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May 1 Big Bank Pulls 2.99% Fixed Rate; Better Options Still Remain

Posted by: AdminS

BMO has pulled away their 2.99% rate from the Canadian market, but better mortgages remain

After garnering some media buzz, the 2.99% 5 Year Fixed Rate Mortgage with restrictions has been pulled away from the market. The BMO mortgage offer used a tantalizingly low rate to interest Canadians; however, the mortgage also came with several restrictions that could force home-owners into tough decisions.

This is not a cause for concern; nor is it a loss to Canadian home-owners as superior mortgage offers still exist in the market-place. In fact, as of this writing, offers a 5 Year Fixed Rate Mortgage at 2.99% without any of the punishing restrictions or costly penalties associated with the fine print of the bank.

While the various low-rate mortgages in the market seem appealing, remember to ask your bank or broker in regards to the following:

- Do I have full Pre-payment & Lump-Sum Privileges? Up to what percent of my mortgage do these privileges apply?

- Is there a collateral charge placed on my home? Or any clause that might force me to sell my home?

- What would it cost me to break my mortgage early?

- Does this bank use posted rates in the calculation of my mortgage penalty?

Readers of the website may recall this interesting clause from the BMO 2.99% fixed product: “ In order to get out of the BMO 2.99% 5 year mortgage, you must either sell your home or refinance your mortgage only with BMO and no other lending institution.

These are the types of restrictions that Canadian home-owners need to know about before signing on the line of that attractive low-rate mortgage.

As of this writing, there are a handful of 5 Year Fixed Rate Mortgage products available to that come in at a 2.99%; however, these mortgage products aren’t better because of rate — these products are better because the restrictions in the fine print aren’t there. Which ultimately saves you, the home-owner, thousands in penalties and interest.

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