Buying a home is one of the most exciting – and often overwhelming – experiences of a lifetime. It’s also among the largest financial investments you’ll ever make. That’s why it’s essential to have a knowledgeable professional on your side walking you through each step and answering questions throughout the homebuying and mortgage processes.
There’s way more to a mortgage than rate alone. But, rate is what the majority of people know to ask about, since it’s among the most commonly asked mortgage questions. ‘What’s your best rate?’ is actually a loaded question. There are so many considerations to take into account when qualifying for a mortgage. In fact, getting a low rate upfront is actually often not the best way to save the most amount of money throughout your time as a mortgage holder.
Mortgage brokers understand the ins and outs of mortgages. It’s what they do day in and day out. They won’t ask you about securing a bank account or making an investment as they solely focus on mortgages.
Did you know that the lowest upfront mortgage rates often cost the most to break? And, while you may think you’ll keep your mortgage for the full five-year term – or whatever length you’ve agreed upon – keep in mind that most Canadians break their mortgage before the three-year mark. This means many people are paying prepayment penalties in the thousands because life has happened and they need to break their mortgage.
Perhaps you’ve experienced illness or divorce, or maybe you’ve outgrown your home or been transferred for work. Whatever the cause, it’s important to know you’re in a mortgage that meets your needs and won’t hit your wallet hard when you need to exit early.
Having prepayment options in place so you can pay extra, double up your payments or even make lump-sum payments is a great way to pay your mortgage off quicker. That’s because every extra dollar you pay towards your mortgage principal reduces the total amount of interest you’ll pay.
Boost your options
Mortgage brokers have access to a wide range of lenders, including the big banks, credit unions and trust companies. More lenders means more choice and added savings for you.
This empowers brokers to be able to negotiate on your behalf with a variety of lenders based on your specific needs. This is also the case when you wish to renew or refinance an existing mortgage.
Access specialty products
Based on your income and creditworthiness, mortgage brokers have a variety of options to help you get approved for a mortgage. In addition to traditional lenders such as banks, brokers also have access to alternative and private lenders who can offer you a mortgage when you won’t qualify for a traditional product at a bank. This may be because you’re self-employed, have bruised credit or you don’t otherwise qualify thanks to the latest stress test used to determine your chances of getting a mortgage.
Best of all, using a mortgage broker is typically free! That’s because, after your mortgage has funded, lenders pay brokers a finder’s fee for bringing your business to them. This means it’s in a broker’s best interest to always match you with the mortgage product and rate that best meets your unique needs, or they won’t get paid.
Content for this blog was supplied by Clinton Wilkins Mortgage Team.
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