Negotiating your Mortgage in Vancouver
Independent mortgage consultants are more likely to give you better deals than your bank.
As with property prices, shopping for mortgages is changing. New mortgage options and features are introduced on a daily basis. It is also more complicated to know how much you will have to pay and what is right for you.
Maybe this is why mortgage consultants now negotiate most BC mortgages these days. The stigma previously attached to mortgage brokers no longer holds. Actually, trends show that Canadians now prefer to work with mortgage consultants while looking for investment advice, pre- payment options and the best rates. What is more, the services are free of charge.
The mortgage process may turn out to be intimidating. You will have to get in touch with different branches and compare the available options and rate structures. Based on the circumstances you find yourself in, one mortgage may be better than another.
On the other hand, financial institutions only use their sales force to sell their products to interested customers. As a result, you will not get unbiased advice or a wider variety of products. This is why most people are opting to work with mortgage consultants.
Today, mortgage news items will inform you that most consultants deal with different lenders – including top banks in Canada. They have the ability to search around for different products on offer by the credit unions, insurance companies, trust companies and major banks.
The primary objective of the mortgage consultant is to help you find the best product, terms and rates depending on your particular needs. They will also be able to structure deals to meet the criteria set between you and the lenders, while negotiating on your behalf.
Banks always look out for themselves. Actually, the bank rewards representatives for offering clients rates that are higher than the lowest discount rate. However, since the consultant does not represent any profit making bank, they are more likely to consider your interests first.
To attract customers through individual brokers and mortgage consulting companies, most lenders pay finders’ fees for referred business. This way, consultants can among different financial institutions at no cost to borrowers. At times, they can complete the entire application process in a couple of hours.
Lenders are also looking for new business; minus the cost and stress of dealing with customers directly. Essentially, they find it more convenient to pay independent brokers to get them clients.
Additionally, if you deal with a financial institution and the application for a mortgage is declines, you will have to restart the entire process again with other lenders. However, while dealing with consultants means that your application can be redirected easily to other lenders for consideration.
While negotiating another mortgage, watch out for the following things:
1. ‘Free Offers’
Some branches will offer to pay the appraisal costs and legal fees. Most of the time, these costs will be clawed back to you in terms of a higher rate. On the other hand, consultants sometimes use their commissions to help you offset either of these on your behalf.
2. Loyalty Program
You should also not expose yourself because you were loyal to the branch. Even with GIC’s, RRSP’s, chequing and savings accounts, the bank will always want to make a higher profit from your mortgage transactions.
Overall, it is clear from mortgage news that consultants are more likely to get you the best deal on your mortgage.