Mortgage Broker

MORTGAGEBROKER mbabc.ca summer 2015 | 43 consumerinsights Renewal Process Seven in 10 (71%) renewers were notified in advance by lenders that their renewal date was approaching; of these, almost two-thirds were notified within three months of their renewal. Only one-quarter (23%) indicated they were contacted in advance by a mortgage broker regarding their upcoming renewal. Among those that were contacted, 42% used the services of a broker to renew. e majority of mortgage renewers (60%) renewed before their scheduled date. Among these, nearly two-thirds (62%) renewed within three months and 80% within six months of their scheduled renewal date. Most (61%) reported they were "totally satisfied" with their decision to renew in advance of their actual renewal date. e main reason for renewing in advance was to avoid a perceived increase in rates (55%). A further 19% indicated that the main reason was because their mortgage professional convinced them that it was the right decision. Almost half of renewers negotiated different terms than those in their renewal statement. Providing advice during the renewal process can greatly increase the chance of repeat business and client satisfaction. Indeed, providing advice on keeping mortgage payments at the same level to reduce amortization, can lead to a 66% increase in likelihood of using the same mortgage professional again and a 55% increase in client satisfaction. Renewers are taking action to pay off their mortgage sooner: 49% have their mortgage payment set higher than the minimum required payment. irty-two per cent have also either made a lump-sum payment, or increased their regular payment, or both since last renewing their mortgage. Within the past year, 64% of renewers have either contributed to an RRSP or to a TFSA. Post-transaction Contact Fiy per cent of consumers who used a broker and 34% who used a lender were contacted by their mortgage professional following their mortgage transaction. e most common methods of contact were telephone (65% of lender clients and 40% of broker clients), followed by email (20% and 31% respectively). Most follow-up occurs within one week to one month aer the transaction. In most cases, the purpose of such follow-up was simply to thank the customer (49% of those contacted by their lender and 63% of those contacted by their broker) and/or to confirm the closing date (38% and 34% respectively). Only four-in-10 mortgage consumers (41%), "totally agreed" that their post-transaction contact was useful. Types of follow-up contact mortgage consumers would have considered useful include advice on long-term mortgage financial strategies (25% of lender clients and 32% of broker clients), housing market information (13% of lender clients and 21% of broker clients), information on how to manage financial difficulty (14% of lender clients and 20% of broker clients) and investment opportunities (14% of lender clients and 17% of broker clients). Post-transaction contact can increase the likelihood for repeat business by nearly 53%. Only 36% of those not receiving follow-up contact "totally agreed" that they will likely use their lender or broker again to arrange their next mortgage. is increases to 55% among those who were contacted. Definitions Recent mortgage consumer definitions First-time buyers: those who purchased their first home in the past 12 months and took a mortgage. Repeat buyers: those who previously owned a home and have purchased a subsequent home in the past 12 months and took a mortgage. Renewers: those who renewed their mortgage in the past 12 months. Refinancers: those who refinanced their home through a mortgage in the past 12 months. Lender loyalty definitions Lender loyalty for repeat buyers, renewers and those refinancing means that they obtained their current mortgage from the same mortgage lender they were dealing with previously. For first-time buyers it means that they obtained their current mortgage from the financial institution they were dealing with the most at the time they took out their mortgage.

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