By : Radu Arvatescu
Working with a mortgage broker is one of the fastest, most efficient, and affordable ways to secure commercial finance. A broker will work on your behalf to find competitive rates with lenders that you might not have access to on the public market. Your finance package will be customized for your needs, giving you more favourable terms when compared to going through a large lender.
Of course, to enjoy all the benefits, you will need to sign a commercial mortgage broker fee agreement.
Some buyers can have hesitation at this point. After all, a mortgage hasn’t yet been secured, so why is money already in the conversation?
In the following sections, we’ll explore what a mortgage broker fee agreement includes, what its purpose is, and why you need one.
Why Are Commercial Mortgage Broker Fee Agreements Needed?
An agreement signed between you and a broker offers protection for both parties. It covers details surrounding the financing, the compensation that will be given to the broker at closing, and any fees that will be paid to the lender.
From the brokers’ side, the agreement offers an essential non-circumvention clause that prevents you from bypassing the broker and going directly to a lender once an offer is made.
Mortgage experts like brokers can spend countless hours, and sometimes weeks on securing a commercial mortgage. When you work with a broker, they become your representative in the application process. They will actively seek the most competitive mortgage offers with the best rates and terms. If you are looking for an unconventional mortgage or don’t have the strongest credit line, then a broker can find options that wouldn’t otherwise be available to you.
Considering that a broker doesn’t get paid until a mortgage is closed, they need protection and security. Quite simply, an agreement ensures that a broker can do their job without the overhead of worrying about borrowers pulling out of the working relationship.
Do You Benefit from a Commercial Mortgage Broker Fee Agreement?
You might feel that the benefit of an agreement is heavily weighted towards the broker. In reality, you will gain significant benefits too.
If you were to work with a lending professional without a commercial mortgage broker fee agreement, would you have confidence that they were working in your best interests? If a mortgage expert didn’t have protection, what incentive would they have to find you a mortgage that works?
The security goes both ways.
- With an agreement in place, a mortgage expert won’t hesitate to network with their extensive group of lenders to find you the best loan.
- If the mortgage expert had no guarantee that a fee would be paid, they might be less inclined to go above and beyond on your application. This could result in missed opportunities.
- The agreement ensures transparency. You will know exactly how much the broker is owed at the end of the process.
Generally, if a broker is willing to work without a commercial mortgage broker fee agreement, they likely aren’t the best choice. This illustrates a type of fiscal irresponsibility that could compromise the process. It may also indicate that the lender will give less hands-on time to your application.
Choosing to work with a mortgage expert is a big decision, but it’s one that can ultimately pay off. Lower rates, a smoother application process, and access to more choices are all significant benefits.
A broker fee agreement is a necessity for both parties. It can inspire confidence on your side while ensuring that the broker will not hesitate to work for the best outcome.
Lowest Residential Mortgage Rates in Canada*
|Term||OUR RATE||TD Bank Rate|
|3 Year Fixed/ 25 yrs||5.89%Promo||6.53%|
|4 Year Fixed/25 yrs||5.54% Promo||6.32%|
|5 Year Fixed/ 25 yrs||5.39% Promo||5.81%|
|5 Year Variable/ 25 yrs||6.20% Promo||7.15%|
|5 Year Fixed/ 30 yrs||5.99% Promo||6.39%|
|5 Year Variable/30 yr||6.80%||7.25%|
|3 Year Fixed/30yr||6.64% Promo||6.81%|
|**NEW RENTAL 5 Year Fixed /30yr||6.44% Promo||6.44%|
|** NEW RENTAL 3 Year Fixed /30yr||6.68% Promo||6.68%|
Updated: DEC 05 , 2023
* Current promotion rates may provide an additional 0.05% discount or may be anytime discontinued at the Lender discretion.Some condition may apply.Rates may vary between geographic regions and the posted rates on this website may not be available in your area.TD Bank rate used for comparable are the rate listed in the Broker Chanel Portal by TD Canada Bank at the date above. Please contact our MCI office for more details and current promotions.
LOWEST REGULAR RATES IN CANADA* * Current promotion rates may provide an additional 0.10% discount. Rates may vary between geographic regions and the posted rates on this website may not be available in your area. Please contact our MCI office for more details and current promotions.