Mortgage brokers will remain a fixture in the Canadian mortgage distribution landscape—and Canadian mortgage holders will ultimately benefit as a result.
These are the findings of the new report by Deloitte, “Winning Strategies in the Brokered Mortgage Marketplace”, which provides an overview of the current state of the Canadian mortgage industry.
The report comments that, “ over the last decade, an increasing number of viable options for borrowers have surfaced. In addition to the traditional options available at bank branches, Canadians seeking a mortgage can now consult the banks’ own mobile mortgage specialists as well as independent mortgage brokers – while conducting their own research online.”
“ In this changing and more customer-friendly environment, the mortgage broker channel has emerged as a legitimate competitor that is helping provide greater choice and convenience to Canadians.”
“Canadian mortgage consumers will ultimately benefit in the form of increased choice of products, value-added advice, and more convenient services.”
Contrary to the U.S. market, the Canadian mortgage broker channel is strong, stable and established. “ Mortgage brokers “, the report notes, “ made particular inroads with first time home buyers and young Canadians, evolving from a fragmented, “lender of last resort”, to a legitimate option for prime customers.”
As a participant of the mortgage industry for the last seven years, I can say that today’s successful broker works very hard to become a trusted and expert adviser to their client. They strive to become more than simply a liaison between a lender and a client, but an expert in their field with a depth of experience and incite not found in the average bankers office.
Having to educate themselves about the constantly evolving products and guidelines of not one, but several, different lenders causes a mortgage professional to develop a true sense of both the prevailing market and their clients needs. With 30 or more products on the broker shelf, compared to the 3 or 4 on a banker’s, a broker must become adept at researching their customers as well as their lenders, in order to make the most suitable match. Simply put, the demands of the job itself, make a mortgage professional a more “customer-centric” professional than their counterparts at the bank.
Couple that with the highly competitive rates found on the broker channel, both from the traditional and the non-bank lenders, and it’s easy to understand why mortgage brokers have increased their market share from 28% in 2003 to 38% in 2009. In fact, 44% of new home buyers chose mortgage brokers to guide them through the process of obtaining their first mortgage. It’s evident that more and more of today’s borrowers knows that a mortgage is an integral part of their financial future and should be handled by a true expert in the field.