Scotiabank Mortgage Rates and Reviews 2024

About The Bank of Nova Scotia – Scotiabank

The Bank of Nova Scotia (Scotiabank) is one of Canada’s Big Six banks and a leading residential mortgage lender. Founded in 1832, Scotiabank has grown into Canada’s most international bank, focusing strongly on domestic retail banking and mortgages.

Scotiabank now serves over 25 million customers globally and ranks third among Canadian banks with over $1.4 trillion in assets under management. [Source]

Scotiabank has over 900 branches across Canada and a total of 1,100 branches worldwide, including in Canada, Latin America, the Caribbean, the U.S., and Asia-Pacific. The bank operates three main divisions:

• Canadian Banking: Scotiabank’s personal and commercial banking services within Canada include mortgages, loans, credit cards, and deposit accounts.
• Global Banking and Markets: Scotiabank’s capital markets, investment banking, and corporate lending arms.
• Global Wealth Management: Scotiabank’s full-service brokerage, asset management, and private banking services.

Scotiabank’s longevity, international scope, and diverse business lines make it one of Canada’s most reputable and stable financial institutions.

In this comprehensive guide, we’ll explore everything you need to know about getting a mortgage with Scotiabank in 2024, including:

• An overview of Scotiabank mortgage options
• A breakdown of current interest rates and how to get Scotiabank’s best rates
• A look at key mortgage features and prepayment options
• The pros and cons of choosing Scotiabank for your mortgage

By the end of this guide, you’ll be able to decide if a Scotia mortgage is the right choice for your home financing needs.

Scotiabank Mortgage Rates

Understanding how Scotiabank determines mortgage pricing can help you get the best possible rate for your situation.

• Scotiabank Prime Rate

Like other Big banks in Canada, Scotiabank determines its prime lending rate based on the Bank of Canada’s overnight rate target. Scotiabank’s prime rate is currently 6.70%, last changed in July 2024.

Scotiabank’s prime rate is the underlying index for many of its variable-rate mortgage and home equity line of credit products.

• Scotiabank Posted rates

These non-discounted rates primarily serve as a reference for calculating prepayment penalties on closed mortgages. Borrowers rarely pay Scotiabank’s posted rates.

• Scotiabank Special rates

Scotiabank doesn’t promote discounted rates publicly like its competitors. Instead, it authorizes mortgage specialists to issue discounted rates to preferred clients who negotiate or bundle with other Scotiabank accounts and services.

Scotiabank Fixed Mortgage Rates

Fixed-rate mortgages allow you to lock in your interest rate for the entire mortgage term, typically 6 months to 10 years.

A fixed-rate Scotia mortgage provides stability in both your payments and interest rates. This can give peace of mind to first-time homebuyers or those with a large mortgage. However, you sacrifice the ability to take advantage of decreases in interest rates.

Scotiabank Variable Mortgage Rates

Scotiabank offers 3-year and 5-year variable mortgage terms. With a variable rate, your payments remain fixed, but your interest rate fluctuates along with the prime rate. This allows you to save if rates fall but also introduces some uncertainty.

Scotia’s variable-rate mortgages offer the option of fixed payments. This means your payment amount stays the same even when rates rise; however, more of your payment goes toward interest and less toward the principal.

Read more: Fixed vs Variable-rate Mortgages in Canada

Here is an overview of Scotiabank’s current posted mortgage rates for fixed and variable terms compared to the lowest rates offered by Canada’s other Big Six Banks:

Term	Scotiabank Posted Rate	Lowest Rates of Big 6 Banks
1-year Fixed	7.64%	6.39%
2-year Fixed	7.19%	5.88%
3-year Fixed	6.74%	5.09%
4-year Fixed	6.54%	4.99%
5-year Fixed	6.59%	4.64%
7-year Fixed	6.80%	5.56%
10-year Fixed	7.29%	5.78%
3-year Variable	8.10%	6.20%
5-year Variable	7.15%	5.90%

However, always keep in mind that posted rates are Scotiabank’s highest prices, and you can likely negotiate a lower mortgage rate. Well-qualified borrowers who shop around can often obtain Scotia’s discretionary discounted pricing near or below the lowest competing big bank rates.

