Bank vs Mortgage Broker in Calgary: Which Gets You the Best Deal?

The most common question I get asked is not about rates or qualification — it is whether people should go to their bank or use a mortgage broker. It makes sense. Your bank already knows you, they make it convenient, and there is comfort in familiarity. But convenience and best deal are not the same thing.

Here is the honest breakdown of how banks and mortgage brokers work, what each one offers, and when you should choose one over the other.

How Banks Work

When you walk into a bank branch or apply online through your bank's mortgage portal, you are dealing with a single lender. That lender has its own set of rates, its own underwriting policies, and its own product lineup. The mortgage specialist you speak with works for that bank, and their job is to find a mortgage solution within that bank's offerings.

Posted Rates vs. Negotiated Rates

Banks publish posted rates, which are almost always higher than what they are willing to offer. The difference between posted and actual rates can be 1% to 2%. Whether you get the discounted rate depends on your negotiating ability, your relationship with the bank, and how much leverage you bring to the table.

Most people do not know how much room there is to negotiate, and banks do not advertise it. If you are a high-net-worth client with multiple accounts and investments, you get better treatment. If you are a first-time buyer with a single chequing account, you get less flexibility.

Limited Product Range

Your bank offers the products it underwrites. If you need a non-traditional solution — self-employed income verification, rental property financing with multiple units, or a deal rescue after a decline — the bank either cannot help or will not. They operate within strict guidelines, and anything outside those guidelines gets declined.

Cross-Selling Incentives

Bank mortgage specialists are often incentivized to sell you other banking products alongside your mortgage. Credit cards, investment accounts, insurance products — these are part of their compensation structure. The mortgage becomes a gateway to a broader banking relationship, which is fine if you want that relationship, but it means the advice you receive is not purely focused on getting you the best mortgage.

How Mortgage Brokers Work

A mortgage broker does not lend money. Instead, brokers have access to 60+ lenders, including the big banks, credit unions, alternative lenders, and private lenders. When you apply through a broker, your application gets shopped to the lenders most likely to approve you at the best rate.

Access to Wholesale Rates

Brokers work with lender wholesale divisions, which means they often have access to better rates than what the same lender offers through its retail branch. A client might get quoted 4.8% at their bank branch, and I can get them 4.4% through the same bank's broker channel. Same lender, better rate, because the distribution model is different.

No Cost to You

Mortgage brokers are paid by the lender, not by you. When your mortgage funds, the lender pays the broker a commission, typically between 0.70% and 1.20% of the mortgage amount. This is built into the lender's cost of doing business — it does not get added to your rate or your fees. You do not pay for the broker's service.

There are no application fees, no broker fees, no hidden charges. If someone claiming to be a mortgage broker asks you for an upfront fee, walk away. Legitimate brokers in Canada do not charge borrowers.

Specialization and Problem-Solving

Because brokers deal with multiple lenders, they understand each lender's appetite for different types of deals. One lender might specialize in self-employed borrowers. Another might have the best rates for rental properties. A third might be aggressive on refinances for debt consolidation.

If your application has a complication — previous bankruptcy, low credit score, non-traditional income, tight debt ratios — a broker knows which lenders will work with your situation and which ones will decline you immediately. This saves time and avoids unnecessary credit inquiries.

Side-by-Side Comparison

Here is how banks and brokers stack up across the factors that actually matter:

When a Bank Might Be Right

There are legitimate scenarios where going directly to your bank makes sense.

Simple Renewal at a Competitive Rate

If you are renewing your mortgage, you already have an existing relationship with your lender, and they offer you a rate that is genuinely competitive with the market, renewal can be straightforward. No new application, no new qualification, just sign and continue.

That said, even on renewals, it pays to shop. Banks count on inertia — they know most people will just renew without checking what else is available. I have seen renewal offers that are 0.5% to 1.0% higher than what the same client could get by switching lenders.

Deep Banking Relationship with Premium Pricing

If you are a private banking client with significant assets held at your bank, you might receive preferential mortgage pricing as part of that relationship. In these cases, the mortgage is one piece of a larger wealth management strategy, and the bank's offer may genuinely be competitive.

Need for Integrated Banking Services

If you want your mortgage, chequing, savings, credit cards, and investments all managed under one roof, a bank provides that integration. Some people value the simplicity of a single login and a single point of contact for all financial services.

