Posted onNovember 13/2015
If you’re looking for a mortgage you may not know if you should work with a broker or a loan officer. There are many differences between the two professionals, and before you commit to either, you should understand what each one does.
What is a mortgage broker?
A mortgage broker is a trained mortgage professional who represents your best interests to the lender. When you work with a broker, they work to ensure you get the perfect mortgage package to suit your needs.
Mortgage brokers will get you the best rates and terms because they work with various lenders and are not tied down to one lending institution. Brokers are licensed and regulated by the province they operate in. They are paid by the lenders only when the mortgage closes, which means they will work hard to make sure you get what you need. They also often adapt to your schedule and are available whenever you need to meet with them. Mortgage brokers understand that you have a full-time job and can’t always sneak away from your desk to discuss a home purchase or mortgage renewal.
Additionally, brokers can help self-employed people get mortgages easily which may prove challenging for a loan officer.
What is a loan officer?
Unlike mortgage brokers, loan officers work for one lending institution and can only offer the products from that company. Generally, loan officers work for big banks and do not have your best interest in mind. They are trying to do what will make their employer the most money instead of trying to get you a great mortgage package.
Loan officers do not need special licenses to operate and there are little to no regulations for this profession. They do, however, need to follow the same mortgage stipulations as brokers and can’t invent products to make their employer money. If you have a tight schedule, loan officers cannot meet you on your own time and must operate within their bank or lending institution’s hours.
Who should you work with?
Many Canadian homebuyers are unaware of all the necessary steps involved with purchasing a home. Brokers are better suited for the home buying and financing industry because they are regulated, understand every little detail about mortgages, and actually have your best interests in mind. Although a loan officer may seem like they are trying to get you a good deal, they can only offer what their employer wants. Mortgage brokers work with everyone from big banks to credit unions to shop for the best deal for you. This is not to say that loan officers are unprofessional, but in the end, it’s your mortgage and a broker knows mortgages better than anyone.