5 Reasons You Need A Mortgage Broker in 2023
The mortgage and real estate market is a complicated place. Lots of law protecting buyers, sellers and of course, banks. Lots of lobbyists protecting…of course…banks. 60% of homes in Canada are covered by CMHC mortgage insurance. Who is protected with CMHC insurance? …of course…banks.
Despite paragraph one, this is not a rant against our esteemed Canadian financial institutions. Rather this is just a friendly reminder that over 50% of Canadians who purchase real estate these days are working with a mortgage broker.
MORTGAGE BROKERS ARE Professionally TRAINED TO HELP YOU NAVIGATE THIS COMPLICATED PROCESS!!
Please click here to learn how Canadians are consolidating high interest debt and saving money WITHOUT refinancing their home!
Here are the top 5 reasons to work with a professional mortgage broker.
Reason 1 – 2022 saw the greatest rise in interest rates that Canadians have experienced in well over a decade. Many homeowners are reeling from higher variable interest rates or perhaps an upcoming mortgage renewal which will increase their monthly mortgage costs.
All of this is simply a sideline to the incessant chorus of media telling us about seemingly never-ending inflation as the cost of living in Canada and feeding your family rises (click here to read more about inflation/price gouging).
These are the realities of 2023 and beyond. A mortgage broker can’t solve all of your problems but they can help you strategize and forge a way forward that will work for you and your family.
One more thing…they are free to work with 🙂
Reason 2 – Mortgage brokers get your loan approved and work hard to get you a great rate.
How can Huber Mortgage ensure that you get approved along with the best rate? – We work with over 30 “A” lenders including big banks, professional mortgage companies and credit unions. These institutions offer the best rates to those who have strong income, credit and down payment.
We also work with “B” or “Alt-A” lenders – these lenders help self-employed people who don’t have a two-year history of tax documentation available or lower credit score.
Last year Huber Mortgage worked with a very strong self-employed client who was only missing a year of tax documentation. We got a loan from an Alt-A lender, got the client into their stylish Okanagan home and this year we will get them an “A” deal as they now can provide the necessary 2-year business tax documentation.
Finally, we work with private lenders; these lenders will provide loans to people who may not have the best credit or documented income.
Private loans require a higher down payment to compensate for the additional risk associated with these types of files.
As well, private lenders are available for investors who want to fund multiple properties, want to construct a development without all the bank’s red tape or need super speedy approval.
Can’t my bank offer me a great rate? Yes they can…BUT…if your application does not fit within their specific lending guidelines they may decline your application or place you with their “alternative” lending options (expensive).
I spoke in 2017 with an RBC mortgage specialist who, if her applicants were denied for “A” RBC loans, would place these clients directly into their alternative program. This alternative program came with higher, client paid commissions and a much higher interest rate.
It is not the bank’s policy to provide borrowers with the best options available on the market. The bank’s priority is to keep their clients borrowing and doing business within their financial institution.
Why are Canadians switching from their traditional bank to Mortgage Brokers?
Over 50% of Canadians now work with a mortgage broker!
Mortgage brokers are not sitting in their big offices waiting for clients to arrive. Mortgage brokers are busy processing applications, furthering their understanding of the real estate market through research and contact with great real estate agents and working to improve business processes.
In addition, mortgage brokers provide online application tools and mortgage calculators, simple documentation submission processes and most importantly, fast application turn around with transparent communication.
An example – in 2020 I received a call from a frantic client/friend. He had been approved by his big bank then, after removing his contract conditions, the bank called him and turned down his mortgage application!!
Not very transparent to say the least. However, big banks have this power to hang clients out on the line. In this case, the mortgage being denied put my friend/client in a situation where he could be sued if he did not close on the transaction.
Huber Mortgage got to work, surveyed appropriate lenders, gathered all necessary documentation and had a committed file approval within two days. We were able to get the deal funded for completion/possession day, alleviated the client’s stress and bailed him out of any potential legal charges.
Huber Mortgage provides human support – your win is our win. We love helping families beat the financial system and guide you through a sometimes stressful process using best practices, strategies and one on one interaction.
Reason 3 – Education / Strategy
Did you know that rate is NOT the most important feature of your loan? However, it is likely what your friends and family will ask you about at the next dinner party.
Rate is actually the easy part as lenders tend to offer loan products around the same rate as economic conditions change. However, when it comes to understanding product terms and conditions, mortgage brokers are your experts.
Their advice on which mortgage product is best suited for your individual or family situation is enormously valuable. The difference between the right and wrong mortgage product could cost you thousands or tens of thousands of dollars.
For example, I consulted with a client who had a 5-year fixed mortgage with one of Canada’s big banks. The client was trying to purchase a new home but her mortgage penalty was over $20,000. This mortgage penalty was simply the fee the bank charges you for the pleasure of paying off your mortgage from the sale of your home.
65% of Canadian mortgage holders pay mortgage penalties each year and these penalties are a main reason why Canadian banks are so profitable.
***Strangely…US banks DO NOT charge mortgage penalties but the banksters in Canada get away with this larceny without a peep from our pious politicians.
Let’s do a proper consultation about your purchase timeline and the duration of time you plan to stay in the home then we can strategize and ensure you get the best and most appropriate mortgage contract for your purchase.
Reason 4 – Product Options
As stated above, mortgage brokers work with a wide variety of lenders. Consequently, we also have access to teh best product options and this product availability allows us to help you build a financial plan which will help you win and get yourself out of the rat race faster.
Huber Mortgage looks at the big picture with each and every client.
How can we get our clients’ mortgages approved, get them a great, affordable rate while ensuring they will not incur massive mortgage penalties in the future?
How can we ensure that our clients are paying the lowest interest rates on all of their debt, not just the mortgage?
If clients have a specific project in mind, can we find them financing that is speedy and cuts quickly through any bureaucratic red tape?
How can we help clients navigate the current rising interest rate environment? Move into their first home? Move from their starter home to a family home? Build their real estate rental portfolio and increase monthly cashflow?