TD Raises Fixed Rates

TD-BankJust nine days after RBC cut posted rates to new lows, they’re headed back up.

TD is raising fixed rates 15-25 basis points, effective tomorrow. The posted 5-year fixed is going from 5.19% to 5.44%.

This is the first such increase in almost six months.

Other banks typically follow competitors’ posted rate moves within 1-2 days. However, there’s still time today to lock in your rate holds (or rate floats, if you’re a broker).

  1. Ive been offered
    3 years fixed — 3.13% Maximum 35 years amortization
    5 years fixed — 3.44% Maximum 35 years amortization
    5 years fixed — 3.39% Maximum 25 years amortization, Note that I would need to get that re-approved as it has a maximum amortization of 25 years..
    From a big 5 bank, but im around 95 days from possesion, they will only lock in for 90 days. I think im in a tough situation, but im going to lock it in at the end of the day unless someone has a better option.

  2. With yields up 50bp in a few weeks you have to expect some kind of pull back. I wouldn’t pay attention to the small day to day movements from here. I’d be more worried about the longer term.

  3. RBC increased their rates this morning, the rest will follow suit before the end of the day. That being said, you’ve still got all day today if you need to lock in a rate. Call your banker/broker ASAP. -Shawn

  4. here we go again, the same warnings about higher rates in the ‘long term’ benig issued again, just because the bond yields bounced up from their LOWEST level in many years, if not ever!
    People are quick to forget every other failed bond yield ‘rally’. Every single one of them has ended up coming right back down again and making new lows several months ahead. Everyone seems convinced rates can only go up but they were just as convinced 6 months ago and 1 year ago. Rates have been declining for about 20 years now. Why should this time be any different?

  5. Hi Al,
    You make a very fair point. No one knows what will happen in 12 months. For what it’s worth, most reputable analysts are putting good odds on higher rates next year. Moreover, the multi-billion dollar swap market is pricing in a very high chance of rate increases in mid-to-late 2011. But both of the above have been wrong before but it comes down to the chances you want to take as a borrower.
    I’d just add that, for people who need a fixed rate regardless, now is a logical time to act (with rates at their all-time lows and moving higher–at least for some period of time).

  6. As fixed rates seem to be going up I’ve talked to a few brokers who have suggested a underhanded way of protecting a rate. Basically you put in a application to the lender with a MLS listing appearing like you are going to buy it – then you tell the lender that the deal fell through and is off – and this somehow allows you to protect the current “purchase/quick closing rates” offered by the lender which are better than the current pre-approval rates. Anyone else heard of this practice? Is it legal/legit? Any risks to the borrower?

  7. Hi JBJ,
    Generally when a mortgage application is submitted to a lender as a “live purchase” (in order to get a special rate) the applicant is assumed to have executed a bona fide purchase agreement for the subject property. It is the broker’s job to confirm that before submission.
    If one engages is the practice you mention, there is always the chance a lender could find out. If the lender determines what happened it could negatively impact the broker’s relationship with that lender, and the client could lose the rate guarantee (or the lender might refuse to do business with that applicant).
    Reputable brokers never engage in practices intended to deceive a lender. It is so not worth the risk to save 10 basis points or so.

  8. RBC decreased Mortgage Rates today, looks like BNS who did not move their posted rates forced RBC to come back down, should be interesting what the other banks do, given that cost of funds has increased

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