nesto ⎯ Matching Canadians With the Lowest Mortgage Rates in the Country

nesto ⎯ Matching Canadians With the Lowest Mortgage Rates in the Country

Written by Caitlin Wood
Last Updated November 2, 2020

When it comes to finding Canadian consumers the mortgage options that work for their unique need with the lowest rates possible, nesto is king.

We spoke with the team behind nesto about how they’re changing the way consumers shop for their mortgages and how the current pandemic is affecting what Canadians want.

For those who are unfamiliar, can you explain what nesto is?

nesto is the first, 100% free digital mortgage solution in Canada! Our goal is to simplify the mortgage process, from start to finish, while offering Canadians the best rates available for their situation right off the bat, no negotiations required. 

What types of mortgage products do you offer?

In short, we offer the same mortgage products as any mortgage brokerage, except with lower rates. From restricted products to full-featured products, we discount all mortgage rates we offer to clients.

Why should Canadians, looking to purchase a home, choose nesto over working with their local bank or mortgage broker?

First, to get a more transparent experience!

Working with traditional banks means you’ll only get access to their rates and their specific suite of products, as opposed to a mortgage agency (QC) or brokerage (ON), like nesto, which gives you direct access to rates from 10+ lenders, including rates from large banks like Scotia, TD and more.

Second, to get the best rate!

With nesto’s commission-free advisors, the borrower gets the floor rate from the start, without needing to ask for it. It’s the most important purchase of your life and we don’t think qualified borrowers should pay a premium for it. There is no other incentive for our team than providing unbiased advice, and the best possible deal, period. 

Third, for the efficiency of the process!

Nowadays, especially in the COVID19 era, being able to securely go through the entire mortgage process online is a big plus, and that’s what nesto offers. A 100% digital solution with a quick, easy application and a smooth financing experience, from the comfort of your home.

What should Canadian homebuyers expect from the nesto application process? And are there any specific requirements they should be prepared for or documents needed? 

While completing nesto’s online mortgage application, Canadian homebuyers should expect to answer questions that directly relate to their identity and financial profile as it pertains to their personal mortgage transaction. Whether the applicant is renewing a current mortgage or applying for the purchase of a new home, the nesto application is tailored to help our lending partners get a full picture of the applicant’s personal employment, credit, and financial situation, as well as the property being mortgaged.

Our digital solution automatically generates a tailored required document list, accessible in the applicant’s document centre that is based on the answers provided through our online application. All borrower profiles and transaction types have varying documentation requirements, and this is captured in our online application.

How is nesto able to offer Canadian buyers better mortgage rates?

It all has to do with our commission-free process, which allows us to offer our clients the lowest rate possible, at all times!

In order to offer customers the floor rate, a broker or mortgage specialist would have to give away a portion, or all of, their commission. Few are willing to go there. Hence why you have to go bank-to-bank, broker-to-broker to finally get such a rate. At nesto, we believe in offering you the floor rate from the start.

So, how does nesto make money? Our revenue comes from our lending partners. They pay nesto as we help them acquire customers that they would not have been able to obtain otherwise.

Yes, nesto makes less than the average broker or mortgage specialist, but it feels good to know that we’ve helped our clients save thousands of dollars on their mortgage! 

How do you choose the mortgage providers available on your platform?

In theory, we could offer products from every provider, in practice, however, we offer products from providers we share similar values with and provide a level of service that we have confidence in. Our products are ranked in our platform from lowest to highest rate, with no exceptions. Important to note is that the lowest rate isn’t always the best mortgage for a specific situation or borrower. This is mitigated during your discovery call with a licensed mortgage agent who’s tasked with confirming product suitability. 

Will users get matched with more than one option?

Absolutely! Within the app, every user gets matched with a minimum of 3 options. For example, option 1 would be the absolute lowest rate available to their situation. Whether it’s a restricted product or not. Option 2 is going to be the next best full featured option and option 3 is a bank option that the client would recognize. Within the discovery call, there’s the opportunity to explore an entire suite (1000+ product options) of mortgage products depending on the borrowers questions, concerns and what-if scenarios that come up. 

What happens after a user submits an application with nesto?

The borrower is contacted and provided a link to book a call with a licensed nesto agent. The agent validates the key details of the application, shares as much mortgage knowledge as possible and explains next steps of the nesto experience, that is underwriting. The process of inquiry to approve a mortgage can be completed in less than 24 hours, assuming that the borrower quickly follows all instructions provided by the app and the agent.

2020 has obviously been a difficult year for everyone. Have you noticed a change in the ways Canadians are shopping for mortgage options and buying homes? 

The biggest thing we’ve noticed is that the home shoppers that we speak to every day want their new home now, and to move in as quickly as possible, as opposed to the previous environment where a new construction (building in progress) was a popular choice amongst our users. In our most recent data analysis report, the nesto-meter, we also found that most buyers remain more cautious when it comes to buying a home, which reflects in both lower planned down payment and targeted purchase price. 

Rating of 4/5 based on 7 votes.

Caitlin is a graduate of Dawson College and Concordia University and has been working in the personal finance industry for over eight years. She believes that education and knowledge are the two most important factors in the creation of healthy financial habits. She also believes that openly discussing money and credit, and the responsibilities that come with them can lead to better decisions and a greater sense of financial security. One of the main ways she’s built good financial habits is by budgeting and tracking her spending through the YNAB budgeting app. She also automates her savings so she never forgets to put aside a portion of her income into her TFSA. She believes investing and passive income is key to earning financial freedom. She also uses her Aeroplan TD credit card to collect Aeroplan points so that she can save money when she travels.

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