Posted by: Vince Gaetano
This historical low on the fixed 10 year mortgage had made an impression at the MonsterMortgage.ca offices as it is the first time ever that a 10 year fixed rate mortgage product has been under 4%. Both journalists seemed keen on the dramatic slide in the 5 year product at BMO, which is at 2.99%; however, it was important to give them the facts BMO was not telling consumers about the restrictive nature of this low rate product, and MonsterMortgage.ca used ING’s 10 year product to help highlight the point.
As mentioned, the journalists started to see less of the shine on the BMO product and took notice of the dramatic decline in the 10 year product at ING DIRECT. The ING product solves the fear of the five year outlook (i.e., the unknown of where will rates be) and it has a full 25% yearly prepayment option and long term portability if you plan to move homes during the term of your mortgage – three month penalty only after the 5 year anniversary! That’s pretty good. We believe that MonsterMortgage.ca was able to provide concrete info as to why ING has overshadowed BMO this week in the mortgage news. The 10 year fixed rate at 3.89% is available only to a select number of mortgage brokers. Hopefully tomorrow’s news articles will help even more consumers understand the difference between the restrictive product and the more flexible 10 year rate product.
Remember, when considering a mortgage for your property, you need to look at more than just the interest rate. Your mortgage is one of the biggest investments you will make so be sure you also consider the terms and conditions of the mortgage product and have your mortgage broker highlight what the pros and cons are for you. Flexibility is the key in a mortgage and although the BMO product is fairly priced it handcuffs consumers and will ultimately cost you more money down the road, particularly when you compare it to a 10 year product like the one being offered by ING.