How to Get Scotiabank’s Best Possible Mortgage Rates

Here are five tips to access the lowest Scotiabank mortgage rates:

1. Connect with a broker

Unlike some competitors, Scotiabank does not advertise its special rates publicly. However, Scotia offers special discounted pricing to numerous brokers it partners with.

If you are offered a posted rate directly from Scotiabank, ask what pricing you would qualify for if applying through a Scotia-approved broker. If the broker rate is significantly lower, having an experienced broker negotiate on your behalf may be best.

2. Be willing to negotiate

Never accept Scotia’s first rate offer. Be polite but firm, and highlight that you are speaking to multiple lenders to get the best rate.

3. Get pre-approved

Scotia’s online pre-approval form allows you to get approved for a mortgage before shopping for homes. This shows sellers you’re a serious buyer.

4. Come prepared with documentation

Have all required income, down payment, and credit documentation ready. The more qualified you look on paper, the better your rate.

5. Open other Scotiabank accounts

Bundling your mortgage with other accounts like chequing or credit cards may give you access to Scotia’s top discretionary pricing.

Doing your homework before meeting with a Scotiabank mortgage specialist or broker will prepare you to negotiate the lowest possible interest rate.

Scotiabank Mortgage Products

Scotiabank offers borrowers plenty of choice when it comes to mortgage selection. In addition to standard fixed and variable-rate mortgages, Scotia provides specialty products tailored to the needs of specific borrower groups.

Hybrid/Convertible Mortgages

Hybrid mortgages allow you to split your mortgage into variable and fixed portions. Scotiabank’s version is called the Long and Short mortgage.

Convertible mortgages, like Scotia’s 3-year Convertible Variable Rate mortgage, start at a variable rate but give the option to convert to a fixed rate later in the term. This provides both savings potential and future stability.

Open and Closed Mortgages

Open mortgages allow prepayment flexibility, letting you pay off your mortgage early without penalties. This comes at the cost of higher interest rates.

Closed mortgages offer lower rates but charge penalties, like the Interest Rate Differential (IRD) if you want to refinance or break your term early. Most Scotiabank mortgages are closed mortgages.

Mortgages for self-employed borrowers

Scotia’s self-employed mortgage program is designed for borrowers who earn self-employment or commission-based income that may not meet the criteria for a typical mortgage.

To qualify, you’ll need:

• At least 10% down payment
• Documentation verifying 2+ years of consistent income
• Good personal and business credit

Self-employed mortgages can provide flexible borrowing power based on the profitability and longevity of your business.

Newcomer mortgages

Scotiabank offers two mortgage programs tailored to newcomers to Canada:

• StartRight for Permanent Residents – For landed immigrants and permanent residents who have been in Canada for 5 years or less.
• StartRight for Temporary Residents – For foreign workers and international students legally residing in Canada on visas.

These newcomer mortgages provide access to home financing for eligible new Canadians with limited time to establish a local credit history.

Investment property mortgages

Scotiabank offers mortgage financing for real estate investors looking to purchase rental properties.

Key eligibility requirements include:

• Minimum 20% down payment
• Documentation of consistent rental income
• Strong personal credit and income

Investment property mortgages allow investors to expand their rental portfolios. Scotia will evaluate the mortgage based on the property’s projected rental income.

In addition to these programs, Scotiabank offers solutions like co-lending arrangements to help Canadians with unique borrowing situations get approved.

Getting Approved for a Scotiabank Mortgage

Once you have an idea of current rates, you need to go through Scotiabank’s application and approval process. You can work directly with Scotiabank or through a Scotia-approved mortgage broker.

