In a tough mortgage market, here’s how to score the biggest rate discount

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A mortgage agent with TMG The Mortgage Group, pegs the decline at between 0.05 and 0.1 of a percentage point

When the Bank of Canada finally began the process of cutting its trendsetting overnight rate a few weeks ago, it was expected that lower rates would filter into mortgages and improve affordability. So much for the hype.

Buyers and people renewing mortgages prefer the certainty and immediate savings of fixed-rate mortgages, even though they have barely moved since the recent Bank of Canada rate announcement. Victor Tran, a mortgage agent with TMG The Mortgage Group, pegs the decline at between 0.05 and 0.1 of a percentage point.

rate was at 4.64 per cent. Special rates advertised online by banks were as low as 5.39 per cent for three years and 5.14 per cent for five years. Five-year rates as low as 4.84 per cent were available for borrowers who put down less than 20 per cent and thus have to pay for mortgage default insurance.

Opportunity to cross-sell other bank products: Offers may apply to people who have a chequing account with the bank and possibly an additional product like a credit card. For lenders, five-year mortgages offer helpful stability. That’s why, according to Mr. Tran, a handful of lenders who work through brokers are offering extra commissions to these agents when they sell five-year fixed mortgages.

 

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