The recent case where an Ontario resident faced extremely high mortgage penalty shows the ability that banks have to impose the strictest sanctions. When determining the penalty, most big banks use interest rates that are much higher than market rates. This difference is especially highlighted in an economic environment where interest rates decrease, such as the times of pandemic and uncertainty. For many Canadians, there’s a feeling that the big six banks of Canadian banking system profit form the financial crisis that the country is going through.
- Banks tend to apply extremely strict standards to lenders, which can lead to high mortgage penalties.
- A homeowner in Calgary noted that she will be forced to pay $5,300 in interest alone to RBC.
- Banks have used the covid-19 pandemic as a way to profit and are charging mortgage rates that are higher than the market rate.
“Ever since the coronavirus outbreak took hold of the Canadian financial system, the Big Six banks have received much flak for their apparent insensitivity to the ordinary consumer’s plight.”