Toronto-Dominion Bank, Canada’s second-largest bank, reduced its four-year fixed-rate mortgage to 2.99 percent, following a rate cut yesterday by smaller rival Bank of Montreal.
The lower rate is effective tomorrow and is available only on new mortgage applications made until Feb. 29, the lender said today in a statement. The previous rate for a four-year fixed mortgage at Toronto-Dominion was 4.79 percent.
Bank of Montreal, the country’s fourth-largest bank, yesterday cut the rate on its five-year mortgage by 50 basis points to 2.99 percent, a record low for the Toronto-based lender. Toronto-Dominion also cut its six- and seven-year mortgage rates yesterday.
“We definitely acknowledge that there is a competitive rate environment,” Farhaneh Haque, the bank’s director of mortgage advice, said today in a telephone interview. “If we look at the bigger picture here, we’re gearing up for a spring market that typically starts in February.”
Canadian household debt rose to a record 153 percent of disposable income in the third quarter of 2011 as borrowing costs increased, according to a Dec. 13 report by Statistics Canada.