At Apply Financial we simplify the process of finding the best mortgage rates and finding a lender that matches to your criteria. Our unique process shows you your options so you get to make an informed decision. We understand that, while there can be a lot of similarity to basic lender requirements, there are also nuanced differences that have a huge impact between getting the best deal vs. wasting your time. Add it all together and this is how Apply Financial can save you time and money when looking for a mortgage.
In Canada, we are blessed with a well-capitalized and competitive financial services market. This includes many different providers of basic day-to-day banking activities, such as chequing accounts and debit cards, but also includes a robust mortgage market supporting Canadian home ownership. There are now hundreds of lenders across the country servicing many market segments. Borrowers are no longer restricted to visiting their local branch at the neighbourhood strip mall. They can now choose between big banks, small banks, credit unions, mortgage finance co’s, private lenders and MICs. However, this luxury of choice can create different challenges in finding the best deal.
For many borrowers, getting a mortgage and buying a home is the biggest investment they will ever make. It is also a specific event, detached from the day-to-day financial services they use, and one that might only come along every few years. For this reason, it makes sense for borrowers to shop for the best mortgage rate possible. Interestingly, borrowers can be indifferent as to who their lender is. Of course, the funds need to come from a legitimate source, but beyond that, it does not need to be from their existing service provider. While banks try very hard to satisfy all of their client’s needs, they only offer their own in-house products. If their mortgage rates are not competitive, many customers will want to look at other options.
For mortgage shoppers, the problem becomes, how much more time do you need to invest talking to other lenders in order to get their rate info? Do you need to schedule an appointment and tell your story over and over again? Wouldn’t it be nice if you could just cut to the chase and get the information you wanted? This is a primary reason why mortgage brokers have become such a big part of the Canadian mortgage market. By many estimates, approximately 50% of all Canadian home buyers now use a mortgage broker to help them get a mortgage. At Apply Financial we access a large network of lenders to reduce your borrower legwork and provide complete market, rate and product information.
So, why can finding a mortgage rate feel so opaque?
Wanting the lowest rate is a given -nobody wants to pay more for anything than they have to. Lenders try to differentiate themselves by highlighting the services they offer. In Canada most lenders do these things very well but, generally, it all comes back to the mortgage rate. Even though lenders will post their rates, allowing for a straight-up comparison vs other lenders, they are still dependent on customers walking through the door.
Part of the trouble with posted rates is you cannot always take them at face value. Upon discussion, the actual rate a lender offers you might be higher, or lower, than their posted rate. This makes sense as all borrowers are different and lenders hedge themselves by placing caveats, or conditions, to their posted rates. Lenders want to verify what type of borrower you are before determining the rate they will show you. It stands to reason that a good quality borrower with a high credit score can get a better rate than someone with weak credit.
Large, established lenders often have a higher posted rate, which essentially serves as a “starting point” for discussions. If you can demonstrate that you are a good quality borrower (and ask for their best rate) then, suddenly, they are able to show you an improved offer. These are lenders that know they are going to have a certain amount of traffic walk through their door, so they have the luxury of starting out with a high posted rate. Lesser-known lenders, on the other hand, might need to attract customers by advertising a lower rate, but then caveat that “conditions apply”. This makes sense, because if a smaller lender was not more aggressive than the big guys, most customers would stick with the better-known lenders. However, when the dust settles, it is likely that all lender rates end up being very close to each other. It would not make good business sense for any lender to undercut the market by any more than necessary to win business. This is where Apply Financial helps cut through the opaqueness. There are so many lenders out there that it is challenging for an individual to keep on top of the best product offerings, or where to find them. We understand the lender’s criteria and the rates they are offering. Our process effectively lets the lenders to come to you, so you can make a convenient and informed decision.