Clay Jarvis
Beth Buczynski
TD Mortgage at a glance
TD Bank is among Canada’s largest mortgage lenders. As a Big Six bank, it adheres to Canada’s strict mortgage qualification guidelines, which means less flexibility for borrowers with low credit scores or non-traditional income sources.
- Available in all Canadian provinces and territories.
- Publishes a modest selection of discounted mortgage rates.
- Provides residential mortgages, and renewal and refinance services.
- Offers a hybrid home equity line of credit, the TD Home Equity FlexLine.
- Open to financing co-borrowing scenarios.
- Fixed-rate mortgages.
- Variable-rate mortgages.
- Convertible mortgages.
- Open and closed mortgages.
- High-ratio mortgages.
- Home equity lines of credit.
- Mortgage renewals and refinances.
Pros
- You can increase your mortgage payment by up to 100% during the term.
- Multiple options in case you’re unable to make a mortgage payment.
- Newcomers with limited credit histories may get approved for financing.
Cons
- Limited online mortgage application capabilities.
- Annual lump-sum pre-payment limit is lower than at other Big Six banks.
- No options for borrowers with low credit scores.
TD mortgage review
Toronto Dominion Bank, more commonly known as TD Bank or TD, is one of Canada’s largest banks, and a major player in the country’s mortgage market. In the third quarter of 2023, TD’s Canadian residential mortgage portfolio was worth $256 billion.
TD is also one of the oldest banks in Canada, an amalgamation of The Bank of Toronto, founded in 1855, and The Dominion Bank, which was founded in 1869. After the two came together in 1954, TD Bank expanded its services to include mutual funds and credit cards and began a growth trajectory that continues today.
TD’s mortgage business is gargantuan, but its mortgage products are standard. It offers a decent selection of fixed-rate mortgage terms, and both open and closed variable-rate mortgages, but there’s nothing an experienced mortgage shopper would necessarily find unique or innovative.
For homeowners who may need access to further credit, TD offers the TD Home Equity FlexLine, a HELOC product that allows borrowers to access up to 80% of a home’s value.
Who is a TD mortgage best for?
A TD mortgage may be best suited for borrowers with strong credit scores and traditional income sources, as well as homeowners who are looking to tap into their home equity.
TD offers fewer niche products than lenders like RBC or Scotiabank, which have mortgages for borrowers who are self-employed or who have been in Canada for less than five years. If you have unique needs as a borrower, TD may not be the right fit.
TD mortgage feature overview
Variety of mortgages
TD’s selection of mortgage products is comparable to those of other major Canadian banks. If you have a low credit score, however, you may need to seek an alternative lender; TD doesn’t typically provide mortgages for this type of borrower.
Scotiabank offers::
- Fixed-rate mortgages.
- Variable-rate mortgages.
- Convertible mortgages.
- Home equity lines of credit.
- Mortgage renewals and refinances.
- Construction mortgages.
Ease of application
Overall, TD’s online mortgage application capabilities are pretty limited. Here’s what the bank does and doesn’t offer:
- Online pre-qualification: No. When a lender like TD doesn’t provide a prequalification option, using a mortgage affordability calculator or mortgage payment calculator can shed some light on your potential home buying budget.
- Online pre-approval: Sort of. TD offers a simplified online pre-approval process that doesn’t include a hard credit check.
- Online mortgage application: No.
- In-person application: Yes. TD has branches all over the country. Call your nearest branch to be put in contact with a local mortgage specialist.
Mortgage rate transparency
TD provides a detailed selection of rates online, including:
- Posted rates: TD publishes posted rates for every mortgage product it offers.
- Special rates: TD provides a small number of discounted, limited-time offers.
- APR: TD provides the APR values for all of its publicly available mortgage rates.
Other TD mortgage details
- Range of terms: TD offers mortgage terms ranging from six months to 10 years.
- Lump-sum payments: Make an additional payment worth up to 15% of your original mortgage principal once a year.
- Increased payment capability. Increase your mortgage payment up to 100% of its original amount.
- Prepayment penalties: Three months’ interest for variable-rate, closed mortgages; either three months’ interest or the amount calculated using TD’s interest rate differential, whichever is greater.
- Portability: You may be able to transfer your existing mortgage to a newly purchased home..
- Programs for newcomers. TD provides mortgage options for new arrivals to Canada who may have limited credit history.
- Options for non-payment. TD allows you to skip the equivalent of one full payment per year, or up to four months if you’ve prepaid an amount equivalent to the value of those four payments.
Customer satisfaction ratings
It’s challenging to gauge how satisfied Canadians are with TD as a mortgage provider. Customer review websites can be helpful, but such reviews aren’t verified and may not accurately reflect the average opinion of TD customers. Unhappy customers, for example, may be overrepresented in these reviews. Nevertheless, these sites are one way to learn about possible downsides to consider.
- TD had a Trustpilot rating of 1.4 out of 5 possible stars based on more than 2,000 customer reviews, at the time of this writing. The most recent reviews contained feedback about a number of TD’s products and services; not just mortgages.
- TD received 1.25 out of a possible 5 stars, according to more than 80 customer reviews on the Better Business Bureau website, at the time of this writing. TD is not accredited by the BBB itself.
