ScotiaBank is the latest lender to offer a sub-three per cent mortgage rate but one broker doesn’t feel threatened by the latest offering; even though he does realize it will bring in a fair amount of business for the big bank.
“It’s much ado about nothing and it’s just a marketing gimmick; I can always buy a rate down,” David Mair of Dominion Lending Centres
NuVision Mortgage Group told MortgageBrokerNews.ca. “Even the front-five banks are fighting back and it will draw a lot of business because most people only care about rate.”
currently offers a five-year fixed rate at 2.97 per cent, which, at press time, is the lowest among the big banks.
The bank is aggressively flogging its latest promotion by taking ads out and promoting tweets in Twitter feeds. But this isn’t the first time a lender has made headline for offering a sub-three per cent rate.
Recently, Investors Group posted a 36 month closed variable-rate mortgage rate at 1.99 per cent (Prime – 1.01 per cent). And, of course, the Bank of Montreal made headlines in 2012 with its “2.99 no-friller,” which is widely considered to be the catalyst for record-low mortgage rates Canadian homebuyers have enjoyed for over a year.
BMO’s rate also drew the ire of then-Finance Minister Jim Flaherty
but current minister, Joe Oliver, has yet to react to Scotia’s offering.
“Oliver looks like he’s in so far over his head he doesn’t know what to do,” Mair said.
Mair is frustrated by the constant coverage bank rates get and has called for national and provincial broker organizations to better compete with the publicity.
“We don’t have the marketing budget to go up against the banks but I beat them on rate and I beat them on rate,” Mair said.