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TagTD collateral mortgage

News Flash! BMO and TD’s 2.79% is great but it ISN’T the lowest rate!

Bmo wide thumbs downIt’s become an annual tradition.  Every year around this time, BMO announces, what appears to be a great mortgage for a 5 year fixed rate.   Last week, BMO announced they were lowering their 5 yr Fixed rate to 2.79%.  TD jumped in and did the same thing.  Wow!  That’s the lowest advertised rate by a BIG SIX BANK, in history. (excuse me while I yawn..pause for long yawn here)

Hey! Guess what?  It’s NOT the best rate available!  Read on….

HERE’S 7 FACTS BMO AND TD DON’T WANT YOU TO KNOW, BUT I’LL TELL YOU: Continue reading “News Flash! BMO and TD’s 2.79% is great but it ISN’T the lowest rate!”

Collateral Mortgages… a different 50 shades of grey!

handcuffs In 2010, TD announced they would begin registering ALL new mortgages as a collateral charge.  The sale pitch was that it was good for the consumer.  It would allow TD clients to borrow more, in the future, without having to incur new legal fees.  Yes, that part is true.

But they’ve left out a lot stuff, too!   For years, Mortgage Brokers and other unbiased financial professionals, cautioned the public about collateral mortgages.    And in 2013, CBC Marketplace did an expose on TD and their retail branch’s lack of knowledge and disclosure.   Is this where you want to go for your mortgage?TD

By the way, TD wasn’t the only Bank to go with collateral charge only.   ING made the same move in Dec 2011.  And they used a similar sales pitch.   But my readers have been hip to this and aren’t getting fooled.

The federal govt was pressured into taking action to protect consumers.  In Sept 2014, the federal govt announced ‘more disclosure.  But have the Banks really given us more disclosure?   Continue reading “Collateral Mortgages… a different 50 shades of grey!”

Federal govt finally takes action on Collateral mortgages.

handcuffsTD Almost 4 years ago, I reported that TD was about to make one of the biggest changes in mortgage history.   They were about to register all their mortgages as a collateral charge.    Consumer advocates spoke out against the collateral charge as they recognized it would limit a borrower’s future options.

A collateral charge is always used for secured lines of credit products.   The charge does not require an amortization which allows the credit balance to go up and down.   Using a collateral charge for ALL mortgage products gives the Banks more power.   It allows them to attach other unsecured debt to your mortgage…  Unsecured credit products such as loans, credit cards, unsecured lines of credit or other unsecured Bank debt.  I bet most people don’t know that?    Continue reading “Federal govt finally takes action on Collateral mortgages.”

CBC Marketplace exposes TD’s collateral mortgage

TDhandcuffs FINALLY!!!!!   A major TV news program calls out TD Canada Trust’s collateral mortgage.  CBC Marketplace aired an episode called ‘Busting the Banks’ on January 25th.  Hey, it’s only taken 2 years but who’s counting??… Lol!    If you want to skip to the video link, just click here and scroll to the 8:00 min mark. (by the way, I should point out my contributions to this episode. I was contacted by the producers of CBC Marketplace for my opinions and advice during the filming of this episode….over the past 3 months, I assisted with some of the research. Hope you find the info useful).

During the program, CBC took a hidden camera into a TD branch….the reporter posed as a potential mortgage borrower….   Only when questioned for the 4th time did the TD banker disclose their mortgage was a collateral charge….  but they didn’t seem to explain the difference between a conventional mortgage and a collateral mortgage… The Banker only agreed that the collateral charge was a disadvantage. Continue reading “CBC Marketplace exposes TD’s collateral mortgage”

ING collateral charge in 2012.. hand-cuffs included

You’ve seen the ads…  That fellow with the Dutch accent and the orange background, telling us to ‘save your money’.  Since 1997, when they first entered Canada, they have grown to 1.7 million clients and $37billion in assets.  ING spends millions in marketing… They’ve created a brand that is synonymous with saving or discounts.

Today, I just heard they will be counting on that trust.  It is rumoured ING Direct will begin registering ALL mortgages as collateral charges.   They join TD Bank as the second major lender to make this bold change.    A move that has great implications for the Canadian consumer.

It was almost one year ago when TD Bank announced they would register all their mortgages as a collateral charge.  (click here for the details of what a collateral mortgage is and some reactions).   Consumer advocates spoke up and warned against getting a mortgage like this…. Strangely, the media was silent.  (hmm, I wonder how much TD spends in media advertising???).

In short, the benefit is that you will be able to increase your mortgage without having to spend money on new legal fees….ok, that saves you around $800 to $1,000.  That’s your benefit.  (but even this has changed as there are some programs that will offer a discounted legal fee).

Here’s what you lose….you give up your leverage to negotiate the best rate… and that’s because if you want to leave ING, you cannot simply transfer your mortgage… Collateral mortgages cannot be transferred.     You still have to qualify for any increase… you must trust that the Bank has your best interest at heart….   Hey, remember when all the banks raised their lines of credit rates in 2008-09 without warning?

ING has been a great Lender, but this new move will drive away most advisors, mortgage brokers and clients that want options and flexibility..

I’ll continue to report more as this story breaks..

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