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Mortgage Brokers

Bass-Invader

TRIBE Member
[sienfeld]So what's the deal with mortgage brokers?[/sienfeld] One just came to my house, seemed to know his shit, explained the different types of 'product' and worked out a bunch of rates for me. He told me that his services cost me nothing, and that they will not affect my mortgage amount or rates - that the banks pay him a finders fee and that's it.
He seemed on the level. Is that normally the case? Do they really not cost me anything. And will he really shop me the best plan, or do they typically con you into going with whoever has the best finders fee?
 

GivinUsociety

TRIBE Member
Bass-Invader said:
[sienfeld]So what's the deal with mortgage brokers?[/sienfeld] One just came to my house, seemed to know his shit, explained the different types of 'product' and worked out a bunch of rates for me. He told me that his services cost me nothing, and that they will not affect my mortgage amount or rates - that the banks pay him a finders fee and that's it.
He seemed on the level. Is that normally the case? Do they really not cost me anything. And will he really shop me the best plan, or do they typically con you into going with whoever has the best finders fee?
You don't pay the mortgage broker he shops around for the best rates for you. The bank or financial lenders pays a percentage to the mortgage broker for bringing clients to them.
 

todiefor

TRIBE Promoter
I'm a few months away from looking to buy my own first pad - sounds like a damn good idea if it doesn't cost me anything.
 

Jennika

TRIBE Member
talk to/PM kuba, he's in the field and was really helpful to Tearer and I when we bought our condo last year.
he arranged a really competitive rate for us and was great at answering my questions about the mortgage and other first-time-home-buyer stuff
 
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Pudding

TRIBE Member
ask your broker if he has a brokers license, check him/her out first. i work as a mtg rep at one of the big banks and you wouldn't belive the fraud that goes on with these brokers, don't get me wrong there are lots of honest ones out there, but do your research. the banks have changed their credit policies quite drastically in the last few years, meaning that its much easier to be approved if you are self employed, bad credit etc.
 

Spinsah

TRIBE Member
I attended question period yesterday and there's some serious new bill in the work which is going to tighten up mortgage broker regulations. I'm not sure exactly how this is going to work as this sort of thing is largely greek to me.
 

VinylRach

TRIBE Promoter
There is a serious new bill in the works. My company is a mortgage lending company, and i underwrite mortgages. Although i'm taking the courses at seneca for an underwriting degree, i just did it to make more money, soon its going to be required to work in the mortgage industry. Although Pudding is right, its good to research your broker before letting them facilitate your mortgage i would disagree with his statment about going with the big banks.

First off, the big banks see you as a number, and they dont really tailor a mortgage to suit your needs, they have mortgages that suit a large group as a whole and the person at the bank tries to fit you into one of their usually 6 or 7 large categories. SOmetimes its like fitting a square into a circle.

With a private broker, they have the opportunity to look at the large amount of lenders as a whole and find a product best to suit your needs.

As for fraud, my job is to catch fraud and i'll tell you 9 times out of ten it isn't the broker commiting fraud, but the client.
 

Bass-Invader

TRIBE Member
also: a member of the board has also been very helpful in explaining the details of this whole thing to me via telephone.
 
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kuba

TRIBE Member
Hi!

(I have nothing to add to this thread other than I like being a broker, I get to come into work at 1030am, the banks pay us to find them clients, the clients have the choice of what mortgage they want, and, umm, yeah, that's about the size of it)
 

Pudding

TRIBE Member
VinylRach said:
There is a serious new bill in the works. My company is a mortgage lending company, and i underwrite mortgages. Although i'm taking the courses at seneca for an underwriting degree, i just did it to make more money, soon its going to be required to work in the mortgage industry. Although Pudding is right, its good to research your broker before letting them facilitate your mortgage i would disagree with his statment about going with the big banks.

