The National Bank of Canada is the largest bank in Quebec and Canada's sixth-largest bank. NBC is based in Montreal, and over 60% of its National Bank's business is in Quebec. NBC has over 400 branches in most Canadian provinces, over 900 ATMs across the country, and over 2.4 million personal clients take advantage of its banking and financial services.

The bank adheres to the digital-first approach, supporting innovations through partnerships with artificial intelligence, fintech, and blockchain technology.

National Bank offers its clients an impressive variety of products and services for individuals and businesses and wealth management services. Personal and banking services make up most of the National Bank's revenue ($3.38 billion for 2022).

With the National Bank of Canada, you can open a no-fee chequing account, boost your savings with a high-interest savings account, start investing, and achieve your housing goal with one of the NBC mortgage options, which include variable-rate mortgages, fixed-rate options, combined variants, closed and open mortgages with competitive rates and repayment terms, self-employed mortgage offer, and a home equity line of credit.

Therefore, whether your goal is—first-time home owning, acquiring a second home or an investment property, a mortgage renewal, or paying off your mortgage sooner—NBC can provide you with a product tailored to your need.

As the whole process can seem overwhelming, you can get personalized advice from one of the bank's mortgage advisors at any step of your mortgage application. In addition, you can lock in your National bank mortgage rate for up to 90 days before your closing date.

It might be a good idea to recollect the difference between a fixed- and a variable-rate mortgage, as it may be important for someone considering taking out an NBC mortgage loan.

A variable interest rate mortgage means the interest charged on your balance fluctuates in line with the underlying benchmark, such as the prime rate. As a result, your payments vary as well. For example, if the prime rate decreases, your interest rate drops as well, and more of your mortgage payment goes toward the mortgage principal, and the payments may decrease as well.

However, when the prime increases prompting the interest rates to go up as well, the amortization period gets extended, as a more significant part of the payment goes toward interest. Alternatively, the amount due on their mortgage payments may also increase. The National bank's prime rate is currently (January 2023) 6,45%.

With a fixed-rate mortgage, your interest rate remains the same during the mortgage term, as it does not depend on market fluctuations. As a result, you will enjoy equal mortgage payments throughout the entire term.

In addition, National Bank mortgages are associated with a beneficial cashback offer: borrowers can get up to $3,000 cashback with just a mortgage loan while having a mortgage, mortgage loan insurance, and an NBC chequing account enables the bank's clients to get up to $4,400 cashback. However, it is important to remember that such offers are limited in time, and it is better to review the NBC promotions page from time to time to save money through them.

With an NBC open loan, you have the possibility to get mortgage-free faster, increasing your payment frequency or the amount of your monthly payments, saving on interest, and reducing your amortization period. You will face no prepayment charges if you
repay your loan in one shot. However, if your mortgage is closed, you cannot avoid a prepayment charge if you want to repay it completely before maturity.

If you want to define your regular payment before investing significant resources in the home purchase process, you can take advantage of an NBC mortgage payment calculator. Enter the purchase price, the down payment, the repayment period, and the interest rate. As a result, you will see your mortgage amount (insurance premiums included) and your monthly payment (there are monthly, weekly, and bi-weekly options).

Types of the National Bank of Canada mortgage loans 

1. Conventional mortgages: A fixed and variable-rate mortgage, closed and open mortgage loans, and a made-to-measure mortgage.

Variable rates fluctuate with the prime rate. Fixed-rate mortgages offer a variety of repayment terms: from 3 months to 10 years with rates of up to 9.15% and a possibility to have stable payments throughout the term.

If you prefer to combine the benefits of both, you might consider the "Made-to-measure" option. This loan includes fixed and variable-rate features. For example, you can take advantage of stable payments and enjoy interest rate drops, which allows you to save. The fixed-rate portion can be open (six months or one year) or closed (three months to ten years). The variable rate portion is closed (five years).

The 6-month and 1-year open mortgage rate has a 9.15% rate. With such a loan, you can avoid the prepayment penalty if your pay off your loan in one shot because their mortgage repayment terms let you make additional payments, increase the frequency of your repayments, and make early repayment penalty-free, depending on the mortgage type. 

A prepayment fee is charged if you refinance, prepay in full, or negotiate the new terms and conditions of your closed mortgage before the end of the term, or if you prepay more than 10% of the principal amount annually, or transfer your mortgage to another financial institution.

A special offer gives you cashback of up to $4,400, depending on the home loan amount and other NBC products you have acquired. 

1. Self-employed mortgages are designed for self-employed workers or business owners who cannot provide standard proof of income. 

