For many Canadians, buying a house is one of the biggest investments they will make.
To finally live in your dream home is a milestone purchase that would fuel anyone with excitement. However, that feeling of excitement can turn into stress once it’s time to get a mortgage.
In this TD Bank mortgage review, we will cover their top features, how to apply, pros and cons, and alternative mortgage lenders in Canada.
- If you’re looking for a reputable and well-known financial institution to get a mortgage with, TD Bank is a good option.
- TD offers variable and fixed-rate mortgages. They offer flexible payment options and terms ranging from 6 months to 10 years.
- You can now easily complete a TD Mortgage application online without going into a branch.
- It is still important to compare mortgage options from other lenders and to take into consideration your circumstances.
TD Mortgage Overview
A TD mortgage is a home loan for borrowers to purchase or refinance residential properties.
The great thing about TD mortgages is that they are flexible and come with different terms and options to best fit the needs of the borrower.
TD Mortgage Rates
TD Bank offers different types of mortgages that come with different rates.
These mortgages provide flexibility to allow borrowers to choose how often and for how long they would like to make their payments.
Borrowers get to determine their payment schedules from weekly, rapid weekly, bi-weekly, rapid bi-weekly, semi-monthly, rapid semi-monthly, and monthly.
Below are the different mortgage types offered by TD Bank:
- Fixed Rate Mortgages (terms range from 1-10 years)
- 6-Month Convertible Mortgage
- 1-Year Open Mortgage
- Variable 5-Year Closed Mortgage
- Variable 5-Year Open Mortgage
- TD Home Equity FlexLine
You can find the updated TD mortgage rates here.
TD Mortgage Features
One of the advantages of TD mortgages is their flexible payment options that help borrowers prepare for life’s uncertainties.
Speed Up Your Payments
Speed It Up
Borrowers can pay more frequently by increasing their interest and principal payments from a longer-term schedule like monthly payments to a shorter-term schedule like bi-weekly or weekly payments.
This will help borrowers pay for their TD mortgage faster over the long run.
Increase Your Payments
By getting a mortgage with TD, borrowers have the option to raise their regular principal and interest payments by as much as 100% throughout the duration of their mortgage term.
With this option, borrowers can double their standard payment amount.
So let’s say the borrower usually pays $2,000 a month, they may choose to increase this to up to $4,000 a month during their mortgage term.
Do a lump sum payment
If you have some extra money available, you could use it to prepay part of the closed TD mortgage to decrease the amount you owe much faster.
Once per year, borrowers can make a lump sum payment of up to 15% of the original principal amount. This will be free of any prepayment charges.
Slow Down Your Payments
If for some reason a borrower will need to take an emergency break from their usual payments, they have the option to ask for the equivalent of a single monthly payment to be skipped, either partially or in full.
The payment pause option can only be requested by a borrower no more than once every calendar year and up to four times during the length of this amortization period.
If a borrower knows that a major change is on its way, maybe having a new child or other new financial responsibility, they can prepare by prepaying.
If they have made prepayments that have shortened their amortization schedule, they can request to defer their payments for up to four months, partially or in full.
Prepayments can be made by either increasing your regular payments or doing a lump sum payment towards your current principal balance.
The difference between a prepayment from your usual principal and an interest payment is a prepayment is a lump sum payment of any amount on top of your recurring scheduled payments.
Whether a borrower chooses to do a single lump sum payment or multiple lump sum payments, a prepayment on the principal amount will allow the borrower to decrease their debt along with paying less interest over time.
TD Mortgage Affordability Calculator
With the TD Mortgage Affordability Calculator, borrowers can find out how much mortgage they can afford.
The calendar will ask you a total of six questions, which are:
- Where do you live?
- What kind of home are you looking for?
- What is your annual income?
- How much do you have for a down payment?
- What monthly expenses do you have?
- What are your monthly payments for loans, car loans, leases, lines of credit, and credit cards?
Once you’ve entered all the necessary details, the TD Mortgage Affordability Calculator will show you:
- How much you can spend to buy a home
- Monthly mortgage loan payment
- Estimate monthly housing costs
- Possible options from Realtor.ca in your desired location
You can also adjust the information inputted in the calculator to see how it impacts what you can afford.
How to Apply for a TD Mortgage
If you have already found your dream home, you can now submit your TD Mortgage application online.
TD gives competitive interest rates online and will also hold your rate for four months once your application has been approved.
Experience the Simplicity
You can now do your TD Mortgage application online at your own time and pace.
