mortgage-telephone“Ring ring”

“Hello, Concierge Mortgage Group – how may we be of service today?

“Hi I want to know your best five year rate”

“Okay sir, no problem. Will that be a hi-ratio mortgage or are you putting down more than 20%?”

“Why does that matter? I just want to know your best rate.”

“Well sir, people who make smaller down payments typically get the lowest and best interest rates.”

“Excuse me? Where’s the logic there? Aren’t they riskier mortgages?”

“Yes sir, here’s why……………. “

“Very well. So what’s my rate?”

“Just a couple more small questions sir. Do you want to have a 30 year amortization, or will 25 years or less suit your needs?”

“I don’t know. What’s better for me?”

“Well, …….long explanation of pros and cons of duration of amortization period. “Oh and also, if you  wish 30 years, some of our lenders will increase their interest rate a bit – typically around 0.15 percent.”

“ Really?! Well screw that I want the lowest rate  possible. Give me 25 years.”

“Yes of course sir. Now of course, you understand this will only be doable if your income is high enough to service the mortgage payments, taxes and heating cost.”

“According to who? Oh so you don’t care if the lights work, just as long as the house is warm?”

best-mortgage-rate“No sir, not at all. We want you to be able to see your way around. And watch tv and use your computers and tablets. So paying the hydro bill and having an internet plan will be necessary too.”

“Are you telling me the more data I use for my household devices the less mortgage I will qualify for?

“No no sir, sorry for the confusion. We just need to know how high the thermostat will be set throughout the year.”


“Oops my bad sir. That was a joke. Perhaps poorly timed. We just factor in a heating cost along with your mortgage payment and property taxes – they should all add up to no more than 39% of your gross income.”

“Oh great I should tell my neighbor. He drives a long haul truck. Pulls in $300,000 a year! He could get a huge mortgage right?”

“Well, that depends sir. Sounds like he is self-employed. Probably no one is paying that in salary to him to drive their truck”

“Yes he is self employed. So what? Will he get my rate too? By the way, what is my lowest rate?”

“Well your friend may get a different rate sir. It can get quite complicated. Let’s keep things simple and focus on you.”

“Sure, ok. So what is my best rate?”

“Almost there sir. Just a few more questions”

what-is-your-lowest-interest-rate“Cheesh, alright – say I don’t have all day. Is this going to take long? I only want to know your best rate. I can go online to a rate site and their best rate is staring me in the face.”

“Very true sir. And yes I suppose those ARE their best rates. What I am trying to determine is what is the best rate we have for YOU and YOUR circumstances. It may not be our “best rate” though.”


“Anyway sir. Moving along. Are you buying a home or are you refinancing your current home?”

“Actually a bit of both. I want to take some equity out of our home and use it for a down payment on a rental property.”

“Ah I see sir. Which rate would you like me to give you?”

“Just your best rate please.”

“Certainly sir. But we have different rates for refinances and for purchases.”

“Really! Which one is better?”

“We’re getting to that sir. First about your purchase. Will it be closing by year-end?”

“No, why?”

“Well we have some special unpublished, promotional rates available to our best customers who are closing before year end.”

“Awesome, let’s do that for the refinance then. I’ll get your best rate then right?”

“Um, maybe yes, maybe no sir. It depends. Now about your purchase. Is there any chance you will be closing this transaction within the next sixty days?”

lowest-toronto-mortgage-interest-rate“ I am not sure. It depends on what my realtor finds and when the seller wants to close. What has this got to do with your best rate for me?”

“It may or may not sir. Depends on the lender. Did I tell you I have dozens of lenders available to me, assuring you of the best rates and mortgage terms at all times?”

“No you didn’t but I kinda knew that. You’re a broker right? At the bank I asked them their best rate and I got the answer in under a minute.

We’ve been on the phone ten minutes now, and I am getting thoroughly confused. All I want to know is your best mortgage interest rate.”

“Yes of course sir, we’re getting closer and closer. About the banks, did anyone warn you how high their prepayment charges might be if you have to break the mortgage mid term?”

“Yeah I heard something about that. You guys are different though right? Your penalties are much lower?

[important]“Usually yes, sometimes maybe, but not always our penalties are much lower sir.[/important]

The banks’ calculations are locked up in a 3 foot thick safe at PriceWaterhouse Cooper’s head office. Our lenders, well some of them, have less punitive calculations…….

Mind you if you want our lenders’ lowest, lowest rate, the penalty becomes much higher. The good news in these cases of high penalties for our low rate mortgages, you don’t need a fancy scientific calculator to calculate the penalty. It’s typically around 3% of the remaining balance.

And in a couple of cases where you get a lender’s lowest rate, the penalty rolls back to what it would be under normal circumstances. How good is that? The only downside is you cannot break their mortgage unless you sell your home.

