BMO lengthens homebuyers' mortgage rate guarantee period

BMO Bank of Montreal has announced it is extending its rate guarantee period for mortgages from 90 days to 130 days. The move is expected to benefit amid homebuyers in what the bank described as an “increasingly complicated” market.

"This change in our mortgage rate guarantee period could not be timelier for our customers," said Martin Nel, head of the firm’s personal and small business banking. "As always, we are listening and responding to their needs to help make their financial dreams a reality, while removing friction and uncertainty from the home buying process."

The longer timeline reflects housing market forecasts, as an extended rate guarantee would give buyers more time to assess the impact of new mortgage rules on house prices in high-priced Toronto and Vancouver before making a decision, the bank pointed out.

"In the coming year, home buyers face tougher mortgage rules, a rising interest rate environment and uncertain housing markets in high-priced regions," said BMO senior economist Sal Guatieri. "After pulling the rate trigger on January 17, we expect the Bank of Canada to raise policy rates two more times this year by a total of 50 basis points to address potential inflation risks stemming from an economy pushing against capacity limits."