14 December 2018

“B-20 caused higher renewal rates for the big banks, increasing their growth rates,” – noted Eight Capital analyst Steve Theriault. “It had an unexpected consequence of weaker competition.”

According to DBRS analyst Robert Colangelo, RBC and Toronto Dominion Bank may raise their forecasts for mortgage sales growth from 3% to 5% and from 4% to 6%, respectively, in 2019.

Although analysts say RBC and TD are expected to take advantage of higher retention rates next year, it doesn’t necessarily mean that borrowers will benefit from it as well.

The banks are becoming stricter in addressing those borrowers who may fail the stress test, so they could charge a higher rate at renewal as borrowers won’t be able to switch to another lender.

In contrast, we at MortgageLegko.com are offering much better rates at renewal and seeing spike in our renewal book of business. For example, we can offer to our well qualified borrowers  Prime – 1.15%% (2.80% as of today) at renewal without any expense to clients! Good luck getting this rate at your branch!