Good news for small mortgage lenders

The budget  should allow more competition from smaller lenders which will keep banks competitive and make dealing with a mortgage broker even more important.  "The government has promised that the smaller banks will have easier access to funding from CMHC.  The corporation's new allocation methodologies will undergo restructuring to increase the access smaller lenders have to portfolio insurance and securitization programs."  The finance Minister, Jim Flaherty has taken steps to arm "smaller banks" with the tools to better compete with the banks and this is a win for the consumer.

The 2014 Federal Budget will make it easier for new banks to enter the mortgage market and improve access to Canada Mortgage and Housing Corporation (CMHC) programs for small mortgage lenders, according to the Financial Post.

The budget, which was released on Tuesday by Mr Flaherty, promises to "improve the ability of new entrants and smaller banks to compete" while preserving the strength of the sector.  In addition the Office of the Superintendent of Financial Institutions (OSFI) has appointed a new representative to contact the small banks and handle some to the issues that they currently face when in competition with the Big Five banks.

The government has promised the smaller banks easier access to funding from CMHC so they are more competitive.  The corporation new allocation methodologies with be restructured to increase the access smaller lenders have to portfolio insurance and securitization programs. "I sure hope (there's more competition),: Gregory Thomas, executive of the Canadian Taxpayers Federation told the Financial Post.  "Canada could use one or two strong  national credit unions."

If you would like to know more about small bank loans please call me at 250 862 1806 or email me [email protected].

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About the Author

Laurie Baird and Tracy Head are mortgage brokers with Verico Complete Mortgage Services. Together they have over 45 years of experience in the mortgage industry.

As mortgage brokers, Laurie and Tracy spend time getting to know the people they work with and help them understand the mortgage process. They support their clients before, during, and after a home purchase.

Laurie and Tracy are able to offer their clients advice and options. With access to over 40 different lenders, Laurie and Tracy are able to match the needs of their clients with the right mortgage package. They work closely with their clients to find the right fit, and are around to provide support for years down the road!

Contact them at 250-862-1806 or visit:

Visit Laurie's blog at: https://www.okanaganmortgages.com/blog

The views expressed are strictly those of the author and not necessarily those of Castanet. Castanet does not warrant the contents.

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