It was triggered after Bank of Montreal dropped it’s mortgage rates again, which will likely cause many people to lock in with them for a long-term mortgage.
I’ve been saying for years that all mortgages are NOT created equal — the devil is in the details, or in this case, the contract!
But most people just focus on interest rates, which is the WRONG thing to do, whether you are a real estate investor or just a regular home owner.
Before you lock in that ‘ultra low’ rate, you have to read this.
And please pass this on, as it is important…
***Please warn your friends and co-workers****
The mortgage market is a very competitive business. BMO’s new 2.99% 5 year mortgage is a sheep is wolf’s clothing. Mortgage brokers have had this kind of no frills product for years and most of us never sell it for good reasons. It is a lawsuit waiting to happen. In 13 years, I have given a no frills product 4 times.
I would prefer everyone take a mortgage through my firm but good god PLEASE NOT THIS BMO product. Go to RBC, or Alterna anyone but this locked in BMO mortgage.
If this comes up at the water cooler please make sure all your friends and co-workers clearly understand what they are getting into. The average Canadian does something with their mortgage every 3 years. That is they move, refinance, increase or decrease the mortgage.
This mortgage is 100% closed for 5 years or OMG the 10 year! I cannot imagine being locked into BMO for 10 years. I cannot commit that long to a pair of socks let alone being 100% “too bad so sad” committed to a bank.
I highly doubt that once you are locked in, BMO will give you the “lowest rate of the day” when you need to refinance, move, sell, increase etc. You will have no choice but to:
A) Sell the house and pay a HUGE penalty
B) Take the posted rate. Compare the difference to the normal BMO mortgage at 3.49 …
I am writing this just so that people are aware. I have spoken to many clients who called BMO about this product and the conditions where glossed over.
If someone wants to take a product like this, ask them to go see a mortgage broker and we give them an Industrial Alliance mortgage at 2.99% or less at least when they refinance it won’t be a posted rate.
If you really want a good deal, I can get you an ING 10 year at 3.89%.
I know this is a bit of a rant, but I get tired of seeing customers getting taken advantage of.
If you’d like to learn more about my mortgage broker, and how he can get the best mortgage for you (not just the best rate!), be sure to check out this page…
PS – Some people think this is a marketing ploy by BMO to gain more market share in a competitive market. What do you think?
Leave a comment below, and please pass this on