Thanks for reading Part one of the three part series, “Bank or Mortgage Broker? What’s the difference?” In Part One we had the mortgage rate discussion and looked at some of the regulatory and licensing differences between Mortage Brokers and Banks. In this segment, we’ll discuss how a mortgage broker may be better equipped to help those who have credit challenges, and those whose income is not traditional, particularly clients who are self-employed or are business owners. We'll also look at product availability between the two channels
Income / Credit Challenges
Without a doubt, brokers win this one. Our job is to learn about you, your financial situation, and your goals and priorities, and to take that information and package it up in the way that makes you look the best. We then take that package and present it to the lenders we think have the highest likelihood of issuing an approval. If you've missed payments, or if you're self employed (or on parental leave), or have rental properties, or if there's anything else about your situation that doesn't "fit in the box" we will know which lenders look more favourably on whichever quirks we're dealing with. This greatly increases your chances of getting an approval.
Keeping on top of all the mortgage rates, products, features, advantages, disadvantages, restrictions and options is a full time job. Bank reps are limited to their bank's products, while brokers (cue broken record) have access to dozens of lenders and hundreds of products. The truth is, like any other business, we get better rates by focusing our volume on 3 or 4 providers and sending most of our loans there. This gets us better service (dedicated underwriters, faster turnaround time), better rates (since we send more business to those lenders), and more clout when we need exceptions or have tighter timelines.
About the Author
Andrew Sikomas is the managing partner of Solara Financial Partners. Solara provides convenient mortgage rate shopping at multiple lenders, along with expert opinions and advice, at no cost to you.
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