How Do Mortgage Brokers Get Paid in Canada?

In most cases, mortgage brokers in Canada receive a finder’s fee or commission from the lender who ends up funding your mortgage. This means you, the client, don’t typically pay anything out of pocket for our services.

Here’s how it works in plain English:

1. You come to me because you want a mortgage, and you don’t feel like rate shopping across 60 lenders on your own (which is totally understandable).

2. I gather your info and determine which lender and product best suits your situation, goals, and budget.

3. I submit your application to that lender, handling the communication, conditions, back-and-forth, and ensuring it closes smoothly.

4. The mortgage closes, and the lender pays me a commission based on the size and type of your mortgage.

   
   

That’s it—simple and straightforward.

What’s the Commission Based On?

The commission amount depends on a percentage of your mortgage amount. Every lender pays slightly differently, but here’s a ballpark idea:

• Let’s say your mortgage is $500,000.

• A typical broker commission might range from 0.8% to 1.1% of that amount (which varies by lender and mortgage type).

• Therefore, I could earn anywhere from $4,000 to $5,500 from the lender after everything is signed, sealed, and funded.

  
  

Keep in mind that’s before taxes and shared with my brokerage (yes, we split the pie). Additionally, brokers get paid only once the deal is fully closed. If your deal falls apart at the last minute, I don’t get compensated for the hours (sometimes weeks) of effort put in.

What About Renewals or Refinances?

Good question! Here’s how it usually breaks down:

Renewals

If you’re renewing with your current lender and not switching or negotiating through a broker, I don’t get paid. However, if you come to me for a better deal, the payment structure remains the same!

Refinances

Of course! We also receive payment for refinances. As long as the mortgage funds through a lender, we’re compensated for our work.

Are There Any Situations Where You’d Pay Me Directly?

There can be. It's rare, but there are a few situations where clients might need to pay a broker fee:

• If your credit is bruised and needs private or alternative lending.

• When you need something highly customized that requires going to a private lender (who doesn’t pay brokers directly).

  
  

In those cases, I’m upfront about any fees from the start. I will clearly explain the reasons, amounts, and what they cover—ensuring no surprises or sketchiness involved. You’ll always know what’s what.

Why Do Lenders Pay Us?

Consider mortgage brokers as a lender’s sales team—except we are not exclusive to one brand. Instead of hiring thousands of in-house mortgage representatives, lenders rely on us to bring them qualified, well-packaged mortgage clients. In return, they pay us for doing the legwork.

It’s actually a win-win-win:

• You get options and expert guidance without any extra costs.

• We get paid for our time and expertise.

• The lender receives a ready-to-go deal with minimal hassle.

  
  

So, What’s the Catch?

There isn’t one—seriously. You’re not paying me more simply because the lender pays me. It doesn’t increase your interest rate either. My role is not to “sell” you on a specific lender; it’s about finding what works best for you.

I have access to dozens of lenders, including banks, credit unions, and monoline lenders (which you may have never heard of, but they often have great rates).

Final Thoughts: How Mortgage Brokers Get Paid in Canada

If you’ve made it this far, congrats—you now know how mortgage brokers get paid in Canada, and why working with one is a smart choice.

We work hard, advocate for your interests, and rarely charge a fee. If we do need to charge a broker fee, I will guide you through it upfront, so you’re never caught off guard.

Feel free to reach out anytime with questions. This is my passion, and I genuinely love helping people find the right mortgage with minimal stress.

Why Choose a Mortgage Broker?

Choosing a mortgage broker can offer you several advantages. Here are some key reasons:

Access to Multiple Lenders

Mortgage brokers work with various lenders, giving you access to a broader array of mortgage products and rates. This means you can find a deal that best suits your financial situation.

Expert Advice

Our expertise means we can guide you through the complex mortgage process. We help you understand your options and ensure you make informed decisions.

Time-Saving

Rate shopping can be time-consuming and overwhelming. A mortgage broker saves you that hassle, allowing you to focus on other important matters.

In conclusion, working with a mortgage broker can enhance your home-buying experience, providing you with options and peace of mind throughout the process.

Still have questions? Don’t hesitate to reach out. Remember, I’m here to help!

Let's Chat!

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