Mortgage Brokers or Mortgage Specialist from Banks

[AlphaPrime]

Does anyone have a perference on who to go with?

I've spoken with a Mortgage Specialist at Scotia and they can give me roughly the same mortgage rate as one from a mortgage broker. With the Mortgage broker I do not know who they will be dealing with until we process things through. Based on what I've been told is that there is no fee in using a Mortgage broker.

[Wing Nut]

I refer lots of clients to indie brokers. Way, way, way better than the bank flakes.

[frugalguy]

Generally, that is true (99% of the time) that there are no fees with mortgage brokers/agents. Only in the most complicated application would there be a fee but they are required to inform you beforehand.

The advantage of mortgage brokerages is that they can shop the market for the best rate that you qualify for. You'd want to find the mortgage brokerage that has the most lenders available.

[EugW]

Does anyone have a perference on who to go with?

I've spoken with a Mortgage Specialist at Scotia and they can give me roughly the same mortgage rate as one from a mortgage broker. With the Mortgage broker I do not know who they will be dealing with until we process things through.
?

My mortgage broker told me exactly who would was giving me the best rates. There were two lenders that were offering a little bit better rates than the other lenders for me. One of the two eventually gave me a slightly better deal, so I went with them, but I could have gone with the other one if I wanted. (The one I didn't go with had slightly better pre-payment options.)

[Losmir]

In my particular case, the independent mortgage brokers did squat.

I have excellent credit (score is ~800). I contacted two different independent brokers and all they could offer me was the going rate (same rate that I could get at ING with no haggling). Super.

I called the BMO Mortgage Broker (not the in-bank mortgage guy but the external speciallist). He told me straight up that he saw that my credit was excellent and that he would immediately offer me the best rate that he could rather than waste my time. His offer beat the going rate significantly and he got my business.

In my experience, it is not some much where the broker is located or what company they are affiliated with, but rather the individual themselves that make the difference.

YMMV.

[EugW]

In my experience, it is not some much where the broker is located or what company they are affiliated with, but rather the individual themselves that make the difference.
Indeed. My broker was able to get me a better rate than the banks at the time, and a better rate than a second broker I also called.

However, when I went to refinance my mortgage (because the record low interest rates), I got a better deal by speaking with my bank directly than going through another broker. ie. I called one broker and they said they couldn't get me a good enough deal to compensate for the IRD penalty. However, my bank rep was willing to reduce my IRD low enough that it became very attractive to refinance.

[Thalo]

Independent brokers are hit or miss. Some only care about getting you signed up and matching you up to the lowest rate possible and collecting their vig, but others actually take the time to educate you about your options and holding your hand throughout the whole process. Same can apply to the banks' own mortgage specialists (outside of bank branches), but they generally are held to a higher standard and are a bit more consistent. Branch staff who offer mortgages (ie: financial service reps, financial advisors, etc) generally offer good and consistent advice but you usually don't get the lowest rate through them.

[liorsyncro]

Does anyone have a perference on who to go with?

I've spoken with a Mortgage Specialist at Scotia and they can give me roughly the same mortgage rate as one from a mortgage broker. With the Mortgage broker I do not know who they will be dealing with until we process things through. Based on what I've been told is that there is no fee in using a Mortgage broker.
For most residential transactions and provided the transaction is straight forward and the borrower has decent credit, there's no fee. If you have impaired credit and we have to go to alternative or private lenders, there may be a brokerage fee. Private lender mortgages you'll definitely incur the fee.

[liorsyncro]

In my particular case, the independent mortgage brokers did squat.

I have excellent credit (score is ~800). I contacted two different independent brokers and all they could offer me was the going rate (same rate that I could get at ING with no haggling). Super.

I called the BMO Mortgage Broker (not the in-bank mortgage guy but the external speciallist). He told me straight up that he saw that my credit was excellent and that he would immediately offer me the best rate that he could rather than waste my time. His offer beat the going rate significantly and he got my business.

In my experience, it is not some much where the broker is located or what company they are affiliated with, but rather the individual themselves that make the difference.

YMMV.
It depends on the brokerage, not the person, although if the broker is an idiot and only wants their commission asap that can be an issue. The broker has to work with who the brokerage works with. You see, some brokerages (and not necessarily the bigger ones) have "preferred" relations with lenders because of the amount of business they generate to a specific lender. So, the broker has more flexibility not just with the rate but with other options as well. Unfortunately for borrowers, they don't know this information and the brokerages that do have preferred relations don't really advertise it.

