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Mortgage Broker News | 10 Jun 2013, 12:00 AM Agree 0
RBC’s announced rate hike Friday is a signal the big bank is laying down its weapon of choice at least for the time being, say brokers.
  • Lawrence Kobescak | 10 Jun 2013, 08:14 AM Agree 0
    The 5 year bond rate has risen 50bps in the last 45 days. That's since 2.89% was offered. RBC is only responding to the increased cost of borrowing. All lenders will follow suit. The reality is this story is off. BMO has raised their rates 10bps from 2.99% to 3.09% while the rising bond rate has eaten away at their profit. BMO and others continue to have low rates while their margin shrinks. This indicates to me they are still being very aggressive as their primary concern seems to be a lower rate versus a higher profit.
  • Jake | 10 Jun 2013, 08:17 AM Agree 0
    Rates still available sub 3% at RBC thru brokers though, so it's all a matter of how (little) they want to get paid.
  • Walid | 10 Jun 2013, 09:55 AM Agree 0
    I don't know about that, once you set foot on a branch (BMO comes to mind) they will give you rates and conditions even brokers can't compete with.
  • Gerry | 10 Jun 2013, 10:37 AM Agree 0
    Concur with Lawrence's comments, don't forget BMO's 'special' five year mortgage has very restrictive prepayment privileges and is locked in to BMO for five years unless client sells property. Can't refinance and go elsewhere. Have to read the fine print.
    Shrinking mortgage market, banks have lots of money want to get it placed, so choice is lower margins to get market share.
  • Ottawa Broker | 10 Jun 2013, 03:24 PM Agree 0
    @ Walid, what do you mean by "not even a broker can compete with"???
    Let me guess, you are a BMO mortgage "specialist"? I have never lost a deal to a bank, if I wanted to keep it. They eventually resort to slandering the broker when the rate gets below their comfort margin, which makes them look bad. It just comes down to how much a broker wants to make on whether or not a rate is matched when the client gets a quote from their branch.
  • Walid | 10 Jun 2013, 05:46 PM Agree 0
    BMO still offers 2.79 in branch 5 years fixed
  • Gerry | 10 Jun 2013, 08:10 PM Agree 0
    2.79% .oops... it's gone! Tuesday, new rates. Let's not forget the restrictive conditions on the BMO mortgage.
  • John Dearin | 11 Jun 2013, 06:36 AM Agree 0
    It's almost a loss leader to the banks. Yes they are still making a buck, but they go back to the shareholders showing a much bigger client base, and better yet, more loans and credit cards pushed on the clients...that is where the money is, and the profits. Big interest rates
  • Walid | 11 Jun 2013, 08:03 AM Agree 0
    @Ottawa Broker, am a broker not a mortgage specialist. I don't like cutting commission (maybe I should sometimes). I agree that it depends on how much you want to earn.
  • Jake | 11 Jun 2013, 08:13 AM Agree 0

    You guys really think most borrowers care about the scary terms & conditions from BMO? They don't. Rate still trumps almost everything (at least in my experience).
  • Lior, Mortgage Edge | 11 Jun 2013, 08:50 AM Agree 0
    I agree with Paolo on the HELOC part. It can be set up with a fixed component and because it's registered as collateral it wraps up the secured and unsecured debt. If the homeowner owes the bank money on a credit credit or personal LOC, they can offset the balance by putting the home into power-of-sale. Retention tool + protection from losses = winner!
  • Marie | 11 Jun 2013, 09:07 AM Agree 0
    RBC is only posting 3.29. the mortgage specialists now have 2.99% instead of 2.79%
    no different than what we have in the broker world.
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