Your house is probably the single largest purchase you will ever make during your lifetime. Yet most people don’t spend a lot of time looking considering whether they are getting the best deal on financing for it. They have no trouble comparing prices for other big ticket items, such as a car or a flat screen TV, but when it comes to a house, it’s a different matter entirely. If you are looking for a new house or your mortgage is up for renewal, you may be asking yourself if you should shop around for a mortgage rate.
Most Canadians Don’t Shop Around for Best Mortgage Rates
According to Canada Mortgage and Housing Corporation, (CMHC) the majority of mortgage consumers are loyal to their existing lender. More than half of first time-buyers (54 percent) get their mortgage with the financial institution they deal with the most. When the mortgage comes up for renewal, most homeowners (84 percent) end up signing the papers and take the offer that their lender has offered.
Why do these mortgage consumers stay with their current lenders? CMHC statistics cite the existing relationship as being a crucial factor (52 percent) and convenience (40 percent) being another consideration.
Why You Should Shop Around for a Mortgage Rate
- You Could Get a Lower Interest Rate or Better Terms
Mortgage rates are at historic low interest rates. No one knows how long it will be before the Bank of Canada will start raising them again. It makes sense to take advantage of them now by finding a lender which can offer the best combination of a low interest rate and terms that fit your lifestyle.
- A Mortgage Broker Will do the Leg Work for You
If the idea of contacting multiple lenders to try to find a lower rate seems daunting, contact a mortgage broker. They are professionals with the training and contacts to shop the market for you. Mortgage brokers also have access to lenders that the general public can’t access, such as private lenders, who are willing to hold a mortgage. A mortgage broker can find a mortgage that will fit your budget and your needs. The lender pays a fee when a mortgage is arranged, so you will not be out of pocket for their service.
- If you decide to refinance with another lender, in most cases you will only need to meet with a lawyer once or twice to sign documents. The lawyer you choose will do the work for you and arrange to have the necessary papers registered on title. Refinancing at a lower rate of interest can mean thousands of dollars in savings over the life of your mortgage, and this will likely make taking the time to sign papers worthwhile.
- Your current lender will understand if you decide to change financial institutions because you can get a better rate elsewhere. Its mortgage representatives know that they are limited to offering their own products to customers. Your new lender will treat you well from the start.
To find out mortgage financing options, call Mark Price, mortgage broker today. The sooner you get him working for you, the sooner you will be able to find the right mortgage.