Bank vs Mortgage Broker: Which Gets You a Better Deal?

When it's time to finance a home, the first decision is where to get the mortgage: your bank, or a mortgage broker who shops many lenders for you. Both can land you a great deal — but they work very differently. Here's an honest, side-by-side look so you can choose with confidence.

Key takeaways

• A bank offers only its own mortgage products; a broker compares many lenders, often from one application.
• On standard deals the lender pays the broker, so a broker's service is usually free to you.
• Your bank may reward loyalty or bundle products — sometimes a competitive offer is already on the table.
• Brokers tend to win for non-standard files: self-employed income, tight credit, or unique properties.
• Whichever you pick, the federally regulated stress test applies — qualify at your rate + 2% or 5.25%, whichever is higher.

The core difference

A bank is a single lender. When you apply there, you're choosing from that one institution's shelf of mortgages. A mortgage broker is an intermediary who takes your file to many lenders at once and brings back the most competitive options — including lenders you might never approach directly.

Neither is automatically better. The right pick depends on your finances, how much shopping you want to do yourself, and how standard your situation is.

Side-by-side comparison

Posted rate vs best rate

At either door, the first number you hear is rarely the lowest. Banks discount off posted rates; brokers compare discounted offers across lenders. The takeaway: always treat the opening rate as negotiable.

When the bank wins

Going direct to your bank can be the smart choice when:

• You have a strong, long-standing relationship and they offer a sharp loyalty rate.
• You want to bundle the mortgage with chequing, savings or investments.
• Your file is straightforward — solid credit, steady salaried income, 20%+ down.
• You value the simplicity of dealing with one familiar institution.

When the broker wins

A broker usually pulls ahead when comparison or flexibility matters most:

• You're self-employed and need a lender that understands your income.
• You want many rates compared without filing several applications.
• Your credit or down payment is non-standard and you need options — see buying with bad credit.
• You want help weighing features like prepayment privileges and penalties.

Same test, either way

Regardless of route, a federally regulated lender must qualify you at the greater of your contract rate + 2% or 5.25%. Know your number first with the stress test calculator.

The lever bigger than rate

Whether you go with a bank or a broker, you're competing for fractions of a percent. The far bigger savings in a home transaction usually sit on the commission side — and that's where HOMEH stands apart.

Get the Cashback Rebate on your purchase

Eligible HOMEH buyers receive the industry's highest Cashback Rebate — often worth more than the rate gap between any two lenders. Sellers list for 1%, or free when they also buy with HOMEH within 6 months, or $395 + HST with a Mere Posting. Compare your numbers at the mortgage calculator and start at get a mortgage.

For the foundations, read how mortgages work in Canada and how to get the best mortgage rate.