Sep 09 2016
Most are unaware of the distinction between a mortgage broker and a bank specialist and therefore follow the path their friends and family took when acquiring their mortgages.
Although I understand this thinking, I feel strongly that one should be educated on the different lenders so they can make their own personal decision of who would best meet their needs. I have put together an outline of the available mortgage outlets to help you make an informed, individual decision. A mortgage broker works for you, not a financial institution. Because of this, they are able to provide you with independent, unbiased advice on a wide variety of products from different lenders. They are considered freelance employees, who get paid a fee from the bank for finding them a borrower; it is therefore in their best interest to provide you with the best and most suitable mortgage product available. When working with a broker, they negotiate discounted mortgage rates on your behalf with each institution. In contrast, bank specialists work with posted rates and negotiate these rates with you yourself. Bank specialists work for one particular financial institution. They only have access to the specific products and rates offered by their institution and may therefore be biased towards promoting them.
Brokers are typically paid the same amount no matter what rate is offered to the client, while a bank specialist’s pay is generally reduced in direct relation to the amount they discount your rate from the bank’s posted rate. Mortgage Brokers must be licensed and are subject to a strict set of requirements. Accredited Mortgage Professionals (AMP) must take continuing education courses in order to maintain their accreditation. Bank specialists are not licensed and require no formal training.
I hope this information provided you with a fuller understanding of the options available to you in obtaining your mortgage. If you have any further questions please do not hesitate to contact me.