Compare The Best Mortgage Rates In Montreal

Your Guide To Getting The Best Mortgage Rates In Montreal

If you are looking for a great mortgage rate in Montreal, Comparemortgages.ca has you covered. We are proud to offer competitive rates that give our customers the ability to get the most out of their mortgages. Not only do we bring you up-to-date information regarding the current mortgage rates in Montreal, but we also provide guidance that can help you make better decisions when it comes to any type of market in Canada. With our expert staff and reliable resources, you can be sure that your next mortgage purchase will be a smart one.

About Montreal

Montreal is a vibrant cosmopolitan city located in Quebec. Montreal boasts a population of over 2.5 million, with as many as 3.7 million people in the metropolitan area, making it the largest city in Quebec and the second-largest in Canada. Montreal is known for its diversity and inclusion, rich history, stunning architecture, and dynamic arts and culture scene.

The history of Montreal dates back over 8,000 years to when Indigenous peoples, including the Mohawk, Huron-Wendat, and Algonquin, first inhabited it. In the early 16th century, French explorer Jacques Cartier arrived in the area and claimed the land for France, paving the way for French settlement.

One of the most notable features of Montreal is its unique blend of European and North American influences. The city’s historic Old Port and the Notre Dame Basilica are reminiscent of French architecture. In contrast, the city’s bustling downtown core and skyscrapers are more reminiscent of North American cities.

Compare Montreal Mortgage Rates

Below is a table displaying the best rates from the five largest banks in the country. You can easily compare the rates offered by major Canadian lenders and banks, including TD Bank, RBC, CIBC, HSBC, and Scotiabank. We take care of the research to guarantee you the lowest possible rates upfront every time.

Compare Big Bank Rates In Montreal

It can be time-consuming and frustrating to compare rates by yourself. With us, you can find everything you need in one convenient location. Also, ensure that you consider the mortgage product term length and type when comparing rates. For instance, if you are in the market for a fixed-rate mortgage, it is essential to examine the range of terms given by various banks, such as three-year and five-year offerings, and not just the interest rate.

About The Montreal Housing Market

Over the past two years, the housing market in Montreal has seen a considerable upswing, with the price of a single-family home growing by +59% since 2017. Experts anticipate prices to moderate as demand starts to decline as the pandemic’s impact on the country starts to fade.

But despite what the epidemic is doing, there is still a housing supply problem in Montreal. This will keep prices rising, probably only slightly over the next 12 months. Nevertheless, homebuyers who would rather spend $500,000 for a property than $505,000 may find even a 1% increase to be a significant issue.

The capacity of homebuyers to spend more than the asking price for a property is one factor that can impact home sales. The lack of availability of houses has caused many Montreal sellers to list their properties for more than they are worth, frequently resulting in bidding wars for houses in popular parts of the city. The amount of money that homebuyers may borrow responsibly may be impacted by increasing interest rates in Montreal. This may reduce the number of consumers willing to purchase at those higher price tiers.

Montreal Closing Costs

When borrowing money to buy a property in this city, there are other expenses to consider besides the interest rates in Montreal. The down payment for the home will be the highest expense you will incur while finalizing the purchase. You probably won’t be able to purchase a property unless you already have the required amount available for a down payment. Depending on the price of the home you’re buying, this amount might range from 5% to 20%.

Closing costs, which are needed after you sign the last document to complete your mortgage, will also be required in addition to your down payment. Usually, there isn’t a way to finance these expenses, so you’ll need to have cash on hand.

At closing, in addition to your down payment, you’ll be responsible for paying between 2-4%, assuming the seller pays the entire real estate agent commission. Additionally, the lender often demands an appraisal; however, they frequently pay for this. If not, this may increase your closing costs by an additional  $250 to $350, depending on various factors.

Montreal First-Time Homebuyer Rebates

Several subsidies available to first-time homebuyers might help reduce some of the costs involved in buying a home. These credits and rebates might provide you with the funds you require to purchase a property or just assist you in covering the continuing expenses of homeownership.

  • RRSP Home Buyer’s Plan: You may be permitted to withdraw money from your registered retirement savings plan to finance the purchase or construction of a property. First-time homebuyers are eligible to withdraw up to$35,000.
  • First-Time Home Buyer’s Tax Credit: When you buy your first home in Canada, you’ll be eligible for a one-time tax credit of up to $10,000. To qualify, the home must become your main residence within a year of purchase.

The Montreal Home Ownership Program was launched in 2018 to give first-time home purchasers financial support in lump-sum payments. If the household has children, the land transfer tax (known as the welcome tax in Quebec) may be refunded in full. If the property was purchased before 2018, families with at least one kid are still eligible for the return if it has at least three bedrooms. The size of the lump-sum payment is determined by the purchase price of the property.

Montreal Mortgage Brokers

Homebuyers in Montreal, Quebec alone have access to over 800 certified mortgage specialists serving over 2,000 different mortgage programs and even more lenders.

Are you in the market to buy in Montreal? Get in touch and let us guide you through the Montreal market and provide you with more information about the current mortgage rates in Montreal available to you.

How To Apply For A Mortgage In Montréal

Obtaining a pre-approval is the first action to take after deciding to purchase a home. You will get a general idea of how much a lender will allow you to borrow through the pre-approval process. With this information, you may approach real estate agents and begin your home search. Prequalification won’t harm your credit, but if you choose a lender for a pre-approval, that lender will perform a formal credit check.

