Equitable Bank Introduces 40-Year Amortization Mortgage Product

Equitable Bank logo

Canada’s seventh-largest bank Equitable Bank is collaborating with a third-party lender to introduce a new mortgage product with an extended 40-year amortization period. 

This move is aimed at addressing economic and affordability challenges by reducing monthly mortgage payments and making homeownership and property investment more accessible.

The unique aspect of this product is the funding structure, with Equitable Bank partnering with a third-party lender. This means that Equitable Bank will not bear the credit or default risks associated with these loans, as they won’t appear on its balance sheet. Equitable Bank will act as the loan originator and service provider for its funding partner, handling underwriting, closing, and servicing throughout the loans’ lifecycle.

Key things to note:

    • Product availability: This new mortgage product is designed for various purposes, including owner-occupied purchases, refinances, rental properties, and investor portfolios. Initially, it will be available in British Columbia, Alberta, and Ontario, with the potential for expansion based on market demand and success.

    • Launch date:Mortgage professionals can expect to receive detailed information about the product in the near future.

    • Pricing: While exact pricing information is not yet available, the interest rates are anticipated to be around 9%. This is due to the product being an uninsured alternative lending option with an extended amortization period, potentially associated with higher risks.

    • Response to market conditions: The introduction of this product is a response to the growing concerns about affordability, particularly in the face of rising property prices and the increasing cost of living. It aims to provide financial relief for individuals seeking debt consolidation through refinancing and those looking to purchase property in challenging economic circumstances.

By extending the amortization period and sharing the risk with a third-party lender, Equitable Bank hopes to offer a solution that addresses the evolving needs of Canadian homeowners and investors in a changing economic landscape.

Related post: 

Lotly Review: Is Lotly Legit For Home-Buying?

Sign up to join the conversation
0 Replies
Inline Feedbacks
View all replies