Any controversy aside, brokers on the growing number of rate sites are standing firm with their peers this time, refusing to match BMO’s 2.99 per cent – a rate that would have them “work for nothing.”
“It’s not that I’m siding with other brokers,” said Elisseos Iriotakis, owner of Verico Safebridge Mortgage Solutions. “But buying down on a loaded mortgage in order to match BMO’s won’t allow us to make any money on that. We’re doing what the other banks and other brokers are doing, trying to move clients into a loaded 4-year term that’s better for the client.”
The comment mirrors those of two other high-volume brokers regularly posting their rates on RateHub.ca and other online-lead generation sites.
That strategy has been particularly effective in increasing the number of deals, although many brokers have objected to the buying down that some of those players rely on.
Still, this time around, that sacrifice would likely be for naught, said Iriotakis, pointing to the thin margins attached to offering the rate.
Safebridge – along with most leading brokers on RateHub.ca – is now advertising a rate 0.1 percentage points higher than the Bank of Montreal’s. The gap on that five-year fixed may effectively leave the five-year mortgage field open for BMO.
But another broker, also using the rate sites to offer 3.09 per cent on a five-year, is advertising 2.99 on his company’s website.
The discrepancy is meant to limit the number of hard-core rate shoppers that lower rate would attract at the same time keeping it on offer for the more-committed clients logging onto his website.