The reality about the Canadian mortgage market is that in the last forty years it has undergone substantial changes. Depository institutions account for the majority of the market, holding 69 percent of Canadian residential mortgage debt outstanding at the end of 2007. At the end of 2008, depository institutions had CAD 566 billion or 62 percent of CAD 906. billion of outstanding residential mortgage debt in Canada. The main reason for the growth in bank participation was due to changes to the Banking Law of 1992, which allowed banks to own trust and loan companies that had been dominant players in the market. Before 1954, banks were not allowed to make mortgage loans. However, gradually from the amendments to the Banking Law of 1954 and later, the laws allowed banks an increasing participation in the market over time. However, until 1992 the value of conventional mortgages could only be below 10 percent of bank deposits. Mortgage brokers have played an increasingly important role in the market.
A survey of mortgage consumers conducted by the Mortgage and Housing Corporation of Canada in 2009 revealed that between June 2008 and June 2009, a quarter of all mortgage transactions were conducted through mortgage brokers. According to statistics, more than 50 percent of home buyers accept the first rate offered by their bank. This means that most do not use a mortgage broker looking for the best rate for their client. However, among first-time buyers and young women, a growing number are turning to mortgage brokers. In the last decade, mortgage brokers have seen an increase in business. Ten years ago, they comprised less than 10 percent of the mortgage market; today, they included 25 percent of the stake. Brokers provide personalized service and can be used for banks to offer more favorable terms.
There are several reasons to use a reputable independent mortgage broker. They educate you on your options. Receive independent and impartial advice. Unlike a bank clerk, who is linked to a bank, an independent mortgage broker offers unbiased advice. As a freelancer, you won’t favor one lender over another based on anything other than rates. They will negotiate rates with the lenders on your behalf and all of their services are free. Provincial laws require education, training, and licensing standards for qualified brokers. A competent mortgage broker is licensed and up-to-date with the provincial regulator.
The main difference between a mortgage broker and a mortgage broker is that being a mortgage broker requires at least two years of work experience. The mortgage broker must pass an approved mortgage course. Mortgage brokers must be supervised by a mortgage broker. Brokers work for a mortgage agency or on their own and bring together potential borrowers and lenders. They do not administer the mortgage. After the client fills out an application using the information contained in it, the broker searches the market for the best mortgage. The client’s mortgage application is tendered through an electronic system to the lenders.
A mortgage broker is a person who carries out mortgage activities for a mortgage broker under the supervision of a licensed mortgage broker. The agent can only work for a mortgage agency. Under the Mortgage Brokers, Lenders and Administrators Act, you must have a license to negotiate mortgages to obtain a license, unless an exemption applies. To obtain a license, a mortgage broker must meet educational requirements. To meet these requirements, approved education courses must be taken. The license application must be made within two years of successful completion of approved education courses. These courses are offered commercially and tuition fees are set by the provider. The courses use the same curriculum, but different providers may use different formats. All approved courses are followed by a final exam.
The first step to obtaining a mortgage brokerage license requires passing the mortgage broker education program. Then a mortgage broker license must be obtained. The mortgage brokerage education course must be completed successfully. Thereafter, a mortgage broker license can be applied for. In the course of this process, the prospective broker should have worked as an agent for one year and worked with a broker.
Brokers and agents investigate and look for the best solution. Financing your home through a mortgage agency rather than a lending institution can save you time and money. They work on behalf of their client to find the most suitable product at the best price. Brokers provide access to virtually every mortgage product available. Consumers expect their own bank to offer them the best rate and product. But the bank does not have access to all available lenders and products. The bank offers a limited number of mortgages. But brokers provide access to more than 400 mortgage products on the market. Each of these products has its own distinctive characteristics. They also have access to new products that are launched frequently in this dynamic industry. Access to unique products can also be offered solely through the mortgage broker.
A mortgage broker offers services free of charge. The lender pays to place the mortgage with them. A broker is paid by the amount of the mortgage, not by the rate. The commission they earn from the lender tends to be higher for a fixed term and lower for a variable mortgage. Unlike the bank, business hours can extend beyond bank hours. They are usually available at night and on weekends. Brokers can also renew mortgages. They can help with leveraged investment loans. For first-time home buyers, a broker can help you through the various steps of the process.
