BMO Mortgage Review 2024

Jan 13, 2024 By Susan Kelly

Whether you are going to buy your first home or want to refinance your mortgage, all you need is a BMO mortgage. Bank of Montreal (BMO) is the oldest and most trusted bank, providing loans, investment, and banking services in America and Canada since 1847.

It offers you several mortgage options, online pre-approval, market-leading offers, competitive rates, and the longest mortgage rate guarantee. If you want to know more about BMO mortgages, this review answers your every query!

What BMO Offers?

BMO offers several lending products, including home equity loans, home equity lines of credit, purchase loans, and refinancing. The bank also provides VA and FHA loans but does not offer USDA loans. Besides that, the bank also has a cross-border program and offers you a Neighborhood Home Loan. Therefore, Canadians can also refinance their home in the United States. A 1% down payment with no private mortgage insurance is needed for Neighborhood Home Loaned. You need to have a 640 credit score to qualify for this loan. The bank also provides a 0.125% rate discount if you use the autopay from the BMO personal checking account for making payments.

  • Loan Servicing: The bank manages its loan servicing but sells the loan portfolio assets to others. So, BMO can be the loan servicer initially and for many years. But, another servicer can buy your loan on the secondary mortgage market.
  • Loan Maximum: The maximum amount you will borrow depends on different factors, including the lender and the type of loan you are purchasing. For instance, with a jumbo loan offer, you can get the maximum amount compared to a conventional loan.
  • Loan Minimum: The bank keeps its minimum mortgage amount private. The amount depends on your credit profile, the location of your home, and many other factors.
  • Loan Types: BMO offers you various types of loans, including the FHA, Jumbo, VA, Conventional (adjustable and fixed rate), HELOCs, Home equity loans, Freddie Mac Home Possible, Investment property loans, First-time homebuyer, Condo financing, and Construction loans

BMO Mortgage Features

Here are the features of BMO mortgage:

  • Ease Of Application: If you want to get the BMO mortgage, you can apply online first for prequalification. Though it will never affect your credit score, it gives you an idea about how much you can borrow. The prequalification will also let you lock in the fixed rate for 130 days. You can answer all the questions within a few minutes. You can also apply for the BMO mortgage pre-approval, including a hard check on the credit file. But it will give you a better understanding of the potential financing. You can apply online within 10 minutes. Finally, you can connect with a BMO mortgage expert in person, by email, or by phone.
  • Mortgage Variety: BMO offers various residential mortgage products, including variable-rate, fixed-rate, convertible, and open and closed mortgages.
  • Loan Terms: The mortgages come in various terms ranging from six months to 10 years. For instance, the rates page of BMO shows only three to five-year terms for variable-rate mortgages. Homeowner ReadiLine mortgage is an appealing offer for the home buyer. It combines the BMO mortgage with the revolving line of credit. When the borrower makes the mortgage payment and pays the balance, the amount he can borrow from the line of credit also increases. Besides that, the bank offers promotional offers, including special rates, cashback, and savings accounts, as you get the BMO mortgage.
  • Mortgage Fees: The bank does not provide much about the fee. The terms and conditions page states that prepayment charges will be applied when changing from fixed-rate to variable-rate mortgages. Also, the page mentioned the $300 fee for the home appraisal. While explaining the closing cost, which includes the mortgage fee, the bank suggests budgeting 2 to 4% of the total cost of your house.
  • Rate Types: The bank provides both variable and fixed-rate mortgages. The variable-rate mortgages can be 3-year open and 5-year close. The fixed rates can be closed, open, and convertible.
  • Mortgage Rate Transparency: You can find the full page of the current mortgage rates on the website. The APR for most of the rates on the website is based on the $350,000 mortgage with 25-year amortization and appraisal charges of $300. The bank also clearly tells about its prima rateā€”the fine print notes that interest for the fixed mortgage is calculated after six months. The interest for the variable-rate mortgage is calculated every month.
  • Security And Safety: When filling out the pre-approval application, the website assures your data is secure. You can also learn more about it from the bank's privacy code.

How Does BMO Mortgage Work?

BMO is available in Washington, DC, and 50 other states. When you are ready to submit the application, start the process online or from your mobile. It would help if you discussed prequalification with the loan officer to gather the information on what you can afford. You can get both unique and basic mortgages. The basic offerings include Jumbo mortgages, FHA, and confirming. The bank also offers physician mortgages for doctors, construction loans, and cross-border mortgages (for Canadians).

The bank also provides the confirming 3%-down mortgage with down payment assistance of $9000 at a 690 (minimum) credit score. BMO also works with the state housing finance agencies to provide affordable mortgages in a state that offers them. Those looking for home equity options can get a HELOC or home equity loan. Present customers can get a discount of $100 to $200 on closing costs if they set up auto pay from an eligible BMO checking account.

Pros And Cons of BMO Mortgages

Here are the pros of MBO mortgage:

  • Lower down payment requirements
  • Rate discounts with the autopay from qualifying the BMO checking accounts
  • Accessible in Washington DC and all the 50 states
  • BMO offers you several application options
  • Multiple financial services
  • 130-day mortgage rate guaranteed
  • The account holders can get $200 off closing costs

Here are the pros of MBO mortgage:

  • The bank does not provide USDA loans
  • The fees and eligibility requirements have not been listed publicly
  • You cannot get prequalified online

Conclusion:

BMO is the largest lender offering different mortgages, including open and closed mortgages and fixed and variable rate options. The bank provides mortgages to new homeowners and those who want to renew or refinance their mortgages. In addition to the primary residents, BMO has options for second homes and investment properties. Due to the mortgage transfer service, BMO assures a smooth mortgage transfer process. The 130-day mortgage rate guarantee and Homeowner ReadiLine are the two prominent features of BMO mortgage.

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