FAQ
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What is a mortgage broker?A mortgage broker is an individual who has taken their provincially administered course and passed an exam allowing them to deal in mortgages. From there they are watched forever by their provincial regulatory association to make sure your best interests are always protected. You as a consumer can file a complaint should you need to and I can assure you it is taken very seriously by these associations.
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What do they do exactly?They take the application and gather all the necessary documentation for the mortgage lender. They submit to the lender they see as having the best product for you and work as a go between you and the lender until they know you have the full approval for the mortgage.
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Who pays them?Usually it is the banks and the mortgage lenders but in some cases you pay them directly though you would know this well ahead of time. The commission a mortgage broker makes is budgeted for by these companies. It is a normal cost of business and can be paid to the broker or to the bank employee and the net effect is the same to you the consumer.
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Why would you consider using a mortgage broker?They have access to a wide variety of mortgage lenders. Considering that every situation is slightly unique, it can be a relief knowing that if bank A says no to your application that there are many more the mortgage broker can present your application to without you having to make appointments with each.
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What if you want a bank you know?Mortgage brokers deal with many of the main banks in Canada but often do a much higher volume than you doing just your own mortgage. They can get better rates and often faster turnaround.
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Are they safe?You bet! This group is watched carefully by the regulators.
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Aren't they just for people with bad credit?Mortgage brokers have made the Canadian mortgage market competitive which means lower rates for you and more money in your pocket at the end of the day. According to a CMHC survey, approximately 51% of first time home buyers chose to go through a mortgage broker. They know the pitfalls you need to avoid. Mortgage brokers are a great resource to save you money both now and down the road as well as saving you time and reducing your stress overall. Considering you debt is the largest debt you will ever take on, it just makes sense to ensure you are getting the best mortgage rate and terms possible for your situation.
CANADA GUARANTY, CMHC AND GENWORTH
High Ratio Fees
If you are looking to purchase a property with less than 20% of the purchase price as a down payment, all banks require that the mortgage be insured through either The Canadian Mortgage and Housing Corporation (CMHC), or Genworth Financial Canada. These institutions provide mortgage insurance to homebuyers and have identical premiums of which are listed below.
*Rates as of 2019-05-07
Mortgage loan insurance helps protect lenders against mortgage default, and enables consumers to purchase homes with as little as 5% down payment — with interest rates comparable to those with a 20% down payment!
To obtain mortgage loan insurance, lenders pay an insurance premium. Your lender will pass this cost on to you. The premium payable is based on a percentage of the home’s purchase price that is financed by a mortgage. The premium can be paid in a single lump sum or it can be added to your mortgage and included in your monthly payments.
For more information try visiting CMHC’s website.
DID YOU KNOW WE ALSO OFFER COMMERCIAL MORTGAGE FINANCING & LEASING SERVICES?
