Mortgage: Bank vs Broker

[shane_c]

What is the difference between getting a mortgage from a bank vs going through a broker.

Applied with ING but was declined not based on credit score or finances but because we have not been at our current job for 2 yrs. Kind of hard since we just moved to Calgary last summer. We have been in the same field though the past 3+ yrs. They said they could refer us to their broker division and that they have greater flexibility in who they can accept. The guy at ING said that the rates were the same or possibly lower with the broker. Is there something I should be aware of if we went with a broker?

[Sample00]

hello,
I am a mortgage broker.
the biggest difference in dealing with a mortgage broker as compared directly to the bank, is that a broker can look at your deal and present your mortgage application to the correct financial institution.
Mortgage Brokers typically deal with more than 30 different financial institutions and with one mortgage application and one credit bureau they can go through and find out the best deal for you with the right financial institution.
its definately in yoru best interest to have a broker work for you. they know the ins and outs and can negotiate better rates with the banks/financial institutions.
If I can be of any assistance please feel free to contact me at 1-877-723-6686 or email at axmann@telusplanet.net.
or for information please feel free to visit my site at www.quickmortgages.ca

thanks and good luck

[shane_c]

Originally posted by Sample00@Apr 8 2005, 03:24 PM
hello,
I am a mortgage broker.
the biggest difference in dealing with a mortgage broker as compared directly to the bank, is that a broker can look at your deal and present your mortgage application to the correct financial institution.
Mortgage Brokers typically deal with more than 30 different financial institutions and with one mortgage application and one credit bureau they can go through and find out the best deal for you with the right financial institution.
its definately in yoru best interest to have a broker work for you. they know the ins and outs and can negotiate better rates with the banks/financial institutions.
If I can be of any assistance please feel free to contact me at 1-877-723-6686 or email at axmann@telusplanet.net.
or for information please feel free to visit my site at www.quickmortgages.ca

thanks and good luck

Does it cost anything to go with a broker? I believe ING said they would cover the application costs.

[V]

Another plus for the broker is that your credit rating stays ok.

If you do countless credit checks with different banks to see what you can get pre-approved at, your rating takes quite a hit. A broker can do one credit check and submit it to all the banks. (However it works).

All I know is that my mortgage broker does a lot of running around for me, and I don't have to pay him a dime. I don't see the point of doing all that work if someone can do it for me for free.

[Sample00]

no in most cases there is not cost to you the client as mortgage brokers typically get paid a commission from the financial institution that you ultimately go with.
most commission rates are the same so there is no favouritism with any particular bank.

[Sample00]

Originally posted by Dominicwasalreadytaken@Apr 8 2005, 03:30 PM
Another plus for the broker is that your credit rating stays ok.

If you do countless credit checks with different banks to see what you can get pre-approved at, your rating takes quite a hit. A broker can do one credit check and submit it to all the banks. (However it works).

All I know is that my mortgage broker does a lot of running around for me, and I don't have to pay him a dime. I don't see the point of doing all that work if someone can do it for me for free.

exactly right!

[shane_c]

Originally posted by Sample00+Apr 8 2005, 03:34 PM--></div><table border='0' align='center' width='95%' cellpadding='3' cellspacing='1'><tr><td>QUOTE (Sample00 @ Apr 8 2005, 03:34 PM)</td></tr><tr><td id='QUOTE'> <!--QuoteBegin-Dominicwasalreadytaken@Apr 8 2005, 03:30 PM
Another plus for the broker is that your credit rating stays ok.

If you do countless credit checks with different banks to see what you can get pre-approved at, your rating takes quite a hit. A broker can do one credit check and submit it to all the banks. (However it works).

All I know is that my mortgage broker does a lot of running around for me, and I don't have to pay him a dime. I don't see the point of doing all that work if someone can do it for me for free.

exactly right! [/b][/quote]
Typically, how long would the rates be guaranteed for?

[Sample00]

rates will typically held for up to 120 days...depending on the financial institution.

[albertGQ]

Originally posted by Sample00+Apr 8 2005, 09:34 AM--></div><table border='0' align='center' width='95%' cellpadding='3' cellspacing='1'><tr><td>QUOTE (Sample00 @ Apr 8 2005, 09:34 AM)</td></tr><tr><td id='QUOTE'> <!--QuoteBegin-Dominicwasalreadytaken@Apr 8 2005, 03:30 PM
Another plus for the broker is that your credit rating stays ok.

If you do countless credit checks with different banks to see what you can get pre-approved at, your rating takes quite a hit. A broker can do one credit check and submit it to all the banks. (However it works).

