27 Jun

ANOTHER BANK ‘HORROR ‘ STORY TURNED GOOD

General

Posted by: Ron Price

ANOTHER BANK ‘HORROR’ STORY TURNED GOOD

We recently had new clients come in who had sold their home firm and purchased another based on a bank pre-approval.

Initially they were assured “No Problem” by the bank and all seemed fine until they realized the bank was taking too long to get them an approval for their purchase financing. They had to get an extension on their financing (offer) condition only to be told later that they had been declined.

What had happened was that the couple (having sold their home) decided that since two of their credit cards were going to be paid off from the proceeds that they didn’t need to make the last few payments.

Wrong! These two delinquencies cost them dearly. Their credit scores plummeted below the acceptable minimum effectively turning them into bad credit risks from an institutional lender standpoint. Now they forfeited the chance to get a prime institutional mortgage.

They only remaining option was for them to take a private mortgage at 8 per cent or more than double the going rate. They wanted the new house that badly so they proceeded with the knowledge that within a year we could get them into a low rate mortgage.

Fortunately they had good jobs and income and could afford it, but what a hard lesson for sure.

The bottom line is this. Bank pre-approvals typically are not worth the paper they are printed on if no credit check is done. Things like this can go wrong, really wrong and present a very nasty and unwelcomed surprise.

When we give you a pre-approval you can count on it since we are very thorough which includes a credit review, proof of employment and income. In fact we are pre-approvals are guaranteed and only subject to purchasing a property, the quality and marketability of which is satisfactory to the lender. Your rate is also guaranteed in advance and you are protected.

If you are thinking of selling your home or you are in a buying mode please call us first for peace of mind protection on your next purchase.

11 Jun

BETTER THE DEVIL YOU KNOW. THAN YOU DON’T?

General

Posted by: Ron Price

BETTER THE DEVIL YOU KNOW, THAN YOU DON’T?
This is but one of many adages that suggests we avoid trying new things so that we stays with and keep the good old ‘status quo’. Another one is “Better To Be Safe Rather Than Sorry”.
In this hectic world today we are bombarded with messages of ‘Caution’. We are ‘fed’ a steady diet of reasons not to “Rock The Boat”creating a mindset which is based in ‘Fear’ and ‘Negativism’. For these reasons our human condition or tendency is to avoid change. In fact most people dislike ‘Change’ and even fear change.
These are people who continue to believe that “The Bank is their friend”. “The Bank Has Always Been Here For Me” they say. In reality they can only say this if and only if they have never had a problem that involved approaching their bank to help them, only then to find out that the bank is not their ‘friend’ any longer. The banks are always eager to ‘serve’ us but when we have a problem such as job loss, separation, divorce, injury, disability etc., we are seen as ‘risky’ to them. Then the response is “Sorry We Cannot Help”.
But it goes much deeper. We are all aware of the relentless cycle of banks to increase ‘Profits’. They are doing a great job of it aren’t they. We continue to see record profits year and after, pretty much without exception. What other industry can produce so much profit. Clearly our big banks have an unquenchable thirst to keep profits rising, seeming without fail. How can this possibly be? It is not ‘normal’ is it? It goes against conventional thinking does it not? They must be “Getting Away With Something” one might surmise.
The truth is that every bank’s ‘modus operandi’ is to maximize profit by getting as much from the customer as possible. Bank staff is trained to accomplish this and they are required to meet quotas designed to achieve this end.
Our role is to create consumer awareness of bank practices and products that are widely considered to be shall we say ‘Opportunistic’. Last week we wrote about excessive and punitive bank penalties (including how they are calculated) versus the much lower penalties our lenders require when a mortgage ‘investment’ is terminated before its contractual term/maturity. We have also written about bank collateral mortgage products that are also designed to extract maximum profit while at the same time giving the banks more control over the borrower than ever before, all this (apparently) without full and proper disclosure to the client. Such lack of disclosure is now commonly seen in the media.
Making a ‘change’ is a good thing to do when one has taken the time to understand the real benefits. ‘Informed’ Canadians are choosing mortgage brokers more and more as they realize we are looking out for your best interests and we can invariably provide you with the best solution and experience.
For your next mortgage, please call us first. You’ll be so glad when you do!
2 Jun

BETTER THE DEVIL YOU KNOW. THAN YOU DON’T

General

Posted by: Ron Price

BETTER THE DEVIL YOU KNOW, THAN YOU DON’T?
This is but one of many adages that suggests we avoid trying new things so that we stays with and keep the good old ‘status quo’. Another one is “Better To Be Safe Rather Than Sorry”.
In this hectic world today we are bombarded with messages of ‘Caution’. We are ‘fed’ a steady diet of reasons not to “Rock The Boat”creating a mindset which is based in ‘Fear’ and ‘Negativism’. For these reasons our human condition or tendency is to avoid change. In fact most people dislike ‘Change’ and even fear change.
These are people who continue to believe that “The Bank is their friend”. “The Bank Has Always Been Here For Me” they say. In reality they can only say this if and only if they have never had a problem that involved approaching their bank to help them, only then to find out that the bank is not their ‘friend’ any longer. The banks are always eager to ‘serve’ us but when we have a problem such as job loss, separation, divorce, injury, disability etc., we are seen as ‘risky’ to them. Then the response is “Sorry We Cannot Help”.
But it goes much deeper. We are all aware of the relentless cycle of banks to increase ‘Profits’. They are doing a great job of it aren’t they. We continue to see record profits year and after, pretty much without exception. What other industry can produce so much profit. Clearly our big banks have an unquenchable thirst to keep profits rising, seeming without fail. How can this possibly be? It is not ‘normal’ is it? It goes against conventional thinking does it not? They must be “Getting Away With Something” one might surmise.
The truth is that every bank’s ‘modus operandi’ is to maximize profit by getting as much from the customer as possible. Bank staff is trained to accomplish this and they are required to meet quotas designed to achieve this end.
Our role is to create consumer awareness of bank practices and products that are widely considered to be shall we say ‘Opportunistic’. Last week we wrote about excessive and punitive bank penalties (including how they are calculated) versus the much lower penalties our lenders require when a mortgage ‘investment’ is terminated before its contractual term/maturity. We have also written about bank collateral mortgage products that are also designed to extract maximum profit while at the same time giving the banks more control over the borrower than ever before, all this (apparently) without full and proper disclosure to the client. Such lack of disclosure is now commonly seen in the media.
Making a ‘change’ is a good thing to do when one has taken the time to understand the real benefits. ‘Informed’ Canadians are choosing mortgage brokers more and more as they realize we are looking out for your best interests and we can invariably provide you with the best solution and experience.
For your next mortgage, please call us first. You’ll be so glad when you do!