Anyway, we’re off topic now. About the investment property. You wanted to know the best rate for that too, correct?”

“Yep, I want to know the best rate to refinance my home, and the best rate to buy a rental property.”

toronto-mortgage-pre-application-form“Okay sir. For your home, I think the easiest thing to do would be if I send out a short questionnaire to you and you check off all the relevant boxes which apply. You can email it back to me. Then I will call you back and will be able to give you a more precise answer.”

“Really?? What could be simpler than just telling me your best interest rate? Now I have to fill out a form first? I don’t want to do an application with you unless I think you have the lowest rate.”

“I understand sir very well thank you. Actually, this is not an actual mortgage application. It’s what we call our mortgage pre-application form. You’ve heard of a mortgage pre-approval? Well this is the same sort of thing.”

“Well I don’t know. It seems like a lot of work for me. I guess that means you are pre-approving me at the same time, right?”

“Oh no sir, not at all – that would require we take a complete application, not just a pre-application

“Okay, but we are getting close to the best rate right?”

“Absolutely sir. Now about the rental property…I am not sure you are asking the right question when you want to know the best rate for it.”

“It IS the question I am asking you.”

toronto-investment-property“I see sir, yes. But what if I told you sometimes the best rate comes with provisions like you have to pay for mortgage default insurance too. Perhaps as much as 2.9% of the purchase price.”

“Are you crazy? I already told you I am not doing a so called hi-ratio mortgage. Sell your premium to someone else wise guy.”

“Of course sir. Let me explain what I meant by that………”

“ Alright well I don’t want no insurance. So what’s the best rate on my rental property?”

“Well then sir. That’s a very good question. That will depend on which lender I choose for you.”

“Um duh! Of course it does. Choose the best one dummy. I asked the bank their rental rate and I had the answer in the next sentence. What’s wrong with you? Why are you making this so complicated?”

“ I completely understand your growing frustration sir. Believe me, we in the mortgage industry all feel the same way. In the last two months our business has been turned upside down by the government. It’s their fault.”

“What? You’re telling me you cannot tell me your lowest rate and I should blame it on the Liberals?!?”

“Not exactly sir. I am just saying even our best and brightest all feel like they are going back to mortgage college all over again.”

“Well in that case, maybe I should just stick with my bank. At least they don’t boast of having dozens of lenders to choose from. And they don’t have me fill out a special form just to answer one simple question. And they don’t complain about Justin Trudeau – even though I am sure they all voted Conservative.

So you’re telling me your business was very simple until a couple of months ago?”

onion-wants-mortgage“Well it’s always been a business of intrigue and mystery sir. You know, it’s like peeling an onion when we first speak with a new customer. Always was.”

“Listen I’m no onion and I am certainly no vegetable. For the last time, tell me your best rate.”

“For the rental property sir?”

“Any of them I don’t care – just give me a number for gosh sakes.”

“Of course sir. Now just one or two more questions…”

“Are you nuts? Enough with the questions. What’s your best rate?”

“Yes indeed sir. Before I answer that, how many rental properties do you own already?”

“About twenty four! No I am just kidding. This will be my second. Does it matter?”

“Ah yes sir, but don’t you worry yourself about that, Now about your other property, do you declare your rental income on your tax returns?”

“Of course I will. But I only bought it this past January. Does that matter??”

“Only a little bit sir, and only with certain lenders.”

“You know what…I feel like I am in a bad Monty Python skit here. Like the man in the cheese shop. I can’t take much more of this. One last time, I’m not answering any more of your danged questions. What is my best rate – okay the best rate for my house and the best rate for my rental?”

“Alright sir, I can tell you are a little frustrated. Don’t worry, that’s perfectly normal. So just one little bitty question for now. How is your credit history? Do you make all your payments on time?”

canstockphoto5198576“Yes of course I do. Do you think I didn’t learn my lesson from the last time I went bankrupt?”

“Excuse me sir? Did you say bankrupt?”

“Yes I did – but that was a long time ago. It’s all behind me now. And I smartened up completely.

Next time I had problems I went straight to a consumer proposal – no bankruptcy for me again, no sir. I  looked my creditors in the eye and said  ‘boys, I’m not running away this time.’

My trustee told me that was the responsible thing to do. They will love me for that down the road”

“Ah I see sir. Well then, this may change things somewhat. How long ago did you complete your consumer proposal?”

“ Who said it was completed? I am about one year in. I am hoping I can pay it off early when you refinance my house. Now, enough about that stuff …it’s all in the past.

One last time, what’s your best five year mortgage rate?”


happy-toronto-mortgage-customer…………………..And they all tried to live happy ever after





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