The Mortgage Broker And You

Hi.

You want to buy a house or perhaps you have one and it's time to renew. Where is the first place you turn to for help? Your bank. After all, you have most likely been with them since you opened your first savings account, an idea that was forced upon you by your parents. They will know what to do and they will help you because you've been with them 10, 20 years.

I totally get this kid...

And they do help you. You go in, talk about purchasing a house and they say we will give you the money to buy this house and you can slowly pay us back over the next two or three decades with this little amount of interest tacked on. Next thing you know, you've signed some papers, told your Realtor and by this time next month, you are a proud new homeowner!

Yes, mortgages are complicated. Some are more complicated than others. Hotels, apartment buildings, skyscrapers, they all have mortgages of some type. But let's just keep things simple. I'm talking to you, the simple home owner or buyer.

5 Reasons to Avoid Big Bank Mortgages

In Canada, there are few things guaranteed. Snow. Taxes. Roll up the Rim to Win.

Wearing out your snow shovel...

We want guarantees. We need them. So when we want that feeling of security that only home ownership provides we turn to the first thing that we think may be able to help us financially; our parents.

But what if you are past that stage of wanting/needing parental assistance? Your second choice is most likely your financial institution. After all, you've been with them probably ever since your parents set you up with your first bank account in a perhaps misguided attempt to teach you about savings and earning interest.

I know that's where I started. I was told that the banks will 'give me money on the money i give them'. It was called interest. So every once in awhile my folks would take me to the local bank and I would give the teller my bankbook and some birthday money from Gramma and the teller would take my money and give me the book back. Inside it were numbers; my previous balance, the money the bank gave me for keeping it there, my deposit and then finally my new total.

The one time i remember registering how much my bank was giving me it was 11 cents. I probably had not been in there for a few months. I remember thinking 11 cents isn't very much. Fast forward 30+ years and I'm still wondering when I'm going to be getting paid for giving my money to the bank to hold for me so that robbers wouldn't get it.

I digress. You are a grown up now and want to buy a house. You need a mortgage because you don't have $400,000 built up from the interest you have earned from your bank. So, after your parents say no, you decide to go to the only place you know that deals with big amounts of money; your bank.

Is that your smartest choice?

You will Discover This Free New Post is Guaranteed to Make You think 'Mortgage Broker'

There's a lot of things to consider if you are thinking of jumping careers into a completely new field in a futile bid to ward off the specter of our imminent demise which will (unless 'science' gets in the way) claim us all in the next 100 years.

Because apparently, NASA becomes sponsored by the wine industry

I decided to juggle the mind field of mortgage brokering after some recommendations from family. This is on top of my job as a care aide, father, husband, volunteer firefighter and part-time writer for a popular webzine (if you live in the United Kingdom and still have an opinion of Christopher Nolan's Batman). I sometimes get them confused as on top of all these responsibilities, I also need to sleep.

The other day, slightly distracted by thoughts on my various career paths, I came across a minor accident; a few vehicles were pulled over to the side of the road and a few people were attending a middle-aged man with no visible signs of injury. He wore motorbike leathers and seeing as how there was no motorbike visible, only a slight skid mark that went over the side of the road into the bushes, it was pretty self-explanatory.

As all first responders, professional or volunteer should do, I identified myself to offer my trained assistance;
"Hi, I'm a mortgage broker, do you need any help?"

It took me a brief moment for my ears to catch up to my words as the 1/2 dozen assorted strangers looked at me. Too late, I corrected myself;
"I mean, I'm with the fire hall."

But by then it was too late, I lost their business.

"Are you looking for a variable or fixed rate?"

Dating Real Estate and your Mortgage Broker

"What is a mortgage broker?" said nobody during my high school career fair.

Well, thanks to the UBC Sauder School of Business, now I know the official version and have the paper to prove it.

But that's boring. Let's assume that nobody under 21 is interested in reading this, because let's face it, mortgages are a pretty dry subject matter. But not if we compare mortgages to your sex-life, which I am pretty confident nobody ever has but for the sake of argument, I'm going to give it a try.

Getting a mortgage, much like getting laid while single (or if already in a relationship, getting involved in a three-way) is a tricky slope; we have all been down the soul-sucking route when looking for prospective mates, from puberty through your 20's and on and on until you find that right someone you were meant to be with. So it is with real estate.

But much like reading Maxim for dating tips isn't the same as actually dating, just saying you are a mortgage broker isn't the same as actually brokering mortgages. Our (my) business is built on referrals, much like most blind dates are. Some blind dates are good, some are bad. And the best are the ones when you wind up being completely compatible with each other and live happily ever after.

This has 'bad idea' written all over it.

What Did It Take to Get Here?

So you are thinking of becoming a mortgage broker?

Perhaps you saw an ad for a mortgage broker and thought- man, that sounds interesting. It's like all the glamour of being in real estate without having to do all that selling and meeting people a realtor has to do. Sign me up!

Big mistake.  

Like Michael Cera with a mustache mistake...

So why did I decide to do it? 

In my case I have 2 relatives that are mortgage brokers; a cousin in a city 500 kms away and a sister-in-law 150 kms away. This is very important because you will soon learn that you are going to be just another fish entering an already full pond that has a limited amount of earning potential before you appeared. It's much like the Cory Schneider and Roberto Luongo goalie conundrum. There is only so much net to go around...  

However, they helped me in answering a few questions i had about the industry and didn't yell at me to back the hell up on this career path. The only problem in hindsight is that they have over 20 years experience between the two while I had none.

It's not glamorous, it's not overly rewarding. It's a job. A lot of being a mortgage broker is based on earning commission, meaning I don't have a set wage, I earn a portion of what I bring in. Yet I'm not really selling a tangible; I have to convince people that I can save them thousands of dollars in the future if they are open to getting a mortgage not from their current bank (which 90% of homeowners do, citing convenience as their primary reason).  

My job is to help people see past their personal banks. Banks are making record profits for a reason; they make the best return they can on the people they serve, which is you and me. That won't change, however I can shop around for the best deal that makes sense to people in their own unique situation, at no cost to the person wishing to purchase or refinance their home. 

People can still be loyal to your bank but when it comes to hundreds of thousands of future dollars, it's best to get the best rate possible. That's what banks expect and they certainly don't want their valued (and profitable) customer to find out that some private lender with little name recognition may save them thousands of dollars in interest payments alone over the course of their mortgage.
I digress.