TD Canada Trust Mortgage Rates

If you’re in the market for a TD-branded mortgage, you generally have four ways to go about getting one:

-A TD mortgage specialist
-TD’s call centre
-Online
-Through the mortgage broker channel

For existing TD Bank clients wanting to renew an existing mortgage, you’ll have to call the bank and negotiate your renewal rate or accept an online renewal offer. For new clients, you can either use a mortgage broker, contact an in-house TD mortgage specialist or go online to TD’s website.

Using a TD mortgage specialist
Despite TD Bank participating in the mortgage broker channel, a majority of the bank’s mortgages are sold through its in-house team of mortgage specialists who work off of commission. What you may not realize is, similar to a mortgage broker, TD’s mortgage specialists can buy down your rate by forgoing a portion of their commission. It’s important to note that mortgage specialists often only serve new bank customers, and not clients wanting to renew their existing mortgage.

Online
TD offers a fast Digital Mortgage application option, often with better rates than its standard advertised specials. Unfortunately, at the time of this being written, you have to submit to a credit check to get a rate quote. Competitors like Scotiabank quote aggressive online rates without that level of commitment. TD bank advertises online pre-approvals in as little as five minutes. Live mortgage representatives are available to help customers through the process.

TD-approved mortgage brokers
There are only two big banks in Canada that offer mortgages nationwide through the broker channel, and TD Bank is one of them. The latest available data showed TD with roughly 10% of the market share in the broker market.

While TD’s in-house mortgage specialists and branch reps can usually offer clients the same mortgage rates as brokers, brokers have an advantage in that they can use some of their commission to buy down rates (While mortgage specialists technically can buydown rates for their clients, deep discount brokers often buy down more.). If you’re set on a mortgage from TD, it may be worthwhile shopping the bank against a TD-approved broker to see if they can offer you a lower rate after buy-down.

If you currently have a mortgage with another lender and want to switch to a TD mortgage, the bank’s mortgage specialists are happy to assist.

While you can switch your existing mortgage to TD Bank at any time, TD recommends exploring your options 120 days before your maturity date. TD’s mortgage specialists will then assist to help you find an appropriate term based on your financial and life goals.

Once you choose the mortgage product you want, you can apply online and TD’s mortgage specialists will guide you through the rest of the process.

Depends on why you want to do it! If you want to keep paying your mortgage, but not with TD – because maybe another bank offers you a lower mortgage rate – you can just switch providers. Like other banks, however, TD may charge you a prepayment penalty, if you happen to get out of your mortgage before the end of your term. So, be sure to review your mortgage agreement with TD before making any decisions.

If you’re looking to sell your current home to buy another one, you can port your mortgage without a pre-payment charge or too many changes to your current agreement.

If, however, you want to get out of a mortgage because you can’t afford your payments, consider some of the following alternatives before committing to such a drastic move:

• Pause your mortgage for a set amount of time to catch up on your missed payments (or save up some money).
• Negotiate a temporary reduction in payments.
• Extend the amortization period to lower your monthly payments.
• Add your missed payments to your mortgage balance, spreading them out over the remainder of your mortgage period.
• Rent out your home, or parts of your home, to collect extra money that can go toward your monthly payments.

Finally, if none of the alternatives work, here are some ways to fully get out of your mortgage:

• Sell your house: If your home is worth more than your mortgage, then this is the most viable option. You can prepare, list and sell your home within weeks, if fact. Just remember, if you do it before the end of your term, a pre-payment charge may apply.
• Transfer your home’s deed to TD: A ‘deed in lieu of foreclosure’ is a process of voluntary foreclosure. Basically, you agree to turn over your property to the lender and move out. This is better than full foreclosure as it helps you avoid a potential lawsuit, maintains your credit score and lets you close out your mortgage right away. Note that your lender may not agree to this, depending on your circumstances.
• Wait for foreclosure: Simply stop making payments and default on your loan. Eventually, this will cause TD or any other lender to initiate foreclosure. This is the least desirable option. In fact, we recommend avoiding it at all costs, as it may result in a costly lawsuit and significantly lower your credit score, making it very difficult to take out another big loan again.

While TD Bank’s pre-approval process used to be more cumbersome compared to other big banks (it required a face-to-face meeting to complete the application), the coronavirus pandemic in early 2020 accelerated the bank’ adoption of a fully digital process.

A mortgage pre-approval from TD is good for 120 days and lets you know how big of a mortgage you will qualify for, barring any drastic changes to your financial health.

