Rate Sites

You may have noticed the many websites out there that list mortgage rates.  Cannex.com, Canoe.ca, and RateSupermarket are a few examples.

Sites like these can be handy for cross-checking mortgage rates.  If nothing else, they keep your broker on their toes.

Rate pages have limits however.  Below are some things to remember when perusing these kinds of sites.

• The information is not always up to date.

Lenders and brokers on these sites do not always update their rates promptly.  In comparison, a good mortgage planner is often current with their rates to the hour.

• The information is not always what it seems.

Some lenders and brokers advertise amazingly low rates. Then, when you call, you find out they're quoting:

• Teaser rates (ultra-low rates that expire)
• No-frills products (i.e.  mortgages without pre-payment privileges and other perks)
• Quick-close rates (rates that apply only if you're closing in 30 days for example)
• Jumbo rates (rates that apply only to mortgages over $250,000 to $500,000)

By contrast, a good mortgage broker always quotes rates that apply specifically to your wishes and your circumstances.

• The information is not complete.

How can you tell from a rate page if a mortgage has good payment flexibility, pre-payment privileges, portability, assumability, readvancing credit, free home warranties, good conversion rates, favourable interest compounding, self-employed programs, or other important features?  You can't, but mortgage planners can tell you.

Mortgage planners also have unpublished rates that rarely make it to most major rate sites.

• Once you find a rate, there's no hand holding.

Unless you're working with a mortgage planner, you have no one objective to:

• advise you of better alternatives
• handle all your paperwork
• advise on how to properly structure an application to maximize chances for approval
• give you advice throughout the process on qualifying, handling credit issues, paying down your mortgage quicker, preparing your documents for submission, etc.
• advise on avoiding fees
• give you the truth about a lender's service quality and turnaround times

Low rates are great.  Lower the better we say.  But there's more to the puzzle, and more to lose, if you put your trust in a rate page.