All I know is that my mortgage broker does a lot of running around for me, and I don't have to pay him a dime. I don't see the point of doing all that work if someone can do it for me for free.

exactly right! [/b][/quote]
Thats not exactly right actually. All inquiries that are made within a 2 week time period that are for the same product (eg. mortgages), then all credit inquiries count as one. This way your beacon score does not take a hit.

[Cheese]

Shane....get in touch with Axel...he is THE man!...and he is a CP hero!

[Sample00]

awwwww Cheese, I'll send ya the five bucks later..

didnt know we had CP heros!

[shane_c]

Originally posted by Sample00@Apr 8 2005, 05:28 PM
awwwww Cheese, I'll send ya the five bucks later..

didnt know we had CP heros!

Thanks for all the replies...

Do you know how this would work.....

I've been at current job for 8 months (clerical/admin). Prior to that I was at a call centre for 3.5 yrs (essentially clerical/admin).

My fiance became incorpated and is under contract for the last 8 months (historical research/consulting). Before coming here she worked for approx 2 yrs in the historical research field.

Will our current income be taken into consideration? Or since it's less than 2 yrs will they only look at previous employment?

[Sample00]

private message sent...

[Claeren]

Hey Sample i am wondering something, if you could help me out that would be great...


My girlfriend and I were condo shopping on a whim and we found this great place for ~$200k but it is not going to be ready until fall 2007. That actually works REALLY well for both of us as we are both still in school and not quite ready to take the plunge and need to get our lives in order before doing so.

While we are both students we make good money and work full time. We each make somewhere in the 40k-65k range but with school expenses and buying cars and stuff we don't really have any other savings, YET. Obviously we have until fall 2007 to put together a bunch of money but i was wondering:

1) When we go to sign the purchase papers in a month and put our 5% down to hold the property are we supposed to already have mortgage arangements made, even though it is 2.5 years away?

2) We have at least 6k, and probably 8k saved up already but is there a low interest way to borrow the remaining 2-5k we will need, just for a few months?

We both have long employment histories, cars, prefect credit ratings, payed off credit cards, and no other debt other then the cars.

I have room for 20k on my credit card, so access to capital in the general sense is not a problem, but that would be just dumb....

Thoughts?

Thanks man!
Claeren.

[Sample00]

Originally posted by Claeren@Apr 9 2005, 06:41 PM
Hey Sample i am wondering something, if you could help me out that would be great...


My girlfriend and I were condo shopping on a whim and we found this great place for ~$200k but it is not going to be ready until fall 2007. That actually works REALLY well for both of us as we are both still in school and not quite ready to take the plunge and need to get our lives in order before doing so.

While we are both students we make good money and work full time. We each make somewhere in the 40k-65k range but with school expenses and buying cars and stuff we don't really have any other savings, YET. Obviously we have until fall 2007 to put together a bunch of money but i was wondering:

1) When we go to sign the purchase papers in a month and put our 5% down to hold the property are we supposed to already have mortgage arangements made, even though it is 2.5 years away?

2) We have at least 6k, and probably 8k saved up already but is there a low interest way to borrow the remaining 2-5k we will need, just for a few months?

We both have long employment histories, cars, prefect credit ratings, payed off credit cards, and no other debt other then the cars.

I have room for 20k on my credit card, so access to capital in the general sense is not a problem, but that would be just dumb....

Thoughts?

Thanks man!
Claeren.

howdy and thanks for asking...
You could have mortgage arrangements in place already but so many things can change in that time frame.
From what I can see it sounds like you shouldnt have any problems getting preapproved, barring any unforeseen circumstances such as credit issues, employment issues and what not. But again as I said, you could talk to a broker and get pre approved. Most preapprovals are only as good as long as no material information changes.
Banks also wont guarantee interest rates that long either. Typically a rate hold will last up to 120 days.
Downpayment can come from one of four ways...
a) Savings - this must be accumulated over a minimum three month period. Again this falls well within your time line.
b) RRSP - you can draw on your rrsp's up to 20K to use for the downpayment on a home
c) Gift from a family member- A family member, mom dad brother sister can give you the downpayment as a gift. No repayment terms need to be made clear in the gift letter. I have some forms to use at the office.
d) sale of an asset - you could sell a vehicle or something similar to come up with the downpayment.

you may also qualify for a 0% down mortgage. basically this works that the banks gives you a loan for the 5% down. you then have two payments, mortgage and loan to repay. you must have excellent credit score(history) in order to qualify.

I dont see you having to have a mortgage already in place for this particular purpose. From what I can tell they want your deposit and then you have to arrange your mortgage the closer you get to actual possession. Usually about 6 months prior. but it doesnt sound like you should have any problems.
I will be back in my office on tuesday. I am going to a Mortgage Symposium in Calgary on monday.
Feel free to email me any questions or call me on monday
regards
Axel aka Sample00