All mortgages are NOT created equal and TD Canada Trust just made the decision to differentiate their mortgages from the traditional ones. TD has now decided to register their mortgages legally (this means at the lawyer's office) as "collateral" mortgages. A collateral mortgage is different from a "regular" or traditional mortgage registration because it does NOT allow you to transfer or switch your mortgage for FREE when it comes up for renewal.
You see, when your mortgage comes up for renewal, it is common for the consumer to shop around and see which lender is offering a good deal and then switch to that lender. Typically, the new lender would pay for the "switch" costs because the legal registration provided for this feature. Banks have caught on and don't like losing business, so some, such as Scotia, TD and National Bank, are registering their mortgages as "collateral" mortgages without your consent.
With a collateral mortgage, the new lender has to re-register your mortgage upon renewal because collateral mortgages are "non-transferrable". When your renewal comes up and your ready to make the switch to a lower rate and better product, your bank then lets you know that your mortgage is collateral and the new lender charges you a legal fee to get the new mortgage switched. In essence, your are now paying to refinance your mortgage rather than switch it!
For more detailed account of how this change may affect you go to Gail Vaz-Oxlade's blog (Till Debt Do Us Part)
In this day and age, it is vital, more than ever, to have a good mortgage broker on your side. We provide clear explanations of the mortgages we offer for each situation. You can also be rest assured that if a lender starts to bully you around, we're here to help you sort through the financial lingo and make the best decision!
Thanks for reading!
Your London, Ontario Mortgage Brokers at Dominion Lending Centres Forest City Funding FSCO# 10671