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Unclear as to what
a mortgage broker can do for you? This article discusses some of the many
benefits and services provided by mortgage brokers in Canada. After
reading this article, we hope you will understand why you will benefit by using
a mortgage broker for mortgage financing.
What is a mortgage broker?
Simply stated, a mortgage broker is an agent for lenders in much the same way
an insurance broker is an agent for insurance companies. Mortgage brokers act
as agents for banks, trust companies, credit unions, mortgage corporations,
mortgage investment corporations, finance companies and individual private
investors. Some mortgage brokers are exclusively lenders of their own money and
provide a direct source of mortgage funds (a topic to be discussed in a later
issue). Mortgage brokers are trained professionals that have to meet a
satisfactory educational requirement before they may become registered. As
such, this requirement ensures you are being provided with a duty of care, a
working knowledge of mortgage products and a standard of service to meet
individual needs.
So, how would I benefit by using a mortgage broker?
Using the services of a mortgage broker for the first time usually results in
the following testimonials:
- I originally thought you only used mortgage
brokers if you couldn't qualify at the bank....I was wrong.
- I didn't feel intimidated or left in the dark
for days on end wondering if I would qualify;
- My mortgage was approved the very same day I
applied;
- I didn't realize there were so many terms and
conditions that vary among the different institutions. My mortgage broker
took the time to explain them to me;
- I didn't realize many mortgage products and
discounts were available exclusively through mortgage brokers;
- I always thought you had to pay fees but
because my mortgage was approved based on my credit history and income,
there were no lender or brokerage fees charged;
- I didn't have to leave my home or take time
off work to apply;
- The broker clearly explained the interest
rates, prepayment privileges and other important terms and conditions
which helped clarify some of my many questions and helped save me a great
deal of money as a result;
- Within five minutes, the broker explained how
much of a mortgage I qualified for;
- Within five minutes the broker told me that I
had enough income to qualify for my $160,000 condominium purchase;
- The application process was pleasant and over
the telephone;
- I didn't have to take the time to shop
financial institutions for the best mortgage myself, the broker did
everything and got me what I wanted;
- The broker was always accessible on evenings
or weekends when I needed an important question answered before making an
offer on a property;
What will
the mortgage broker need to know? As you probably already know, lender terms and
conditions are not created equal. So, whether you are
purchasing a property or refinancing an existing mortgage, there are many
factors to take into consideration. A quick analysis of your personal situation
by a qualified mortgage broker, lets him/her know where to shop the market.
Some things he/she will need to know are:
- Net worth (i.e. your assets less your liabilities);
- Income (i.e. income from employment or
self-employment);
- Credit history (i.e. your payment history with your other
creditors, loans credit cards etc.);
- Property type (i.e. Residential, Land only, recreational,
remote location etc.);
- Down payment amount;
Once your
application is complete, the mortgage broker knows where you will qualify. With
the click of a few buttons, he/she can tap into the vast network of computers
which connect lenders and brokers electronically. As mentioned above, the
broker can obtain rate discounts for you that you cannot obtain yourself.
Where will your next mortgage financing experience be?
Volumes of detailed important information are available to consumers right now
but do you have the desire, time or where-with-all to effectively examine
what's out there? It can be a daunting, frustrating task. To limit your
frustration, consider using the expertise of a qualified and knowledgeable
mortgage broker to help you understand the mortgage process and meet your
financial needs.
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