First off, the big banks see you as a number, and they dont really tailor a mortgage to suit your needs, they have mortgages that suit a large group as a whole and the person at the bank tries to fit you into one of their usually 6 or 7 large categories. SOmetimes its like fitting a square into a circle.

With a private broker, they have the opportunity to look at the large amount of lenders as a whole and find a product best to suit your needs.

As for fraud, my job is to catch fraud and i'll tell you 9 times out of ten it isn't the broker commiting fraud, but the client.

if you have the time to research the product and rates, you don't need a broker. and really its not about the product for the majority of people...its about the rate....i would say that almost 99.99% of my clients only care about the rate.

the banks don't decline people for mortgages anymore, mine doesn't anyway. the mortgage market is extremely competitive right now, with the housing market slowing down compared to recent years, banks are doing all they can to not only keep their existing clients, but to gain marketshare. for example..we all have heard of BMO (bank of montreal) up until a few weeks ago when interest rates went up they were actually losing money on every new mortgage they put on their books, all they cared about was gaining marketshare.
 

Ditto Much

TRIBE Member
annec said:
MMM, mortgage. You guys sound all sexy when you talk fiscal.

Mortgage subsidy bonds help reduce housing expenses by lowering mortgage interest rates by about 1-1/2 to 2 percentage points. For example, a family with a gross income of $16,000 buying a house with a $40,000 mortgage would save about $550 a year after taxes if it received a mortgage financed with tax-exempt bonds. While that saving may not be large enough to affect the decision of most families about whether or not to buy a house, it would enable them to devote less of their income to housing or to purchase a higher-priced home.


can't fault a guy for giving a girl what she wants now can yeah...
 

LivingRoomPornstar

TRIBE Member
The cost is usually situational in that it depends on the lender. If it's a major bank, the broker shouldn't be charging you any fees. I do know that there are some lenders that don't pay out as much, so the broker charges a fee to account for their time and effort(more often found with higher risk lenders or special products).

Mortgage brokers are not regulated near as much as other financial professionals, and the new rules relate to the licensing of their services.

It's a great idea, as it brings some accountability(regulating body with power to revoke licenses) and also increases the level of service and professionalism in smaller outfits. It'll be a big win for the consumer.

Dan
 
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LivingRoomPornstar

TRIBE Member
Pudding said:
if you have the time to research the product and rates, you don't need a broker. and really its not about the product for the majority of people...its about the rate....i would say that almost 99.99% of my clients only care about the rate.

the banks don't decline people for mortgages anymore, mine doesn't anyway. the mortgage market is extremely competitive right now, with the housing market slowing down compared to recent years, banks are doing all they can to not only keep their existing clients, but to gain marketshare. for example..we all have heard of BMO (bank of montreal) up until a few weeks ago when interest rates went up they were actually losing money on every new mortgage they put on their books, all they cared about was gaining marketshare.
I'm sorry, but some of the statements here are blatantly false. Though I agree some of the approval policies have been relaxed, most lenders have minimum approval criteria. For example, you will have a hard time getting approved if you have a very small down payment(less than 5%) and have questionable credit quality(history of many late payments, collections, and/or discharged bankruptcy). Of course every situation is different, but there are some deals that I have not been able to get done even with a broker.

Dan
 

Pudding

TRIBE Member
LivingRoomPornstar said:
I'm sorry, but some of the statements here are blatantly false. Though I agree some of the approval policies have been relaxed, most lenders have minimum approval criteria. For example, you will have a hard time getting approved if you have a very small down payment(less than 5%) and have questionable credit quality(history of many late payments, collections, and/or discharged bankruptcy). Of course every situation is different, but there are some deals that I have not been able to get done even with a broker.

