In past years in the U.S. there has been a real boom in the mortgage industry. There are now more lenders than ever before and more mortgage options than you can shake a stick at. One thing that people should know before applying for a mortgage is what kind of lender they are dealing with. In the mainstream market there are usually 2 different kinds of mortgage professionals that an individual will come across, the broker and the banker.
Perhaps the best way to discern between the two is to realize that brokers are middlemen. They shop the market for you and present you with an array of mortgage options from different lenders. This is an asset in that as a borrower, your options are less limited. It is always a good idea to get references for a mortgage broker as the practice is still unlicensed in some states. Bankers on the other hand are usually more established and have been in operation for some time. However as a banker is attached to a particular financial institution, their range of mortgage products will also be established. These are typically the bankers that will be located by the broker in their search for mortgages to present you.
No matter who you choose to deal with for your home funding, the most important thing to do is to investigate where the money is coming from. There has been a rash of "shifty" mortgage companies in recent years so a good way to tell if a company is legitimate is longevity. Check how long they have been in business and if there have been any complaints made against them. If so, what was the nature of the grievances? You can never be too careful in deciding how to finance your new home. This is a purchase that has the potential to stay with you for a lifetime, make sure that you make an educated decision.
? The representative of the local bank branch: They only offer loans, and have many other duties besides mortgage loans, are salaried, and perhaps receive an annual bonus.
Traditionally, it is the local bank branch representative who acts as the home loan consultant. He is the only one who is able to make a mortgage application for borrowers - taux hypothecaire. The world of mortgage financing has changed and almost all lending institutions offer their mortgage products through mortgage brokers and, in certain cases, through mortgage marketers. The bank representatives still offer mortgage loans (as well as other financial products) but only for the bank they represent.)
? The mortgage marketer: He deals in loan products only, specializes in mortgage loans and is mostly paid by commission (paid by the lender).
In order to better serve their clients, banks have begun to hire local representatives. Mortgage marketers go to the client but work principally for a bank or lender. Like the other mortgage brokers (taux hypothecaire), they are paid by commission on the amount of the client's mortgage.)
? The mortgage broker: The broker offers the loan products of many lenders. He specializes in mortgages and receives a commission. This commission is paid by the lender that the loan is placed with.
Mortgage brokers have been dealing with mortgages for more than thirty years but have only become an import part of the mortgage market (taux hypothecaire) recently. A mortgage broker works with many lenders, usually 30 or more and can choose the best one for each client. Today, more than 12,000 mortgage brokers operate in Canada, controlling 27% of the mortgage market.)
(Please note that, although I try to be neutral on this topic, I am a mortgage broker - taux hypothecaire. I want to advise you that I believe working with a mortgage broker is the best way to go when you are shopping for a loan for your home.)
You can be sure of one thing, it is the integrity and expertise of your mortgage advisor that will make the most difference. There are very good local bank branch representatives, very good mortgage marketers and very good mortgage brokers. Of course, there are very bad ones as well. It is the person in the position who will make the most impact in the long run.
One thing is for sure. It is the expertise and integrity of the advisor that will make the difference - taux hypothecaire. There are excellent local bank branch representatives, excellent mortgage marketers and excellent mortgage brokers. However, the opposite is also true.
The service of the person with whom you will work is most important.
Mortgage brokering has become more popular
In 2004, a survey conducted by the CMHC indicated that over 26% of all of the home loans in Canada were financed through the intermediary of a mortgage broker (taux hypothecaire). In any case, it is the individual you work with, his integrity and expertise that counts.
Both Katie Lancelot & Gregory Van Duyse are contributors for EditorialToday. The above articles have been edited for relevancy and timeliness. All write-ups, reviews, tips and guides published by EditorialToday.com and its partners or affiliates are for informational purposes only. They should not be used for any legal or any other type of advice. We do not endorse any author, contributor, writer or article posted by our team.
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