The comments section of MortgageBrokerNews.ca provides a soundboard for brokers to critique, lambast or applaud our articles (and, in some cases, fellow commenters). 2013 provided its fair share of heated debate but one particular story about renewal business
– and the value brokers can add to win business – stoked the fires and, in some cases, the ire of several opinionated readers.
The article, which garnered 38 comments, evolved into a discussion about good vs. bad; brokers vs. bankers and the value they both provide. The following are some of the highlights of the discussion.
The bottom line is no matter what level of other non-mortgage business you could be doing with that client, the client stays with the incumbent unless they are incented to leave; why would the client do something against their own monetary interest just because they have other financial products with you?
I think the real lesson here is the rate game is (as always) a losing game. Bad brokers sell rate, good brokers sell value.
-Paolo Di Petta
, Di Petta Mortgage
My question is why can you only get a 90 day rate hold when 120 days is the norm, unless it is just my brokerage who can get that? I am certain that is not the case though. The other thing about the bank is that they usually don't renew at best rates anyhow; therefore it gives you ammunition to sell yourself as the better choice for both service and rate. Knowing what the bank is offering ahead of time is a bonus. It allows you the luxury of deciding if it is possible to match or beat their rate or to cut bait and move on to the next client.
Browsing through interesting comments one thought has struck me: brokers have to charge retention fee/security deposit from rate shopping clients - and clients should happily pay it, since only because of brokers better offers, clients are getting better deals with their current lender.
If you keep in touch with clients throughout the entire terms (i.e. quarterly phone call, mailings, newsletter), basically keeping yourself top of mind, you will have less problems at renewal time because now the relationship part is part of the value proposition.
-Lior Hershkovitz of Mortgage Edge
These are just a small sampling of the (more friendly) insights shared by our knowledgeable reader base. To read the rest of the discussion, click here