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									Backgrounder

CMHC Mortgage Consumer Survey
Understanding today’s Mortgage Consumer

Canada Mortgage and Housing Corporation (CMHC) is pleased to present key results from
the 2006 survey of Canadian Mortgage Consumers. Since 1999, the annual consumer survey
has provided a uniquely Canadian perspective into the changing attitudes and behaviours of
mortgage consumers. The survey explores the dynamics of consumer choice, and mortgage
shopping behaviour when arranging, renewing, or refinancing a mortgage. Consumer usage
and attitudes towards both lenders and mortgage brokers are captured and analyzed. The
survey is based on a national probability sample of active mortgage consumers comprised of
first-time buyers, repeat buyers, mortgage renewers and refinance consumers. The results
are accurate to within 2.1 percentage points 19 times out of 20.
Highlights from the 2006 CMHC Mortgage Consumer Survey include:
Paying Down Debt is a Top Priority
Seventy five per cent of respondents are in agreement with the goal of paying off their
mortgage as quickly as possible.


               Paying down debt is a top priority


               Majority of consumers want to pay off
               mortgage quickly



     My goal to pay off
          quickly
                                                                      75%




    When possible use
    extra money to pay                               50%
           down




                                                                                2006 Mortgage
                                                                                Consumer Survey
                                                                                Canada Mortgage
                                                                                and Housing
                                                                                Corporation
Half of all consumers also indicated that whenever possible they would use any extra money
they have to pay down their mortgage.
Canadians Well Served by the Mortgage Industry
Overall, the vast majority of mortgage consumers were satisfied with the services they
received when arranging their mortgage and were equally satisfied whether they opted to
deal directly with a lender or choose to use the services of a mortgage broker.
When dealing with a mortgage lender, an overwhelming majority of Canadian consumers feel
that it is important that the mortgage lender be a Canadian institution and that the institution
be well known to them.


              Satisfaction with service is high

              Brokers and lenders meeting needs of Canadian
              borrowers

                           5%


           Brokers   6%         4%   32%                  53%       85%


                           3%


           Lenders    7%        6%   30%                  54%       84%


               Totally unsatisfied   Rather unsatisfied   Neither
               Rather satisfied      Totally satisfied

                                                                               2006 Mortgage
                                                                               Consumer Survey
                                                                               Canada Mortgage
                                                                               and Housing
                                                                               Corporation
Personal Connections are Important
The majority of respondents agreed that it is essential to have a personal relationship with a
lender when negotiating a mortgage. Meeting with your current lender is the most common
activity consumers engage in when shopping for a mortgage. A familiar lender loans officer is
felt to be a reliable source of information (69 per cent use this source) and the majority who
look to their present loans officer for guidance and information find the information provided
to be useful (82 per cent).


              When borrowers shop around

              Current lender relationship is essential
                                                                              71%
                    Meet with current lender                                     81%
                                                                               74%
                                                                          64%
                     Check competitive rates                          52%
                                                                       56%

          Get info on services offered by diff.               33%
                                                               35%
                         lender
                                                                     47%
                                                              32%
                   Shop for several proposals                29%
                                                                    43%
                    Click to edit Master subtitle style
                                           13%
                       Use a mortgage broker                22%
                                                             27%
                    Purchasers                Refinancers                  Renewers


                                                                                       2006 Mortgage
                                                                                       Consumer Survey
                                                                                       Canada Mortgage
                                                                                       and Housing
                                                                                       Corporation
Lender Loyalty Remains High
The majority of mortgage consumers continue to remain loyal to their existing lender. At the
same time, in 2006 consumers showed a greater tendency to switch lenders when arranging,
renewing or refinancing their mortgage.



             Lender loyalty remains high

             But consumers are taking advantage of
             competition
                     90%
          88%                                    87%                    87%
                                                               86%
                                    84%
                                                                                      81%
           80%                                   77%                  83%
                                                               71%          80%
                     67%
                                    63%
                                                   61%                                   65%
                                                               67%                     66%
                                    63%          63%                    62%
          57%                                                                         58%
                                                               54%
                     48%
                    Click to edit Master subtitle style
          2000       2001           2002         2003          2004     2005          2006
            First-time purchasers          Repeat purchasers      Renewers        Refinancers

                                                                                                2006 Mortgage
                                                                                                Consumer Survey
                                                                                                Canada Mortgage
                                                                                                and Housing
                                                                                                Corporation
Use of Mortgage Brokers:
The proportion of consumers using the services of a mortgage broker when buying a home
has remained unchanged from last year’s level of 27 per cent. Compared to previous years,
an increased proportion of refinance and renewal customers have chosen to use a broker.


          Mortgage brokers remain popular


          On the rise with renewers and refinancers

                                         32%
                          30%
                                                  28%
                                         26%                           30%
                            26%
                                                                       27%
         22%                                         27%
                            22%                                        23%
                                         20%                           22%
        21%                                        24%
           20%

                                         16%      16%                  13%
                          15%
         11%
                           9%                      8%
                                         6%

         2002             2003           2004     2005              2006
                 First-time purchasers          Repeat purchasers
                 All purchasers                 Renewers
                 Refinancers

                                                                             2006 Mortgage
                                                                             Consumer Survey
                                                                             Canada Mortgage
                                                                             and Housing
                                                                             Corporation
Refinancers Don’t Wait to Renew
A large majority of Canadians who refinanced their mortgage in the last year, did so before
the scheduled renewal time.


              Refinancers don’t wait to renew


              Be ready: 71% of all borrowers refinance before
              mortgage term is up

               Mortgage not
                  due for                                    71%
                  renewal




               Mortgage due
                for Click to
                    renewal    edit Master 29%
                                           subtitle style



                                                                             2006 Mortgage
                                                                             Consumer Survey
                                                                             Canada Mortgage
                                                                             and Housing
                                                                             Corporation
Renovations One of the Main Reasons for Refinancing
Reinvesting the funds back into the home through home renovations is the most common
reason as to why consumers refinance their mortgage. Almost one-in-three of those
refinancing used the funds to consolidate debt.


             How do consumers use refinancing
             funds?

             Typically to renovate or consolidate debt



               House
            renovations                                      37%




            Consolidate
                   Click   to edit Master subtitle style
               debt
                                                       29%



                                                                        2006 Mortgage
                                                                        Consumer Survey
                                                                        Canada Mortgage
                                                                        and Housing
                                                                        Corporation

								
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