- TD had a Customer Service Scoreboard rating of 29.74 out of a possible 200, based on 168 ratings, at the time of this writing. Like Trustpilot, the reviews were not exclusively about TD’s mortgages.
TD mortgage eligibility requirements
Because it’s a federally regulated financial institution, TD’s lending criteria will generally be quite strict. The interest rate and loan amount you’re offered will be based on your finances, but before you get that far in the process, lenders will need to evaluate your:
- Credit score: Chartered banks like TD typically don’t lend to borrowers with lower credit scores. A credit score of 680 or higher is worth aiming for.
- Credit history: Having several established credit accounts in good standing, and no recent negative marks on your credit report, will help you get approved.
- Income: The amount you earn and how predictable your income is are both important factors.
- Down payment amount: You need to provide at least 5% of a home’s value as a down payment if it’s worth $500,000 or less. For homes worth between $500,000 and $999,999, you need 5% of the first $500,000 and 10% of the amount above $500,000.
- Debt service ratios: Your gross debt service ratio must not exceed 39%. Your total debt service ratio must not exceed 44%.
- Employment history: You generally have to show lenders that you’ve been consistently employed for at least two years.
Nerdy Tip: Use a mortgage affordability calculator to determine how much you can afford to pay for a home. If you have a unique situation or need additional information about the eligibility requirements, it’s best to speak directly with a mortgage specialist.
How to apply for a mortgage with TD
TD offers limited online mortgage application options. Based on our experience with the bank’s website, it might be easier to locate a local branch and arrange a meeting with a TD Mortgage Specialist if you want to get the mortgage process started.
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From the main menu of the TD Bank website, hover over the “Products” tab and click on “Mortgages”
On the next page, you’ll see a lot of helpful information, and have the option of connecting directly with a TD Mortgage Specialist. If you want to start the mortgage process yourself online, scroll down and find “Mortgage pre-approval application.”
We found TD’s online pre-approval process to be pretty frustrating.
We repeatedly entered actual, verifiable personal information into our application but never reached a point where we could actually submit it.
TD’s online pre-approval doesn’t appear to be all that thorough anyway. It doesn’t affect your credit score, which typically happens with a mortgage pre-approval.
TD’s terms and conditions say you’ll have to continue the pre-approval process through the phone or in person before your credit score is impacted, so the online component feels more like an introduction than an official pre-approval.
Alternatives to a TD mortgage
TD is just one of many Canadian mortgage lenders. If the product you need isn’t available at TD, there are other Big Six banks, credit unions and B lenders you can turn to.
| Tangerine | RBC Mortgage | Rocket Mortgage | |
|---|---|---|---|
| Lender type | Online-only bank | Big Bank lender | Mortgage broker |
| Service area | National | National | National |
| In-person service? | No | Yes | No |
| Ease of application | Easy (online) | Easy (online, phone, in-person) | Easy (online) |
| Mortgage variety | Average | Average | Above average |
You can also consider reaching out to a mortgage broker and asking for help in finding a better deal on your home loan.
Frequently asked questions about TD mortgages
TD’s current mortgage rates are mostly in line with those offered by other Big Six banks. You might score a lower mortgage rate at TD by working with a mortgage broker. A broker may be able to negotiate a lower rate at TD by taking a smaller commission.
Mortgage approval times can vary depending on how busy TD’s Mortgage Advisors are, but borrowers themselves affect the process, too. Not providing the documentation a lender requires to properly assess your finances will inevitably delay the process.
Selecting the right mortgage lender is an important decision. Not only do you want to get the best mortgage rate, you’ll also want to align with a lender whose products, terms and conditions align with your financial needs.
To do all that, it’s helpful to do each of the following:
- Understand the different types of lenders. Mortgage providers include banks, credit unions, alternative lenders, and private lenders. Each has its own pros and cons.
- Compare offers from multiple lenders. Don’t commit to a mortgage from TD or any other lender until you have a solid idea of what constitutes a good current mortgage rate.
- Don’t focus solely on rates. The interest rate is important, but it’s just one part of the mortgage equation. It’s also important to consider a lender’s reputation, the types of loans they offer, any fees they charge, and how much prepayment flexibility you’ll have.
Like most lenders, TD will consider the following when calculating your monthly mortgage payment:
- Home price: the amount you agree to pay for a home.
- Down payment: how much you can afford to pay upfront on your home purchase.
- Amortization period: the total time it takes you to pay off your mortgage.
- Mortgage term: how long your mortgage contract will be in effect.
- Payment frequency: how often you’ll make mortgage payments.
- Mortgage interest rate: the amount a lender charges you to borrow its money; expressed as a percentage of the loan amount.
- Property taxes or title transfer fee: an annual fee based on your property value; not all mortgages are set up to include these fees.
- Mortgage default insurance: an extra cost you’ll pay if your down payment is less than 20%.
Example:
- Home price: $650,000
- Down payment: $58,500 (9%)
- Amortization period: 25 years
- Mortgage term: 5 years
- Payment frequency: Monthly
- Mortgage interest rate: 5.5%
- Mortgage insurance: $23,660
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