Hey all! As soon as I sell my house, I'm going to apply for a mortgage. Our CS is 800 and we are putting 65% down. My DH is a sub contractor so we have got an irregular monthly income, but consistent year to year. The only debt we have is a balance on one credit card. Our new mortgage payment will be about 40% of what we currently pay on the house we are selling (never been late).
So I'm trying to decide if I should go with a mortgage broker since they deal with many lenders and if there is a problem because of my DH's employment, the broker can send it with a different one. Is it true that a direct lender has less options? I was advised that it's always easier to use a direct lender, but what if they don't want to approve it, the loan officer will have no other options, right?
Advice is appreciated.
Mon Mar 02, 2015 6:27 am
oldguy Senior Member
Cash: $ 717.80
Joined: 21 May 2006
quote: Direct lender or a mortgage broker?
In my experience, it doesn't make much difference, I check with both and go with the best deal. But they have to compete with each other to get the lending business so their deals are about equal. I've purchased several rental houses over the past 40 years, and I have refi'd all of our houses, some more than once (one rental is on it's 4th or 5th mortgage since 1980). I continually remove the equity and use it for other investments.
But I'm in the US, the US 30 yr fixed-rate loan provides the lowest cost capital in the world - all other nations have shorter terms, usually 10 years. So in Canadian, your situation is different than mine - In Canada I might not use mortgage capital so much. Eg, I would never make a 65% 'down', I try to get as close to zero down as I can and free up as much cash as I can, I try to minimize real estate equity (so that I can invest elsewhere).
Mon Mar 02, 2015 3:35 pm
Wino Senior Member
Cash: $ 113.80
Joined: 03 Aug 2012
If Canadian credit scores work like US credit scores, when you decide to start getting mortgage quotes, do them close together, timewise. The reason is that multiple inquiries for mortgages within about a one month period are treated as a single "hard inquiry" or "hard pull." Hard inquiries have a very small detrimental effect on your credit score, but even so, fewer inquiries are better than more inquiries, especially if your score is borderline (like low to mid 700s).
Just trivia: Hard credit inquiries stay on your record for up to two years. More trivia: checking your score or credit at something like creditkarma, creditsesame, or annualcreditreport.com (the free, government-mandated credit report site) are "soft pulls" and have no effect at all on your credit score. The baseline credit score for the "best rates" is usually in the neighborhood of 740.
Tue Mar 03, 2015 5:42 am
EBurn New Member
Cash: $ 0.70
Joined: 01 Apr 2015
I would suggest that you go with the mortgage broker. From my experience, they are better than the lenders.
With strong credit, such as you have, the choice between broker or direct lender is not a major decision. Both should be able to provide you with a timely closing. Review both options, on the same day, and see what their interest rate and fees will be for the said purchase scenario. Make your decision based on who you are comfortable working with, and that has the most competitively priced offer. Make sure the choice you go with can make the close of escrow deadline. Good Luck!
The days of mortgage brokers are nearly defunct with the internet being an equalizer whereby you can find the lowest rates in minutes, then go to your local bank and have them match it, most will, especially when you have high FICO credit score, little debt and more than 50% down, should be no problem getting lowest rate.
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Sat May 02, 2015 6:35 pm
peter21b First Time Poster
Cash: $ 0.20
Joined: 01 Dec 2015
I would suggest going on with a mortgage broker as they will have a better idea since they deal with many lenders. Also, the competitions among the mortgage providers make many of them provide with better rates. I consulted a home purchase mortgage in Vaughan called The Financial Forum for purchasing my home. I got the best available rate in Vaughan from them and was very much satisfied with their service.