Posted on: 20-09-04 10:27:25
Could we develop a list of current mortgage rate offered by the Banks in Canada. In my case, the following rates are offered:
CIBC : Five Year Fixed - 5.25%
Variable open five years - 0.75% below prime
Better than prime - 1.01% below prime for first 9 months and then 0.25% below prime for upto 5 years.
I will appreciate if the other members also share their experiences on this forum, which will help us to negotiate better with the banks.
-----------------------------------------------------------------
Sunil Sharma, P.Eng.
Quote:
Orginally posted by sunilosharma
Could we develop a list of current mortgage rate offered by the Banks in Canada. In my case, the following rates are offered:
CIBC : Five Year Fixed - 5.25%
Variable open five years - 0.75% below prime
Better than prime - 1.01% below prime for first 9 months and then 0.25% below prime for upto 5 years.
I will appreciate if the other members also share their experiences on this forum, which will help us to negotiate better with the banks.
Hi,
If you want to see the best rates offered by all the banks, you can go on my website http://www.pramodchopra.com" rel="nofollow">LINK and see the rates there. You can also sign up for my free rate service 'rate watch' which will send you a weekly update of best mortgage rates.
An Independent mortgage broker does the shop around for you for the best mortgage rates amongst 25 pluse lenders and you do not have to pay any fee for this service as he/she is compensated by the bank as a finder fee. Its a win-win situation for every one. YOU get the best rates without the hassle of going to a number of banks, the bank gets the business and the independent broker gets paid by the bank for this service.
Moreover, if you do the shopping around yourselves, every time you go to a bank, the bank would pull up your 'credit report' which means that if you go to 4 banks, all would pull up your 'credit report' and you 'credit score' comes down with each enquiry and in case where it is on borderline, it might drop below that and the banks might not be interested in giving the best rates. Secondly, the 2nd bank you go to would see that you have been to 1st bank, and the 3rd one would see that you have been to the first 2 and so on.. This could mean 2 things to them 1) You are shopping around or 2) you are not getting the best rate specially if the credit is on borderline and this bank may also not offer you the best rate.
While on the other hand, the broker pulls up your 'credit report' only once and the same report is sent electronically to all the banks he/she deals with and no bank sees that the application is being considered at other place or not.
I am posting today's best mortgage rates from my website;
Term Posted Rates Best Rates*
6 Month 4.85% 4.05%
1 Year 4.80% 3.65%
2 Year 5.35% 4.25%
3 Year 5.90% 4.55%
4 Year 6.25% 4.90%
5 Year 6.45% 5.00%
7 Year 7.35% 5.47%
10 Year 7.85% 5.83%
Variable Rate 0.80%
Prime Rate 4.00%
*Rates may vary provincially & are subject to change without notice.
-----------------------------------------------------------------
Pramod Chopra
Senior Mortgage Consultant
Mortgage Alliance Company of Canada
echoing what pramod has said... posted rates mean squat... actual rates that may be offered by lenders vary widely, sometimes as much a 100 basis points between them...
unless you have preferred client status with your bank, your best bet will always be in using a broker to do the shopping for you... brokers get paid regardless of which lender you go with, as long as you accept one of the offers they find for you, so they will (obviously) try and get you the best deal they can, because they want your business...
I also support using the services of a broker. One does not pay a penny, gets million $ advice, best rates and other host of benefits.
-----------------------------------------------------------------
Live and Let Live. Together we can make a difference.
DP JAIN, CPA, CGA, CPA (US), CA(I), LL.B.(I)
416-305-0080
(Loans, Mortgage, Tax, Accounting, Investments)
Another benefit of dealing with a broker is that you can get the mortgage process completed by just sitting in the comfort of your own house. Everything can be done electronically (application and approval etc.) and or by fax. You only go out once to sign up the paper with the lawyer and to collect the keys of your dream home.
-----------------------------------------------------------------
Pramod Chopra
Senior Mortgage Consultant
Mortgage Alliance Company of Canada
Are these Best Rates* are the final negotiated rates or there is further room for negotiations. I understand that the negotiations are based on the credit history, however, in majority of the cases with Indians, I do not think anyone with bad history will go for a mortgage! So we can assume that we have a good credit history and are well positioned to negotiate with the banks.
Can we have a listing of the negotiated final rates with other members.
-----------------------------------------------------------------
Sunil Sharma, P.Eng.
___________________________________________________________
Are these Best Rates* are the final negotiated rates or there is further room for negotiations. I understand that the negotiations are based on the credit history, however, in majority of the cases with Indians, I do not think anyone with bad history will go for a mortgage! So we can assume that we have a good credit history and are well positioned to negotiate with the banks.
Can we have a listing of the negotiated final rates with other members.
-----------------------------
Sunil Sharma, P.Eng.
____________________________________________________________
THe best rates mentioned are THE BEST RATES as offered to the broker channels by the banks as these broker channels give these banks billions of dollars in mortgage business. Naqturally, these broker channels are in best position to negotiate much better rates then an individual. However, nothing is written in stone and exceptions can always be there as the branches have their own profit accountability and descreation and the manager can sometime even slightly better this rate to an individual as he can compensate by offering higher rates to others and thus still meet his branch profitability target.
However, as DP Jain has suggested, it is not always the rates, but the service and the advice that counts. A broker can 'customize' product or find suitable product as per individual needs keeping also in view of his present and near future requirements, regarding pre-paying facilities, skip payment options without causing default if a need arise etc.
Also, an individual can go to only 4 or 5 big banks and try what best they offer ( of course as mentioned earlier it does affect his credit with each visit to the bank) but would not have access to other lenders, which are basically other big financing companies, brokerage arms of big banks, mutual fund or pension fund holders and credit unions and trust companies who are looking to invest money in mortgage market can offer better rates and terms then the big banks in order to earn the mortgage business.
One thing I would like to mention about the so called good credit of desi's as I daily see numerous cases in which desis want mortgage but can not get the best rates because of poor credit and not all the times these poor souls can be helped and since they still want the house, they not only pay much higher rates but lender's fees as well.
-----------------------------------------------------------------
Pramod Chopra
Senior Mortgage Consultant
Mortgage Alliance Company of Canada
