National Bank Launches Its Variable-Rate Mortgage
Montreal, 22 May 2002 -
The variable-rate mortgage now available at the National Bank is a new product intended for clients who want to repay their mortgage quickly and to benefit from the lowest interest rate on the market.
The variable-rate mortgage is offered with a 5-year term. The rate varies monthly according to the prime rate, which is currently 4%. However, the amount of the payment is fixed – which makes it easier for clients to manage their budget – and is based on the published rate for a 3-year term at the time the mortgage is granted. In addition, a promotional rate of 1.9% is offered for the first 3 months, after which a 0.25% reduction is applied to the prime rate.
Jean Blouin, Vice-President – Product Management, explained that the new product was designed to enhance the National Bank's range of mortgage products so as to meet home buyers' needs more effectively. "The variable-rate mortgage, which will be offered to a target clientele, will enable customers to pay off their mortgage more quickly while benefiting from the lowest mortgage rate available."
With a variable-rate mortgage, clients get to benefit each time the Bank's prime rate goes down. Even if the rate goes up, it will still be more advantageous than the rates for other mortgage terms. However, clients will be able to convert their mortgage loan, at any time and without penalty, to a fixed-rate closed mortgage with a term equal to or longer than the remaining period of the current term.
Owner-occupants and non-occupant owners of buildings of 1 to 4 units are eligible for this mortgage. The variable-rate mortgage applies to conventional mortgage loans insured with Canada Mortgage and Housing Corporation (CMHC) or GE Capital, allowing for financing of up to 95% of the value of the property.
National Bank of Canada is an integrated group which provides comprehensive financial services to consumers, small and medium-sized enterprises and large corporations in its core market, while offering specialized services to its clients elsewhere in the world. The National Bank has assets of over $75 billion and, together with its subsidiaries, it employs over 17,000 people. The Bank's shares are listed on the Toronto Stock Exchange.
For more information (the telephone numbers are for the exclusive use of journalists and other media representatives ) :
Public Relations Department
National Bank of Canada
Tel.: (514) 394-6991
Vice-President - Product Management
National Bank of Canada
Tel.: (514) 394-6185