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PostPosted: Sun Dec 27, 2015 12:25 pm 
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Joined: Thu Jan 12, 2012 7:24 pm
Posts: 87
RBC offered me a new rate of 2.59 for four year fixed for my renewal. I'm coming from a 2.99 for four years so it sounds like a good rate, but i know it was recently lower. Im due to renew by End of April 2016. Just wondering if i should take this since i feel like i missed out on lower rates from October or should i wait until the usually hot spring time. Its hard to tell given the current pressures. Any advice?


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PostPosted: Sun Dec 27, 2015 5:24 pm 
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Joined: Fri Mar 07, 2014 1:51 pm
Posts: 550
Banks aren't stupid. If they're going out of their way to "offer" you a low rate, you know they're not going up any time soon.
At the same time though, don't expect it to get any lower... This is pretty much as close to free money as you're going to get.


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PostPosted: Thu Feb 25, 2016 8:53 pm 
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Joined: Wed Jul 21, 2010 6:14 am
Posts: 62
Location: Milton, Canada
Hi Fran
Typically the banks get very competitive in the spring to attract business resulting in super low rates for us as consumers. The focus though should firstly be on the type of product that will give you flexibility with good pre-payment privileges and low penalties if you need to break your mortgage during the next term. Secondly the focus should be on the rate. Often "great rate" mortgages come with expensive "hand cuffs" that you can't get out of. Right now we can get a nice flexible product with a 5 year fixed at 2.59%, giving you an extra year of lower rate, and we may even get better rates in the next month or so.

Keep in mind, when you deal direct with banks, they are in the business of selling you money to make money and they try sell you higher rates and they can only offer you their products. When you work through mortgage brokers, they can choose products from many different banks and they have access to unpublished discounted rates that you typically cannot get direct from the banks and best of all, their service to you is free, as they get paid by the banks.

Also keep in mind, if you are not taking any money out or don't need to consolidate any debt, you can move your mortgage to another bank at no cost.

I would advise you prepare for the spring market by having your application ready to lock in as soon as rates dip or to lock in if hints are they are going up again.

Good luck

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Warwick Johnston
Milton Mortgage Specialist at RBC
647-274-6029


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PostPosted: Thu Feb 25, 2016 10:51 pm 
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Joined: Thu Aug 14, 2014 9:27 pm
Posts: 56
HI! are you talking about the home equity line of credit? what do you mean by move mortgage to other bank without cost or penalty? even term is not yet done? sorry, i m on the process of deciding about mortgage and I am confuse with the difference of HELOC and normal mortgage, I mean what are the advantage and disadvantages of it? Thanks!


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PostPosted: Fri Feb 26, 2016 6:28 am 
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Joined: Wed Jul 21, 2010 6:14 am
Posts: 62
Location: Milton, Canada
Hi #Darlspyke
In my response to #Fran I was talking about a normal mortgage and not a HELOC (Home Equity Line of Credit), which I mention below.
Up for Renewal: For the normal mortgage, if it is up for renewal and you do not want to take any equity out and your bank is not offering a competitive renewal rate, you can do a No Fee Switch and move your mortgage to a new bank with a better rate at no cost, except a discharge fee from the old bank which range from $220 to $440, depending on the bank you are leaving. The new bank will cover the legal fees and the appraisal fee.

Not up for renewal: If your mortgage is not up for renewal yet but you want to lower your rate, one can do a No Fee Switch to another bank who will then cover the fees and will add part of the penalty to the new mortgage, although different banks have differing penalty amounts that they will allow to be added to the new mortgage. This is where it is important to carefully check numbers to ensure the move saves you money on the new rate and term.

Refinance at no cost: We do have one bank that will actually allow you to refinance your mortgage and they will cover the legal fees and refund the appraisal cost. Their rates are very slightly higher, but you can move your mortgage, take equity out to consolidate higher interest debt and refinance to a better rate at no cost. That is very attractive. Once again, only done if the numbers clearly show it's in your best interest to do that.

Renewal Rate Offers: Can I add, in most cases, if not all cases, the renewal rate offered from the banks is not competitive and clients can save much more by moving to a bank that has the better rate and yet around 67% of Canadians sign back the renewal form without asking mortgage brokers to shop around for cheaper rates. This results in clients paying $1,000's in extra interest over their new term and the bank pocketing the profits.

Client story: I have many stories. One recent one who is renewing next week. They are coming off a 5 year fixed of 3.79%. Their bank offered them an "early renewal promotion" for a new 5 year term of 3.45%. Yeah Right!!! We are switching their mortgage, at no cost, to the new bank at 2.64% fixed for 5 years. A HUGE savings for the client and their bank wants to know why they are leaving. You tell me my the client would possibly stay!

Better rates by staying with your bank: Don't be fooled by thinking if you keep all your banking with one bank they will give you the better rates on your mortgage. That is hardly ever the case. Your bank sells you money to make money and we all know they are very good at that. Even the "employee pricing" marketed by some banks are not competitive rates. Your mortgage can be with any bank and you don't have to move all you banking products. Often banks threaten clients that if they move their mortgage they loose banking privileges. Most often that's just manipulation. Don't let them scare you.

A HELOC is treated completely different to a normal mortgage in that they are registered as Collateral Mortgages. A collateral mortgage is typically registered for more than you are borrowing, some up to 100% value of your home and one bank in particular to 125% value of your home. These collateral charges can very seldom be moved to other banks and have to be discharged (taken off) your property and re-added at the new bank with normal legal fees. I can discuss this in more detail if you require.

Hope this helps

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Warwick Johnston
Milton Mortgage Specialist at RBC
647-274-6029


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PostPosted: Tue Mar 22, 2016 8:00 pm 
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Joined: Thu May 28, 2015 9:12 pm
Posts: 7
Hi Fran,

If you want to stay with RBC, I would advise wait until the last week before renewal. Rates always drop in spring market.

That said, we at Scotiabank have already lowered our fixed rate to the lowest point we had in 2015. And we also have a switch program in place, $1200 toward your cost of switching to Scotia.

Oh course I had to plug myself :D

Feel free to call me anytime for details.

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Robin Shiwsankar | Home Financing Advisor
__________________________________________
Scotiabank | Home Financing Solutions
T: 647 886 1214 F: 905-636-1354
robin.shiwsankar@scotiabank.com


Last edited by Robin S. on Tue Mar 22, 2016 8:29 pm, edited 2 times in total.

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PostPosted: Tue Mar 22, 2016 8:08 pm 
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Joined: Wed Jul 21, 2010 6:14 am
Posts: 62
Location: Milton, Canada
Hi Fran
As mentioned previously, 4 year rates now down to 2.44%. We may see even lower heading into the spring market.

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Warwick Johnston
Milton Mortgage Specialist at RBC
647-274-6029


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