According to CMHC ‘s 2010 Mortgage Survey, results show that first-time buyers are educating themselves on various mortgage options prior to obtaining a mortgage. A large proportion research terms and conditions (84%), compare the costs of different interest rate scenarios (71%), and check for competitive interest rates (65%).
In addition to seeking out information themselves, first-time buyers consult a great deal with various third parties and mortgage professionals prior to obtaining their mortgage. They consult with mortgage lenders (59%), family and friends (58%), mortgage brokers (48%), and real estate agents (44%) for advice. More than three-quarters of first-time buyers noted they received advice on mortgage terms and conditions, as well as whether to take a variable or fixed interest rate. First-time buyers also report that mortgage brokers and mortgage lenders are more influential to their mortgage decision than several other third parties.
The combination of the time spent educating themselves about mortgages, and meeting with mortgage professionals is definitely worth the effort. According to the survey, a very high proportion of first-time buyers (90%) feel that they made their mortgage decision with a good understanding of the mortgage options available to them, 85% said they had a good understanding of how much mortgage they could afford before buying, and 75% feel that the process of getting their mortgage was easy and straightforward.
Loyalty to a lender is most common among the renewer and refinance segments: 88% of renewers and 70% of refinancers did not change lenders when obtaining their current mortgage. These levels have remained relatively consistent over the past few years. Lender loyalty is less prevalent among the buyer segments. Just under half (46%) of first-time buyers took out their mortgage with the institution they were dealing with at the time (similar to last year) while 58% of repeat buyers did not change lenders when obtaining their most recent mortgage.