It Isn’t Easy Being a Mortgage Broker in Hamilton
In a city as big as ours, any competitive business has it’s ups and downs. Those are our troubles, and your goal is simply to find the best broker and the best interest rate. Everything else is just insider issues. I wonder how your search has been going so far? Have you been able to talk to a bank in Hamilton, or have you been browsing for mortgage brokers instead?
Perhaps you’re wondering what exactly the difference is between the banks and brokers. Well, it all goes back to what I mentioned at the start. Competition is the difference.
Learn more below:
Key Differences Between Banks & Mortgage Brokers
So many articles have touched on the main differences in the entities from which you can aquire a mortgage. I’m not here to necessarily rehash what’s already been written a thousand times, but I will summarize to keep it straight.
Mortgages from a Bank
Banks in Hamilton are rather anti competitive (really, banks everywhere are the same). By that I mean that they have static rates, typically based around the Bank of Canada’s prime rate, and they will not deviate from their set products.
With a bank, your mortgage will end up being offered from a small selection of ‘products’ from which you pick, and that’s that. No negotiation, no real choice of financing options. The end.
Mortgages from a Mortgage Broker
A mortgage broker’s goal is to get YOU the best interest rate on your home’s financing. They have access to both public and private money, which basically means MORE OPTIONS. With more options, and competition between lenders, your broker can get you THE BEST RATE simply by pitting the lenders against one another.
All you have to do is look at the incentive structures of each lender, banks and brokers, and you’ll see who’s on your side.
We’ve established the differences, now let’s discover how to find the best broker. This is a tournament of optimizing your quest for home financing after all.
Determining Your Ideal Mortgage Broker in Hamilton
Now that we’ve decided to opt for a broker instead of a bank for our home’s financing. We need to then find out who the lucky broker is going to be.
What to Look for in your Lender
You can check for online reviews or word of mouth from your friends on Facebook. This is the best way to cull the short list of candidates.
Reviews are very helpful because it can show you what you’re looking for, even if you choose a different broker. For example, if someone states that they liked the speed and ease of the process, that should jump out to you as a typical pain point for someone seeking a mortgage.
We all know it can be mountains of paperwork, and that the process can drag on for days if not properly (or eagerly) managed. So by seeing a review touting the speed of service, that is something you now know to search for in a broker in Hamilton, or at least to ask about timelines in advance.
Other Factors to Look for
The experience of a mortgage broker is also something that can be a tell tale clue as to their reliability. When someone is brand new at the job, it can be a little tougher to truly test their quality.
A mortgage professional who’s been in business since the 1980’s, however, is showing dedication to their craft, and is likely successful for a reason. To maintain status in Hamilton as a mortgage lender for over 30 years takes a methodology and dedication that is truly incentivized by the job.
Phil Romano of the Romano Mortgage Group in Hamilton has been around since the late 1980’s, and has happily placed hundreds, if not thousands of local residents into new home ownership roles.
Financial Associations and Partnerships
While many mortgage brokers in the Hamilton, Stoney Creek, and Ancaster area may be only working for one company (which limits their lending options), Phil Romano is not only the leader of the Romano Mortgage Group, he is also a broker for the Verico House of Mortgages in Burlington (VHME).
This association and affiliation enhances the reach of a broker or agent so that they can pit more of the public and private lenders at their disposal against one another. This is a surefire way to get the best interest rate possible. From there, it’s about terms and amortization.
You’re well on your way to lining up the best deal in the Hamilton area.
Interest – Term – Amortization
When you’re in the hot seat and you’re down to the specific details of your mortgage, there’s important factors to consider. Getting them right and knowing what they all mean in advance can save you thousands of dollars over the course of your loan:
- Interest Rate – The cost of borrowing money
- Term – The length of time that the current rate will be set, or at least the the duration of the variable rate if that’s what was chosen.
- Amortization – The time it would take to pay down your mortgage using the current rate and payment frequency.
The Interest Rate
The rate on your mortgage in Hamilton, Burlington, Stoney Creek or Ancaster can vary based on the available pool of options from your broker. Ideally you want to get as low of a rate as possible, as this means you’ll be paying LESS to borrow the money for your home.
Most mortgages end up in five (5) year terms. It’s a convenince factor, and way to assure you have five years of consistent payments with some level of predictability. This may not be the case if you’ve chosen a variable rate, which would be based on a difference versus the Bank of Canada’s prime interest rate.
With variable mortgages, some people think it’s a better idea for shorter terms, just incase of unfriendly swings in the prime rate.
Amortization is where you can manipulate the size of your monthly payments to some degree. By drawing out your mortgage over a longer amortization, you can reduce your amount owing on your monthly or biweekly payments.
The common amortization length is 25 years. Prior to 2008 it was increasingly common to see 40 year amortization. Due to the sub prime real estate crash in the US, 40 year amortizations have basically been eliminated.
This helps to keep people accountable to their loans, and keep the principle amount reducing at a nominal rate.
Get Your Mortgage From a Broker in Hamilton Today!
This is a nice refresher on mortgages, brokers, and our great city of Hamilton, Ontario. Should you need any more information, you can call Phil Romano of the Verico House of Mortgage Experts, who house the above mentioned Romano Group.
Serving Hamilton, Ancaster, Stoney Creek and Burlington