Bank of Montreal cranks up the heat by bringing back their 5year 2.99% mortgage rate, making home owners anxious to take advantage of the low interest rate. However as tempting as these rates may be make sure to read the fine print, because it could cost you more than you think.
To take advantage of the Bank of Montreal’s record low rate, there are some stipulations that are not being advertised and can cause you set-backs. Such as:
- A lower maximum amortization period of 25 years versus the typical 30 years, thus increasing your monthly payments.
- A less lump sum pre-payment ability of 10% versus the normal 20%. Meaning that to pay your mortgage off sooner will be more difficult and end up costing you more.
- A locked term fully closed unless you sell the property or pay out a high penalty, making refinancing or renewing with a different lender difficult and expensive.
- A smaller payment increase option of 10% versus the 20%, again making it more difficult to pay down your interest and your mortgage faster.
So as tempting as this rate may be, it is also highly restricting. Before locking yourself in, talk to one of our Mortgage Associates. They can analyze your finances to ensure that your mortgage will fit into your financial goals and not be restricting to your lifestyle, as well get you a low rate. Contact us today!