Weighs in on Canadian Housing Market After Big Banks Cut 5-Year Fixed Rate to 2.99% in Run-Up to Spring

Toronto, Canada (PRWEB), April 2, 2014 – , the leading low-cost private mortgage solution provider in Canada, is weighing in on the state of Canada’s housing market after the country’s big banks started to cut the five-year fixed rate to below three percent. is also cautioning that there is more for first-time home buyers to consider when getting a mortgage than just interest rates.

“The busy spring real estate season kicked off in earnest recently after the Bank of Montreal slashed its five-year fixed mortgage rate to 2.99%; the first of the big banks to cut the key mortgage rate below three-percent threshold,” says Bob Aggarwal, president of “The drop comes just a week after finance minister Jim Flaherty stepped down from his post. In March 2013, Flaherty admonished Canada’s big banks for offering mortgages below the three-percent mark; fearing the low lending rate would overheat an already red-hot housing market.” (Source: Marr, G. and Isfeld, G., “New mortgage rate war looms as BMO cuts 5-year below 3%,” Financial Post, March 26, 2014;

Aggarwal explains that in an effort to slow the housing market, Flaherty initiated a number of tighter lending rules. One of the biggest measures was reducing the maximum amortization period for a government-insured mortgage from 40 years to 25 and reducing the upper limit that Canadians can borrow against their home equity to 80%.

“These actions certainly made it more difficult for first-time home buyers to get onto the property ladder, but it hasn’t had the added effect of curbing the increase in home sales,” he adds. “In fact, Canada’s major housing markets continue to show exceptional resiliency, setting the stage for a busy spring real estate season.”

The rock-bottom mortgage rates are raising concerns that first-time home buyers will jump onto the property ladder simply to take advantage of the low interest rate environment. Aggarwal notes that with households carrying record debt levels, the eventual uptick in mortgage rates could leave many homeowners unprepared for when mortgage rates eventually start to increase in earnest.

“Despite the concern, evidence suggests that Canadians are more than capable of handling their debt even as it closes in on record levels,” he observes. “According to a new study, less than one percent of Canadians are in arrears on their mortgage, and the number of those in arrears is actually going down in just about every market across the country.” (Source: Marr, G., “What bubble? Canadians have their mortgage covered, study shows,” Financial Post, March 24, 2014;

“That doesn’t mean potential home buyers should just rely on what the big banks are offering. For example, some discount lenders are offering rates slightly lower than the big banks. However, that’s not something the big banks are ever going to tell customers—but the independent, licensed agents at will,” Aggarwal concludes. “By searching hundreds of banks and lenders, agents can help home buyers save time, reduce overall risk, and find the mortgage best suited to their lifestyle needs.” is one of the largest, most trusted private mortgage brokers in Canada, with skilled independent, licensed professionals helping Canadians coast-to-coast. provides its clients with residential and commercial mortgages, home equity credit, debt consolidation, and financing concerns. To learn more about, visit the web site at .

Bob Aggarwal

Mr. Aggarwal was one of the original founders of, one of the largest volume Mortgage Brokerage houses in Canada. Mr. Aggarwal has over 12 years of experience in Brokerage and Lending in the small and medium business sector, as well as experience and expertise in the residential housing market. Since the inception of, Mr. Aggarwal has been instrumental in developing the operating platforms, and policies and procedures which have guided the organization to date.


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