Alternative mortgage lenders Canada: Introduction
Alternative mortgage lenders Canada have now made sure that mortgages and loans are no longer the exclusive domain of banks and other brick and mortar financial institutions. Fintechs (financial technology companies) have changed the game in the same way that Uber disrupted the taxi industry. In fact banks who don’t want to be left are changing the way they do business and investing in or partnering with fintechs.
We recently blogged our review of two recent alternative lenders in Canada:
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Alternative mortgage lenders Canada: Fintechs are a legitimate alternative
We’ve traditionally thought of alternative lenders as shady operators or payday lenders who prey on the most vulnerable. However a new crop of alternative lenders has emerged in the mortgage game – the fintechs. Some are publicly traded companies and perfectly legitimate. They market to the millennials who want everything online and in an instant; and that’s what some of the new fintechs deliver.
Alternative mortgage lenders Canada: How do the fintechs offering mortgages work?
- They can register as a broker and have licensed brokers on staff
- In addition to mortgages they can offer personal loans
- They work on a fee-based model which gives them upfront revenue without capital requirements or credit risk
- They receive a commission on mortgages completed through their service
Alternative mortgage lenders Canada: Fintechs technology advantage
Fintechs take advantage of technology to change the mortgage process. They try to create a more personal experience for users (more akin to online banking) and believe that their process of acquiring a mortgage is more transparent than that of traditional financial institutions. Some even give perks such a bottle of champagne to celebrate your new mortgage and/or dinner for meeting payment milestones. Some fintechs offer:
- A mobile interface where users can compare rates, apply for a mortgage and track their payment progress
- An interactive dashboard that walks users through the mortgage process
- The ability to set up things like payment reminders and progress trackers
Alternative mortgage lenders Canada: What does it mean for you?
For one thing, the banks and other financial institutions have competition, and competition always benefits the consumer. Chances are if you’re already indoctrinated in digital and reach for Apple Pay or Android Pay instead of your wallet, you may welcome fintechs into the mortgage scene. But, not all fintechs are created equal. It’s up to you to check them out thoroughly and check out the rates to make sure they are giving you a good deal. You have options when it comes to taking out a mortgage but make sure you do your homework.
Alternative mortgage lenders Canada: What if you have too much debt?
Not all homeowners’ stories have happy endings. If you’ve bitten off more than you can chew or life has thrown you a curve ball and you can’t make the mortgage payments, contact Ira Smith Trustee & Receiver Inc. We’re here to help you solve your debt problems and set you on a path to debt free living Starting Over, Starting Now. All it takes is one phone call to schedule a free, no obligation appointment.