Dan
zero downpayment mortgages are very popular these days. yes, you do have to meet minimum credit conditions, but those conditions become ever more relaxed as time goes by, and as the competition heats up. "sweat equity" has also become somewhat popular, this alowws the purchaser with very little downpayment, to do some of the work on the house themselves, such as plumbing, heating/cooling systems and electrical etc.

send those unapprovable deals my way, i'll get 'em done.
 

kuba

TRIBE Member
Yeah, so will I. We just did $50M last year between 2 people (in volume) and I still don't think you know what you're talking about.
 

justin surdit

TRIBE Member
Pudding said:
i work as a mtg rep at one of the big banks and you wouldn't belive the fraud that goes on with these brokers,
with all due respect, fraud is also rampant among the mtg reps at the big banks - there was a big stink with Royal Bank reps not too long ago, LOTS of heads rolled on that one. fraud is not limited to the brokerage channel, it is rampant in the whole industry which is why the new legislation is a good thing - it'll help weed out the bottom feeders and leave the mortgage game to the true professionals.

but I do agree, research your broker and if you feel that he/she is not addressing your concerns and/or questions either keep on them or simply look elsewhere.

now in response to the comment that 99.9% of the people are rate shoppers only, that is because whoever is arranging their mortgage is not doing the right job of explaining the differences between the banks and their standard charge terms - most of our clients will opt for a mortgage with .05% to .10% higher on the rate once they have been properly EDUCATED (and that SHOULD be the role of a mortgage broker, any donkey can take a list of mortgage rates and pick the lowest one) on the differences between the banks and what they will and will not let you do.

Kuba - congrats on the volume nice work! just to let you know though, our 2 man operation funds over $100m every year without fail. :D
 

LivingRoomPornstar

TRIBE Member
Pudding said:
zero downpayment mortgages are very popular these days. yes, you do have to meet minimum credit conditions, but those conditions become ever more relaxed as time goes by, and as the competition heats up. "sweat equity" has also become somewhat popular, this alowws the purchaser with very little downpayment, to do some of the work on the house themselves, such as plumbing, heating/cooling systems and electrical etc.

send those unapprovable deals my way, i'll get 'em done.
I'm talking about a combination of those conditions.

I have done a few "no downpayment" mortgages myself, and they are generally reserved for customers with good incomes relative to their obligations and good credit history.
 
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VinylRach

TRIBE Promoter
LivingRoomPornstar said:
I'm talking about a combination of those conditions.

I have done a few "no downpayment" mortgages myself, and they are generally reserved for customers with good incomes relative to their obligations and good credit history.
Thats right. We're an "a" lender and we wouldn't touch anyone with a no money down mortgage without a substantially great Beacon score at LEAST.
 

LivingRoomPornstar

TRIBE Member
Kuba - congrats on the volume nice work! just to let you know though, our 2 man operation funds over $100m every year without fail. :D[/QUOTE]

These are great numbers, how long in the biz? A little extra time building a network really makes a difference. I'm a branch advisor and spend a small amount of my time doing mortgages, and fund close to $30m/year, but I also have a large book of clients to draw from.
 

LivingRoomPornstar

TRIBE Member
VinylRach said:
eaaaaaaaaaaaaasy show offs.
hahaha, i'm just really interested in where they draw their business from!

My job is a lot different from a broker's job though, so it's not really comparing apples to apples. I'm also responsible for a large investment goal as well(which is what i focus the majority of my time on).

Dan
 

kuba

TRIBE Member
VinylRach said:
eaaaaaaaaaaaaasy show offs.

this coming from some lame-ass who needs her MOTHER to get her a job underwriting mortgages

so, ummm, shut the fuck up.

second: dan; you funded $100M but probably got paid 1/4th what a broker does (the RBC guy who does $100M gets paid half what we do at $50, you should SERIOUSLY consider going over to the independent side!!! do it!!!)

EDIT:

Dan, I didn't realize you quoted... oops. ok $30M is still great and would pay you VERY well. YOu should STILL consider doing it.

Justin Surdit: where do you work? (PM me if you'd rather, I would actually rather you would)

Pudding: same for you

(you can never know enough people in the biz)
 
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