20 Things I’ve Learned in my 20 Years as a Mortgage Broker
Reaching this milestone in my career and looking back I wouldn’t have imagined I’d still be a mortgage broker, but here we are! I’m in my 20th year as a broker and I still love what I do, every single day. Because I’ve surpassed this milestone, I think it’s fitting to pass along some of the wisdom I’ve gained throughout my tenure; here are twenty things I’ve learned… so far!
As a mortgage broker I’m not paid if you do not get the mortgage you are needing, therefore I (always) work extra hard!
As a mortgage broker, I hold a license that is regulated and requires educational components to hold and keep it. This isn’t something any of the Bank Mortgage Specialists have so they have less accountability.
Rules change all the time! Back 20 years ago we could write on a piece of paper what someone’s equity is, now it all has to be what they file through Revenue Canada to ensure they are paying their share of the taxes.
A lot of mortgage brokers come and go – being in this business for 20 years is an anomaly.
Many deals get lost by the broker or bank employee in how they package it for the approval/insurers. It’s important to work with someone who understands your specific needs and property. I specialize in rural financing and have repaired a lot of messes with files in my time.
Rates have gone from high to super low and back up again, but not as high as when I started in 2003. A 5-year fixed was 5.79% then and everyone thought it was such a deal.
Ensuring that clients are prepared and understand the process is essential to ensure the transaction runs smoothly. I have created my Home Buyers Guide to assist with this.
This business is about relationships! I have some of the best with the referral partners I work with and my clients.
The most mortgages I have done for a repeat client is seven!
Being up-to-date on technology and ensuring I have the best processes and system is essential for a well-run operation.
Covid changed many things… Initially we thought the market would tank and it turned out to be the busiest two years of my career with people moving as they realized they wanted different things, thanks to being at home so much.
In the last two years house prices have increased in many areas from 15-20%. This provides a lot of equity available for clients to use to pay down debt, buy a vacation property or maybe help a child with their future, either schooling or buying a home.
Everything can be done virtually now even the signing with the lawyers. Twenty years ago, it was a pen and paper and a fax machine.
Amortization of mortgages was 40 years and then scaled back to 25 years, but now we are seeing 40 years available again.
The age of a first-time home buyer is increasing due to the cost of living and amount of the down payment.
At one time we offered zero down payment, but these options are no longer available.
Refinances used to be up to 95% loan to value, but now limited to 80% to ensure home owners retain equity in their homes.
In October 2016 the stress-test was introduced. All insured mortgages must now be stress tested using the 5-year posted rate (qualification rate) or 2% above contract rate.
As of December, 2015 there are now changes to the down payment requirements from 5% to 10% of the portion of a home’s value $500,000 to $1-million.
20.We now have 3 insurers in Canada; CMHC, Sagen (formerly Genworth) and Canadian Guarantee. At one time there was only one CMHC the government- owned corporation.
As you can see, it’s been a fun and interesting ride these last twenty years – especially keeping up with the markets and changes in interest rates. If you’re looking for a new home, please reach out, I’m always open to answering any questions you might have!
If you’re a colleague in the industry and have some lessons you’d like to share, please send me a message… I’d love to hear about your experiences.