You will gain access to a personalized dashboard that will help make tracking your progress easier. You can also apply with a co-borrower.
If along the way you have any questions or are in need of assistance, a TD mortgage specialist contact you within the next day to help you with your concerns.
Advantages of Applying for a TD Mortgage Online
Below are some benefits of applying for a TD mortgage online:
Pause and Resume
By doing your TD mortgage application online, you can accomplish your application whenever you prefer and TD will send you nudges during the process.
You can pause and resume the application and send it to TD without hassle.
Privacy and Security
TD uses comprehensive protocols to safeguard borrowers’ sensitive information.
This way, you can apply for the TD mortgage knowing that all of your sensitive data is protected and safe.
Prepare the following to complete your application
All borrowers will need to prepare the following items to complete the TD mortgage application:
- Status / Citizenship
- Mortgage Options
- The New Home
- Details of the Property
- Employment Status and Income Details
- Assets and Liabilities
- Age of Majority
- Co-borrower Options
Mortgage Application vs. Pre-Approval
There is a key difference between a mortgage pre-approval and a mortgage application.
A mortgage pre-approval is something you do when you start looking for a new house. This is not a required step, but it’s helpful as it paints a clear picture of how much you can afford.
Once your mortgage pre-approval is approved, TD will hold your rates for four months subject to terms and conditions.
On the other hand, a mortgage application is for when you have already found a house you would like to buy.
This will be needed once you already have a sale and purchase agreement.
Pros and Cons of a TD Mortgage
Still undecided if you should get a mortgage with TD? Here are some pros and cons you should weigh in on as you make your decision:
Pros of Getting a Mortgage with TD
Borrowers can negotiate their rates with TD especially if it’s a large mortgage or if they already have existing business with the bank.
TD mortgage specialists are more than happy to meet with borrowers in person. In addition, if the borrower would prefer to do it online, they may also complete their TD mortgage application online.
Access To TD’s Products
Getting a mortgage with a Big 6 bank like TD also gives borrowers access to the other suite of products they offer.
Getting a mortgage with TD means doing business with one of the most reputable banks in Canada.
TD has many branches across the country, so scheduling a face-to-face meeting should not be a problem.
Cons of Getting a Mortgage with TD
When getting a mortgage with TD, you are only offered its mortgages. Borrowers will be limited to the features that come with a TD mortgage.
TD mortgage specialists are indeed helpful in the process of applying for a TD mortgage.
That said, borrowers will need to remember that it is their job to sell the bank’s products, not provide them with the best products available in the market.
Constrictive Mortgage Insurance
As with all big banks, TD’s mortgage life insurance cannot be moved to a new lender in the scenario that the borrower would like to switch.
Borrowers will need to get new mortgage insurance if they would opt to switch lenders for rate savings.
Higher Fixed Penalties
If you break your TD mortgage early, a prepayment charge called Interest Rate Differential will need to be paid.
This penalty is usually expensive as it is based on the bank’s posted rates.
Possible Higher Rates
Just like other big banks, TD isn’t well known to have the most competitive mortgage rates in Canada.
Even the special rates offered by TD pale in comparison with other non-bank lenders.
TD Bank Mortgage Alternatives
Featured Mortgage Offer
Neo MortgageApply Now
On Neo Financial’s website
- Compare mortgage rates across several lenders
- Access to competitive rates and online applications.
- Available Canada-wide
- Accepts a wide range of credit scores
If you are looking for other alternatives for a mortgage besides TD Bank, you may consider the following:
Is a TD Mortgage Worth It?
Getting a TD mortgage is a good option, especially for those who value convenience and doing business with a well-known institution.
However, you should compare mortgage options from other lenders as well and take into consideration their goals and circumstances.
If you’re having a difficult time deciding, you can always talk with a financial advisor or a mortgage broker to receive personalized guidance that best suits your goals.
Yes, TD is a good bank to get a mortgage. TD Bank is a Big 6 bank and is a very well-known financial institution in Canada.
If you have a high credit score, proof of stable income and employment, a good-sized down payment, and low existing debt, then it should be easy to get your TD mortgage approved.
Yes, TD is a major bank that only offers mortgages with collateral charges to potential borrowers.
As of March 2023, TD Bank Group earned the #1 spot in the Brand Finance 2023 Canada 100 Report. As of August 2023, according to Forbes, TD Bank is the 10th largest bank in the US with $401 billion in total assets.