Edmonton Mortgage Broker

For many Canadians buying property is made possible by taking out a mortgage. Often first-time home buyers neglect shopping around for home mortgages and settle for the first lender they work with. It shouldn’t be the case. 

It’s important to enlist the help of different mortgage professionals to understand your options. Luckily there are many mortgage professionals in Edmonton to help find the best mortgage. 

You could work with a loan officer or ask friends to refer you to a trusted Edmonton mortgage broker. While the two professionals help you secure the best deal, knowing their differences is necessary.

Who is a Mortgage Broker?

A mortgage broker is an intermediary between the lender and the borrower. They work with different financial institutions and offer options from credit unions, banks, and mortgage lenders.

A mortgage broker will do the legwork on your behalf, making it easy to find the best mortgage product for your budget, needs, and situation. The professional also collects the paperwork the lender requires for approval and underwriting.

This way, the borrower saves the time and effort required for the application process. In addition, some lenders work exclusively with mortgage brokers, which allows you to access loans that would never be available. 

Who is a Loan Officer?

A loan officer is a professional who works for a bank, credit union, or other financial institution that lends money to borrowers to purchase homes or refinance mortgages. Their primary role is to explain the options available from the lender and guide the borrower through the mortgage application process.

A loan officer is conversant with the lender’s loan products, required documents for the mortgage application, and the banking rules and regulations. 

As such, they can offer different types of mortgages available at the financial institution, interest rates, and origination fees on particular loan products.

Once the borrower agrees to take out a particular mortgage, the loan officer helps prepare the application. They provide the documentation for the underwriting process, mortgage approval, and credit risk assessment. Once the loan is approved, the professional prepares the documents for loan closing.

Difference Between a Mortgage Broker and a Loan Officer

The two professionals perform similar tasks, but there are notable differences:

Loan Options

The primary difference between a mortgage broker and a loan officer is the loan options each offers. An Edmonton mortgage broker offers loan products from different lenders, while the loan officer offers products from one lender. 

That’s because a mortgage broker has developed relationships with different lenders, making it easy to access different products. This vast repertoire of loan products gives you many options to choose from.

Special Training

Mortgage products for homes are different from regular lines of credit. The requirement to provide collateral makes this loan type even more complex. This means professionals handling home mortgages must have the expertise to handle real estate complexities.

In addition to expertise, Canada requires mortgage brokers to obtain a license from the Real Estate Council to practice in their respective provinces. 

However, loan officers don’t need special training or licensing to handle mortgages. They only need to possess comprehensive knowledge of the lender’s mortgage types and the requirements for applications.

Who Should I Work With?

The decision to work with a mortgage broker or a loan officer is largely a matter of personal preference. However, if you’re a first-time home buyer, working with an Edmonton mortgage broker is best. 

Comparing loan products from various lenders allows you to choose one that meets your needs and budget. Other applicants who might consider working with an Edmonton mortgage broker include:

• Self-employed individuals
• Unsalaried individuals with a credit score of 700+ and a low debt-to-income ratio
• Retired individuals relying on assets instead of income to qualify for a mortgage

On the other hand, a loan officer is most beneficial when refinancing a loan with the same lender. They help you collect loan estimates for the same loan product and term, compare the interest rates and fees and determine the most affordable option.