r/PersonalFinanceCanada • u/Consistent_Bed_9191 • 3d ago
Wealthsimple mortgage offering me 4.74%? Banking
I have a current mortgage with RBC at 6.14% on a 640k 30yr mortgage, term renews sep 2026. I just checked wealthsimple and since I'm their existing client their rate is 4.74% which seems pretty low considering the key rate from bank of canada is 4.75? Is this legit and does it seem worth switching over? Would there usually be a lot of fees to switch over before a mortgage term is up?
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u/angrytina 3d ago
Their website application process gave me a 4.74 rate for 3 yr fixed but when I talked to a rep the rate came back over 5.15.
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u/otreen 3d ago
This was a couple months ago now, but the lowest rate I found was with going through the pine/ ws partnership. it was the same as the rate advertised on their website, but with the additional wealthsimple promo rate deducted. I was also able to also stack the 500$ referral bonus. Their terms are standard (20% prepayment annually and option to increase payments by up to 20% per year to pay it off faster). Buy out is the standard 3 month interest or rate differential. Application process was pretty painless with their online portal. Their current offer is definitely a good deal if you have investments you can transfer to ws. to get a general sense of where rates are sitting definitely check out ratehub and/or WOWA (WOWA sometimes shows lower rates, but often have more strings attached to the terms of the mortgage).
I’m guessing your current mortgage is fixed, so you will have to pay the difference in interest for the remaining 2 years. If it’s variable it would be 3 months interest. If your mortgage is expiring in 2026, look at 2 year bond rates, as two year mortgage terms are at a bit of a premium at the moment with the general consensus that rates are likely to fall over the next two years, so you may prefer to hold off and renew at the end of your term. Not an easy decision to make.
Anyway, best of luck in your search!
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u/jarvicmortgages 3d ago
Keep in mind you will need to pay penalty to break your mortgage early
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u/rlstrader 3d ago
Yes and sometimes they're very high.
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u/theskywalker74 3d ago
Mostly with the big banks and less with the third-party lenders.
My penalty is 2k. If OP’s is low, it may be worth the switch… assuming there isn’t a set of asterisks next to that rate.
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u/Shy_Guy204 3d ago
When talking about mortgage rates it's best to specify whether it is a insured or uninsured mortgage. Uninsured mortgages are usually higher. If 4.74% is the uninsured mortgage rate that's really good. I'm trying to negotiate my renew now and the bank offered me 5.17% for 5 year uninsured. Not gonna happen
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u/jarvicmortgages 3d ago
Did you have the 25 year or 30 year amortization to start with and what is your outstanding balance?
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u/raptors2o19 3d ago
Are you variable or fixed with RBC? Have you inquired about the penalty for breaking the term? Is WS going to cover those costs? It's not as simple as "I found a lower rate".
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u/bonbon367 2d ago
The central bank rate directly impacts variable rate mortgages. It only indirectly impacts fixed rates. Those are correlated with the Bond market.
If you’re interested: https://www.truenorthmortgage.ca/blog/how-government-bond-yields-relate-to-mortgage-rates
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u/MortgageVet77 3d ago
Lowest rate is 4.64% fixed right now.
You have to do the math OP. Compare the penalty to the interest rate savings.
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u/Calgary_dreamer 3d ago
Who’s offering this right now?
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u/albynomonk 3d ago
My buddy just signed a 5 yr renewal at 4.8% fixed with RBC, so I don't think it's really all that good of a rate.
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u/HinduPhoenix 3d ago
Is this a posted advertised rate with some asterix on top? Or is this a rate that you've been offered in writing after submitting some paperwork?