How to negotiate a better mortgage

1. Concessions: Make your banker know you deserve special treatment. Your banker must be "educated" as to why you deserve special treatment.

2. Wring a deal: When it comes to loans and mortgages, most banks have one-half-per-cent to a full one per-cent discretionary leeway in their posted rates. Simply ask for the best rate, don't worry, they can afford it. Just because you are not a "heavyweight" borrower with lots of clout, that does not mean you cannot negotiate a three-quarters of one-per-cent reduction.

3. Consumer clout: If you shift your other chequing, savings, RRSPs etc. to the bank, itought to swing yourcapacity to negotiate in your favor.

4. Documentation: Make it easy for a banker to appraise risk by making your strengths/assets clear. The more your strengths are reinforced on paper, the easier the negotiations will be.

5. Equity: Do you have more than 25 percent equity in your home or can you ante in a 25-per-cent downpayment on the manse or cubicle of your dreams? The stronger the chains that bind you, the happier the banker.

6. Stability: Have you been working in your current field for two or three years? Have you suffered any interruptions in your work history? If so, be ready to explain why.

7. Cash flow: After factoring in the principal/interest payments and property taxes, do these payments represent less than 30 per cent of your gross income? Cash flow or debt-service ability is the most highly scrutinized elements of any mortgage application.

8. Self-employed applicant: The banks commonly look at a three-year average of your personal income to determine your qualification. You in turn may add auto expenses, depreciation, net income and, occasionally, rent etc. back into the mix. Most lenders recognize that self-employed people/businesses enjoy certain tax concessions and write-offs which means that smaller overall income actually translates out to a larger net income and thus a greater ability to support a larger mortgage. Before you visit the lender, see your accountant.

9. Bank manager: If uncertain of your standing and clout, make your run at the bank manager, rather than the mortgage officer. The manager often can make an immediate call on an interest-rate reduction; the mortgage officer needs permission.

10. Shop around: If you're refused by one institution, don't be discouraged. Instead, politely ask why, do your best to rectify the problem...and then go onto the next institution. To successfully negotiate a mortgage, remember that attitude counts. Lending has a very human element to it. If you're organized, courteous and make a small effort to assist the loans officer, you'll often discover that small variations or special requests in your application may be treated with "exception" and thus granted. The principal reason many mortgages are declined is because of poor communications between the client and the potential lending institution.

11. Presentation: Get yourself organized. Get your "ducks in a row" -the offer to move your accounts in from the other financial institutions and so forth. And while you should always be polite (no screaming), bargain hard. Remember, a half-point reduction can save more than thousands and if you put that savings into paying down the principal, the reward is substantial, so do your homework well. Use the following to search for the advertisers/bankers who are willing to negotiate a "better mortgage" and it's Happy hunting.