2. A HELOC called "All-in-one" could be a single line of credit consisting of a mortgage loan and a line of credit. It allows you to buy a property and use your repaid principal for other expenses. The equity you own in your home increases in line with your paying off your mortgage, and so does the amount of funds you can access in the form of the line of credit portion.

How to apply for an NBC mortgage

Mortgage pre-approval is available online. It guarantees the amount and interest rate for 90 days, lets you know your mortgage affordability, calculates your down payment ahead of time, and gets expert advice. 

1. Prepare your finance, income, personal information, and details about the wanted property for the meeting with your mortgage advisor.

2. Get pre-approved online by clicking «Apply» or «Get pre-approved» on the website. 

3. The specialist will get in touch with you. 

4. Find your dream home and make an offer.

5. Have the property appraised by a professional certified by the Bank.

6. Once financing is approved, sign the official documents.

Mortgage refinancing or transfer application is available online. Fill in your email address, personal and income information, and details of your current mortgage loan, and a mortgage expert will contact you within the next two business days to complete your request.

Requirements

To be eligible for a mortgage loan, you should:

• Have reached the age of majority in the province where you're applying 

The mortgage pre-approval is only valid for a property located in Canada, excluding the territories (Yukon, Nunavut, and the Northwest Territories). 

• Provide two pieces of ID, proof of down payment, income-related documents, statements for bank accounts or investments at another financial institution

• (To apply online) own, in total, one property or less, whether it's owned jointly, individually, or with a third party.

• For transfer or refinance, the property must have four units or fewer.

To qualify for a mortgage for the self‑employed, you should:

• have been a self-employed worker or small business owner for at least two years, and show two years' worth of sound financial and credit management

• purchase or refinance a property with no more than two dwellings, one of which must be owner-occupied. The property value can't be over $1,000,000, and the maximum loan amount is $600,000.

In general, all mortgage applications are subject to credit approval by NBC, are must comply with the bank's standard credit criteria, residential mortgage standards, and maximum permitted loan amounts.

National Bank mortgage rates

The National bank of Canada offers the possibility to lock in the interest rate for up to 90 days through the pre-approval form. Thus, you protect yourself from undesirable consequences market fluctuations may have, securing a more advantageous rate for yourself.

Below you can find a chart with the National Bank of Canada rates. Hopefully, it can help you to choose the best mortgage rate that suits your budget and expectations.

Fixed-rate loan

• 3-months 6.34% (closed)

• 6-months 9.15% (open), 6.34% (closed)

• 1-year 9.15% (open), 6.19% (closed)

• 2-year 6.19% (closed)

• 3-year 6.14% (closed)

• 4-year 6.09% (closed)

• 5-year 6.49% (closed)

• 6-year 6.90% (closed)

• 7-year 7.00% (closed)

• 10-year 7.49% (closed)

Variable-rate loan

• 60-month 6.45%

• 60-month capped-rate mortgage 6.70%

These rates depend on the prime rate currently set at 6.45%.

Home equity line of credit

The rate in effect for an NBC HELOC is 7.45% (the current prime rate +1%).

National Bank mortgage loan insurance

Loans with a less-that-20% down payment are considered high-ratio mortgages requiring mortgage default insurance, known as Canada Mortgage and Housing Corporation insurance (CMHC). The premiums will be included in your monthly payments.

If you want to enjoy the peace of mind protecting your family from unexpected circumstances, you can enroll in the optional life, critical illness, and disability insurance on your mortgage.

If you were to pass away, a maximum amount of $1,000,000 can cover all or part of your balance. In the event of disability, you could be entitled to receive up to $3,000 per month. If you were to be diagnosed with a critical illness, your coverage could be up to $150,000.

Pros and cons

Pros

• Flexible repayment terms 

• Fixed, variable, and combined mortgages 

• Opportunity to prepay without fee

• Cashback offers

• Transparent rate information online on the website

• Get pre-approved online and assisted by a specialist 

•  Mortgage for the self‑employed

Cons

• Can't apply online (only online pre-approval, refinancing, or transfer application) 

• Only 90 days of locked mortgage rate after the pre-approval

How to make a payment for an NBC mortgage

You repay the mortgage loan in monthly installments, including interest, usually debited automatically from your bank account, as specified during the application.

To make a down payment on your online bank: sign in, click «Overview» in the left menu, choose your Mortgage loan, click «Accelerated repayment» — «Edit my additional payment» — «Continue,» and follow the directions.

You may talk to your mortgage advisor to choose the best option.