When meeting a potential client, one of the first questions I ask is: "Have you worked with a mortgage broker in the past?"Here are statistics based on Maritz research completed for Canadian Association of Accredited Mortgage Professionals (CAAMP) in 2010:
- 25% of Canadians arrange their mortgage with a mortgage broker
- 40% of first time home buyers arrange their mortgage with a mortgage broker
- 33% of Canadians have a good or full understanding of the services provided by mortgage brokers
Working with a professional mortgage broker who holds an accredited mortgage professional (AMP) designation can provide the following to a homeowner:
- Access to various lenders (options with respect to products)
- Discounted rates based on volume of business placed with lenders
- Unbiased advice on products depending on client's goals and personal situation (5 year terms do not make sense sometimes)
- Mortgage management strategy after funding
Some might argue that dealing with their institution is the way to go. Here are items to consider when negotiating with your lending institution:
- Is the employee loyal to me (the client) or employer who pays their paycheque?
- Does the product being presented to me make sense for my personal situation or is it what's most profitable for the institution?
- Will the employee manage my mortgage and let me know what's happening in the market that could affect my mortgage?
- Am I getting options with an explanation of pros & cons of each option?
- Am I being told to shop around and they will match what I get? Is so, do they deserve my business if I am doing their work? Shouldn't they offer me the best deal upfront to earn my business?
- Are the fine terms being explained to me? And what type of costs I might incurr due to the terms in the mortgage?
Working with a professional mortgage broker does not cost money to the client as the broker is compensated by the lenders they place the mortgage with. The mortgage broker's loyalty is with the client, since happy clients refer their family, friends & colleagues.
When deciding which mortgage broker to work with, consider the following:
- Length of time in the business and whether they are in the business full time
- Do some research on the net to find out more about them
- Ask for references from previous clients
- Ask how will they manage your mortgage once it is funded to reduce the total cost of homeownership
- If they promise "best rates and work with 20+ lenders" run away
And the most important factor, is work with someone you trust, share similar values and connect with. Afterall, our homes are the largest investments we make in our lives.
To discuss your mortgage options please contact me.