Short answer
A mortgage agent is licensed to arrange mortgages on your behalf with many lenders rather than one. In most standard residential deals the lender pays the agent, so the service costs you nothing. In Ontario, agents are licensed and regulated by FSRA.
What the job actually involves
Working out what you can borrow and on what terms. Choosing which lender fits your situation. Packaging and submitting the application. Then managing it through approval, appraisal, lawyer and funding.
The part that matters most is the second one. A bank has one set of rules. An agent knows which of dozens of lenders will look kindly at a self-employed borrower, a bruised credit file, or a rural property with a well and septic.
Level 1 and Level 2 in Ontario
Ontario licenses mortgage agents at two levels. A Level 1 agent can deal with lenders other than private lenders and works under a licensed brokerage. Level 2 adds private lending. Brokers hold a further licence again. All of it is administered by FSRA and every licence is publicly searchable.
How they get paid
On a standard residential mortgage the lender pays a commission on funding. You pay nothing directly. Exceptions are private lending and some credit-challenged files, where a fee may apply, and it should be disclosed before you go any further.
Agent or bank
Your bank can offer its own products. An agent can put your file in front of banks, credit unions, monoline lenders and alternative lenders. Where an agent earns their keep is on anything unusual: self-employment, thin credit, a high debt load, a cottage or acreage, or a file a bank has already declined.
Where the bank can win is on a long relationship with real negotiating leverage, or at renewal when staying put avoids re-qualifying under the stress test.
How to check someone is licensed
Every Ontario licence number can be looked up on FSRA’s public register. Mine is M25003153, with Dominion Lending Centres YBM Group, brokerage licence 11129.
If you are weighing up who to work with, would a short conversation help you decide?
General education, not financial advice. Figures are illustrative and subject to lender approval (O.A.C.). Lora Fenn, Mortgage Agent Level 1, Lic. #M25003153. Dominion Lending Centres YBM Group, FSRA #11129. 705-881-2780 · lfenn@dominionlending.ca
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