Is it worth hiring a mortgage broker?

A mortgage broker acts as an intermediary between you and various lenders, offering not their own products, but access to a wide range of mortgage options from different financial institutions. Unlike banks, which can only offer their own mortgage products, brokers in Calgary have access to over 50 different lenders, including:

  • large banks,
  • credit unions,
  • private lenders,
  • alternative financial institutions.

Statistics show the growing popularity of brokerage services among Canadians.

According to CMHC, the share of mortgages arranged through brokers increased from 43% in 2023 to 48% in 2024. This indicates that more and more homebuyers understand the advantages of working with professional intermediaries instead of going directly to banks.

In Calgary, brokers are particularly valuable due to the specific nature of the local real estate market and economy.

The city's economy, which is heavily dependent on the energy sector, creates unique challenges for assessing creditworthiness that local brokers are more familiar with than representatives of large banks. This knowledge of local conditions can be a decisive factor in obtaining mortgage approval.

Key benefits of working with a mortgage broker in Calgary

Access to more lenders

The biggest advantage of working with a broker is access to a wide range of loan products. When you go directly to a bank, you are only offered their own products on their terms.

A broker can compare offers from dozens of lenders at once.

Mortgages for Less, one of Calgary's leading brokers, has partnerships with a wide range of lenders, from large banks to private institutions. This means that clients can access:

  • a variety of mortgage products,
  • competitive rates,
  • more flexible terms.

This allows you to choose the best option for your specific financial situation.

Example: In unusual situations (self-employment, problematic credit history, unusual sources of income), brokers have access to specialized lenders who may consider such applications, whereas traditional banks may decline.

Potentially better interest rates

Brokers can often secure better interest rates thanks to their volume agreements with lenders. Lenders are willing to offer discounts to brokers who bring in large volumes of business, and brokers, in turn, pass these savings on to their clients.

The Mark Herman Team, one of Calgary's top brokers, claims that their clients get lower rates than they could get directly from their bank.

With 28 years of combined experience and a ranking among the top 10 brokers out of over 1,800 agents at Canada's largest brokerage, they have significant negotiating power with lenders.

Financial impact: Even a small difference in interest rate can result in thousands of dollars in savings over the life of a mortgage.

For example, a 0.25% difference on a $500,000 mortgage can save you about $13,000 over a 25-year term.

Personalized service and expertise

Brokers offer a personalized approach that differs from standardized service at banks.

They take the time to understand your specific needs, goals, and financial circumstances, offering customized solutions.

The Mortgage Group Calgary emphasizes its commitment to providing the best home buying experience. They understand that buying a home is the biggest purchase you will ever make, so the team supports clients through every step of the process.

The brokers also have extensive knowledge of the Calgary market. They are familiar with:

  • price trends,
  • property values,
  • mortgage lending specific to the region.

This may include understanding the impact of the energy sector on the city's economy and how this affects lenders' decisions.

Time savings and convenience

Finding a mortgage can be a laborious process, especially when trying to compare different lenders. Brokers do this work for you by:

  • gathering quotes,
  • comparing options,
  • handling paperwork.

Mortgage Design Group emphasizes its flexibility and availability outside of traditional banking hours. This makes the process more convenient for busy professionals who are unable to visit banks during the workday.

Brokers also have experience navigating complex situations and can anticipate potential problems before they arise. This saves time and reduces stress in the long run.

Financial aspects of working with a broker

Payment structure and costs

One of the most attractive features of working with a mortgage broker is that for most clients, the services are free. Brokers receive a commission from the lender after the mortgage is closed, not from the client.

A typical broker commission is 0.5% to 1.25% of the total mortgage amount. For example, on a $500,000 mortgage, a broker might earn $2,500–6,250 from the lender.

This commission is not added to the cost of your mortgage — it is paid by the lender as a fee for finding a qualified borrower.

The Calgary Mortgage FAQ from Mortgage Momentum confirms that most people will not pay for the services of a mortgage broker. Clients only pay in the following cases:

  • private mortgages;
  • commercial lending, where commissions may not be paid automatically.

Exceptions and additional fees

In some situations, brokers may charge fees directly to clients. This usually happens when working with B-lenders (alternative lenders) or private lenders, where commission rates are lower or non-existent.

According to a Reddit discussion among mortgage professionals, the typical fee is at least $2,500 or 1% of the mortgage amount. However, this is always disclosed upfront, and clients can decide whether it is worth it.

Important: Even when fees are charged, the overall savings from better rates and more favorable terms often outweigh these costs.

Comparison with going directly to banks

Advantages of banks

Banks have their advantages, especially for customers with long-term relationships. If you have worked with a particular bank for many years, you can:

  • get better terms or rates thanks to your history of cooperation;
  • take advantage of package discounts on additional financial products: credit cards, personal loans, investment services;
  • establish a direct relationship with your lender, which is useful if you need after-sales service.

