Alterna fixed-rate mortgages
With a fixed-rate mortgage, you don't have to worry about rising interest rates causing your mortgage payments to increase. Alterna Savings offers fixed-rate closed term mortgages in 6 month, 1, 2, 3, 4, 5, 7, and 10-year terms.
If you want the flexibility to make significant lump sum prepayments or pay off your mortgage entirely, Alterna also provides fixed-rate open term mortgages in 6 month and 1-year terms.
Alterna variable-rate mortgages
Variable rates can potentially provide you with a lower interest rate on your mortgage compared to fixed rates. That's because Alterna's variable rates are based on their prime lending rates, which are currently low. However, if Alterna's prime lending rate rises, so will your borrowing costs.
Alterna has variable-rate mortgages on 3 and 5 year closed terms. They also offer a variable rate 3-year open term mortgage if you are looking for higher prepayment limits.
Alterna cashback mortgage
On fixed-rate closed term mortgages, Alterna currently offers up to 5% cashback. The interest rates on cashback mortgages are slightly higher than Alterna's regular posted rates. Still, the extra money could be useful if you're looking to cover initial moving and renovation costs associated with purchasing a new home.
Alterna Savings provides a hybrid mortgage product called the Flexi-Mortgage. With the Flexi-Mortgage, you can divide your mortgage into up to six different portions. Each portion can be either a fixed or variable rate with either an open or closed term. The terms lengths for each portion can also vary.
The Flexi-Mortgage allows you to build a mortgage that makes sense for you. You can build it to take advantage of low variable rates and stable fixed rates of varying term lengths. It can also allow for more flexible prepayment options, giving you a more balanced mortgage.
Alterna mortgage prepayments
Making prepayments on your mortgage will allow you to pay off your mortgage sooner and reduce your overall interest costs. On closed term mortgages, Alterna Savings allows you to make a lump-sum prepayment of up to 20% of the original mortgage principal every year. The full amount of this lump sum payment will go towards paying down your mortgage principal.
Alterna also allows you to increase your mortgage payments by up to double your regular payment amount every year.
If you pay over your allotted prepayment allowance during any given year, Alterna will charge you a prepayment penalty. The penalty charge is based on the number of months left on your current mortgage term and Alterna's currently posted interest rates.
Open term mortgages, as opposed to closed term mortgages, don't have any prepayment limits. With an open term mortgage, you can make unlimited prepayments on your mortgage without penalty.
In addition to making prepayments, you can also change your mortgage payment frequency to weekly or bi-weekly to further save on interest costs and help shorten the life of your mortgage.
About Alterna Savings
With 167,000 members and 35 branches, Alterna Savings is the second-largest credit union in Ontario. In 2000, they launched Alterna Bank, which offers digital-only banking services nationwide, making them one of the first Canadian financial institutions to go fully digital.