How does a mortgage broker work?
The process typically begins with an initial consultation to assess your current financial situation and discuss what type of mortgage product you are looking for. From there, we do the research on your behalf to find you the right mortgage and handle all of the details around preparing and submitting your mortgage application.
A common misconception is that the best mortgage is always the one with the lowest rate, which is not always the case.
Additional factors that your broker will consider include your loan-to-value ratio, income type, prepayment privileges, and any payout penalties you might incur if you’re considering moving before your term is up. Understanding your entire financial picture helps ensure that the product aligns with each of these requirements. After your application has been submitted, we help you collect the required documentation, and liaise with your REALTOR®, appraiser, and lawyer to ensure the remainder of your mortgage process goes smoothly. It is our job to keep you updated and educated along the way.
We are here to represent you, negotiate your mortgage on your behalf and be your point of contact for any of your mortgage related needs – even after your mortgage has been fully approved.
How do brokers get paid?
If you’re looking for a traditional mortgage (not commercial or private), we charge our clients nothing for our services. From the initial consultation to the closing of your mortgage, there are no fees associated with using a mortgage broker. How does this make sense? We are actually paid a commission or ‘finder’s fee’ by the lender for helping our clients secure a mortgage through them.
When should I use a mortgage broker?
Mortgage brokers aren’t just for purchasing a home. You can use a mortgage broker anytime you need to access mortgage financing. Generally speaking, this includes:
- Mortgage pre-approvals
- Purchases and purchase plus improvements
- Refinances and refinance plus improvements
- Mortgage renewals
- Purchasing a rental or investment property
- Commercial mortgages
- Debt consolidation options
Why should I use a mortgage broker instead of my bank?
With a broker, you aren’t limited to the mortgage products from only one institution. This increases your ability to secure the right mortgage for your situation, and you also receive the benefit of negotiating power with lenders. A mortgage broker is a licensed expert in the mortgage industry, who keeps track of the latest requirements and legislation so you don’t have to.
There are also two key differences between an independent mortgage broker and the mortgage specialist at your bank:
- It is mandatory for your broker to be certified through the Real Estate Council of Alberta. This requires initial training and testing to become licensed and brokers are also required to renew their license each year.
- Mortgage specialists at your bank are usually paid an hourly or salaried wage, while mortgage brokers work solely on commission. Simply put, a specialist will still get paid if they are unable to secure mortgage financing on your behalf, while a licensed broker will not.
Questions about our process or services? Contact our office today.
