I thought i would finally start doing a bit of writing for my website in case some of you are bored and would like some pertinent information about mortgages!
After 10 + years of working in mortgage industry, some of the most common questions i get when i quote a rate from a “monoline” lender (non-bank mortgage lender) is regarding the legitimacy of the lender:
“Are they a good lender??”
“what happens if they go under?”
“I’ve never heard of them…is this a mom and pop shop!?”
“Is this one of those lenders with HUGE penalties?”
If they are a close friend dealing with me for the first time, i always make sure to throw some sarcasm in my answer.
“As a professional mortgage agent interested in having a great reputation and being trusted…i always make sure to place my clients with the worst lenders in the market, mainly the ones on the edge of bankruptcy and that offers my clients the highest risks and the least amount of flexibility going forward!!”.
You get the point! The last thing i want is an unhappy customer calling me a few years down the road to complain of the awful experience they’ve had with the lender i placed them with. So i make sure to place them with reputable lenders with the best rate and most flexible options.
Truth be told is most Canadians by and large feel very comfortable and loyal to “their” bank so they never have the same level of questioning for their own bank that they bring to other non-bank lenders. And I hear some of these things:
“they have a branch i can walk into…”
“my parents have always dealt with them…”
“they have all my accounts and investments…”
“they told me to watch for smaller lenders…”
No need to ask tough questions…they must be looking for your best interest right? Yes and No. The employee you are dealing with is likely looking out for your best interest as most bank employees are honest working Canadians, but the bottom line is the companies they work for are in business to make money from you! Either, lending you money or up selling you on as many products (loans, credit cards, accounts, insurance, investments) as possible…products you might not always need or some plainly bad for you.
Hence the reason they are the “leaders” in areas that client can overpay and end up on the short end of the stick…especially with mortgage penalties. I won’t dive into details in this post as it would make this blog entry too long and boring…you would likely move to another website and not finish this riveting piece of information!
In my next blurb I will compare the major difference in how banks calculate penalties versus most monoline lender.
A+ tard,
Your friendly Frenchie!