Mortgage Brokers vs. Banks: Which Is Right for You?

When it comes to getting a mortgage in Canada, one of the first big decisions you’ll need to make is who to work with: a mortgage broker or a bank. Both can help you get the financing you need, but the experience, flexibility, and cost savings can vary depending on which route you take.
This guide breaks down the difference between mortgage brokers and banks, so you can decide which one aligns better with your situation.

What’s the Difference Between a Bank and a Mortgage Broker?

Banks are direct lenders. They offer mortgage products from their own institution only. If you’re already a customer, it may feel convenient to just go with what your bank offers—but that means you’re limited to their rates and terms.
Mortgage brokers, on the other hand, are licensed professionals who shop around on your behalf. They have access to dozens of lenders—including banks, credit unions, and alternative lenders. Their goal is to find the best deal and fit based on your financial profile.

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Banks: The Familiar Choice

Working with a bank might appeal to you if you already have accounts, investments, or credit cards with them. It’s a one-stop shop, and you may even get loyalty perks or rate discounts.
But banks aren’t always the best at negotiating or offering personalized advice—especially if your financial profile isn’t perfect. Mortgage specialists at banks are also usually salaried employees who can only offer their employer’s products.

Pros:

• Easy access if you already bank there
• Trust and brand familiarity
• Bundle discounts on other products (like chequing or credit cards)

Cons:

• Limited to one set of products
• Stricter qualification rules
• Less flexibility on rate negotiation
• Typically register mortgages as collateral charge (harder to switch lenders)

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Mortgage Brokers: Expanding Your Options

Mortgage brokers work with a variety of lenders, including big banks, monoline lenders, private lenders, and credit unions. Their job is to match you with the best mortgage solution—not just the one a single bank can offer.
This can be especially helpful if you’re self-employed, have a lower credit score, or want to compare rates and features across lenders.

Pros:

• Brokers are mortgage specialists
• Access to dozens of lenders
• Often better rates and more flexible terms
• Free service in most cases (lenders pay their commission)

Cons:

• Some brokers charge fees for complex or non-prime mortgages
• Quality of service varies depending on the broker
• Not all lenders work with every broker

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Which Option Is Right for You?

It really comes down to your preferences, financial situation, and how much effort you want to put into shopping around.

Choose a Bank if:

• You value an all-in-one experience
• You have strong banking history and credit
• You’re happy with your bank’s current offer and don’t want to shop around

Choose a Broker if:

• You want to compare multiple lenders
• You’re self-employed, new to Canada, or have unique needs
• You want a lower rate or more flexible options

“Whichever path you choose, be aware of misleading rate expectations and how they affect timing your purchase.”

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Frequently Asked Questions

Is it cheaper to go with a mortgage broker than a bank?
In many cases, yes. Brokers often secure better rates because they work with multiple lenders and do high volumes of business. For most prime mortgages, their service is free to you.
Do brokers only work with private lenders?
No—brokers have access to major Canadian banks as well as alternative and private lenders. They help you compare all your options.
Can I negotiate with my bank for a better mortgage rate?
Yes, but it can be tricky. Banks don’t always offer their lowest rates upfront, and they may not match a rate from another lender unless you push for it.

“If you’re unsure which to choose, it’s also smart to ask how compensation models differ between brokers and banks.”

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Final Thoughts

Banks offer convenience and familiarity, while Brokers offer choice and flexibility. There’s no right or wrong answer—it depends on your personal situation.
If you want to explore all your options, especially in today’s rate-sensitive market, working with a mortgage broker could give you a big edge. And if you’re loyal to your bank and value simplicity, they might be just fine too.
🏦 Yet Not Sure if a Broker or Bank is Better for You?
Mortgage brokers can shop multiple lenders — while banks offer direct service with fewer choices. Not sure what’s best for your situation? Talk to a licensed advisor who can help you compare both paths side by side. Get Matched With the Right Mortgage Option