This week we will investigate the phenomenon of discounted rates.

As you can see by the mortgage rate chart (on this page) most institutional lenders have the same rates, while Mortgage Matters' rates are about .75% better. That three-quarter percent drop in rate is worth a fortune. As an example, on a $100,000 mortgage, the rate drop would be worth about $28,000 over the life of the mortgage. That $28,000 could pay for a child's education, a trip around the world, a brand new car or a house full of furniture. Where does Mortgage Matters find such wonderful rates? The answer is right under your noses. The same lenders that advertise the higher rates right on this page are the lenders that Mortgage Matters finds for its clients. All the lenders listed on our rate chart will give you a rate discount if you ask properly. Why the charade? What makes the difference?

Most institutional lenders will refuse to openly advertise discounted rates just in case your credit is not as good as it should be. Supposing they advertised these low rates and one of their clients was a little weak, they would have to raise the rate in order to cover their loan risk formula. Increasing rates to a credit risk is more difficult than saying to this same client that they want his business and they are prepared to offer him the "going rate," that being the posted rate. So the institutions won't openly advertise that they are prepared to offer lower rates. Should you happen to ask for a better rate, normally you will not be refused. Because they started this rate discount thing, all of them hopped on the bandwagon. To increase market share is the name of the game, and if they must discount rates, they will. Most lending institutions also know that once they have you under their spell, you probably won't leave, knowing the frustration and cost of getting a new mortgage.

Other institutional lenders will use the discounted rate as a ruse to get all your business. Some institutional lenders offer the posted rate to get you in the door, discount that rate by a 1/4% to get your credit card business, another 1/4% if you transfer your RRSP, and another 1/4% for your personal loan business, totalling 3/4% in discounts. I am a firm believer in not putting all your

eggs in one basket. If your credit is good, and you qualify under the banking industry standards, you should be good for the maximum discount without giving up your soul.

Being a mortgage broker, I can insulate my clients against the games being played. My clients really don't get to see the lending officer at the corner branch. My clients really don't have to make choice about closing credit card accounts with one institution only to open up with another. My clients can shop where they want for their RRSP. Their mortgage, in most cases, will be with one of the lenders mentioned in the rate chart, but they won't have to waltz through the maze to get the maximum discount.

If you are seeking a new mortgage for the purchase or refinancing of a home, seek the guidance of a mortgage broker. It'll save you time and money. If you want the pleasure of finding your own mortgage, please shop the lenders in our rate chart but don't forget to ask for your discount. Better $28,000 in your pocket than in theirs.