When Do Mortgage Brokers Charge?

The short answer is: it depends.

When a mortgage broker places your mortgage with an institutional lender (a bank), they usually get a finder’s fee. It’s a fee that the mortgage broker receives for administering the mortgage and bringing the business to them. Most mortgage brokers will not charge a brokerage fee on top of that because they are already getting paid. It’s like double dipping. Some brokers double dip.

Some mortgages are more difficult to place due to bad credit or low income, for example. On these files, the mortgage broker may get paid less by the bank or not at all. In such cases, the broker will often charge a brokerage fee to compensate them for their time.

The good news is that the broker MUST disclose all fees on a cost of borrowing disclosure form. They are mandated by law to do so. Thus, it is very important to check this document carefully. There can be no “fine print”. The charges and amounts are itemized on the form.

Sean Howard is a Mortgage Broker. His office is located at 651 Fennell Avenue East in Hamilton, Ontario. If you would like to speak with Sean, he can be reached at 905-574-9200 #216. Alternatively, you can contact Sean here.

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