A pre-approval specifies the term, interest and mortgage amount, but typically comes with a number of conditions attached.

Should interest rates fall after you’ve received a pre-approval, you can ask TD to have your pre-approved interest rate adjusted to match current rates.

Your best chance at scoring the best TD Bank mortgage rate is through negotiating. Keep in mind that big banks, TD included, don’t typically advertise their best rates. There’s almost always room to negotiate, particularly if you’re a well-qualified borrower and have a long banking history with the bank.

To prepare for your negotiation, make sure to compare mortgage rates that other banks and non-bank lenders are offering. That way you’re fully informed. Just make sure that those rates are for comparable terms, with similar features and conditions—in other words, you should be comparing apples to apples.

In the event your TD mortgage rep refuses to play ball in the negotiations, don’t be afraid to try a different rep who may quote you a better rate. Remember, even a small rate difference on your mortgage can work out to hundreds or even thousands of dollars in savings over the term. Barring that, you can threaten to take your business to another lender offering a lower rate (assuming you’re well-qualified).

Remember that bank specialists and their employers want your business and are usually willing to come down on rate in order to secure it.

TD Bank, together with the other big six banks, helps set the country’s benchmark prime rate. That rate is based on a mode average of the banks’ prime rates.

TD is rarely the first bank to announce its prime rate following a Bank of Canada interest rate cut, although it typically follows the other big banks in lockstep. The bank’s prime rate is used to set interest rate pricing on Home Equity Lines of Credit (HELOCs).

For mortgages, however, TD is unique in that it has a separate (and higher) “mortgage prime rate.” As of this writing, TD’s mortgage prime rate is 15 basis points higher than the prime rate of its competitors.

The bank has faced much criticism from its customers ever since it hiked its prime rate independent of a Bank of Canada rate move in November 2016. The end result was TD’s mortgage customers paying a higher rate for variable-rate mortgages compared to other big bank variable-rate customers.

You can get them from a different mortgage lender, of course! All you need to do is shop around until you find the one that suits you best. The easiest way to do so is by consulting a rate comparison site like RATESDOTCA, which will show you the available rates in seconds.

You can search online for other banks and mortgage companies to find out their rates, then put them into a spreadsheet and manually compare them yourself.

Another option is to contact a mortgage broker, who will work with you to get you the lowest mortgage rate possible.

Both options would require some effort on your part. The easiest option is to instead use a comparison site like RATESDOTCA to look up the available rates immediately.

Buying a home is an enormous financial decision for most buyers, but it can be even more overwhelming for those who are new to the country.

Like many other lenders, TD offers specific banking options for newcomers to Canada, including mortgages.

To be eligible for TD’s New to Canada banking package, applicants must:

-Be a permanent or temporary resident of Canada for at least five years
-Have never held a TD chequing account
-Supply proof of status using a Permanent Resident Card or Temporary Permit
-Be at least the age of majority in your respective province

TD’s services are also offered in a variety of languages to assist those new to the country.

While it may seem like a good idea to break your mortgage early and change lenders, TD makes you pay for that privilege. If you prepay more than your annual privileges allow, penalties apply.

On variable mortgages, the penalty is three months’ interest.

On fixed mortgages, the penalty is the greater of three months’ interest or the interest rate differential (IRD). Big bank IRD penalties are notorious for being in the thousands, often tens of thousands, of dollars. The more short-term posted rates fall, the bigger they usually get.

Paying out a closed TD mortgage before maturity also entails a discharge/assignment fee in most provinces (e.g., $260 in Ontario and $75 in B.C.) and in some cases a mortgage reinvestment fee of hundreds of dollars.

Many borrowers fret renewal time, but the process need not be complicated. The best advice for renewing a mortgage is to give yourself plenty of time before the mortgage comes up for renewal.

If your lender doesn’t reach out ahead of time, you should contact them roughly 60 to 120 days before your renewal deadline, which will give you time to shop around if the rates your bank offers you are less than desirable.

Remember that you should always negotiate the first rate your bank offers you. In nearly all cases you should not accept the first rate offered since they almost always come down on the rate if you can do some sweet talking.

If push comes to shove and you threaten to pull your business, make sure you’re prepared to follow through. If you choose to switch your mortgage to a new lender, you will be subjected to the mortgage stress test, so you’ll want to make sure you’re able to qualify. If not, you will be forced to renew at your existing lender…on its terms.