As for rates, I don't compete for them nor do I give a damn about them. There are two reasons: first, the rate is only a small part of the mortgage and the only thing no one can control. I can't control it, the lenders can't control it (rates are based on what's happening with the economy), and certainly the borrower can't name their price when borrowing someone else's money. Second, there's always going to be someone who claims they can offer a better rate even if it's off by only 10 bps. In fact, this is how a lot of brokers lure the clients. But I don't need this headache, because then they'll just go someplace else to get something even lower. I compete for service, advice, and actually providing the client with insight and products that I know I can control and do much better than your bank, and most of my business comes from referrals. The other small portion comes from advertising. The rates I can't control, so I'm not going to bother competing for them. There will very little if any deviation at all between one broker and another because they all work with virtually the same lenders. I can tell you that I get the best discounted rates possible. But whether it will beat whatever tricks with the balance sheet the banks may have at their disposal, that I can't promise. Don't forget that banks too don't have that much leeway. They can't lend you funds at a rate where they're losing money. And they won't care if your beacon is 600 or 800.

[M08006899]

Broker, ask your REALTOR(R) for recommendations. Ask for the 5-year quick close rate from Home Trust Accelerator (4.09 currently) or 4 year from First National, also 4.09. Avoid BNS like the plague.

[sslinn]

You can get the same without a quick close and better prepayment priviledges at a broker only lender right now.

[liorsyncro]

Broker, ask your REALTOR(R) for recommendations. Ask for the 5-year quick close rate from Home Trust Accelerator (4.09 currently) or 4 year from First National, also 4.09. Avoid BNS like the plague.
Hey hey now don't you guys work with BNS?:D

[M08006899]

Hey hey now don't you guys work with BNS?:DOnly for STEPs, for normal mortgages my entire office has bad experience with BNS underwriters and branches losing documents or claiming that they never received them (even though we have a fax confirmation, or an e-mail thanking us for submitting it :lol:). Usually First National/HTC/Bridgewater for most deals, have a few privates if needed, BNS for STEPs but thats it, although our BDM e-mailed me yesterday to let me know that we are below the 5 deals/$1mil requirement and need to reach it or BNS will stop accepting our files :(

Any interest in co-brokering on some deals?

[Wing Nut]

Independent brokers are hit or miss. Some only care about getting you signed up and matching you up to the lowest rate possible and collecting their vig, but others actually take the time to educate you about your options and holding your hand throughout the whole process. Same can apply to the banks' own mortgage specialists (outside of bank branches), but they generally are held to a higher standard and are a bit more consistent. Branch staff who offer mortgages (ie: financial service reps, financial advisors, etc) generally offer good and consistent advice but you usually don't get the lowest rate through them.

I have a couple of brokers to whom I refer clients. I know they're good and I follow up on each referral with the client and have had nothing but good comments back about the broker's service and advice. The brokers know that I do this and that the referrals will dry up if they don't service my clients well. It works perfectly.

[Losmir]

As for rates, I don't compete for them nor do I give a damn about them. There are two reasons: first, the rate is only a small part of the mortgage and the only thing no one can control. I can't control it, the lenders can't control it (rates are based on what's happening with the economy), and certainly the borrower can't name their price when borrowing someone else's money. Second, there's always going to be someone who claims they can offer a better rate even if it's off by only 10 bps. In fact, this is how a lot of brokers lure the clients. But I don't need this headache, because then they'll just go someplace else to get something even lower. I compete for service, advice, and actually providing the client with insight and products that I know I can control and do much better than your bank, and most of my business comes from referrals. The other small portion comes from advertising. The rates I can't control, so I'm not going to bother competing for them. There will very little if any deviation at all between one broker and another because they all work with virtually the same lenders. I can tell you that I get the best discounted rates possible. But whether it will beat whatever tricks with the balance sheet the banks may have at their disposal, that I can't promise. Don't forget that banks too don't have that much leeway. They can't lend you funds at a rate where they're losing money. And they won't care if your beacon is 600 or 800.

I beg to differ... for me, the rate is by far the single biggest factor. Prepayment terms are a distant second and as an educated consumer, a mortgage broker's advice and insight are meaningless to me. I'm not entirely sure what you mean for service... so long as they are competent enough to make sure the right paperwork is completed in a timely manner, what else is there?? Once the paperwork is signed, do you ever hear from the broker again (unless it is time for renewal)??

Now, I've never met you or dealt with you, so I can't comment on the "service and advice" you offer. If you really know what you are talking about and have the client's best interests at heart, then I can see that your offering could be quite useful to the uneducated masses. I can see you doing quite well. Good for you.

Unfortunately, my personal experience leads me to be much more cynical. I am quite certain that the brokers I dealt with were much more interested in products for their own benefit rather than mine. When I was inquiring about shorter terms, they were less than enthused. And I got the impression that I knew more about their products than they did. At the end of the day, everyone is looking out for themselves first. There is nothing wrong with that, except there are many industries that obscure that fact by trying to pretend that they looking out for the client's best interest when they really are not.

So, for me, 10 bps gives me a real quantifiable benefit to the bottom line. I'm not looking for advice or for friendship, just the best deal which, for all intents and purposes, equals the best rate.