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Mortgage origination is not a creative endeavor; mortgage advisory should be.
Creativity
comes from a knowledgeable practitioner, with a disciplined
understanding of how to apply financial planning techniques, to an
individual's needs, wants, and goals. Like a talented wardrobe
designer, the recommendation should be a balance of propriety,
"fashion" and daring; all tailored to highlight the user's strengths
while downplaying their weaknesses.
A mortgage
should be functional as well as stylish. It's a little black dress or
blue blazer, accessorized properly, to make the user comfortable and
confident about their choices.
 It starts with the expected hold time of the mortgage,
not the house. Life events like college for the children, potential
promotions, remodeling, major purchases, and anticipated appreciation,
all play into the hold time for a mortgage. While homeowners may
expect to live in a home for 20 years, economic and life-style events
dictate that the loans can change as often as color choices. Just like
"pink is the new black", fixed rate loans may be the new risk. Erring
towards the "staples" rather than the "latest fashions" is always
preferential. Blue blazers, however, change with the times. While a
suit always seems appropriate, it CAN signify a staid and lazy
approach; much like a 30-year fixed rate mortgage. The ramifications
are similar. Like a nebbish at a dance, the 30 year fixed rate loan
can blend into the backdrop and result in missed opportunities.
Flair then, comes in the proper tailoring of the mortgage. Interest-only and negative amortization loans, attract
opportunity (like investment opportunities) like a plunging neckline
attracts the admiring glances at a healthy decolletage. Employment of
"exotic" loan choices must be used to accentuate those assets while
minimizing unwanted attention. Intent then, is the driving factor. We
want to attract the "proper" opportunities while avoiding those
unwelcome advances.
Enter the professional mortgage planner.
She assesses the environment, like a wardrobe designer would ask about
the event. Environment, economic or social, will dictate what is and
isn't appropriate. She understands the user's tolerance for "risk".
While wardrobe designer would understand that a middle-aged accountant
might be uncomfortable in a lemon yellow blazer, the professional
mortgage planner understands that a certain loan solution, while
stunning for a young bombshell, would make some matrons feel
self-conscious. The creativity lies within the ability to make the
right choices for the age, personality, and comfort level of the user.
Mortgage borrowers should not shop on price alone.
While certain financial decisions are akin to "picking up a pair of
jeans", a mortgage solution should be approached with the diligence
applied to a wardrobe purchase for a gala event. Quality, experience,
and execution applies when selecting the proper mortgage planner;
sometimes shopping on price alone can result in a costly mistake.
Creativity,
in mortgage solutions, is much like a perfect outfit. Certainly, some
users can make fashionable and appropriate wardrobe decisions, unaided- the
same could be said for mortgages. The wise individual leaves little to
chance, For a few extra bucks, a knowledgeable fashion adviser can
outfit you properly...just like a professional mortgage planner.
The cheapest outfit can often cost you the most money- just like the cheapest mortgage.
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American real estate at a bargain. The strong Canadian dollar, while inopportune for Canadian manufacturing firms, is giving Canadian investors built in downside protection when they buy American real estate. I explain that 