What does a mortgage broker cost?

It is the first question everyone asks, and it deserves a straight answer.

On the large majority of standard residential files, the lender pays the broker’s commission when the mortgage closes. You pay nothing extra for my services, and the rate you are offered is not marked up to cover it.

When fees can apply

There are situations where the client is charged a fee. That is the case for files that do not qualify with traditional lenders and must be placed with an alternative or private lender: income that is hard to document, credit being rebuilt, an unusual property, a very tight closing date.

In every case, if there is a fee, you have it in writing before you commit to anything. No surprises at signing, no amount appearing at the notary. That is a regulatory requirement, and it is also how I work.

What actually costs money

It is almost never the fees. It is the clause nobody read.

A prepayment penalty you did not understand. Breaking a fixed term can cost several thousand dollars depending on how your lender calculates it. Two lenders at the same rate can have very different penalties.

A renewal signed without shopping. The first rate your institution offers at renewal is not always the best it can do, and rarely the best on the market.

A mortgage that is not portable. If you move before the end of your term, not being able to transfer your loan can cost you a full penalty.