QuestMortgage Review: Is the online mortgage broker right for you?
Purchasing a home is the biggest financial endeavor most Canadians will ever embark on. It can be a scary and stressful experience given the huge financial commitment and securing a mortgage with a competitive rate is one of the most important factors in the entire process. Understanding how the mortgage process works is an essential part of purchasing a home; you are committing to a huge sum of money that you will be repaying for up to 25-30 years in some cases, so you want to ensure you are paying the lowest interest rate possible.
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QuestMortgage is a new service that aims to make the process of securing a mortgage easier than ever. Part of the Questrade Financial Group, QuestMortgage is an online-only brokerage service that allows users to apply for a mortgage electronically without the need for numerous in-person meetings with their local bank.
With QuestMortgage, you can apply for a mortgage directly through their app or via their website, 24 hours a day. You will be prompted by the system to create a free account with your basic information, and then you can begin the application process. The steps are straightforward; you select the type of mortgage you are looking for and the corresponding rates, and then submit the application for approval, all via the app or the web interface.
QuestMortgage Pros & Cons
Pros: The Good Stuff
Low-interest rates. : The primary benefit of QuestMortgage is their low interest rates. Since the company doesn’t have the expense of operating and staffing brick-and-mortar locations, it can offer highly competitive rates that may be lower than traditional banks. With Questmortgage, you can either elect for a locked-in rate or a variable rate with a lower interest (more on those options below).
Ease of use. The mortgage process can be incredibly confusing (and costly), requiring numerous meetings and lots of paperwork. On top of that, there is the added stress of buying a home and hoping that you’ve made a prudent decision with the broker and the type of mortgage you’ve selected. QuestMortgage removes some of that stress by offering a clean and easy-to-use interface that allows you to apply for your mortgage much quicker than via the traditional time-consuming method.
Cons: The Not So Good Stuff
Limited to online customer service. Since QuestMortgage is an online-only service, all of its customer service is also handled online. While there are disadvantages to the traditional mortgage application process, it’s also comforting and instructional to be able to discuss your fears and questions with a mortgage specialist in-person.br>
Not available in all of Canada. QuestMortgage is currently not available for properties located in Quebec or the three territories (Northwest Territories, Nunavut, and Yukon).
As of April 2022, Questmortgage is offering the following interest rates:
Fixed-Rate: With a fixed-rate mortgage, your interest rate is locked in for a period (5 years) and is guaranteed not to go up. This is a great option for those looking to stick to a budget without any surprises each time the Canadian interest rate increases. Currently, QuestMortgage is offering fixed-rate mortgages for as low as 3.69% on a one-year commitment, 3.79% on a 2-year commitment, and 3.89% on a commitment of 3-5 years. If the rate being offered by QuestMortgage is much lower than what other banks are offering you, you may want to lock in the rate for as long as possible (5 years). However, if the prime rate when you’re buying your home is relatively high, you may only want to lock in your rate for 1-2 years, with the hope that you can lock in a lower fixed rate down the road.
Variable: Choosing a variable mortgage rate is a bit of a gamble. The rate offered is lower, but it will change along with the national prime rate. If you can afford the price swings, you can potentially save money on a variable mortgage if the interest rate stays low or decreases over time. As of this writing, QuestMortgage is offering variable-rate interest mortgages for as low as 2.15% on a 5-year commitment or 2.25% for a 3-year commitment.
Hold Your Rate
Even if the interest rate goes up the day after you submit your mortgage application, QuestMortgage will lock the rate you are presented with during the process for 120 days.
Flexible Lump Payments
If you come into some money, you can pay off your mortgage faster via QuestMortgage; you can make a lump sum payment of up to 20% of the original balance at the start of the term each year. You can also elect to increase your mortgage payments at any time to help pay down your mortgage sooner (up to 100% of the original monthly payment).
Create Your Pay Schedule
With QuestMortgage, you can easily customize your mortgage payment schedule. You can choose to pay weekly, bi-weekly, monthly, semi-monthly, weekly accelerated, or via bi-weekly accelerated mortgage payments. Accelerated mortgage payments allow you to pay down the interest on your mortgage quicker by making slightly larger payments more often.
Skip a Payment
We all run into unexpected expenses, especially once you become a homeowner. If things are temporarily tight, with QuestMortgage you can elect to skip a payment on your mortgage once per term with no penalties.
How is Questmortgage different than other services?
QuestMortgage is different than other mortgage services in that it exists entirely in the online sphere. Traditionally, the mortgage process requires many in-person meetings to go over paperwork, discuss the financing options, and get your mortgage approved. With QuestMortgage, that entire process is done online, via their app or website. That enables the company to keep its expenses down and pass its savings onto customers by offering competitive interest rates that may be better than what you’d get from a standard bank.
Is Questmortgage safe?
Since QuestMortgage is a new service that exists only online, it’s natural to be skeptical about the safety of the service. Thankfully, you can assuage those fears; QuestMortgage is owned by Questrade Financial Group, a Canadian-owned company that has been in operation for over 20 years. While Questrade Financial Group is not affiliated with any of the major banks, the service still offers robust protection to its clients; the company is part of the Investment Industry Regulatory Organization of Canada (IIROC) and is a member of the Canadian Investor Protection Fund (CIPF). The service is run by Community Trust Company (CTC), a direct-to-customer service founded in 1975 and acquired by Questrade in 2019. While the QuestMortgage service is new, it is being operated by a company with all the safety and assurances of any major bank or lender.
Frequently Asked Questions
Yes, you can use Questmortgage as a first-time homebuyer. In addition to using Questmortgage to secure the mortgage on your first home, first-time buyers in Canada can also take advantage of Canada’s Home Buyers' Plan (HBP). The HBP allows first-time buyers to withdraw up to $35,000 (tax-free!) from your RRSPs to put towards the down payment of a new home. Once you purchase your home, you then have up to 15 years to pay yourself back the funds without any penalties. Combine the HBP with a low-interest mortgage from Questmortgage and you’ll be on your way towards smartly financing your first home.
QuestMortgage is owned by Questrade Financial Group. Founded in 1999 in Toronto, Ontario, Questrade Financial Group is a Canadian-owned discount brokerage firm. Alongside Questmortgage, Questrade Financial Group also offers self-directed investing as well as curated portfolios via the company’s Questwealth division. While Questrade Financial Group is not affiliated with any of the major banks, the service still offers robust protection to its clients; the company is part of the Investment Industry Regulatory Organization of Canada (IIROC) and is a member of the Canadian Investor Protection Fund (CIPF). The service is run by Community Trust Company (CTC), a direct-to-customer service founded in 1975 and acquired by Questrade in 2019
While Questmortgage is a new service, it is part of the long-running Questrade Financial Group, and it is indeed a legit and secure way to apply for a mortgage. Part of the IIROC and CIPF, the company is regulated the same way the major banks are, even though QuestMortgage is an online-only service. One crucial factor to consider with an online-only service like QuestMortgage is the fact that you can’t simply walk into a local branch with any questions. If you are fairly tech-savvy and don’t mind communicating with customer service strictly online or by phone, Questmortgage may be a viable option for you.