SURREY – Many customers who took a risk on a variable interest rate on their mortgage or have line of credit which are based on the Bank of Canada (BOC) prime rate are angry that the major banks have decided not to pass on the full rate cut by the BOC.
All the major banks are only passing down .15 of the .25 cut by the Bank of Canada to variable rate and prime rate customers.
“This is thievery man,” one irate called told the LINK.
Mortgage specialist Ben Gill told the LINK that those who have a variable rate need to email and call their bank and complain.
“The reason people took the “risk” and went with a variable was for this purpose,” Gill said, who is a champion of variable rate mortgages.
But many are complaining that these banks are mega monopolies and the government should be looking into this as this to make sure they are complying with the full rate cut.
“It seems illegal to me cause if the BOC rate had gone up by .25 then the banks would have done that right away,” another angry reader told the LINK. “But not only they waited a whole week to change but then they pull a stunt like this about not passing the full .25. Something is not right here.”
The interesting thing is that most of the mainstream media and financial news services, saying nothing about this and the politicians are quiet on this as well.
Many are saying that banks’ decisions to not take the prime lending rate down to where the Bank of Canada cut is leaving them feeling cheated.
A finance professor Andrey Pavlov with SFU told News 1130, one of the few media who did the story on not passing the full rate cut, said customers should take what they are given as the banks are not bound by the rate cut to cut their own prime rate.
He said if it is a disappointment, customers should demand loans that are tied to Bank of Canada rates.
The last time the Bank of Canada dropped its rate was almost six years ago, and the banks followed suit.
