A recent TD Canada Trust poll shows that 87 per cent of immigrants did not know how to apply for a mortgage in their first three months in the country – and that knowledge gap provides a prime opportunity for mortgage brokers to fill.
It is a resource for brokers that can be nurtured and developed – and should be secured early before banks gobble up these future clients, says Mortgage agent Zev Glina, who works in the Greater Toronto Area.
Glina, who is familiar with the special needs of new Canadians, says that the most important thing brokers need to build first is trust.
“At CYR we deal with a large number of new Canadians,” says Glina. “I have found that the most important factor when dealing with newcomers is the trust factor. You need to make them understand that you are there to help them, you do not work for the banks or credit unions, you work for them and you will be there for them every step of the way.
“You have to put yourself in their shoes. Would you entrust someone with your personal information if you didn’t believe they are there to help you?”
Numbers from the TD poll show that 47 per cent of newcomers did not know how to open a bank account and 58 per cent didn’t know how to apply for a credit card.
“One of the major challenges new Canadians face when they arrive is establishing a credit history so they can buy or rent a home, get a credit card, purchase a car, and even secure a mobile phone plan and insurance,” says Stephen Menon, the associate vice president of credit cards at TD Canada Trust. “But in order to build a good credit rating, you need to apply for credit, which is challenging when you are new to Canada and don't have a Canadian credit history.”
Building a credit history and explaining what is realistic for new Canadians to own is a large part of the process as well, says Glina.
“The second most important factor is managing expectations. You need to explain to the clients that the process of them obtaining a mortgage is not going to be easy,” he told MortgageBrokerNews.ca. “Our financial institutions have begun to lower the restrictions on new Canadians, though it is still much more difficult for them to get financing than your average Canadian.”
The TD study also shows that 38 of newcomers said they wish they knew more about local mortgage rules – something that can be difficult to understand if English is not the first language.
But that too, says Glina, can be overcome through the help of a trusted translator.
“I like to bring in a family member who speaks English so that we are able to communicate easily with the client,” he says, “not only for the sheer time factor that it saves but it makes for the client to feel more comfortable hearing everything in their own language. And if they do not have a family member who speaks English we will bring in someone who can translate.”
But most importantly, brokers need to do what they do best – to take the time and explain everything in detail to the client.
“Take your time,” he stresses. “Explain everything as thoroughly as possible and with some determination, you will be able to give them the gift of home ownership.”