Brokers aren’t buying what one big bank is selling. But customers may be.
“My wife works at RBC (10 years now), there was no such thing and she never heard about it,” Walid Hammami said of the Royal Bank
of Canada’s “employee pricing” mortgage promotion. “This is just another marketing gimmick. This one was borrowed from the auto industry.”
And it appears that the majority of the mortgage broker industry agrees.
In a recent MortgageBrokerNews.ca poll an overwhelming 85 per cent of voters believe such marketed product is merely a marketing ploy by the bank, which aligns with the overwhelming opinion being aired by industry players in the publication's comments section.
Still, RBC is pumping the tires of the promotion, telling customers that it is the first of its kind.
“This is a first for RBC, and a first for the big banks,” says Sean Amato-Gauci, senior vice-president of home equity financing at RBC. “Home buying season is competitive and cluttered, and it’s not just rates that get you noticed.”
And it’s no surprise one of the “big fives” is using this tactic in a bid to gain market share of its competing banks and the thousands of mortgage brokers across the country.
Canadian banks have been battling for mortgage market share – often a gateway to other banking services — with a variety of low-rate enticements, such as a recent 2.99% rate on a five-year fixed-rate closed mortgage at Bank of Montreal.