Finding the right mortgage is like running a cross country race; it is a long, arduous process and you will need help along the way. Like the helpers offering water along the race route, your mortgage consultant (courtier hypothecaire) will help you through this struggle by getting the best strategy for you. Finding this strategy is an important step that will have an impact on your savings for years to come.
You can find the right kind of mortgage consultant for you if you know what you are looking for. Look upon it as hiring any professional with whom you plan to work with for years to come, like your lawyer or your accountant. Just like these professionals, your mortgage counselor should be there for you over the next 15 or 25 year - courtier hypothecaire.
Here is what you should look for in choosing a good mortgage counselor:
There are three types of mortgage counselors, each with his or her own strengths and weaknesses:
Working with each type of mortgage consultant has advantages and disadvantages:
• A bank representative. This consultant can only offer you the lending products that his bank has to offer. He also has more duties than just finding you a mortgage, and gets his salary whether he finds you a good one or not. He may get a bonus if he originates a lot of mortgages for his bank, however.
Many times the bank employee acts as a mortgage consultant. They have to submit the mortgage application to the bank. Now, with changes in mortgage lending, lenders offer their home loans through mortgage brokers, or mortgage marketers. The bank rep continues to offer mortgage products and other banking products for the financial institution that they work for.
• Mortgage marketing agent. They can only offer loans, and they specialize in home loans. The lending institution pays the mortgage marketer - courtier hypothécaire.
In order to serve their clients, banks now use local representatives. The marketing agents can go to the client to make it more convenient, but they still work for the bank or other lender. Just as a mortgage broker is paid a commission by the bank, a mortgage marketer is paid a commission for each mortgage he brings to the bank.
• Mortgage brokers: A mortgage broker does not work for any one financial institution. He works with a number of them and can pick and choose the best mortgage strategy for the client he is working for. He is paid a commission by the bank he obtains the loan with.
Brokers such as this have been around for a while, at least 30 years, but recent changes in banking regulations have meant that they are now a bigger factor in the market. Usually, a mortgage broker will work with 30 or more financial institutions to find a loan for a client. There are over 12,000 mortgage brokers in Canada, generating 27% of the mortgages.
Things to think about when you pick your mortgage consultant
Choose carefully, you want to choose someone in whom you will have a lot of confidence. Look at two key elements to see if you should have confidence in this consultant:
• Integrity: Will this mortgage consultant (courtier hypothécaire) have only my interests to consider, or will he have to get the best deal for the bank? When a home loan is negotiated, each side wants something different: the lender wants to earn as much money as possible and the borrower wants to spend less. A mortgage consultant who is trying to make money for his employer may not want to get the lowest interest rate for his client.
• Expertise: Does your mortgage broker (courtier hypothecaire) have the ability to offer the best solutions? Your mortgage broker should be able to compare all of the different mortgage products for you and find the best one for you.
These two ingredients, integrity and expertise are imperative in order for you have confidence. Here are two examples to illustrate this point:
• Someone may be an excellent used car salesman and has the right expertise to sell you a used car. Do you necessarily have confidence in him? Maybe, maybe not.
• You may use the best auto mechanic in the world but just because he works with motors and mechanics of a car, does that mean he can fix anything for you, like your T.V. or your plumbing? No, he does not have the expertise in those fields.
Make the right choice.
Confidence is difficult to describe because it is frequently just a feeling. Somehow, this person shows to you that he has integrity and can demonstrate his expertise. It is critical (courtier hypothecaire) to choose well, since this is someone with whom you will be working for many years to come. You want a professional who can serve you well.
