BMO is again leading the way with historic low mortgage rates arriving back on the market. The bank has dropped rates half a percent, to 2.99 on five-year mortgages, and cut the rate on ten-year mortgages to 3.99 percent. The rate on the ten-year mortgage is one that no Big Five bank has posted until now. This comes several weeks after other banks also dropped their rates, despite worry over slimming profit margins.
The expectation is that other lenders will roll out similar rates in order to mitigate losses to a rival bank. For buyers, this is excellent news in a market where real-estate prices are already stretched, especially markets such as Vancouver where this is especially true. These rates will be available through the Bank of Montreal until March 28, and both the five-year and ten-year rates apply to 25-year amortization.
However, beware of being locked into a mortgage over a fixed period, because the penalties for exiting a fixed-rate mortgage before term can be stiff. — Grant Robertson, The Globe and Mail
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