Is the Client Getting the Best Rate for Themselves?
It is fair to say that at Robert Floris’ Mortgage Architects office, we put the client first. Does that mean that he or she is getting the absolute best rate? Not always, as we will try to explain. Below we will show how we plan our process with our clients in our Hamilton Ontario office.
It is our belief that in order to best help our clients, we must first meet with them. Over 95% of our completed mortgages are done with a face to face interview. This is crucial. This step is where we really listen to the clients and get to know and understand their needs. Let’s take an example. Let’s suppose that a new first time homebuyer couple is requiring a mortgage. For them, this home is a starter and they really do not know what the future holds. Furthermore, the couple feels most comfortable in a fixed rate. Well, we would certainly offer the best rate to our clients, but with the following caveat. Yes, this is the lowest five-year fixed rate. HOWEVER, if you move or decide that the homeownership process is not for you, then you will have a significant penalty. Currently, we are working with a couple today who really believes that this is their home for the rest of their lives. We explained the same in regards to the penalty, but they still feel like this is absolutely their home for life. In this case, we were able to offer an outstanding variable rate to these clients.
The main point here is that we try to educate our clients so that they can make a well informed decision. Mortgage professionals should not discuss rates without explaining products. As described earlier, the rates should come with an explanation including similar prepayment privileges, the same or fewer restrictions, comparable service and advice, similar qualifications and the same rate guarantee period. At our office, we do our best to strive for well educated consumers.
Another classic example is if you have credit that requires repairing. Every bank which offers great rates will generally refuse these types of clients. We will educate (again) that their problem is their credit rating. We will help to repair the problem in one or two years at the most. Will these clients get the best mortgage rate? Of course not. But we would place them in a secondary mortgage product (usually 2-3% higher) than the market. After their credit has been fixed, we can switch these clients into primary rates. We call this program “short-term pain, long-term gain”.
We have only briefly touched the surface of offering the lowest mortgage rates. We at Robert Floris’ Mortgage Architects take pride in explaining to our clientele what is offered and what can possibly meet their mortgage needs. There are times that, although they may not have the best rates, they do have peace of mind.
Robert Floris is an independent mortgage broker at Mortgage Architects in Hamilton Ontario.