Although you could go straight to a bank, and then another bank, and then find you can’t go directly to some of the alternative lenders available – believe us when we say there is a better way: Use a mortgage broker.
A mortgage broker’s job is to help you find the best mortgage rate, terms and conditions for your particular needs. And what’s even better is they get paid by the lender – not by you.
Like any professional, though, you need to make sure that you get recommendations on whose services to use – ask friends and family, or search our extensive mortgage broker database (we update it regularly and sort brokers by neighbourhood).
Mortgage brokers will have a panel or list of mortgage lenders that they regularly use or have access to. Of course, more mortgage lenders means more choice, but remember that quantity isn’t everything – a good mortgage broker may well whittle the available list down to which ones they know have the best rates, the lowest fees and the most competent services.
Brokers are generally paid close to the same amount by every lender, so they shouldn’t be biased when helping you, but some lenders do offer bonuses or special incentives for brokers or offices that give them more than a certain amount of business. Lenders may also pay a higher rate to brokers who sign clients to a longer term. Make sure you ask your broker plenty of questions so you can understand why that particular mortgage was chosen and how the broker is getting paid for the recommendation.
Many mortgage brokers are independent, but there are also a large number who belong to various groups such a franchises or what are called super-broker groups. Brokers working as part of one of these operations use a brand name and are sometimes able to get bonuses or increased commissions from lenders that offer incentives for companies that sell large volumes of their loans.
Broker networks are the companies mortgage brokers work under. There are several of these companies across Canada, and each has its own list of lenders it works with.
Dominion Lending Centres
The Mortgage Centre
TMG The Mortgage Group
These lending institutions are the private companies that mortgage brokers turn to in order to find you a mortgage. Brokers will often have close relationships with many of these lenders so they can win you the best rate.
Sometimes it’s best for you to get your mortgage through a traditional bank. Mortgage brokers will have relationships with these institutions as well.
Bank of Montreal
If you have a small down payment, your lending institution may require you to pay insurance on the mortgage amount, so that they’re protected should you become unable to make your monthly payments.
Are you looking to invest in property? If you like, we can get one of our mortgage experts to tell you exactly how much you can afford to borrow, which is the best mortgage for you or how much they could save you right now if you have an existing mortgage. Click here to get help choosing the best mortgage rate
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