The Hudson's Bay Company (a.k.a. Hbc, Zellers, Home Outfitters, etc.) is just one more major corporation that is now a bank and credit union competitor. These companies have always been major credit card vendors, but now they are getting into full-service financial offerings. Case in point, the Hbc Mortgage.
I received a flyer in the mail with some pretty compelling arguments. Here is some of the brochure copy:
Standard Fixed-Term Mortgage—Competitive interest rates and payments will not change throughout the term of your mortgage and are available from 3 to 10 years.
5-Year No-Frills Mortgage—Our best-priced 5-year fixed-rate Hbc Mortgage gives you a great rate and Hbc Rewards points.
Prime-Adjusted Rate Mortgage—Always Prime less 0.95%. No negotiation required!
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I took a look at the Hbc 5-Year No-Frills Mortgage and compared it to others offerings across Canada.
|Institution||5-year fixed rate|
|RBC Royal Bank||7.24%|
|TD Canada Trust||7.24%|
|Coast Capital Savings||5.95%|
|Meridian Credit Union||7.10%|
|Conexus Credit Union||not posted|
|Servus Credit Union||7.44%|
Yikes. My mortgage is with a credit union and I am paying more than the Hbc No-Frills Mortgage, but I'm the wrong person to analyze since I am so fully invested in the credit union movement.
However, think of the average consumer who can't differentiate between any financial institution—why would that person get a mortgage from your credit union today? What's your hook? Obviously it's not rate.