The biggest of the big banks has brought back its “employee pricing” on mortgages, but the industry argues brokers will be the biggest beneficiaries.
“At 2.69 per cent we can easily be competitive,” Brent Irving of Dominion Lending Centres
Valley Financial told MortgageBrokerNews.ca. “Though we don’t have the big marketing budget that RBC does and we’ll never have that budget, if anything the promotion will pique buyer interest and make our phones ring and hopefully it creates some inquiries as to whether there are better offers out there.”
The Royal Bank
of Canada is currently offerings employee pricing to its customers until July 3, including a five-year fixed at 2.69 per cent, making it the lowest advertised rate by one of the Big Five.
The promotion will place RBC firmly back in the mortgage game, with many clients likely to be swayed by the bank behemoth’s name recognition alone. But brokers aren’t prepared to give up that business without a fight.
“It’s a lot of smoke and mirrors,” David Skinner of TMG
The Mortgage Group said. “Brokers can easily beat it – I still have a five-year fixed at 2.59 per cent from two different lenders. Royal Bank’s offer does not cost me any business at all.
“If our rate is the same as Royal’s, let alone if we beat them, we will get nine out of ten clients.”
Irving believes monolines are doing their part to give brokers every advantage in the current record-low rate environment.
“They are very competitive these days,” he said. “As soon as RBC comes out with their 2.69 and start marketing it, 90 per cent of monolines will come out with a competitive offer.”
However, one RBC mortgage specialist suggested the bank would go even lower than its advertised 2.69 per cent five-year fixed rate if necessary.