How mortgage brokers can best serve their clients

by Gerv Tacadena04 Mar 2020

An increasing number of Canadians are becoming more uncertain about the process of buying a home, and mortgage professionals need to be able to address these issues, according to the Canada Mortgage and Housing Corporation (CMHC)'s latest study.

According to the study, unforeseen housing costs were one of the biggest concerns of homebuyers last year. Some of these unexpected costs could be in the form of repairs, legal fees, and other adjustments.

"This could be why an increasing number of buyers are discussing hidden costs with mortgage professionals," CMHC said. "If you want to best serve your clients, you should be prepared to answer these important questions and help them properly plan."

Mortgage professionals also need to recognise the increasing popularity of renovations amongst Canadian buyers. In fact, around three in five homebuyers are planning to make some renovations over the next five years.

Also read: Unsure Canadians in Toronto seek help from agents

Financing a renovation project is also one of the most common reasons why Canadians refinance. However, around one in three were unaware that they could include renovation costs as part of their mortgage.

"As home renovations become increasingly popular in a low interest rate environment, it is important to have the information ready to serve your client," CMHC said.

There is also a growing need for mortgage professionals to understand the changing needs and wants of Canadian homebuyers.

CMHC said homebuyers nowadays no longer feel that location is a primary need when looking for a home. In an environment of increasing house prices, prices and affordability are the main focus of these buyers.

In terms of what buyers want, a newly-built home tops the list. Interestingly, getting a newly-built house ranked last in the list of needs of buyers.

"The difference between wants and needs of homebuyers is quite drastic, and the difference is growing. Understanding this will allow you to better serve them," CMHC said.

The study also pointed out to the need of buyers to be in touch with their mortgage brokers even after signing the deal with the lender.

Around three in four homebuyers said face-to-face interactions are crucial despite the rapid technological advancements.

"Mortgage professionals would be well advised to follow up with their clients after the transaction to maintain a high level of customer satisfaction. The level of service and interest rate offered are tied as the most common reasons buyers gave for choosing a lender," the study said.

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