Meet With A Mortgage Expert

Now more than ever, it is simple to start the mortgage process. A local lender can be contacted via phone or video chat and in-person visits. These means of contact are opportunities to raise questions and ensure you receive the best mortgage for your particular scenario.

Acquire All Necessary Documents

Application for a mortgage involves a lot of documentation. If you’re self-employed, you’ll generally require assessments for the last two years of income, confirmation of your financial stability, and at least one recent pay stub to show your income. In the latter scenario, you will be required to provide proof that you can make the required down payment.

Apply For Mortgage Financing

Pre-approval gives you a head start on your mortgage application before finding a property, which is the most significant step. After putting a deal on a home, you’ll go on to the complete application procedure, where the lender will request any additional documents required to approve your loan. Your contract will include a “closing date,” and your lender will work with you to ensure your loan is ready to be closed on that day.

Sign & Finalize Your Mortgage

Although mortgage closing day is a joyful occasion, you must be ready to complete all the necessary payments to your lender on that day. Once the complete money for the house has been transferred to the seller, your lender will ensure that your real estate lawyer receives it. Normally, you’ll be told where to go to meet with your real estate agent and a mortgage lender representative to sign everything. You’ll be prepared to move in after the seller, and you have signed all the paperwork.

What Affects My Mortgage Rate In Montreal? 

Getting the lowest interest rate in Montreal depends heavily on factors like credit score and income. The riskier the borrower, the greater the interest rate could be due to these factors. However, given that no-frills mortgage packages frequently provide rock-bottom mortgage rates in Montreal, it is undoubtedly not the most crucial factor in a mortgage. In other words, even if a borrower is eligible for the lowest rate, choosing the lowest-rate program frequently requires them to forego other advantages like prepayments and porting rights.

Instead of choosing the lowest mortgage rates in Montreal, there are several alternative options to save money throughout the course of the mortgage, such as rounding up mortgage payments or making lump sum payments as bonuses or other income is received during the year. It’s crucial, nevertheless, to stay under your lender’s permitted yearly maximum for additional payments.

Down Payment

When purchasing a home, a down payment of between 5% to 20% is typically required to secure a mortgage. This means that if the cost of the property you are looking to buy exceeds $500,000, you will need to put down at minimum – 5% on the first $500,000 ($25,000) and 10% on the remaining balance. as an upfront investment. If you don’t put 20% down, that’s completely fine, but you will have to pay an additional monthly mortgage insurance payment.

Amortization Period

Having a longer amortization term means your mortgage payment will be reduced since they are spread out over a lengthier period (the maximum is 25 years on mortgages with less than a 20% down payment and 30 years on mortgages with 20% or higher down payments). Higher interest rates in Montreal might accompany longer amortizations. As your mortgage is paid off over a longer period of time, you will pay more in interest. .

Property Usage

Purchasing a property that you plan to occupy is referred to as owner-occupied and is understood to be your primary dwelling place. Borrowers will usually pay higher interest rates in Montreal than on a personal home if you’re purchasing an investment property to rent. People often pay the mortgage on their principal property before any rental properties due to the rationale behind this. This is why lenders thus include more risk in the rates for rental properties.

Mortgage Type

Your mortgage rate will depend on the type of mortgage rates in Montreal: variable vs. fixed or open vs. closed. Each option is an individual decision based on several considerations.

For example, while comparing open and closed mortgages, it’s crucial to remember that open mortgages are more expensive due to the freedom to pay the loan off at any moment without incurring fees.

While fixed mortgages, such as the 5-year fixed rate in Montreal, have historically been more expensive than variable mortgages. Some borrowers still prefer the security of knowing their payment would remain the same throughout their mortgage.

Your Credit Score

A credit score of at least 680 is required to be considered by mortgage lenders in Montreal. To qualify for the lowest rates, borrowers’ scores should be at least 700 points, with a maximum score of 900. There are choices available for those with lesser scores, but you can anticipate higher interest rates in Montreal and shorter durations in these cases.

Learn About Rates & Mortgages In Montreal

Our Frequently Asked Questions (FAQ) section is here to help you make educated decisions on the best mortgage rates in Montreal every time.

Why compare Montreal mortgage rates on Compare Mortgages?

Comparing mortgage rates in Montreal on Compare Mortgages guarantees that you get the most recent rate information, which can effectively help you save on your mortgage throughout your homeownership journey. 

When you are comparing mortgage rates in Montreal, ensure that you evaluate similar mortgage types (variable rate vs fixed rate) and terms (three or five years) so that you are not simply looking at rates; you are comparing similar products.

Mortgage rates and features see variations based on the specific lender, therefore, you would only get a clear comparison by evaluating similar offerings. 

Are Montreal mortgage rates higher than other cities?

Montreal mortgages today would see variations based on the lender or bank offering the product. With Compare Mortgages’ advanced technology, we get an accurate overview of the entire market at any point in time to guarantee that you always have access to the most current mortgage rates in Montreal. This way, you are able to make guided decisions about whether to leave your rate or lock it in. 

Should I get a fixed-rate or variable-rate mortgage in Montreal?

The choice of a variable rate, like the 5-year variable rate in Montreal or the fixed-rate mortgage hinges on how much risk you can tolerate and your level of comfort. 

If you have a preference for being able to know ahead how much mortgage payments you would be making monthly, then a fixed rate would be a good call given that payments remain the same. A fixed-rate remains the same through the term that you select (1-10 years).