Frequently Asked Questions


1) What do you mean, "Shop" for my mortgage?
What does a mortgage broker do that is any different than what a bank loans officer does?
    
1) A professional mortgage broker maintains a constant awareness of the mortgage marketplace, including the rates, terms and conditions available from lenders in the marketplace.
  • We commit to you to obtain the best mortgage terms, rates and conditions available given your specific circumstances.
  • Furthermore, we will seek lenders who will best serve your needs over the expected life of your mortgage with them, with attention to all aspects of the relationship, including costs, fees and restrictions.
2) Some brokers charge fees, some don't, do you?
Brokers make our living by providing services to our clients - how fees are determined, and how is it decided as to who should pay and who won't have to pay?
    
2) Some brokers state that they don't charge the borrower anything, and that's true, as far as it goes.
  • However, in circumstances where we don't charge a borrower directly for arranging your mortgage, we are paid by the lender in the form of a fee, commission or bonus, or a combination of the above.
  • With some types of mortgage loans the fees are charged directly to the borrower, most often when there are no fees being paid by the lenders, as in the case of most private mortgages and in the case of most commercial and/or development loans.
  • Fees are charged on the basis of competitive market conditions and reflect generally the difficulty in arranging mortgages of certain types. Fees for mortgages range from a low of .5% and up to 12% of the funded amount of the loan, called the principal. Your mortgage commitment will ALWAYS detail any fees or charges to be paid at the close, and you always have the right to decline an offered mortgage if you are not willing to pay the requested fees or expenses.
3) What is an "Accredited Mortgage Broker?"
How does the industry establish credentials, and what are the professional standards to be expected?
    
3) Sets a single national proficiency standard for mortgage professionals.
  • Was introduced by the Canadian Association of Accredited Mortgage Professionals (CAAMP) to enhance the level of professionalism in the mortgage industry.
  • Demonstrates commitment to ongoing education and ethical behaviour providing added value to borrowers and other professionals engaged in the mortgage industry
  • For you, this means access to the dedicated services of a professional who is focused on meeting your needs.
There are also provincially based organizations in many jurisdiction and some mortgage brokers are member of the their provincial organization in addition to or instead of the Canadian Association of Accredited Mortgage Professionals (CAAMP)

4) What is a "Conflict of Interest" and how does it apply in the mortgage application process?
How does a borrower (or a lender) know that a broker has (or does not have) a conflict of interest in a particular transaction?
    
4) Conflicts of Interest occur frequently in transactions between various parties doing business where-ever there is an imbalance of power between the parties, such as a mortgage broker who is possession of knowledge and expertise not enjoyed by a client.
  • If a broker has an interest in a transaction of any kind, including being paid by one party, it is his/her duty to fully disclose that confict of interest, in writing, to the party potentially harmed by the conflict of interest.
  • Most jurisdictions have regulations that spell out the specific forms or documents required in the presence of a conflict of interest, and have regulations that establish a broker's duty of disclose, both full and true disclosure.
  • CAAMP has national standard of conflict disclosure, and goes further than simply regulating potential conflicts of interest, and encourages its members to actively avoid conflicts of interest when ever possible.