The Newsy Neighbour
January Issue #111
Article provided by:Jason Eldridge
PASSION…PRIDE…PURPOSE
Now that we have said goodbye to 2016 and welcomed in the
New Year, one thing remains clear…the evolution of the mortgage financing
industry continues. Now it appears to be more important than ever to consult
the advice of a mortgage professional to assist clients with sorting through
all of the most recent batch of changes and getting a better understanding of
the financing process moving forward.
For years, people wishing to purchase or refinance a home
have always gone to the same place…their bank. Is this the best option for
everyone? Not necessarily, but it is the one alternative that most people have
been aware of, or felt obligated to use...perhaps until now.
In the past, mortgage brokers were often called upon in
cases where the client(s) did not qualify under traditional criteria, or they
needed money quickly, and hence had to borrow from a “loan shark”. While
mortgage brokers still assist clients with bruised credit or other qualifying
challenges, the vast majority of our clientele is made up of clients with good
job stability, and excellent credit history.
So what are the advantages of working with a dedicated
mortgage professional?
Firstly (and perhaps the biggest reason for most clients),
is the interest rate that can obtained. When you go to your bank, more often than
not, you will be put into the uncomfortable situation of having to negotiate
with your banker for a better rate. When you work with a broker, if you qualify
for the best rates (based on your credit history), you automatically get the
best rates. No tied selling. No moving all of your other banking and
investments to the new lender to get the better rate. And the best part…it doesn’t cost you a thing. There is no
charge for our service (when working with a chartered bank or regular financial
institution. Even a ¼% reduction in your interest rate, can save you thousands
of dollars in unnecessary interest costs.
Secondly, you have more lenders and options to choose from. When
you go to your own bank, you only have access to their mortgage products. Mortgage
brokers have access to over 30 lenders,
including many of the chartered banks, so we have access to a vast array of
mortgage options to suit your particular needs and goals. While there can be
subtle differences, something as simple as better prepayment privileges or a
lower prepayment penalty (if necessary) may be a reason for choosing one
institution over another.
Thirdly, mortgage brokers cater to your schedule, not the other way around. Don’t you enjoy
the process of calling your bank and then you are told that they can’t see you
for a week or so because they are already “booked up” with appointments? Mortgage
brokers will meet with you where and when you prefer, or at the very least
offer you the convenience of arranging your financing via phone, fax and/or
email. Generally speaking, you can be pre-approved for mortgage financing the
same day you apply.
Finally, mortgage specialists are able to offer their
clients a more flexible qualifying process.
If you don’t happen to meet all of your banks’ criteria, they will often turn
you away, whereas a broker will continue to source your application to as many
lenders as required to find you the financing you require based on your
personal situation. Being a mortgage professional for over 15 years and an
additional 10 years working for the chartered banks, I have a vast knowledge of
both the chartered banks and other financial institutions as well as their
product line up. Often today, there is high turnover among staff within the
banks, and with the sales team representing the banks being responsible for
selling so many products and services, one might ask if they have the knowledge
and experience to assist clients with perhaps the biggest investment and loan
of their lives.
If you are looking for a change, and would like to
experience the convenience and value of working with a dedicated mortgage
professional, please ensure that they have their proper accreditation. As a
mortgage specialist working with Axiom Mortgage Solutions, I am governed by the
Alberta Mortgage Brokers Association (AMBA), the Real Estate Council of
Alberta(RECA) and Mortgage Professionals Canada(MPC). As always, I welcome any
questions or comments you may have regarding the information contained in my
articles. Until next month…this has been a Mortgage Moment with the Mortgage
Mogul.
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