Mortgage renewals are one of the most neglected decisions made during the life of a mortgage. Many homeowners stay with their existing mortgage lender because they believe it is too time consuming to shop around for a better rate. Or, they simply think that the offer from their existing bank is the best deal available. This is not correct.
Our experience has shown that most banks offer their renewing clients a discount of .25% off their advertised rates. If a client wants to discuss a rate discount with the branch they belong to, they usually receive a response no sooner than 5 days.
If the client does manage to negotiate a better rate, it’s usually a maximum ceiling discount of .50%. This is all the branch allows the mortgage representative to discount any mortgage product. Some special cases are given for clients who have many investments held within that bank, but for the most part there are no exceptions made.
If the bank wants to keep your business, shouldn't they respond in a timely manner with a deep discount for a returning client? At Ontario Equity, all clients are treated with the respect and courtesy they deserve. The best rates are always offered and there is no consideration for one client over another.
This is all done within an 8 to 12 hour approval turnaround. That’s because most of the institutions we deal with are strictly mortgage lenders. They focus 100% of their time and effort on the mortgage market. This is very crucial when it comes to providing the service and rates that each client deserves.
These lenders also have the same philosophy as Ontario Equity, which is to provide the best service and products to the client by cutting out the high unnecessary overhead that results in an inflated mortgage rate.
| A difference of 1% interest over the years for a $250,000 mortgage (5.0% vs 6.0%) | |||
|---|---|---|---|
| Year(s) | Interest of 5.0% | Interest of 6.0% | Difference |
| 1 | $12,250* | $14,700 | $2,450 |
| 2 | $24,250 | $29,100 | $4,850 |
| 3 | $35,950 | $43,250 | $7,300 |
| 4 | $47,400 | $57,050 | $9,650 |
| 5 | $58,500 | $70,550 | $12,050* |
| 7 | $79,750 | $96,500 | $16,750 |
| 10 | $108,950 | $132,400 | $23,450 |
| 15 | $149,150 | $182,450 | $33,300 |
| 20 | $176,100 | $216,750 | $40,650 |
| 25 | $186,200 | $229,850 | $43,650 |
| Figures are rounded to the nearest $50. Based on a standard 25 yr. amortization. | |||
The discount that clients typically receive through Ontario Equity ranges from .75% to 2.00% off bank posted rates. This is available to all clients who qualify under regular credit and income guidelines. Ontario Equity clients who transfer their mortgages have the opportunity to take advantage of lender incentives such as free appraisals, free legal fees and discounts on mortgage insurance and home inspections.