Limitations of banks

The main limitation of working directly with a bank is lack of choice. You only get what that particular bank has to offer, without being able to compare with competitors.

Banks can also be more selective when making lending decisions. They have strict internal criteria and may reject applicants who do not meet their standards.

Nerdwallet Canada emphasizes that large banks are often selective about who they lend to. A good broker, on the other hand, can search for mortgages based on your income and credit score, making approval more likely.

Features of the Calgary market in 2025

Current market conditions

The Calgary real estate market in 2025 is undergoing significant changes.

Home inventory has risen sharply:

  • from 0.9 to 2.3 months of supply for single-family homes (+156% year-over-year);
  • for apartments, from 1.2 to 3.2 months (+167%).

These changes are creating the best opportunity for buyers in recent years. The end of severe supply restrictions means a shift from a seller's market to a buyer's market with plenty of choice.

In this environment, broker expertise becomes even more valuable. Brokers can help clients:

  • take advantage of improved negotiating conditions;
  • find the best financing options;
  • save on interest rates.

Forecasts and trends

The Calgary Real Estate Board predicts that 2025 will be one of the most affordable years for real estate investment. The following is expected:

  • prices will remain below the national average;
  • growth in the technology, healthcare, and renewable energy sectors;
  • an influx of new jobs and increased demand for housing.

Interest rates are also expected to fall throughout 2025, making this year a golden opportunity for buyers. Brokers can help clients:

  • lock in rates at the right moment;
  • or wait for further reductions, optimizing mortgage terms.

Potential disadvantages of working with brokers

Conflicts of interest

Although brokers are legally required to work in the best interests of their clients, the commission structure can create potential conflicts. Some lenders may pay higher commissions for certain products, which in theory could influence a broker's recommendations.

Rates.ca advises asking your broker directly:

“Are there products on the brokerage market that offer you less compensation but would save me more money in the long run?”

Quality of service can vary

Not all brokers are the same, and the quality of service can vary significantly. It is important to choose an experienced and reputable professional.

Statistics show that 80% of people in the mortgage industry stay in it for less than 2 years. This highlights the importance of working with professionals with a proven track record.

How to choose the right broker in Calgary

Selection criteria

When choosing a mortgage broker, consider the following factors:

  • Experience and reputation Look for brokers with at least five years of experience and positive reviews. Mark Herman Team is proud of its 28 years of experience and status as one of the top 10 brokers in Canada.

  • Access to lenders Make sure the broker has a wide network of partners: banks, credit unions, alternative lenders.

  • Local knowledge It is important that the broker understands the specifics of the Calgary market and the local economy.

  • Availability and communication Choose a broker who is available outside of business hours and responds quickly to inquiries.

Questions for potential brokers

During your interview with brokers, ask:

  1. How many lenders are in your network?
  2. What is your experience working with clients in my situation?
  3. What fees can I expect?
  4. How will you keep me informed of the process?
  5. Can you provide references from recent clients?

Alternatives to brokerage services

Direct online lenders

The rise of digital lenders such as Nesto offers an alternative to traditional banks and brokers. They offer:

  • online convenience;
  • competitive rates;
  • fewer product options compared to brokers.

Credit unions

Calgary credit unions, such as Servus Credit Union, may offer:

  • competitive rates;
  • personalized service;
  • more flexibility in lending requirements.

Recommendations for different types of buyers

First-time buyers

For those buying a home for the first time, brokers are especially valuable for their ability to:

  • explain complex terms,
  • help with federal and provincial programs for buyers.

Self-employed and non-standard situations

Brokers are useful for self-employed individuals or those with non-standard sources of income. They have access to specialized lenders who are willing to work with non-standard income documentation.

Experienced investors

Investors can benefit from a broker's extensive network to find the best rates for investment properties. Brokers help with complex financial structures for real estate portfolios.

Conclusion and practical advice

Hiring a mortgage broker in Calgary is usually a wise decision for most homebuyers.

Advantages:

  • access to more lenders,
  • better rates,
  • personalized service,
  • market expertise.

Especially in the current market conditions of 2025, where buyers have the best opportunities in recent years, a broker's experience can be invaluable. They help you:

  • compare options faster,
  • take advantage of favorable negotiating terms,
  • save money and time.

The key to success is choosing the right broker with:

  • experience,
  • reputation,
  • access to a wide network of lenders,
  • in-depth knowledge of the Calgary market.

For most homebuyers in Calgary, especially first-time buyers or those with unusual financial situations, the benefits of working with a qualified mortgage broker far outweigh the potential costs and risks.

In the competitive and dynamic Calgary market, the professional assistance of a broker can be the deciding factor between a good deal and the best possible deal.