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Taking a Home Equity Loan in Burlington? – Bank vs. Mortgage Broker

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So, now that you’ve decided to take out a home equity loan in Burlington or other nearby township; you’ll need to make an appointment with a secured loan professional; will it be a mortgage broker or a bank lender?
While both are viable alternatives, each has specific benefits that will favour what’s most important to you. Here’s an overview that will help you choose the best mortgage professional for your unique needs.

Benefits of a Mortgage broker

According to the Canadian Association of Accredited Mortgage Professionals (CAAMP), mortgage brokers represent about 40% of all total mortgage originations in Canada, and that trend is continuing upward.
For your home equity loan or home equity line of credit (HELOC) refinancing needs, you’ll want to consider an independent mortgage professional before going straight to your local bank; because a broker provides you a number of invaluable services (in most cases) for free.
Most home owners appreciate that a mortgage broker will shop the mortgage interest rate market for them, assuring diligence that they just wouldn’t have time to complete on their own. The broker’s function is to provide an auction type marketplace, where lenders vie for your business and bid at their lowest interest rate possible; for the second mortgage or loan term you’re considering.
This pseudo marketplace, will include chartered banks, smaller tier-2 lenders, and if required private lenders. Often times, a mortgage broker will secure your first mortgage, second mortgage, home equity loan, or home equity line of credit at rates below what you would have received on your own; because of the negotiating leverage their accumulated business provides.
Unless you have ‘top shelf’ credit, you’ll likely want an independent mortgage professional scouring the market to find the best combination of approval level, low rate, and strength of the institution. Because they deal with many institutions, their experience in matching your unique situation, with the appropriate lender, is well worth consideration on its own.

Benefits of Using a Bank Lender

Your neighbourhood bank can provide you with a secure option for your mortgage or home equity financing needs, as long as your credit meets their standards. Banks provide you with the same lending packages that your independent mortgage professional negotiates, however you may also receive preferential savings, investment and deposit perks if you have other services at the same institution. Be sure to use this pooled negotiation leverage if you decide to take this direct financing route.
While bankers used to have set hours, most will now equal the flexibility of an independent professional; meeting around your schedule and location if necessary.
The banks have become more competitive with the rise of the independent market, sometimes covering your appraisal fees or some of the closing costs to complete the deal.

Follow Your Instincts

Regardless of which option you choose, remember the funds for your loan are coming primarily from the same place; deposits and investments made by people just like you. A financial institution, not a mortgage broker, will provide and service your loan, and collect payments after the closing.
Weigh your options carefully, and remember to follow your instincts; you’ll likely be dealing with the person and the facilitating company for many years to follow for your home equity loan in Burlington.


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