Should I use a Mortgage Broker or a BankDo I need to use a mortgage broker or a bank?
Mortgages Option - Bank versus Broker
It is an excellent moment for house purchasers coming onto the shelves for the first and foremost. In addition to falling property values, interest levels are low, making mortgage lending more accessible. However, an understanding of the fundamentals as well as getting a great deal when it comes to your mortgages can come down to who you decide to work with - a banker or broker.
"My customers should speak to their bank and a few mortgage agents - at least three," says Norah Higgerty, a broker with Coldwell Banker First Choice Realty in Shediak, N.B. "It's necessary if you want to make sure you make the best possible business you can," she says.
Currently, their customers choose brokerage houses and financial institutions in one step, but they check both before making a choice. Whilst brokers have different opinions about who they would refer their customers to, the ultimate choice lies with the first purchaser. Banking advantages: For some first-time purchasers, it is attractive to get their first mortgage through their bank because they have already established a bank connection and they have come to entrust their finances to them.
If there is no relation between the customer and the bank, first-time purchasers may still find a bank more convenient, says Joan Dal Bianco, VP of Collateralised Loans at TD Canada Trust in Toronto. According to their company's research, Dal Bianco says that the main explanation why some clients see a broker is that broker can rationalise the processes for clients, especially first-time purchasers, by doing the research, locating the various offerings on the plaza and presenting them to you.
However, remember that not all creditors take part in the brokerAGE. The Bank of Montreal, for example, doesn't. "Brokers are payed by the creditor and so it is that the broker actually buys the mortgage or provides you with a mortgage with the highest commission," says John Turner, mortgage sale manager at the Bank of Montreal in Toronto.
Turner says on the bank or creditor side that it is important to assess the entire bank account and not just the mortgage. With the brokerage business accounting for nearly 30 percent of all mortgage sales in Canada, many banks work with brokers, says Dal Bianco, whose firm TD Canada Trust provides mortgage sales to clients through third-party brokers.
A number of estate agents and realtors say that this is increasingly the case because the trend among home buyers to use brokerage fees to obtain a mortgage is rising. Balance the benefits: Broker While bankers offer a comprehensive view of one' s own financial situation, which mortgage brokerers say can sometimes work against. They deal with mortgage and investment issues and they do not specialise in a particular area.
Buying mortgage commodities in the market place (read more about this on our Mortgage Loan page) and not having to do with a bank's restricted number of commodities, estate agents may be better placed to align the needs of an Individual client with a mortgage commodity. It is important that you review a broker's skills, experiences and relations with creditors.
Underwriters do not all have long-standing relations with reputable creditors. In order to take full benefit of real estate agents, you will want to find someone who does, says McNabb. In a way, brokerage can rationalize the mortgage buying experience by searching the mortgage forecourt for the best available product, so you don't have to go to every borrower to find out more about theirs.
They' ll do it for you with a mortgage broker, Vaughan says. Brokers often have recourse to creditors that you may not have considered, says Vaughan. Ultimately, the most important thing is who you feel most at home with, the functions of your products and the price. It' s about getting the mortgage that best suits your needs and assessing who you work with on the basis of how well they fit your circumstance and a mortgage offering.