Best Mortgage Lenders 


It's all in the fine print, rates, terms, penalty policy

905.308.8063 FSCO No. 10420

Banks and "A" Lenders pay us for your residential service. EXCEPT bad credit mortgages, some self employed mortgages from "B Lenders", private mortgages or multi-use and commercial loans - these broker fees are payable to us by clients. Lenders change their products and interest rates without notice.

..... follow me and get daily Twitter updates ... Marie Copeland @AxcessMortgage

Best mortgage lenders are those who meet the unique needs of individual borrowers - financing offered must be the right fit for you.

But, at a glance, I look for an ideal blend of transparency, competitive interest rates, fair interest rate differential (IRD) policies for a payout penalty if you should need to break your mortgage, flexible terms and a helpful service to my clients after the mortgage closes.

If your job, income and credit are solid, you're an 'A' client and deserve a lender that offers you the best blend of terms. I prefer one of the monoline wholesale lenders available only through mortgage brokers. They are specialists in the mortgage financing business and can offer you the best you deserve. Axcess Mortgage and Loans Financing are accredited mortgage brokers with broker channel lenders.


Penalty calculation -- the best kept dirty little secret

Whether you agree or disagree with me, the Penalty or Interest Rate Differential (IRD) calculation is a key consideration for choosing the best mortgage lender. In my opinion, the best mortgage lenders are those offering the best IRD terms - this is more important than the small differences in the interest rate offered between lenders.

There is no guarantee you won't need to sell or refinance your home before your 5 year term is up.

How the IRD is calculated is one of the greatest pieces of information I can offer you. Often clients have "no idea" how much their existing mortgage penalty might be before they decide to sell or refinance their home - this is because lenders have done their best not to clarify this information to you when they finalize the mortgage with you. If you go for a mortgage to a bank, such as TD Canada Trust or any other Canadian Bank, ask upfront to give you a formula how your pay out penalty will be calculated -- that's important!

Some variable interest rate mortgage structures with the best mortgage lenders offer pay out penalty as low as three months interest or another reasonable calculations policy.

Here is a simple example how an IRD is calculated:


First, here is how best mortgage lenders calculate your payout penalty

$200,000 with 3 years remaining on a 5 year term of 3.70% interest rate.

Because there are 3 years remaining, the present contract 3 year rate is used to calculate the differential /penalty.

If the lender's present contract 3 year rate is 2.70% - there is a difference of 1.00% between the two rates.

As there is still 3 years left on this mortgage, the $200,000 is also multiplied by 3.


$200,000               x              1.00%           x              3 years remaining   =   $6,000 penalty

(remaining mortgage)           (difference in rates)       (# of years remaining)



And here is how other lenders and banks calculate your penalty

$200,000 with 3 years remaining on a 5 year term of 3.70% interest rate.

If the original mortgage was for a 5 year term, many lenders and banks use the original 5 year POSTED rate to calculate the penalty - their own posted rate can be 1.1% - 2.5% higher than the contract rate of 3.70% -- in this example we'll use the use a posted rate of 1.1% higher than the contract rate.


Because there are 3 years remaining, the posted interest rate of 4.80% is used to calculate the differential /penalty.


If the lender's present 3 year rate is 2.70 there is a difference of 2.1% between the two rates.


As there is still 3 years left on this mortgage, the $200,000 is multiplied by 3.


$200,000               x             2.1%            x             3 years remaining   =   $12,600 penalty

(remaining mortgage)               (difference in rates)         (# of years remaining)

** This is an estimate only and will change every time interest rates change. If the differential increases, the penalty also increase.

If the current market rate is higher than the contract rate, a standard 3 month interest penalty may apply depending on the specific lender's fine print.


Interest rates

The mortgage market is a moving target with constantly changing rates and programs. 

And, there is no guarantee that you will qualify for an advertised interest rate, or that you will be comfortable with the terms or prepayment privileges. For example, there are lenders that may offer a slightly lower rate, but if you need to pay the mortgage out early, the cost is prohibitive.

Also, the published rates often have conditions that banks don't tell you upfront. The reality is, retail banks properly evaluate your application and commit to the interest rate at the last minute, when it's too late for you to search for another mortgage.

That's because at a bank, such as TDCT or other banks, each branch acts as a separate profit centre. Their front line people are really a marketing force who are rewarded and paid based upon the profitability of their overall mortgage portfolio - and as a result ...

Banks often publish their lowest rates to get you in the door and you may, or may not get it when its time to close. What's worse, you may not get a mortgage at all after the bank reviews your documents at the last minute and it's too late for you to shop around. 

It is our policy to pre-qualify your application from the start to get a proper picture of your situation -- we deal with many lenders, virtually the entire market place and stay on top of the market so that you can get the best interest rate that you qualify for.


Flexible mortgage terms are important too

I want you to own your home sooner.

Here's what you need to know and how you can do it.

You want flexible payment policies -- choosing accelerated weekly or bi-weekly payment options can take years off your mortgage and save you thousands of dollars in interest.

Most retail bif banks such as TD Canada Trust, known as TDCT, Scotia, CIBC, RBC or National Bank offer 10% - 15% prepayment privileges and 10% - 15% monthly payment increase. At a glance, this may look reasonable to you ... but, it is not.

The best mortgage lenders offer prepayment privileges that let you pay up to 20% of the original principal balance each year OR increase your payment amount by up to 20% each year OR a combination of both.

These options have no penalties and I can show you how using these privileges effectively you can save yourself thousands of dollars on interest and become mortgage-free sooner.


Service after your mortgage closes

Best mortgage lenders will provide you with excellent service long after your mortgage closes. When I place the client with a lender, I want to know that you are being well looked after for the duration of your loan term and that there is a process in place that allows me to intervene on your behalf if you need my help.

Everything being equal, I prefer a lender who provides an authorization system that allows me to continue to be your advocate throughout the life of your mortgage.


Best of all, our service is FREE

The best mortgage lenders pay us for your business.

You get knowledge and experience -- one hour with me will make a huge difference in your application -- you won't have to worry about the terms, rates, penalties -- you get the best rate the first time you ask.

Marie Copeland FSU, Mortgage Broker 


Call 905-308-8063 for free phone consultation

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