What exactly is a mortgage broker?
For most Canadians, buying a home is the most important financial decision they will make in their lifetime. And yet, consumers across Canada will spend more time painstakingly analyzing dozens of investment opportunities to grow their portfolio of securities, rather than carefully considering their mortgage options.
The mortgage world, like the investment world, are sometimes confusing. Closed, open, fixed rate, variable rate mortgages, long-term amortization, fast amortization, prepayment options, portability can cause a lot of headaches…and we haven’t covered the interest rate yet! ! The right mortgage decision will certainly have significant long-term financial repercussions.
Many Canadians use an investment advisor to help them make their choice. They are just starting to use mortgage brokers to help them make better mortgage decisions. They’re only catching up to their neighbors south of the border, where mortgage brokers handle about 70 percent of mortgages on properties in the U.S.
What is a mortgage broker? The role of the mortgage broker is to understand your mortgage needs, find the best options for your situation, and guide you through the borrowing process. A mortgage broker does not work for a particular institution or lender; independent, he is able to obtain the latest, up-to-the-minute lending rates from an extensive network of banks and other lending institutions.
Unlike many bank mortgage officers, mortgage brokers have comprehensive mortgage training. They are financial professionals trained to provide advice on borrowing.
There was a time when banks thought their customers “belonged” to them; mortgage brokers being seen as the last resort for homebuyers with poor credit histories. But those days are over, homebuyers of all categories are learning that they benefit from seeking advice from a mortgage broker.
A good investment advisor will earn you thousands of dollars; a good mortgage broker will SAVE you thousands of dollars. Whether you’re about to buy a home or renew your mortgage, consider incorporating a mortgage broker into your financial plan this year.
In the next article Why should I use the services of a mortgage broker?”, we’ll talk about the reasons why more and more Canadians are using mortgage brokers to make better financial decisions.