Brokers have for years boasted about their ability to find the best mortgage for clients -- by considering more than just the best rate rate -- and a new study suggests young homebuyers need that service now more than ever.
When it comes to buying a home, it’s in a purchaser’s best interest to consider all aspects of a mortgage – and not just the rate. But it seems many aren’t considering their mortgage from all angles, with a new study finding many regret taking on a mortgage that has left them house poor.
"It's important to choose the house and mortgage that you can afford so that you can manage your cashflow and won't end up with buyer's remorse," David Nicholson, Vice-President, CIBC Imperial Service, said. "A house can represent so much – a new start, independence, putting down roots, starting a family or building wealth. But, it's important to evaluate the pros and cons and crunch the numbers so it's the right decision for today and tomorrow."
Many Millenials regret purchasing their homes, according to a recent CIBC report. A poll found 39% of Millenials have become homeowners; of those purchasers, 81% plan to sell in near future.
Of those, 63% cited housing costs making them cash poor; 57% are afraid interest rate increases will make it more difficult to meet payment requirements; and 36% believe renting is the better option.
The results speak to the growing need for the services brokers provide – which include in-depth advice about long- and short-term mortgage options that best suit individual financial goals.
“One of the problems you have with Millenials is they figure they can get all the information they need online as opposed to the information from people like brokers. The internet is no different from a dictionary or encyclopaedia,” Bill Macklem, a BC-based broker with Dominion Lending Centres
, told MortgageBrokerNews.ca. “You can research how to build a car or a plane but building it is another matter. You need to have someone that is going to be your advocate, who is going to see what you’re doing and help you plan it out. We don’t have enough financial education and I think brokers provide that.”