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    « A 125% Mortgage??? | Main | Mortgage News From CIMBL 2006 »

    November 09, 2006

    Mortgage Brokers Add Value

    A new CIMBL survey quantifies the value that mortgage brokers add with several interesting statistics.  (see CIMBL Survey

    Among the more interesting points:

    • Mortgage brokers, in part, have helped Canadians negotiate roughly 1.38% off typical posted bank rates in the last year.
    • The number of Canadians using mortgage brokers has jumped 24% since 2005.
    • Among those who renewed or refinanced over the past 12 months, 84% remain with the same lender, most likely a mistake given the intense competition out there.
    • 88% of Canadians say they are happy with their mortgage terms. 
    • The average Canadian interest rate in October was 5.05%, versus 4.62% in September 2005.

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    Way to go! It is about time that someone starting talking about how much value mortgage brokers add. Thanks for sharing the truth rather than just sensationalizing like all the other media out there.

    It's good sign for Mortgage Brokers, most of my clients are very happy with their brokers, rates too

    I renewed with the same lender, but used a brokers quote to get the bank to match them. Willing to bet I am not the only one.

    Matt. Nothing personal but that is a pretty slimy way to negotiate.

    a licensed mortgage broker has a specific and essential job to do. their job is to effectively shop around the real estate financing market to find the buyer the best mortgage rate, at the best terms possible.

    usually a broker comes in before the home buyer actually goes looking for their dream home. buyers should first go to a broker for a mortgage pre-approval. most (if not all) financial lenders offer a mortgage pre-approval, and this document is normally free for prospective home buyers. this mortgage pre-approval is crucial to the home buyer as it tells them what they can actually afford and details the limits to which they can borrow from the financial institution.

    a mortgage broker is of added value in this situation as in the time it takes a home buyer to meet with one particular lending institution, the mortgage broker can contact a number of quality banks on the buyers’ behalf. a broker understands that different banks have different rules, and as they know the market; the mortgage broker in effect ‘goes shopping’ for you to find the best rate.

    even though using a mortgage broker is often free for the potential home buyer, their value and necessity should not be overlooked. a mortgage broker makes their commissions from the financial institutions where they secure; while there are no fiduciary responsibilities to the home buyer, a mortgage broker’s business is almost always based on referrals; it is important for a mortgage broker to act in the best interests of his or her clients. securing mortgages and positive client referrals are the backbone of a mortgage broker’s success.

    sam

    Hello Mortgage Specialist,

    I don't understand why people go the bank and get the banks to match our mortgage brokers rates. If you were valued as a bank customer, wouldn't you have gotten the best rate from your bank the first time you called on them? For that reason I do not hand out my rates on paper until the deal is actually closed. It is just wrong.

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