1. What are mortgage interest rates based on?
The only correct answer is the Bank of Canada rate for variable mortgages and Mortgage Backed Securities, specialized mortgage bonds, or Government of Canada Long Bonds for fixed rates. A professional mortgage originator ought to at least know the basics of how your interest rate is determined. Do not work with a lender who has their eyes on the wrong indicators, or worse yet, has no idea what the indicators even are.
2. How will rising interest rates in the coming years effect me if I take a fixed rate product?
Most lenders will mistakenly answer that if your rates are locked in then rising rates in the future will not affect you. This is an incredibly dangerous thought process. What will happen to your payments at renewal if rates rise from their current emergency low levels to a more normal level, 2% or more higher then today?
This is called your payment shock and it is incredibly risky to your long- term financial health. Working with a broker who pro-actively manages your mortgage and notifies you when rates rise with a suggestion on how to minimize payment shock, is not only smart; it will knock years off your mortgage. Let Us show you how.
3. What strategy are you recommending and why?
The key here is the word “strategy”. If a broker cannot clearly articulate the strategy behind their recommendations to you then they are simply quoting a rate. Anyone can do that! On your largest investment make sure you are dealing with someone who has a solid financial plan that is considering your overall financial wellness.
4. What commitment are you giving me to personally manage my mortgage over the long term?
This is the most critical question of all. Many lenders, especially bank personnel, have no desire or ability to proactively manage your mortgage personally over the long haul. How can you take advantage of changing markets in the future to optimize your mortgage if no one is watching the markets and advising you when to optimize? Who will ensure you don’t miss an opportunity to renegotiate your mortgage? If you are considering a variable rate mortgage why would you choose a lender who is not committed to keeping an eye on it? Anyone can sell you a mortgage but only truly committed mortgage professionals can manage your mortgage over the long term.
Ask for documentation summarizing their plan for your mortgage, make sure they include projections for the different options they are recommending to you. Ensure that they include their lowest rates that they have available for you, and let them know that you are not interested in a negotiation; tell them you just want their best deal!
“You never have to negotiate with us; we always have the best possible rate for you the first time.”
More than likely this is one of the largest and most important financial transactions you will ever make.
You might do this only four or five times in your life…but we do this every single day.
It is your home, and your future. It’s our profession and passion. We are ready to work for your best interest!
We believe it’s all about the person sitting across the table from you, not the bank you choose!
Get In Touch With Us.
