Real Estate Agent · Windsor, Ontario · Member since 2016 · 95 posts · 65 votes
Hi Everyone,
I'm trying to getting conventional mortgage through Mortgage broker(Unimor Capital Brokerage) in Windsor Ontario Canada for 168,500 valued duplex, in first meeting he said there will be a small fee(he didn't specify % or amount), atm didn't paid much attention to it, and I provided all the documents he asked for, 2 weeks later I got a call from him saying I got approved and I need to bring 5900$ Broker fee and sign the document, I asked why 5900 for ? he said it's the small fee I mentioned to you when we meet, I was in shock and I said I need to verify and I will call him back. After 10 or 20mins later he call me and said that 5900 includes all hst/laywer fee/appraisal, I asked him what's the % he charge as fee, he didn't gave me any number just said 5900 - laywer fee, all hst & appraisal is my fee, still I had so many questions in my mind so I said I need to verify. Again, I got a call back from him after few mins saying I spoke to lawyer& RE agent they said that I don't have to pay him lawyer fee so come with (5900 - lawyer fee).
I'm wondering about the process involved in getting conventional loan through a brokerage who change fee, Is't legal to charge broker fee before closing?? or is this guy planing tricks?
I don't know about lending in Canada however I have never heard of such a thing. In the US the broker Comp is paid through closing and it's usually paid by the lender not the borrower.
Depending upon the lender with whom the broker is placing your business, s/he may be compensated by the lender or may be compensated by charging you a fee (typically 1 - 1.5 points). This needs to be disclosed up-front and there are disclosure forms the broker should provide you.
I would find my own attorney for Close and pay them directly.
As for the appraisal fee, lenders and brokers are always trying to pass that along - my stock answer to them is "If I pay for the appraisal, I get a copy of the appraisal" ... in my experience, most lendors will wave the fee rather than provide you with a copy of the appraisal.
The final note, as indicated by Elena, the broker's fee - and other fees such as the appraisal - are paid at Close. The broker should not be asking for this up-front.
I think you might be best served finding another broker.
@Aditya Soma Sometimes Brokers will charge a fee if they've found you an alternative source of lending like a B deal or Private funds. We can talk over direct msg, I can help out. I'm a broker so have some experience here.
Typically, we'd fund the appraisal for our clients seems a little odd.
Yes I did felt it very Shady with this guy, so I decided to look for another broker who can understand Investor needs
@Jacob Perez Sure thing, I appreciate a lot. But I'm sure deal is good and I do have good credit history(760+)/steady Income I feel the guy is not honest
I believe Unimor is mostly used by people with less than great credit or self employed. They probably use a standard fee schedule because of this. If you're looking for a traditional mortgage, I would use a different broker.
use a broker that gets paid from the lender if you have good credit and no issues on getting financing
You cannot make this generalization, not all lenders pay brokers. Depending on the lender which best fits your deal, the lender may compensate the broker, or the broker will be compensated by the borrower. Either way, the broker needs to disclose this upfront.
Thanks everyone for providing your valuable suggestions
I learned many lesson's for this deal, also motivated me to take a deep dive into mortgages and end up getting my License in less then a month and close my own deal.
Feel free to reach me out for your mortgage needs.
This is my mortgage broker: https://intellimortgage.com/. I have never been asked to pay a fee with them (they paid my appraisal fee too) but you will obviously have to cover your own closing costs, like legal fees. Ask for Melanie if you call them. She's a rental financing superstar and their rates are the lowest I've seen in Canada, bar none. You can also try a major bank like CIBC, but know that banks have tightened up their rental policies dramatically in the last year or two.
This is my mortgage broker [link removed]. I have never been asked to pay a fee with them (they paid my appraisal fee too) but you will obviously have to cover your own closing costs, like legal fees. Ask for Melanie if you call them. She's a rental financing superstar and their rates are the lowest I've seen in Canada, bar none. You can also try a major bank like CIBC, but know that banks have tightened up their rental policies dramatically in the last year or two.
John:
Whether a mortgage broker asks the borrower to pay is dependent upon the lender with whom the broker places the borrower. Some mortgage brokers only use lenders who compensate the broker (Schedule A banks, insurance companies, etc) as part of their business practice. Your broker's claim of "no fees, ever" means they likely do not work with second tier lenders, private equity placements or commercial lenders.