1-877-744-3436 Apply Now

Why Use A Mortgage Broker Instead Of a Bank? 4 Reasons To Help You Decide

By September 23, 2022Mortgage Solutions
woman discussing why use a mortgage broker

There are many big decisions to be made in life, and applying for a mortgage loan is certainly one of them. Why use a mortgage broker? Because regardless of age and professional background, getting a mortgage can be daunting. There’s a considerable amount of paperwork involved and quite a bit of stress if you don’t have the best mortgage offers readily available to you. 

In Canada, as in many other countries, there are plenty of mortgage offers to choose from, so identifying the one that suits you the most can be quite difficult. Having said this, you can either go straight to a financial institution for your mortgage needs or work with a mortgage broker

Banks and credit unions used to be the default go-to financial institutions when addressing mortgage needs, but times have changed. 

Nowadays, mortgage brokers tend to have an upper hand on banks by the sheer amount and quality of benefits they offer. Mortgage brokers are not beholden to one lender. They work with many different lenders and will shop for the best rate for you. You will get a no-obligation quote for the home you want to buy, and you can take that quote to any lender, including a bank. 

Most importantly, using a mortgage broker offers a level of service that banks cannot match.

In this article, we’ll answer a question we hear often: “Why use a mortgage broker instead of a bank?

So without further ado, here are some of the main benefits of working with a mortgage broker in BC, Canada:

1. You’ll Have Access To a Rich Portfolio Of Mortgage Lenders

If you are wondering why you should use a mortgage broker, one of the main reasons to work with these professionals is because a reputable broker in British Columbia has a rich portfolio of lenders to choose from. 

When you go straight to a bank or a credit union, they will only display their in-house loan options or recommend some affiliates. While this is not a bad thing per se, and some banks can make good offers, you’ll still have to deal with scarcity.

On the other hand, you can rest assured that a reputable mortgage broker has networked with all the good lenders on the market and has access to their offers. They will also have access to multiple lenders operating outside the traditional banking system, also known as private lenders, and can offer you a wider range of mortgage options. 

Together with your mortgage broker, you’ll carefully go through this rich portfolio to settle on the one option that is best tailored to your needs.

2. Mortgage Brokers Offer Expert Advice And Service

Choosing the right mortgage is just as important as choosing the right home. A mortgage broker will examine your unique situation and help you find the best deal that meets your needs.

Just because you think you’ve found a mortgage offer that fits you like a glove, it doesn’t mean your mortgage broker will simply let you go ahead and apply. 

A good and well-seasoned mortgage broker knows all the criteria an applicant needs to meet to qualify for the mortgage they want. They will thoroughly look at factors related to how long you’ve been employed, how much mortgage you can get, your credit history, and other loans you may have or have had.

A mortgage broker knows well that if your loan process is rejected by the mortgage lender you want, this may decrease your approval chances with them down the line.

If the mortgage broker decides that, for any reason, you may not qualify with your preferred lender, they will advise you on how to improve your chances before applying. A bank, on the other hand, will only call you with a “yes” or “no” answer.

To continue walking you through why to use a mortgage broker, the third reason is that working with a broker is convenient and transparent. 

3. Working With a Broker Is Convenient And Transparent

Why use a mortgage broker? Because whether you want it or not, applying for a mortgage will take time and attention. However, banks and mortgage brokers are definitely not alike when it comes to the time and resources they require from you to cross the finish line, straight to your best loan.

 men discussing why use a mortgage broker instead of a bank

A mortgage broker will help with the necessary steps. They will handle all the paperwork and lender talks while successfully streamlining the entire lending process, so you won’t be too bothered with pestering tasks. This is, perhaps, the main asset a mortgage broker brings to the table and one strong reason why some opt out of the banking system and choose to go with a more personalized approach.

When you choose a mortgage broker, you establish a professional connection with them. Having good rapport with your broker — both personally and professionally — will be essential to achieving your goals. A good broker will be transparent and not hold back important information you need to know. 

Transparency includes providing any licensing they might have and a detailed description of their services. They should also be upfront about any affiliations they may have with specific lenders or partners. Plus, they should disclose any potential conflicts of interest. 

Transparency goes both ways. A good broker will also want to know about you. They want to make sure they are recommending a product that is right for you.

4. You Could Save In Terms, Rates, Or Costs

While banks and credit unions often pay the broker for referring clients to their products, there are additional costs that can add up. Brokers in some cases can get the banks to credit back some of those costs to the borrower at closing. In the alternative mortgage lending arena, terms rather than rates are often your largest source for savings. An established mortgage broker can explain how these savings add up.

Mortgage brokers are independent contractors in BC and licensed through BCFSA. In certain circumstances, they represent either the borrower or the lender. Often mortgage professionals can obtain better rates, better terms, or some other cost savings based on their individual volume of business and experience in the industry.

Conclusion

When it comes to applying for a mortgage, people’s needs have started shifting, rendering banks outworn and unable to keep up with modern requirements. Why use a mortgage broker instead of a bank, then? It’s simple. People are looking for convenience, a more personalized approach, and variety to choose from. 

Don’t hesitate to contact us if you want to experience these benefits and get your desired mortgage loan in an informed, efficient and comfortable way. We work on home equity loans, second mortgages, non-residents mortgages, and many more.

You might also enjoy: 

Leave a Reply