We had the pleasure of interviewing our long-time friend and trusted mortgage specialist with RBC, Eric Cyrenne. He has some wonderful tips to share with us covering a wide range of mortgage-related topics including a recent change to the mortgage stress test being implemented by the government. Eric has worked as a mortgage advisor for over 15 years, and brings a wealth of knowledge and experience to the table. Let’s dive right in...

Eric, can you explain the difference between a mortgage broker and a mortgage specialist?

Sure. My title is mortgage specialist because I work exclusively for the Royal Bank of Canada. A mortgage broker is someone who is independent and who is not affiliated with any one specific bank. 
In our experience, whenever we work with you on a transaction or another mortgage specialist for that matter, it always seems to go a lot smoother and quicker than when we’re dealing with a mortgage broker. Why may that be?
I can’t speak for mortgage BROKERS, however I know that as a mortgage specialist, I have an obligation to maintain the highest level of knowledge and understanding of all of RBC’s current products and policies. We have weekly, monthly and quarterly meetings to discuss any updates to our products. RBC is very much in tune with the changing market conditions and it strives to constantly improve the client’s experience. I cannot begin to imagine how overwhelming it might be for a mortgage BROKER to learn and stay updated on the different programs and policies within the various individual banks they may be dealing with. I consider myself an expert of RBC mortgages and I deliver tailored advice to my clients based on their individual needs and goals. 

Can you describe what you do for your clients?

I handle residential mortgages from A to Z. If a client walks into the RBC branch and inquires about a mortgage, the branch will introduce the client to a mortgage specialist. I don't open accounts or VISA cards, nor should I be asked about investments...My focus is on residential mortgages, anything from a condominium to a 6-plex - I’m your guy! There is nothing more disappointing for clients than to start shopping around and then come to the bank to discover they can’t afford their ‘dream home’. As a mortgage specialist, my goal is to provide you with an accurate portrait of your budget before you even start the process. I also take the time to understand your unique situation, and to help choose the mortgage product that best fits your needs. Contrary to popular belief, mortgages are not a one-size-fits-all solution. There’s a lot more to consider than just an interest rate.

What tips do you have for people who are looking for a mortgage?

My biggest tip is to contact a mortgage specialist in the early stage for a pre-approval. With the current market, most realtors won't even allow a client to visit a property without a pre-approval letter. I can provide a letter by verifying your income, credit, and down payment. Essentially, 90% of the job is done during the pre-approval process. When you make an offer on a property afterward, the only thing left for the bank to do is to appraise the property and reconfirm that you have the down payment. The pre-approval process is also an excellent opportunity to get your finances in order. It doesn't happen often, but sometimes we find mistakes in the credit reports or discover credit issues that clients were not aware of, and we are there to help sort these issues out. My job is to guide you on the best way to fix any problems so that you can buy a home later, with complete confidence and zero obstacles in your way. 

Do you have any further insights for clients?

Yes! We really want people to understand the sheer volume of applications that the banks are receiving during this exceptionally hot market! We have never seen activity like this before. It's causing delays that are much longer than usual, which is why it's SO important to start the pre-approval process well in advance. Failure to do so causes many buyers to exceed their deadlines to fulfill the conditions of their offers, which can put them at serious risk of losing a property if the seller decides to NOT grant them an extension of time. 

What would make the process go smoother? 

The most important thing to do is to get your pre-approval in order! Unfortunately, most people start looking for a new home before contacting the bank. When they find something they love, they call their bank, but it ends up being too late. I get several panicked calls from clients begging me to do a pre-approval on a Friday afternoon because they want to go look at a property on Sunday and only have until Tuesday to make an offer. Sadly, it's nearly impossible to get a pre-approval done in that short of a time frame.

Do you have any more advice for people looking to get a mortgage?

One of the biggest errors people make is to get pre-approved and then go out and take on additional debt, like buying a new car or maxing out credit cards. Between the time you are pre-approved and your signing at the notary there cannot be any significant change in your financial situation or it could negatively impact the sale. The government is also changing the stress test as of June 1st, 2021, which will affect the way banks calculate what their clients can afford. Their goal is to ensure that Canadians don't take on too much debt. This is going to reduce the amount of borrowing power that people have. 

Is the government doing this to calm the frenzy? 

They are certainly trying and I suspect that there'll be more changes coming our way. They are considering increasing the minimum down payment from 5% to 10%. I don't think these 2 measures will slow the market down significantly considering the current lack of inventory, but we have to wait and see what else the government may have in store. 

What's your favorite part of your job?

What I find the most rewarding is helping first-time homebuyers. There's nothing more exciting than a young couple or person buying their first home because they're SO enthusiastic and grateful! I consider myself incredibly lucky to still love my job so much after doing it for 15 years.

So if you’re thinking about buying a home, don’t hesitate to contact Eric at eric.cyrenne@rbc.com Once you’ve done the pre-approval process and understand your budget, Team Broady is here to help with all of your real estate needs. Schedule an appointment today at info@teambroady.ca or call 514-613-2988.