The mortgage itself is unavoidable - after all, very few people are wealthy enough to afford the $300,000 lump sum payment required to buy the average North York homes for sale in today's market. Banks and other mortgage lenders must supply us with a top-up, and charge us an arm and a leg in interest and fees. No one wants to spend more on their mortgage than they have to, so how do you get the best deal? By going directly to the bank or by employing a mortgage broker?

The Broker's Job

Mortgage brokers exist to match mortgage lenders (i.e. banks) with borrowers (i.e. you). They compare and contrast the mortgages offered by a number of institutions, submitting your application in as many places as possible to find the best deal out there. Many North York real estate lending companies turn to brokers to promote their mortgages. They conduct credit assessments on behalf of banks, give mortgage advice, and handle all the paperwork of applying for a mortgage.

The Broker's Interests

Mortgage brokers work on a fee-for-service basis, but the service they're providing isn't for you, it's for the banks. After all, the banks are the ones getting your business. Like buyers' North York real estate agents the applicant has to rely on the good will of the broker and trust that he or she actually cares about finding them a deal. However, brokers are regulated by federal and provincial banking and finance laws. A good indicator of professional conduct is membership in the Canadian Association of Accredited Mortgage Professionals.

Benefits of Brokers

Using a broker holds the possibility of saving you both time and money. By using a broker, not only are you free from having to go on a city-wide tour of loan officers at the major banks but you might actually see them competing for your business. This ends up lowering the interest rates many people have to pay to mortgage their North York houses. Often people with bad credit have no choice but to turn to a broker, because it's usually the only way they'll be able to get a mortgage at all.

Drawbacks of Brokers

Because brokers are paid by the lenders they represent, you may run into a situation where a broker actually ends up negotiating YOU into paying a higher interest rate because the more the bank gets from the deal the more the mortgage broker gets. Therefore you should always be careful not to tell the broker the maximum you're willing to pay. Just like in a negotiation, you should never say the first number. Brokers may also end up finding you a non-local lender who has never financed the sales of North York condominiums before. This could be bad because you will be unable to talk face to face with a representative if you have issues and it may take longer for the lender to understand the risks and accept the mortgage.