As always in life, you get what you pay for!
BMO dropped to 2.99% … BUT, and its a BIG “but”,
There’s fine print.
This is a 5 year – “Restricted” Mortgage Offering
(just as they had offered it last time)
– 90 days max closing (most lenders at 120 days)
– restricted prepayment options at 10%/year (can’t pay down as fast as industry standard 20%)
– no “skip a payment” or “double up” options further to above
– amortization restrictions
– any sale of your home must be arms length (can’t sell to anyone you may actually know)
– if you break for ANY reason, Breakage: 3 months interest? NO. Full interest remaining on the term (IRD). This can be HUGE … 10’s of thousands (as friends learned from taking this product when BMO offered it last time)
Who’s this appropriate for:
– retiree with the 100% certainty there is 0 chance of having to ever sell, move or break their mortgage.
– the only certainty, is UN-certainty.
With many lenders at 3.09% and FULL mortgage options, this mortgage broker wants you to recognize as always: You get what you pay for !
By having a mortgage brokerage actively manage your mortgage, increasing your mortgage payment by as little as $5/year, you can save in interest further than the .10% difference of above. It takes time & effort on the part of the brokerage, but by giving your business to a bank or brokerage, you’re paying for that strategic servicing and should be demanding it.
If you find your bank hasn’t recommended a strategy such as annual payment increases, its because it pays your mortgage off faster, thus less interest earned by the bank (Profit to the lay person). No bank employee is ever encouraged by management to call clients annually and find ways to earn the bank less profit … but we are NOT the bank. We work for you.
We’re on the team “Lets Give the Banks Least Interest Possible” (and we’re always looking for players on our team)
Yours in fine print reading,