Getting Pre-Approved Online

One of the easiest ways to get pre-approved for a Scotiabank mortgage is through the bank’s online pre-approval application.

Scotia’s online pre-approvals take as little as 15 minutes. You’ll need to provide basic personal information, income documentation, a down payment source, and details on assets and debts.

Once submitted, Scotiabank conducts a thorough underwriting assessment. If approved, you will receive a letter stating the maximum mortgage amount and terms you qualify for.

Online pre-approvals allow you to get fully approved for a Scotiabank mortgage virtually. However, you won’t necessarily receive Scotiabank’s lowest rates, which require negotiation.

Working with a Scotiabank Mortgage Specialist

You can meet with a Scotiabank Home Financing Advisor at one of Scotia’s 900+ Canadian branches. Scotia advisors can pre-approve you and help you choose the mortgage product that best fits your needs.

One thing to note is that Scotia Home Financing Advisors only assist brand-new clients.

Using a Scotia-Approved Mortgage Broker

Going through a Scotiabank-approved mortgage broker provides a streamlined way to compare Scotiabank’s rates and products to other lenders all in one place. Brokers also offer expertise to ensure you choose the right mortgage and can negotiate discounted rates on your behalf.

Scotiabank Mortgage Features

Scotia mortgages have helpful features and options that set them apart from competitors.

Prepayment Options

Most Scotiabank mortgages include:

• 15% Annual Lump Sum Prepayments – You can increase your principal by up to 15% of the original amount annually without penalty
• 15% Annual Payment Increases – You can boost your scheduled mortgage payment by up to 15% once per year

This provides flexibility to pay off your mortgage faster and save on interest. Keep in mind that payments above the allowed amounts trigger prepayment charges on closed mortgages.

Payment Flexibility

Scotia offers two unique programs providing payment flexibility:

• Match-a-Payment – Make up to one extra principal payment annually equal to your regular payment amount, which doubles up your payment that month.
• Miss-a-Payment – You can skip one mortgage payment per year if you have already used Match-a-Payment. This helps your mortgage stay caught up.

These options help you manage cash flow interruptions without defaulting on your home loan.

Scotia Total Equity Plan (STEP)

STEP is Scotiabank’s home equity line of credit, allowing you to unlock and borrow against home equity. A revolving credit line allows you to access up to 65% of your home’s value, and combining it with an amortizing STEP mortgage segment allows you to borrow up to 80%.

As you repay the amounts owing, the funds become available to draw again. This gives Scotia homeowners access to flexible, low-cost financing.

Mortgage Protection Insurance

Scotiabank offers optional mortgage insurance covering

• Mortgage life insurance
• Critical illness and disabilities

Premiums vary based on your age and mortgage amount. Adding this insurance to your mortgage provides added peace of mind.

Monthly Tax Payments

Depending on your specific mortgage agreement, Scotia may require you to pay your property taxes monthly as part of your bank payments. This avoids falling behind on tax obligations.

Scotiabank estimates your monthly tax amounts based on the documentation you provide. Any overpayments get credited back annually.

Scotiabank Mortgage Penalties and Fees

While shopping for a mortgage, it’s essential to understand how much it might cost to break a mortgage early with Scotiabank.

Mortgage Discharge/Assignment Fees

When your Scotia mortgage term ends, and you decide to pay off your balance in full, the bank charges a discharge fee.

You pay an assignment fee if you want to transfer your mortgage to another property or lender instead.

Scotiabank’s Prepayment Penalty Calculation

If you break your closed fixed rate mortgage term before maturity, Scotiabank calculates your penalty using the higher of:

• Three months interest
• The interest rate differential (IRD)

The IRD method, which Scotia uses, involves:

1. Determining the posted interest rate for a term similar to your remaining mortgage term
2. Subtracting your contract mortgage rate from the posted rate
3. Multiplying the rate difference by your mortgage balance
4. Then, multiply the above amount by the number of months left on your term.

Scotiabank Mortgage Renewal

If your Scotiabank mortgage term is maturing, here are some tips to get the best renewal rate.

