Toronto -- Fewer than half of home buyers who are negotiating a mortgage believe they can get what they want, according to a survey unveiled yesterday.
Forty-four per cent of the mortgage consumers surveyed say they get the deal they are looking for, and 75 per cent of participants believe that obtaining a good deal is a matter of skill, not luck.
"Sixty-six per cent feel they need to bargain to get a good deal," said Karen Kinsley, vice-president of insurance for Canada Mortgage and Housing Corp. (CMHC).
The survey of 1,300 mortgage shoppers was jointly sponsored by federal agency CMHC and the Canadian Institute of Mortgage Brokers and Lenders.
While 75 per cent of mortgage shoppers have access to the Internet, only 25 per cent actually seek information about their mortgages on-line.
Ms. Kinsley said that consumers seem to feel comfortable applying for a mortgage on the Internet. At present, however, the deal must still be completed with a signature.
And while 40 per cent of consumers say they intend to move to electronic commerce for their mortgages in the future, 74 per cent still insist on a personal relationship with their financial institution.
Ajay Mundkur, vice-president of mortgages for Bank of Nova Scotia, said lenders will have to respond to consumers who want to do their browsing on-line if they want to stay competitive.
"The Internet is going to be the great equalizer."
He added that the U.S. market shows that consumers -- particularly young ones -- are more technologically attuned and willing to use on-line mortgage services.
Not surprisingly, the survey also found that the interest rate is by far the most important consideration when home buyers choose a mortgage, with 97 per cent of participants ranking the rate as a critical factor.
But mortgage shoppers are also concerned with terms, payment frequency and conditions.
Seventy per cent of consumers who are looking for information about mortages go to the lender they already do business with, while 64 per cent read brochures and 57 per cent ask friends and relatives.
But once they have that information, 40 per cent of first-time mortgage buyers decide to bypass the place where they do their regular banking in favour of a rival financial institution.
The study found that 70 per cent of mortgage consumers are aware of the services of mortgage brokers, but only 62 per cent of those who used those services were happy.
Art Trojan, a managing partner with mortgage broker Norlite Financial Services, said the results of the study have persuaded him to aim more of the company's marketing efforts at renewal business.
Traditionally, he said, mortgage brokers have aimed their advertising at first-time buyers who need help.
The survey found that first-time buyers represent 50 per cent of the clientele of mortgage brokers.
"I'm missing the boat on 50 per cent of the business."
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