BMO’s move to withdraw its 2.99 posted rate is no more than “smoke and mirrors,” says one Ottawa mortgage broker, suggesting the bank will continue to offer even lower rates at the branch level.
“I can still walk into a bank and get 2.89,” says Jeff Cody, with MCC Mortgage Brokers City. “The move back to 3.09 is just a lot of smoke and mirrors.”
BMO has apparently bent to Jim Flaherty’s will and announced it is backing off its 2.99 per cent posted rate for that five-year no-friller mortgage, returning it to 3.09 per cent at the end of the week.
“Our advice to Canadians is simple: Protect yourself from rising rates by locking in for five years and become mortgage-free faster by choosing a maximum amortization of 25 years,” said Ernie Johannson, senior VP of Personal Banking Canada with BMO, in a statement issued to the press. “This mortgage is the responsible choice for the times.”
Although Cody doesn’t deal with BMO, he does do a lot of business with Manulife.
“Is BMO raising the rate to please Flaherty? Absolutely,” says Cody, who cited Manulife’s decision to go back on their own rate after a phone call from the finance minister’s office.
Last week Manulife Bank announced it was cutting its five-year fixed rate to 2.89 per cent, but changed course one day later – bringing it back up to 3.09 per cent – after receiving a call from an official in Mr. Flaherty’s office.
But for Cody, the best rate for the customer starts and finishes with the mortgage broker.
“Let us do the shopping for you; we’ll get you the best deal out there,” he told MortgageBrokerNews.ca.