We now shop on-line for number of household items. Many real brick and mortar stores have gone on-line with their products and prices. It is a very competitive environment out there. With the promises of price match and discounts – it is a tough turf for the retailers.
Lenders are not far behind in this new domain. There is a overwhelming amount of information available for your use.
Mortgage brokers and rate sites pioneered the trend with their ultra-low rates and very competitive mortgage product offerings. Initially most of the big banks ignored that trend. Now the situation has changed, increased competition has prompted the big banks to take part in the same game.
In the world of advertisements you should be aware of some simple facts while trying to shop on-line. Some of those important clues are presented below.
You must spend some time on-line:
It is important that you do a minimum amount of research on-line to check what the market situation is. When you go to a bank and ask for a rate then it is possible that you shall be presented with an above average rate. If you did your homework then you shall be able to question that.
Check for rates in more than one place:
Those days of fixed price and prime rate for prime borrowers are gone. Everyone is trying to offer you their lowest possible rate. It is not necessary that the lowest of XYZ bank will be as same as lowest from ABC bank. So, it is needless to say that you look for rates in more than one place.
Understand the differences between rate sites, broker sites and banks:
There are three types of web sites which advertise mortgage interest rates. First group are the mortgage brokers or super brokers. They advertise rates on their web sites and you can talk to a broker if the rate happens to attractive.
Second are the rate sites. There are two types of rate sites. One ran by mortgage brokers but their focus is only on rates. Another are ran by lead generation businesses who channel your call to a mortgage broker who pays for your lead.
Third types are the banks and other lenders. Many smaller lenders also advertise their rate on-line. They will give you a good idea on rates too.
Look for rate specials:
Often lenders – who have some extra fund – offer rate specials to quickly invest their money. Once they are done with the surplus funds then the rates go up to their normal levels. Keep your eyes open to find out if any rate specials are being offered by any lenders.
Don’t be fooled by search engine results:
You may be a bit confused with this. An example will make things easier to understand. Say, you are do a search for the phrase “best mortgage rate”. Your intension is to find the minimum offered mortgage rates.
Your favourite search engine looks at it from different point of view. If a web site has these three words in its text then there is a possibility that it will show up in the result. Web sites uses a technique called SEO to get their page in the top search results.
SEO is a type of on-line advertisement. It is used to advertise the site to the search engines to gain page ranks. So, you may not get what you are looking for but you will end up with what your search engine thinks you are searching for.
According to Alyssa from RateHub.ca – long searches are better performer than the short searches.
Ask Your Friends:
Chances are that some of your colleagues have already gone through this process. If you can get some advise from people known to you, then your job will be much easier.
Don’t forget the big banks sites:
Recently the big banks have almost stopped their ridiculous rate advertisements. If you visit their web sites then you shall find very competitive rates are posted there.
Not all the shoppers buy from the shop:
It is a bitter reality of on-line market place. There are a lot of window shoppers but few decide to buy. It is true for the rate sites as well. We have seen may similar sites closed down over years as they simply could not see a viable business in there.
A number of Canadians also admit that they end up getting their banks to match the rate advertised on-line.
Words from the expert:
I had a chat with Alyssa from RateHub.ca. She gave me some interesting insights of the market. Her most valuable piece of advice was
Ask a lot of questions.
The sentence says it all. Once the initial research is done, you should make few calls and meet few people. The transition from on-line to off-line is important to understand the product and to know what you are getting.
Alyssa said that although people shop for best rates they also pay attention to brand names and do their research on the rates offered by big lenders. The purpose of her site is to make the process easier.
Her word of advice;
While looking for lowest rate – don’t forget toe read the terms and conditions carefully.