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2.99? So what!
April 4, 2014 @ 9:10 AM by:

Over the last week or so, I have become increasingly baffled over the hype over 5 year fixed mortgages hitting 2.99% with certain lenders.    Let me tell you why.

Have you ever been suspicious of the car ads you see on TV (especially for some American dealers) where the announcer speaks really loudly and quickly espousing how low their payments are, or what a great deal they are offering on interest rates?   I think sadly we are hitting the same mark in Canada.

I have, and have had for quite some time, lots of rates significantly lower than 2.99% on both variable and fixed rates.   For many Canadians, a 5 year fixed rate mortgage isn't a great option to start with, as statistically over 2/3 of borrowers end up trying to do something with their mortgage before the end of their term anyway.

Secondly - what's the catch attached to the low rate?   Is the mortgage fully closed for the term? Can you refinance it or switch to another lender (with BMO for example you cannot if you take their "low rate offer").   Does the mortgage have to close within a certain number of days?

Good financial advise is not loud or over the top.   As a broker, I will always have great rates and make sure you are put into an appropriate product for your circumstances.   But what I also provide is the proper advice to go with it.   If I do my job correctly the first time, you should be able to ignore all the white noise in the news knowing you have been well taken care of.