Saturday, February 21, 2009

The Self Employed Mortgage

You’ve worked hard to get your business off the ground. It’s taken months or years but you’re finally enjoying a steady return. One of the many benefits of being self employed is that you have an opportunity to reduce the tax you pay because you can write off business expenses. Any accountant worth his (or her) weight will help you develop strategies to reduce the amount of income your report, to minimize the tax you pay.

Now you want to apply for a mortgage. The only problem is, the first thing the bank asks you for is your tax returns. “Show me the money” they say. And so it goes.

Self employed people are advised to seek out the services of a mortgage broker who will match your mortgage application with the right lending program. There are lenders out there that will either gross up the income you report by some margin if you are self employed, or waive the requirement to prove income altogether.

At Mortgage Alliance we have fifty six different lenders to choose from when matching your application to a lender. There are many lenders that you can only access through a mortgage broker, and since they don’t have a massive network of branches to support as the banks do, their rates are lower than the banks.

With as little as 10% down, a self employed applicant can obtain a mortgage without any proof of income. The application must be reasonable however. For example, if you are a self employed mechanic it is reasonable that you could afford to carry a $300,000 mortgage, but not an $800,000 mortgage. Your credit should also be excellent and the lender will also want to see that the down payment is coming from your own resources.

Monday, February 16, 2009

Service vs. Price: Service is the only sustainable way to differeniate yourself

As a mortgage specialist, one of most common questions I get when a prospect calls me is what are your rates? Through Mortgage Alliance we have access to very competitive rates, but I think that is one of the least important questions. First of all, most mortgage agents have access to the same lenders, rates and programs. In addition, rates change daily and sometimes by the hour. Fortunately we have access to Mortgage Alliance's Rate Advisor (click here to visit Rate Advisor now), which gives you current rates and automatically sends you weekly e-mail updates if you sign up; however, even Rate Advisor is not 100% accurate. It doesn't change everytime a lender announces a new promotion. The number of variables that will affect your rate are too numerous to capture in a chart. While I will always do my best to give people my best estimate as to what their rate will be, I usually have to get back to them after checking for the latest updates.

How do I differentiate myself?
In a word, SERVICE. Anyone in business for themselves knows that your business will not be sustainable if you try and compete on price alone (unless you are Walmart or somebody like that). There will always be someone willing to give their service away at a lower price. That's is why I put most of my energy into figuring out how I can offer better service than my competitiors. I want to be they guy you know you can count on to get things done, the guy who answers all your questions and explains everything to you until you have no more questions, they guy who ALWAYS gets back to you and your clients and who keeps you and your clients in the loop in terms of what is going on with the mortgage. That is how I compete. Knowing how to do, what you do, better than anyone else, being more helpful and more diligent than anyone else is in our industry is, in my opinion, the only way to complete. Oh yeah, and having a good marketing idea once in a while won't hurt either.

Friday, February 6, 2009

Rate Specials: Rates Continue to Drop

Lower prices and rates continue to drive affordability. Don't miss this great opportunity to to buy. Here's a look at some of the great specials out there:

1-year fixed (60 day closing) - 3.70%
1-year fixed (insured) - 3.89%
2-year fixed (insured) - 3.99%
3-year fixed (45 day closing, income qualified) - 3.75%
4-year fixed (30 day closing, insured) - 4.09%
4-year fixed (insured) - 4.19%
5-year fixed as low as 4.25% depending on mortgage amount, length of closing and prepayment allowance
5-year variable 3.75% (P+.75%) with privilege to lock in anytime at lenders best discounted rate

* Prime is currently 3% and may drop further when the Bank of Canada meets again March 3rd.


Rate Advisor

Want to have my weekly rate updates delivered to you inbox? Click here to visit my Mortgage Alliance Rate Advisor page and sign up.
Need help with your mortgage? Call me direct at 416 876 2031.

Have a great day!

David Grossman MBA
Mortgage Alliance Mortgage Loans Canada Inc.
Tel: 416 876 2031
Fax: 416 987 5631