Information on Working with a Mortgage Broker
This industry is provincially regulated and is guided by the Canadian Institute of Mortgage Brokers and Lenders. Mortgage Brokers are handling a larger and larger portion of the mortgage business every year.
So what exactly do mortgage brokers do?
One of the main differences between a Mortgage Broker and dealing with a bank is that they are available 7 days a week and into the evenings. All independent brokers shop all financial institutions for the most preferred rates and terms for you. They require basic information such as your income and lending requirements.
Why use a mortgage broker when most people can get a mortgage from a bank?
1). Usually one meeting, or even just a call to a mortgage broker, is all that is needed. Once the broker has the pertinent information, they will search around to find the best mortgage deal. On the other hand, if you are arranging your own financing you may have to get involved in a time consuming process of negotiating with several lenders in order to get the best rate and terms.
2). Take advantage of the contacts and expertise they offer in order to get the best mortgage deal. Many people can negotiate with the financial institutions however, some people are hesitant to try to negotiate on their own behalf or don’t even know that they can. Furthermore, mortgage brokers have access to certain lenders that the general public does not and these lenders often have unique products and/or lower rates that may benefit you. So it’s quite likely that you can get a better mortgage deal by going through a broker.
3). Each person has their own credit rating kept by the Credit Bureau of Vancouver and is based on a statistic known as a Beacon Score. A mortgage broker applying to a number of lenders on your behalf, only does one credit check versus an applicant physically going to different lending institutions over a period of time could affect a Beacon Score rating.
4). You have more confidentiality when dealing with a mortgage broker. Anyone with access to the credit checking system can find out who has done a credit check on you. So for example, if you applied to a bank, a credit union and a trust company and they all ran credit checks on you; each of those lenders could find out that you had applied to the other two. However, if you went through a mortgage broker, they submit only one credit check, it is less invasive of your privacy than a number of lenders submitting credit checks.
So how much extra is it going to cost you to go to a mortgage broker?
Typical you should not expect any difference between going through a broker versus a bank. The broker is compensated by the lender. If you require high ratio financing than only the lending institution may charge an additional fee.
A good relationship with a Mortgage Broker will simplify and guide you through the process.
The three Mortgage Brokers I have worked with and can recommend
Cara Savege and Daniela Serena
5487 West Boulevard Vancouver, BC V6M 3W5
Dave McIntyreManager, Residential Mortgages TD Canada Trust
Telephone: 604.716.1303 Fax: 604.294.8057
Tony RossanderMobile Mortgage Specialist RBC Royal Bank
Raman HolatMortgage Specialist Verico Paragon
#227-5589 Byrne Road Burnaby, BC V5J 3J1
Local: 604.992.5835 Fax:604.681.1065