What banks say they offer, and what they really offer

Image result for banks canadaDo banks really offer the products and rates they promote? If you are looking for the term “bank loan” on Google, you will be bombarded with results featuring mortgages, personal loans, home equity lines of credit, credit, etc. However, will you really qualify? Maybe, but we’ll have to dig a little deeper to determine the requirements for a strong qualification.

First, let’s look at the rates that are offered by banks. All banks are in constant competition for the most competitive rates and the lowest. However, what they do not tell you is that each posted rate includes a multitude of terms and conditions. These conditions reflect the qualification requirements of the bank in question; good credit, income, and job stability. If you go into a bank after hearing something about any rate, but you are not necessarily aware of the usual loan requirements, and you are not an experienced negotiator, the bank will benefit of this situation and will try to finance you at higher rates than you deserve. At the end of the day, his only goal is to make the most money possible at your expense.

Banks want to give money to people who do not need it. In other words, they are looking for security. If your financial situation seems unstable, the banks will do everything they can to increase the loan rate, and only if they want to take you into consideration! If you are in the market for an unsecured loan, the banks will not be likely to offer it to you. All they want is to see their loan secured by a property, a vehicle, or whatever.

A good way to protect yourself from opaque products, rates and conditions of a bank would be to visit a mortgage broker. Mortgage brokers already know the products, and they have a realistic understanding of the rates promoted by the lending institutions. It is a lot harder for a bank to do at its head with a competent and experienced mortgage broker. In addition, mortgage brokers do not work for banks, they work for consumers. Their income comes from commissions earned from the business they provide to the banks, so they want to finance you, it’s in their best interest to do that. Not only that, but good mortgage brokers that raise a lot of opportunities for banks are rewarded with exclusive rates that are neither displayed nor promoted by the banks. This means that by visiting a mortgage broker instead of a bank, not only are your chances of qualifying increasing, but your potential to save more is also increasing! Your local bank probably did not share these details with you, did it?

What does this mean for people who have bad credit?

Image result for bad creditIt is more difficult to find a loan and it is more difficult to borrow at a good interest rate if you have a bad credit score or bad credit history. This is public knowledge. However, given the fact that banks make it difficult to obtain mortgages, home equity loans or personal loans if certain specific criteria are not met, what are the alternatives that remain for those who have bad credit?

Whether for secured loans or unsecured loans, the safest option is to visit a private lender. However, these lenders are hard to find. Quebec Loans does business with private lenders, so we can help you find financing from a private source if you visit our application page.

Other alternatives include credit unions, investment banks and other types of credit institutions.