Why Use a Mortgage Broker?
Is it really better to use a broker?
Well, the short answer is YES, using an independent mortgage broker not tied to any one financial institution is absolutely in the best interests of the consumer. Who uses a mortgage broker? Is this a growing trend in Canada? Homeowners are using mortgage brokers for their financing needs today more than ever, in fact, more than one if four Canadian’s and growing every year are turning to mortgage brokers to shop for the lowest rate and best mortgage on their behalf.
So what exactly does a mortgage broker do?
With any major investment – your home being one of the largest – it’s really important to do your research and shop around for the best solution – this is exactly what a mortgage broker does. A skilled broker will work to understand their clients needs, shop all the banks and come back with options that best meet the long…. and the short-term objectives of the client.
Does this save you time – money?
Financing your home through a mortgage broker rather than a lending institution will definitely save you time and money. It simply makes sense – brokers do the legwork which save you time – one stop. They then they shop your mortgage to the lending institutions who bid on your business, resulting in the best rate = which saves you money.
So then, who does the broker really work for? The bank or the client?
We work on behalf of the client – our main purpose is to find the client the best product at the best rate. Unlike a bank employee, or a broker that is tied to a bank, an independent mortgage broker (independent being the key word here) is not tied to any one financial institution thus offering true unbiased advice with the clients best interests in mind.
Does that mean you are middle-men?
We are actually not middlemen at all. Again, unlike the banks, brokers have direct access to lending institutions – over 40 major lenders across the country in fact with whom we have very strong relationships – and get instant approvals. This grants a greater likelihood of approvals of higher mortgage amounts as well as access to unique products – many only offered through the mortgage broker channel. And because of these relationships and access to hundreds of products, we have greater leverage in negotiating extremely competitive mortgage products, terms and rates.
Sounds great, but how much does all this service cost the client?
I know it sounds too good to be true – a service you benefit from with out without having to pay – but that is the case. Using the services of a mortgage broker costs the client nothing in the vast majority of cases. The lender pays the broker for placing the mortgage with them. They can do this because it costs the lender a whole lot less to fund a mortgage through a mortgage broker than having in house lending reps – they basically save on the overhead. A broker is paid on the size of the mortgage, not the rate – so you can see, getting the best rate for the client is in the best interests of the broker.
Are there many mortgage products on the market?
Interestingly, there are over 400 mortgage products on the market each with their own features, benefits, terms and rates. Plus, there are new products launching very day – many specialized products for the self-employees, first time buyers and 0 down programs to name a few – it’s a very dynamic industry.
So what’s the bottom line – a mortgage broker will give you a better deal than your own bank?
I understand many consumers expect their own bank will give them the best rate and product. The bottom line is that your bank does not have access to all the lenders and products on the market. They typically have a limited number of pre-packaged mortgages available to them. Another way to think about it is this: If you were thinking about buying a car but you didn’t know what vehicle you wanted or needed. Would you go straight to one dealer or would you shop around at an auto mall and compare? Now, think about having someone there to take you around, tell you all the differences in the vehicles, dealer services and negotiate on your behalf – without a fee. That is what a mortgage broker does. It simply makes sense and savvy consumers know this.
Expert Mortgage Ltd
Milton, Ontario – Canada
Contact: George Moutsouroufis
Work Phone: 647-724-8100