A new spring report suggests more and more buyers – among them investors – are turning to mortgage brokers as credit challenges creep in and banks grow reluctant to lend.
“That represents a very good news story for brokers in that they’ve been steadily growing not only their share of new mortgage but renewals and refinances,” said Jim Murphy, president of the Canadian Association of Accredited Mortgage Professionals, sponsor of the report.
According to his “Confidence in the Canadian Mortgage Market,” released Wednesday, some 22 per cent of respondents who renewed or refinanced an existing mortgage in 2011 and first four months of 2012 obtained it through a broker. That’s up from the 19 per cent who did the same during the year-ago period.
Brokers were also rewarded for their efforts in terms of growing their share of new mortgages, says the report.
“For new mortgages, 50 per cent were obtained from a bank, 31 per cent from a mortgage broker, and 19 per cent were obtained from other types of mortgage representatives,” reads the CAAMP report. That, too, represents progress compared to the year-ago period when brokers claimed 27 per cent of new mortgage transactions.
Data for this year’s report was obtained an online survey of 2,000 Canadians, including 800 homeowners with mortgages. It was conducted by Maritz Research and adds weight to the findings of a CMHC report issued last week.
The results likely speak to the growing need for mortgage broker services among investors , but even owner-occupying buyers. Both are facing tighter underwriting standards at the big banks. Investors, in particular, have suffered through a cutback in rental programs this year at many of those Schedule-A players. It means they’ve had to rely on brokers to connect them with alternative lenders as well as private money sources still willing to lend in that area.