It may be a sign of where the big banks are moving, with BMO temporarily resurrecting its infamous 2.99 per cent offer but only for online applications – a move threatening to cut out road reps.
That “no-friller” mortgage helped the lender beef up mortgage originations in the first and second quarter, after a barrage of media attention paved the way for mortgage specialists and branches alike.
Access to the stripped-down product has now been limited to low-key short-term offers. The latest special is no different: it was, in fact available only to clients prepared to complete their applications online over the weekend.
While many brokers are accessing similar rates on full-featured five-year mortgages, the BMO offer may disadvantage its own road reps as they fight for business in a slowing market.
New numbers from CREA suggest sales in September were down 15 per cent from the year-ago period. That confirms broker concerns about the market and the challenge of growing originations.
Theoretically, BMO’s move to cut out its own middleman promises to slash origination costs at a time when fewer of those deals are available. That's something other lenders both in- and outside the broker channel are focused on. The growth in online rate shopping is also helping drive the trend.
Any move on the part lenders to regularize BMO's offer may eventually limit broker access in the same way it may affect BMO's road reps, cautioned one broker Monday.