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The Difference Between a Banker and a Broker

Tue, 26 Feb by Pauline Relkey
A mortgage banker works for a bank or similar lending institution which actually provides you the money for the mortgage. A mortgage broker works with many lending institutions to shop for a loan for a specific individual. The broker is a middleman between you and the lender.

The difference between a banker and a broker comes down to the products each can offer and where their allegiances lie.

While using a mortgage broker seems like it would save you money because they have access to many lenders and programs, brokers are paid commissions by the mortgage company and some lenders pay more than others or offer perks. When working with a Bank, that loan officer only has access to their own mortgage  programs and mortgage rates. A banker is paid by the bank, to make the bank money, by selling you services, while a mortgage broker is paid by the lender they choose for your mortgage provider.

Either way has its pros and cons.

Both have access to various mortgages. The broker might have more companies to work with, but banks and credit unions are becoming more flexible with their products in order to compete.  You still need to shop around. Word of mouth from a trusted friend or family or from your realtor is a good way to start. Friends and family do mean well, but as a Realtor I can tell you that I have come into contact with many bankers and mortgage brokers over the last 28 years and always try to find you the best match.

You will likely have to meet with either a mortgage banker or mortgage broker, as they need some basic info about you and your income and expenses.  You typically don’t pay either for their research or time. When you choose your mortgage and get it in place, either will then be paid.

You will still negotiate on terms and rates with either.

Renewal Time?

If you have a mortgage up for renewal, or you would like to refinance, it is always in your best interest to check around with a mortgage broker and/or with the lender who currently holds your mortgage. Just because they were the best option previously, that doesn’t mean they will be the best option in the future.

If you or someone you know is considering a new mortgage or renewal, let’s connect to get you the best mortgage options available!

Know What You Sell

Wed, 21 Jan by Pauline Relkey

what you need to know

Once in awhile I get a newer agent asking me questions about selling properties that they have no expertise in selling.

One example on the sale of an acreage – “What do I need to have for a water test? What is a septic tank and why do I need to have it inspected?”

Other questions that can come up:

“I have a buyer who wants to rent a church in the area that does not have the designated zoning. “What do I have to do to get the zoning changed?” and, “Why does it take so long?”

These are a few of the questions that I have come across from other agents. I have no issues with agents asking these questions, but am mystified as to why agents would venture into areas of real estate that they have no experience in. Our provincial watchdog states that we should exercise “duty of care” and that if we have no experience in that field of endeavour, we should stay away from it.

What usually happens is the agent confronts other agents or their manager with the issues AFTER the fact. And that’s where the problems start.

Looking at provincial stats on real estate fines and penalties, I see a few cases like this.

I recommend that, in addition to the regular courses that are required in most provinces, agents should consider investing time and money learning about these specialized fields. Alternatively, agents should seek a mentor to assist in real estate activities that are beyond his/her normal area of experience.

The result of testing the waters in areas other than regular residential real estate can be financially burdensome.  Just check out some of the fines and penalties that provincial authorities have charged. Errors and omissions insurance will only cover the agent so far and in most cases will not cover the agent or the brokerage in cases like this.

I have always been an advocate for learning and furthering our education. The most expensive lessons come when you practice real estate in areas beyond your current knowledge.

All one has to do is look at the stats and determine not to become one of those who has earned fines and penalties.

So if an agent does not know something, they need to ask and/or refer to someone who does know.

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