewals are treated the same way - unless you have arrears with your payments, that's another issue.


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## prabhu (Jul 7, 2016)

dougboswell said:


> Way too high! 2.08 (high ratio) and 2.1% available from several lenders for convential


I am shopping for Mortgage rates .. Can u tell which bank gives 2.08 ? Is it for 5 yrs ?


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## Newone (Jul 12, 2016)

OurBigFatWallet said:


> I renewed in December at 1.90% (variable)


Hi ,

I am looking for best interest Rates , Can you please tell me which bank offered you 1.9 % rate ?


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