Tangerine has ratcheted up its competitiveness. For non-default insured mortgages, it is suddenly the national leader on four fixed terms:
2-year fixed at 1.64%
3-year fixed at 1.59% (lowest refi rate in the country)
4-year fixed at 1.69%, and
10-year fixed at 2.14%.
These are exceptional rates for uninsured mortgages (which include refinances and purchases over $1 million), particularly if you’re looking for a shorter, more flexible fixed termor the longest term available at a fair price. Tangerine has:
some of the best prepayment privileges in Canada (25% annually)
120-day portability (many of the lowest-rate lenders only give you 30 days or less), and
a 120-day rate guarantee
a blend-and-extend option for existing variable-rate mortgage customers who want to refinance into a lower variable rate, at anytime without penalty.
It’s also dropped its variable rate to prime – 1.00% (1.45%), which is the lowest advertised uninsured floating rate in Canada, save for HSBC’s prime – 1.06%. And here’s a little-known benefit of Tangerine. Its variable rates adjust up to three months after the Bank of Canada hikes rates. Other things equal, that and semi-annual compounding will save you more interest than most other floating rate products.
And don’t forget its HELOC. After 10 months, Tangerine is still defying expectations by maintaining Canada’s lowest advertised HELOC rate, prime – 0.10% (or 2.35%). It’s held that rate steady despite recession-related mortgage risk, a record unemployment spike and surging funding costs last spring. If you need a simple, low-cost HELOC, there really is no better option that we’re aware of today.
A few weeks back, the Spy forecast that variable rates (on new mortgages) would decline. And they have. The average variable at a mainstream lender is down about 5 bps in the last 10 business days. That’s thanks to a whole slew of lenders taking advantage of favourable margins to cut their floating rates. That includes some major banks that have lowered their variables on a discretionary basis.
That doesn’t mean it’s time to run right out and float your mortgage. It does mean that you’ll save about $700 over five yearsif you planned to go variable and haven’t closed yet.
This & That
Rate leader HSBC has raised the following special rates:
5yr variable (insurable): 1.34% to 1.39% (P – 1.06%) These hikes may be partly related to how busy HSBC’s become, thanks to headline rates like its 0.99% variable. Its return to the broker market may be a factor as well.
“We continue to think that the BoC moves the forward guidance date [for policy tightening] from 2023 to H2-2022 later this year,” says RBC Capital Markets.
“We have become increasingly convinced of the prospects for exceptional growth this year,” Bank of America said today. It raised its U.S. GDP forecast to 6% (that’s lofty for a GDP estimate). It also hiked its 10-year bond yield forecast by 25 bps. It now sees the 10-year yield, the most-followed bond yield on earth, at 1.75% by year-end—69 bps higher than today.
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