Lately, non-bank lenders have had a shortage of low-priced funds to lend out on variable-rate mortgages. As a result, we’re seeing the best variable rates at places like RBC.
For example, if you’re in the market for a regular closed variable-rate mortgage, we’ve found RBC reps quoting prime-.85%. As best we can tell, that’s an extra 1/10% off what you could find elsewhere, or $11 a month on a $200,000 25-year amortization.
(Although RBC’s prepayment privileges and conversion rates are not the best–if that’s important to you.)
If you’re interested in any of the following variable rate products, however, you can still often find the best deals with mortgage planners:
- Open variable-rate mortgages
(good if you hate penalties for breaking a mortgage) - Variable rate mortgages with front-loaded discounts
(good if you plan to lock into a fixed rate later this year) - Variable readvanceable mortgages
(good if you need cheap credit for future investing or personal reasons)
Interestingly, the fact that commercial banks have an edge in closed variables is a phenomenon driven by Canada’s current liquidly shortage. Later this year this trend could very well reverse itself, with the banks playing second fiddle to brokers again. Only time will tell.
Of course, to most people, rate isn’t everything. If you find yourself needing quality advice, you’ll serve your best interests by talking to an independent mortgage professional.
Mortgage planners can help you:
- Determine the optimal mortgage for your long-term financial goals
- Summarize the latest and best mortgage products
- Develop strategies to save you interest
- Decide on a fixed or variable rate
- Arrange your current debt to qualify for a mortgage
- One-stop shop for mortgage rates and terms
- Best structure your mortgage application to improve your chances of approval
- Handle all the tedious paperwork
Apart from mortgage planners, there aren’t a lot of other places to get this kind of help. Bank reps are particularly limited in the advice they can give because they don’t have daily exposure to products from all lenders, nor do they recommend the competition.
At the end of the day, good and honest advice usually saves people money.
_____________________________________________________
Quote du jour…
In giving advice seek to help, not to please.
~Solon
Banks are taking their sweet time in passing any reduced mortgage rates to customers!
As has already been mentioned, they are trying to penalize us for their mistakes.
Some rates have not been changed, like 5 year mortgage rates!
Could this be?
Waterloo RBC only quoted me P-0.8 (best he can do) 2 weeks ago, I should send him this page to see his take on P-0.85 :)
National bank was offering P-0.9
Hi NSB,
It depends on the bank you call and the day you call them. P-.85% is not RBC’s official rate. It’s just what we’ve heard them quote on a few occassions. As for National, P-.90% is much much lower than the rates we’re hearing through the grapevine from them. But again, the deal bank clients get depends on which way the wind’s blowing that day.
dd, fixed rate mortgages are not tied to the prime rate, which is why they didn’t reduce when the banks lowered their prime rates.
It looks like Canadian Tire is at P-.90%. Way to go CT!
We’re hearing that multiple lenders are raising their variable rates tomorrow! If you can secure a P-.75% to P-.90% rate today, it might be wise to do so.
Update: Canadian Tire is now at P-.75%.
Darn, just noticed CT is 4% now instead of 3.85% LAST NIGHT!!
https://www.myctfs.com/Rates/MortgageRates/