The first is that the 2.99% BMO five-year mortgage isn’t quite as good as it sounds.  The media blasted the low rate and it triggered home owners and buyers to jump at it.

BMO’s recent move to bring its rate below the psychologically significant 3% mark for fixed-rate five-year mortgages is being treated as a big deal because a similar move a year ago provoked then Finance Minister Jim Flaherty to admonish the bank. Joe Oliver, Flaherty’s successor, is taking a more laissez-faire attitude.

What BMO is offering until April 17th is a competitive rate in a mortgage with uncompetitive terms. Most important, you can’t break this mortgage before it comes up for renewal in five years unless you sell the property, refinance with BMO or do an early renewal into another BMO product. All the usual prepayment penalties would apply in these situations. 

Alot of other questions are coming in regarding the other low rates that have popped up on the rate sites all over the internet. 

Like any other bargain basement product, be aware that these products all come with limitations.  Some of them suit some home owners and some don’t.  The important thing to know is what to ask, as it’s not all about rate.  Contact me directly if you want the nitty gritty on these products.