Scotia Leads Posted Rates Lower & Launches 2-Year Special

ScotiabankAfter a month of plunging bond yields, a major bank has finally decided to lower its posted 5-year fixed rate.

Scotiabank has just announced a 20 basis point cut to its 5-year fixed mortgage. Several of its other fixed rates are falling as well (between 6-20 bps), effective tomorrow.

Scotia is setting its new 5-year fixed posted rate at 5.19%. That matches the lowest posted rate of the last 50+ years, and is a rate we last saw in February of this year.

If history is a guide, other banks will likely cut their own posted rates in the next few days.

Scotia also announced two other noteworthy changes today:

  • Its discounted two-year fixed is now 2.49%. That’s one of the lowest bank-advertised two-year rates we can remember. It’s also a decent alternative to today’s 2.30% variables because it provides two years of rate protection for just a 19 bps premium.
  • Scotia’s advertised variable-rate discount is shrinking by 20 basis points to prime – 0.30%. Even its broker pricing, which has been notably better than advertised rates, is going up.

Rob McLister, CMT

  1. ING’s Variable is at 2.5% … so 2 yr fixed below that rate isn’t bad at all. Unless BoC reduce the rate back to .25% for the next year and a half.
    I hope Carney is reading ;)

  2. Don’t know where you got 2.5 from? I’m currently running at 2.15 with ING and I’m sure if you walked in today it would be .65-.80 of the 3.00 prime.

  3. Looking like the Scotia figures BOC is dropping the bank rate soon. Got to crank up the variable rate mortgages and suck people into longer term more profitable mortgages. Proving that banks do think their clients are stupid!!

  4. You sure about that? My GF just got .80 from a brokerage for her new condo. Pissed me off cause she beat me by .005 ;)
    Those rates are out there you just need to look “buddy”

  5. in the next 4 months there will be still people getting 2.15, 2.25% IF they have reserved the rate as a rate hold, or via broker. ING does discount their posted rates via brokers, btw.

  6. so it means after all this reviews scotia bank offering best
    got 2 year at 2.49%, i am planning to renew my mortgage for 2 years

  7. That’s incorrect. As stated by Scott, select brokerages do get a discount over ING’s published rates. And if an individual agent send a lot of business there, there’s opportunity for more considerations to make the deal work. Ultimately it’s all about relationships and this is especially true with lenders that get more of the business through brokers instead of their own salesforce.

  8. My bad. I should have wrote “ING does not discount its variable rates via brokers.”
    To the best of my knowledge they only give brokers discounts off their fixed rates not their variable rates.

  9. Yes, looks like 2yr closed at 2.49% from Scotiabank is the best rate now, and that’s what I signed up for today. Rates can’t go much lower from here, upward risk is much bigger hence closed rate to sleep at night for the next 2 years. Let the Greeks fry.
    If rates go higher in the meantime due to inflation possibly the discount on a variable will increase and I’ll renew in 18-24 months to that option.

  10. Hey guys, you sound like you know what your talking about so I have a quick question. My mortgage is due and I’ve done a lot of looking around and I’ve narrowed my 2 choices down to either a 2.49% fixed 2 year from scotia or a 3.19% fixed 4 year from RBC…any thoughts, we aren’t planning on staying in our house much longer than 2-4 years. Thanks in advance.

  11. My broker arranged 2.99% for us on a 4 year fixed. We chose it over the 2 year fixed because for 1/2 percent more I don’t have to worry about renewing at a higher rate.

  12. Hi Friends,
    We need to make a decision soon and are mind-boggled at the moment. Should we take a 2 year @ 2.49 or a 5 year @ 3.99 ? The lower rates would definitely increase our cash flow and be easier on us but is it worth the risk to have to resign in only 2 years? We will also most likely be downsizing as well in 2 years.
    Any advice you can provide would be greatly appreciated.

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