TD Canada Trust announced their new mortgage program this week amongst much controversy.
While the new mortgage makes it easier for homeowners to access their equity, it makes it difficult to transfer their mortgage to another lender on renewal.
That means if you don't like your mortgage rate on renewal, it's going to cost you in legal fees to move your mortgage to another lender! Traditional mortgages allow you to change to a new lender without incurring any legal costs. You will be losing the choice to make a decision on what lender best fits your needs on renewal.
It's one thing to make a decision that you want this type of mortgage program after carefully reviewing your situation, but with TD Canada Trust, ALL new conventional mortgages
as of October 18th will be registered as a collateral charge. What ever happened to consumer choice?
TD Canada Trust's new program means that up to 125 percent of the value of your property will be registered, so if your property goes up in value, you will be able to access those funds.
Of course, there's always the reality that while for some people that access to cash may be manageable, for others it makes it way too easy to take on additional debt in the thousands.
This strategy appears to benefit the bank more than the consumer but is marketed as a benefit to you. I'm not convinced .. are you? Buyer Beware!