Clay Jarvis
Beth Buczynski
There’s a certain amount of pride that comes from eschewing outside advice and handling your own mortgage needs. But when mortgage rates are high and you feel trapped by your lender’s renewal offer, you might require the services of a mortgage broker to find the best option.
Mortgage brokers aren’t the first choice for most Canadian home buyers. A Mortgage Professionals Canada survey from June found that just 34% of Canadians reported using a mortgage broker to line up their most recent mortgage.
There are plenty of legitimate reasons not to work with a broker — loyalty to your bank, a fear of the unfamiliar, a desire to DIY. And if you’ve never needed a broker to find a mortgage, you might wonder why you’d use one for your renewal.
Fair enough. But renewing your mortgage in the next 12-18 months could be more complex or expensive than in past years. You owe it to yourself to weigh all of your options ahead of time, including whether it might be time to tag in a broker.
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Mortgage broker pro: Variety
One thing a mortgage broker can do that a bank’s mortgage advisor can’t is provide you with rate options from different lenders, including credit unions, B-lenders and alternative lenders.
When hunting the lowest rate, comparison shopping is a must, and an experienced broker may have access to more rates than you’re able to find on your own.
Many alternative lenders, for example, don’t deal directly with borrowers, so if mainstream lenders aren’t willing to renew your mortgage, you might need a broker to suss out some alternative offers.
A mortgage broker with multiple lenders to turn to can be a powerful ally when it’s time to negotiate your renewal rate. And if they work for a large brokerage that sends a steady stream of business to a particular lender, that lender might be more willing to ease up on the rate you’re offered.
Mortgage broker con: May not deal with your bank
A large brokerage might deal with dozens of lenders, but your bank might not be one of them.
Currently, only three of Canada’s six largest banks deal with mortgage brokers: BMO, Scotiabank and TD. If your mortgage is with RBC or CIBC, and you intend to stick with them for the next phase of your mortgage, you’ll have to work out the details of your renewal with one of your bank’s mortgage advisors.
That’s not the end of the world. You can always negotiate your renewal rate on your own. You can also call a broker to get their opinion on the renewal terms you’ve been offered.
Mortgage broker pro: Analysis and expertise
If you’re an inexperienced mortgage shopper, or find the process of comparing mortgage products unappealing, turning the comparison stage of your mortgage journey over to a broker might be in your best interest.
For many Canadians, the most important part of getting a mortgage is the rate. Among mortgage consumers who conducted at least one fact-finding online search prior to their most recent mortgage transaction, 58% of them searched for interest rates, according to a 2024 report from the Canada Mortgage and Housing Corporation. Loan terms (22%), loan types (16%) and mortgage closing costs (15%) weren’t nearly as front-of-mind for survey respondents.
But those lesser-searched aspects can be critically important. An attractively-priced mortgage might still come with restrictive prepayment policies or fees you may not anticipate.
A good broker will compare more than just the rate for you, and will ideally find the mortgage product that fits your budget, lifestyle and future financial plans.
That’s not a puzzle everyone can piece together on their own.
Mortgage broker con: What if you get a lousy one?
Fear of the unknown — or disaster — can be a powerful demotivator where mortgage brokers are concerned.
There are thousands of brokers and mortgage agents operating in Canada, and they aren’t all superstars. Maybe you’ve read stories of unethical brokers having their licenses revoked or being arrested for fraud. In 2024, the Financial Services Regulatory Authority of Ontario revoked the licenses of 29 mortgage brokerages for lack of compliance.
There’s also the risk of aligning yourself with someone inexperienced or flat-out incompetent. (This can happen at a bank, too.) Working with a broker for the first time can be a little nerve-wracking — unless you find a good one.
Here are three simple ways to find a capable mortgage broker:
- Ask around. Consult your friends, family and co-workers to see if they have any broker recommendations.
- Request the best. Call a brokerage and ask to be put through to its most experienced broker — or the broker that does the most referral business.
- Count the lenders. Some broker/brokerage websites mention how many lenders they deal with. A higher number is generally more beneficial. You can also call to find out how many lenders a particular broker has relationships with.
The benefits of working with a broker on your renewal — personalized service, competitive rates, ample choice — are considerable. Doing a little legwork should allow you to find one you can trust.
About the Author
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