Types of Lenders

Choosing Your Mortgage Path: Broker or Lender

When it comes to securing your mortgage you can either work with a Mortgage Broker or a Lender.

Option 1: Working with a Mortgage Broker

Mortgage Broker's Role:

  • Acts as an intermediary, submitting your application to multiple lenders.
  • Allows you to shop around and find the best qualifying terms.
  • No lender fees expected, especially for prime mortgages.

Advantages:

  • Broker handles the entire application journey for a hands-off experience.
  • Can potentially find the best rates in the market.

Negotiating with a Broker:

  • Brokers are compensated by the lender they place you with (around 1% of the loan amount).
  • Potential to negotiate lower rates or receive cashback to cover additional fees.

Common Lenders a Broker May Work With:

MCAP, First National Financial, TD Broker, Scotia Broker, among others.

Option 2: Working Directly with a Lender

Lender's Mortgage Advisory Team:

  • Collaborate directly with the lender's mortgage advisory team for application approval.
  • Requires a hard credit check for each lender you work with directly.

Advantages:

  • Long banking history with a lender may lead to preferential rates.
  • Rates depend on the lender's advertising strategy, allowing for negotiation.

Negotiating with a Broker:

  • Rates are set by the lender, offering room for negotiation.
  • Big banks may have more wiggle room to negotiate lower rates.

Key Considerations

  • Both options are effective; your preference guides your choice.
  • Stay informed about mortgage rates; providers may not always notify of rate drops.
  • Actively monitor the market to secure the most favorable mortgage terms.

Embark on your mortgage journey with confidence, whether you choose the expertise of a broker or the direct engagement with a lender. Your dream home awaits!