Start 60-120 days before renewal – Begin the process with enough time to compare rates from multiple lenders. Scotiabank may offer renewal incentives to existing customers within this period.

Be ready to negotiate – Your first renewal offer from Scotia will likely be at a better rate than their best one. Politely negotiate using competing rate quotes as leverage.

Consider a mortgage broker – An experienced broker can negotiate with Scotiabank on your behalf and easily compare alternative options.

Provide updated documentation – proof of income and other documents verifying your financial profile can help you obtain Scotia’s top-tier pricing.

Ask about bundling incentives – Scotiabank may offer preferred pricing if you bundle your renewed mortgage with other products.

With the right preparation and negotiation strategy, you can renew your Scotiabank mortgage for a new term at very competitive rates.

Scotiabank First-time Home Buyers Programs

In addition to its standard mortgage offerings, Scotiabank offers a First-Time Homebuyer program designed specifically for Canadians buying their first home. The key benefits of Scotia’s First Time Homebuyer program include:

• Home Buyers’ Plan (HBP) – First-time homebuyers can withdraw up to $60,000 within a tax year through their RRSP.
• First Home Savings Account (FHSA) – Borrowers can use the government’s FHSA initiative to save tax-free for their down payment.
• No Purchase Transaction Fees – Scotiabank will cover legal and appraisal costs associated with buying your first home up to $1,500
• Ongoing Education – Scotiabank provides first-time homebuyers with guidance on getting a pre-approved mortgage, submitting an offer, and understanding closing costs.

Read more: First-Time Home Buyers Programs in Canada

Pros and Cons of Scotiabank Mortgages

Before deciding whether to use Scotiabank for your mortgage, consider some key advantages and potential drawbacks.

Pros of Scotiabank Mortgages

• Established reputation – Scotiabank has been in business for over 190 years and manages over $1 trillion in assets, providing peace of mind.
• Wide range of mortgage options – Scotia provides plenty of choices, including specialty products for self-employed and newcomers.
• Opportunity to negotiate discounted pricing – Scotiabank is willing to negotiate rates lower than advertised prices with the right strategy.
• Access to bundled banking – You can qualify for Scotiabank’s top mortgage rates by opening a chequing account or investing with Scotia.

Cons of Scotiabank Mortgages

• Possibility of higher rates – Despite negotiating, Scotia’s rates may still be beaten by smaller lenders.
• Possibility of large penalties – Breaking a Scotia mortgage before maturity can lead to expensive prepayment charges.
• Lack of rate transparency – Scotiabank doesn’t openly publish its lowest rates, making it harder to know if you’re getting the best deal.
• Scotia’s most competitive rates are reserved for premier customers – To get Scotia’s rock-bottom rates, you’ll likely need to bundle multiple products and services.

Canadians can access thousands of mortgage lenders, so compare Scotiabank to big bank competitors and smaller providers to find your best option.

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Finding Your Best Scotiabank Mortgage

Scotiabank offers a comprehensive range of mortgage solutions suitable for all types of Canadian homebuyers and real estate investors. While Scotia may not always have rock-bottom rates, those who come prepared and negotiate firmly can access competitive pricing.

The key is weighing Scotiabank’s mortgage features, flexibility, rates, and benefits, like bundled account packages, against alternative options. Applying for pre-approval and being ready to discuss rates with Scotia advisors and brokers will help ensure you get your optimal deal.

For more help assessing your mortgage options, turn to the independent experts at Best Mortgage Online. Our experienced mortgage advisors can check if you qualify for a lower rate and better terms to maximize savings on your Scotiabank mortgage or any mortgage product in Canada.

FAQs

Article Sources

1. Scotiabank Mortgage Rates & Reviews – wowa.ca
2. Scotiabank Mortgage Rates – nerdwallet.com
3. Pro’s and Con’s of a Scotiabank Mortgage – findmeamortgage.ca