How to Identify Mortgage Refinance Opportunities

Learning how to identify mortgage refinance opportunities is as simple as thinking outside the box. Fortunately for Canadian mortgage brokers and agents, a strong Canadian housing market has continued to see property values skyrocket in most urban centres across the country.

This past month, The Teranet-National Bank House price index released their report stating that Toronto saw a 7.24% increase in housing values over 2013:  www.housepriceindex.ca. On the other side of the country, The Teranet-House Price Index showed Vancouver with a 4.96% year over year increase.  The Vancouver Sun reported that single family homes have seen a 6.5% increase with some areas having increased in value over 11%! http://ow.ly/IX2WJ.

What does this mean to you? Opportunity, opportunity, opportunity! Now let’s get to thinking outside the box! With incredibly low interest rates continuing to be the norm, many homeowners are opting for 5 year mortgages when purchasing a home. Some agents and brokers see their next opportunity being the point at which these mortgages come up for renewal.

A flourishing housing market combined with lenders diversifying and offering more and more competitive secondary financing products such as secured lines of credit means that, in fact, a client with a 5 year term or even longer may be primed in 2-3 years to look at finding the financing to complete home renovations or financing their kids’ educations through their home equity – which often results in far less interest than unsecured credit products.

Maximizing this opportunity means staying on top of your portfolio to know when there is an opportunity to make the pitch. How do you do this? By leveraging the tools that help you identify when this opportunity arises.

Identifying these opportunities is as simple as knowing which clients have enough equity in their home to warrant a refinance: secondary financing in the case of a client who may be mid-term and even primary financing where your client is actually approaching renewal.

Particularly in the urban centres mentioned earlier, it can be really difficult to simply guess what your clients’ homes are worth to be able to see how much opportunity there is.

Your first step is to look at an AVM (Automated Valuation Model) and corresponding Property Report. This is an automated report that will generate an estimated value of any given property. Purview For Mortgage Brokers is an example of an affordable subscription-based product that many brokers use to look for refinance opportunities within their portfolios.

Your next step is to come up with ideas regarding what you can pitch to your prospective client. A client in an aging home may be in the market to renovate, while a client with a higher TDS at the time they purchased the home may be in the market for a debt consolidation.

You can be the gift that keeps on giving by first being the broker or agent who helped them achieve their goal of buying their dream home and then later coming forward to show them how they can use that home to achieve financial and personal goals that otherwise might be unattainable.

For more about how to identify mortgage refinance opportunities and take advantage of them please contact Purview For Mortgage Brokers today by calling 1.855.787.8439.