Building Your Entourage of Experts – Part 4 – Choosing a mortgage broker
If you missed the previous article – Creating your Entourage of Experts – Part 3 – Choosing a Realtor
As a full-time Canadian real estate investor, we need to create a team around ourselves that is the most powerful team to build our success. In order to build our success, we need to rely on particular people that we have chosen, and be able to delegate tasks expecting that they will be done correctly and on time.
The next person that is crucial for our team is a mortgage broker. Mortgage brokers are selected under a number of criteria. Firstly, they need to be investors, and they need to understand how creative financing works for the investor when building their portfolios.
The average investor
As you may know, the average investor can only get anywhere from 3-6 properties (case by case) under their name before the banks or lenders feel that they are too much of a risk. Their debt-service ratio may be too high, and unfortunately the average investor may not qualify for the next deal. We need a mortgage broker that understands how the system works. Without fudging numbers or hiding any evidence, the creative mortgage broker should be able to utilize creativity in order to continue to finance you.
Works in your best interest
Your mortgage broker must be able to get you 90, 95, or even 100% financing on your deals. A mortgage broker needs to have a plethora of lenders available to them, not just one or two. They need to work in your best interest, not theirs.
Your mortgage broker needs many private lenders available to them that require minimum up front fees to do the deal. Your mortgage broker must be able to structure a deal that may involve a vendor take-back mortgage.
Deficiencies in a mortgage
Your mortgage broker must be able to outline any deficiencies your mortgage. Mortgages and standard charge terms are given by the lender, and a just that…very standard. However, the "standard" clauses may not always be in the investor's best interest. A good mortgage broker will be able to go through those documents and outline any areas of concern that may be an issue for the investor.
The mortgage broker must be able to facilitate a cash-back on closing deal. Sometimes deals may need a renovation credit that acts as a cash-back on closing. A good mortgage broker should be able to structure a deal in such a manner that the underwriter is ok.
I suggest that you get a mortgage broker both in your own city ortown, and in other cities that you are working in. A mortgage broker can lend all over the country, however, it is easier to deal with a local mortgage broker that knows the areas and the local lenders, thus being able to qualify you much easier.
Don’t be afraid to ask pertinent questions. Understand that the great team member will only make your business great.
Canadian Wealth Builders offers many unique, practical, "out of the box" real estate investor trainings which offers the student hands on, in the trenches style instruction to facilitate both a different mindset as well as a successful and lucrative real estate investment business. To find out more, please go to www.canadianwealthbuilders.com
For the next article in the series – Creating your Entourage of Experts – Part 5 – Choosing a Lawyer
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