BMO Blows Mortgage Horn to Lure Spring Homebuyers
McNeill, Murray, Winnipeg Free Press
Several other lenders offer even lower rates, brokers say
The Bank of Montreal has fired the first audible volley as competition among mortgage lenders heats up heading into the important spring home-buying season.
The bank announced Sunday it has reduced its five-year, fixed mortgage rate by 0.10 points to 2.99 per cent in what is seen as a bid to grab a bigger share of the spring mortgage business.
BMO sparked a mortgage-rate war this time last year when it temporarily offered the same deal. The move prompted other banks to quickly follow suit and drew the ire of federal Finance Minister Jim Flaherty, who was trying to discourage Canadians from taking on more household debt.
This year's announcement is also expected to put pressure on other banks to lower their rates.
But two local mortgage brokers said Monday the impact will likely be more muted this time because several other lenders have already been quietly offering five-year terms at even lower rates -- 2.89 per cent and 2.94 per cent. They just didn't publicize it.
"So in the mortgage-brokerage world, this is nothing new," said Daryl Harris, an accredited mortgage professional (AMP) with Verico One Link Mortgage and Financial in Winnipeg and the first Manitoba broker to be elected chairman of the Canadian Association of Accredited Mortgage Professionals.
"But I certainly think it will spur some interest," added Candace Zihrul, an AMP with the Invis office in Winnipeg. "Everybody is trying to get a piece of the pie out there right now."
Zihrul said several lenders, including Scotia Bank and TD Bank, also recently lowered the rate on their 10-year mortgages to 3. …