The #1 mistake that people make in getting a mortgage is blindly signing up for the lowest rate mortgage and never asking the right questions.
Any mortgage broker can get you the lowest rate.
Matter of fact, even you can do it yourself with a quick internet search.
Google: Lowest mortgage rate.
Questions that you should have asked:
does the lender have 1 set of rate or 2 sets of rates?
how is my mortgage registered? Standard or collateral charge and why?
who has full control of my mortgage?
what are my early pre-payment penalties (show me in writing)?
how will these affect me in the future?
is this the best product in the whole market place for me?
Beware: the lowest rate mortgage is not always the lowest cost mortgage.
Most people don’t ask the right questions when getting a mortgage and it ends up costing them much more than the low interest rate originally quoted. Would you purchase a vehicle base solely on price or do some research and evaluate it first?
Unfortunately for the consumer, industry statistics have shown that nearly 40% of borrowers do not complete the term of the mortgage contract and end up incurring stiff penalty for breaking the mortgage term. Taking into account the huge penalties that are applied in those situations, their mortgages end up having much higher interest cost than the highest interest rate at the time of signing. Just Google: Mortgage Penalty lawsuit. You will find many unhappy mortgage holders who signed up for the lowest rate mortgage only to find out later it costs much more.
The banks know they will end up making more money from these “rate driven” consumer than those that have a mortgage product with a strategy in mind. Have you ever wondered why banks have “Posted Rates” that nobody ever signs up for? Banks do not have them for no reason. They use that to massively increase the payout on the penalty that they charge you, which they refer to as “Interest Rate Differential” or IRD. As a broker I can educate you and show you strategies to avoid paying these ridiculous mortgage penalties.
So many banks are undercutting each other to gain new business. Some even offer “cash back” incentives to lure you in. The banks consider mortgages as loss leaders. Their strategy is to profit from you on the back-end or in the long term. Bank employees represent their shareholders’ interest, who is representing yours?
If you are looking for someone to represent your interest and offer an independent and unbiased advice on:
different options and types of mortgages (ie traditional or collateral charge mortgage)
different products offered by wholesale lenders and retail lenders
answers to questions that you should have asked or didn’t even think about
Life event often comes unannounced at the most inopportune time.
When it comes to your finances, it is always better to be proactive. Developing a mortgage strategy to cover your financial situation and potential life events will require several hours of consultation.
Would a bank employee be able to dedicate the time? Would they be in a position to offer an unbiased advice or is there potential for conflict of interest?
Would they be able to shop around in the marketplace for the best product for you rather than just offer whatever they have?
I can and I will always do what is best for you, rather than what is best for the bank. There is no conflict of interest. I am not a bank employee; I don’t work for the bank, I only work for you. I will be your advocate!
I will take into consideration:
your current financial situation
your immediate plans
your future goals
Base on the information that you provide, I would do the research and come up with several options to help you rather than just sell you a product.
Our mortgage advisory team can converse in English, Vietnamese, Mandarin, Cantonese, and Punjabi!
Have a complimentary consultation today by clicking here to email or call the “mortgage broker with a soul” for your commercial or residential mortgage needs.
Another labour of love is my 4 day course to teach Residential Mortgage Brokers the complexity of Commercial Financing. Do you want to know how to be successful at Commercial Financing in a short period of time? My Commercial Financing…Read More