Navigating through the home buying process can be a serious, challenging and expensive task. This is especially true as the pandemic affected Canadians in many ways. Amongst these setbacks, a silver lining arose: Canadians became smarter and more efficient in managing their money. 

A part of becoming more efficient in managing money is looking for opportunities to save and when you’re applying for a mortgage or a home loan is no exception. First-time home buyers may go to their financial institution for help or they can choose to work with a mortgage professional

What’s the difference? 

Both mortgage brokers and mortgage specialists provide similar services regarding mortgage financing. However, their procedures may differ in many ways. 

Mortgage brokers vs mortgage specialists: pros and cons

Anyone seeking a home loan should weigh the pros and cons of working with a mortgage broker or a mortgage specialist. In this article, we specify the advantages and disadvantages of working with either a broker or specialist. 

Mortgage specialists

Mortgage specialists work for a financial institution, such as a bank and they can only provide mortgage products offered through that institution. Having the mortgage approved is usually based on the financial institution’s evaluation of the client’s financial situation. 

Pros: 

  • Applications are completed at the financial institution, potentially saving time and money; 
  • You don’t need to pay a mortgage agent or broker.

Cons:

  • Finding a loan may take longer as borrowing options are limited;
  • Borrowers would require multiple loan applications at various institutions along with divulging personal information to multiple mortgage specialists; 
  • Mortgage specialists don’t require a mortgage license.

Mortgage Brokers

A mortgage broker acts as the go-to person between borrowers and lenders when applying for a home loan. They assess your financial situation, compare products from different lenders on your behalf and manage the application process all the way to the end and beyond.

Pros:

  • Works with multiple lenders so you have multiple loan options and can save you an enormous amount of time from “shopping around”; 
  • Also works with private lenders that don’t directly transact with borrowers, so they’ll act on your behalf;
  • Are licensed professionals;
  • Uses one application, along with one credit check to submit to multiple lenders;
  • Helps negotiate for better mortgage rates and fees
  • Works with everyone involved in the home buying process, including: real estate professionals, lawyers, appraisers, underwriters and more;
  • Can also help borrowers with poor credit or no credit. 

Cons:

  • May charge a commission fee based on your personal financial situation;
  • Can be biased based on current relationships with lenders;
  • Some financial institutions won’t work with mortgage brokers.

The Bottom Line

Mortgage brokers have the ability to offer mortgage products from a network of lenders and provide access to a greater range of products than mortgage specialists, who are limited to their own financial institution’s offerings. 

Daisy Raouph offers mortgage consultations that’ll help to guide you to the right mortgage product based on your individual needs and goals. Daisy’s a mortgage broker and financial security advisor based just outside of Toronto. Consult Daisy today

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