When a Broker Is Better

Most of the time, a broker provides more value. Here is when broker access makes the biggest difference.

Shopping for the Best Rate

If your primary goal is to secure the lowest possible rate, a broker's access to 60+ lenders gives you a structural advantage. Rates vary significantly between lenders at any given time, and having one conversation with a broker is more efficient than calling ten banks individually.

Self-Employed or Non-Traditional Income

Self-employed income is one of the most common reasons borrowers get declined by banks. Traditional banks want two years of Notice of Assessments, full financials, and conservative income calculations. Many self-employed borrowers cannot meet those requirements, even though their actual income is strong.

Brokers have access to lenders who specialize in self-employed mortgages, using alternative documentation methods like bank statement programs or stated income options. For more details, see self-employed mortgages.

Bruised Credit or Previous Declines

If your credit score is below 650, or if you have had a bankruptcy, consumer proposal, or previous mortgage decline, most traditional banks will not approve you. Brokers work with alternative and private lenders who assess risk differently and can often get deals approved that banks will not touch.

Investment Properties and Multi-Unit Financing

Financing rental properties, duplexes, or multi-unit buildings requires lenders who understand rental income qualification and have appetite for investment deals. Not all banks are competitive in this space. Brokers know which lenders offer the best terms for investment properties. Learn more at investment properties.

Deal Rescue Situations

If you are under contract to purchase a home and your bank declines your application or delays approval past your closing date, you need a fast solution. Brokers can pivot to alternative lenders quickly, often saving deals that would otherwise collapse. This is what we specialize in with deal rescue.

First-Time Buyers Needing Guidance

First-time buyers benefit from education and options. A broker walks you through the entire process, explains your choices, and helps you understand trade-offs between rate, term, prepayment options, and penalties. Banks provide service, but brokers provide consultation. Check out first-time buyers for more.

Real Examples

I cannot share names or specific addresses, but here are real scenarios I have worked on in the past year.

Rate Savings Example

A couple applied to their bank for a mortgage on a $650,000 home. The bank offered them 4.74% on a 5-year fixed. They came to me for a second opinion. I got them 4.29% with a different lender. Over five years, that difference saved them approximately $14,500 in interest.

Same qualification, same down payment, different outcome.

Deal Rescue Example

A buyer was conditionally approved by their bank, but two weeks before closing, the bank reassessed the property and declined the deal due to an issue with the building's reserve fund. The buyer was facing a lost deposit and a failed purchase.

I moved the deal to an alternative lender who understood the reserve fund situation and approved the mortgage in four days. The deal closed on time, and the buyer kept their deposit.

Self-Employed Approval

A contractor with strong income was declined by two banks because his Notice of Assessments showed lower income due to legitimate tax write-offs. I placed him with a lender that uses bank statement verification instead of tax returns. He qualified for the amount he needed based on actual cash flow, not taxable income.

Bank says no. Broker finds a yes.

Common Myths Debunked

There is a lot of misinformation about mortgage brokers. Let me clear up the most common myths.

Myth: Brokers Charge Fees

Reality: Legitimate mortgage brokers in Canada are paid by the lender when your mortgage funds. You do not pay application fees, broker fees, or service charges. The service is free to you.

If someone asks for an upfront fee, they are not operating as a standard mortgage broker, and you should question their legitimacy.

Myth: Banks Are Safer or More Regulated

Reality: All mortgage lenders in Canada — whether they are banks, credit unions, or alternative lenders — are regulated by federal and provincial authorities. Mortgages arranged through brokers are subject to the same legal protections, same disclosure requirements, and same underwriting standards as mortgages issued directly by banks.

Your mortgage is a contract with the lender, not with the broker. The broker is the intermediary, but the lender is the counterparty, and all major lenders are heavily regulated.

Myth: Brokers Only Have Access to Bad Lenders

Reality: Mortgage brokers have access to the Big 5 banks, major credit unions, and top-tier lenders through broker channels. TD, RBC, Scotiabank, BMO — all of these institutions have broker divisions. You can get a mortgage from a major bank through a broker, often at a better rate than going to the branch.

In addition to the big banks, brokers also have access to alternative and private lenders for deals that do not fit traditional criteria. This is additive access, not a replacement.

Questions to Ask Whether You Choose a Bank or Broker

Regardless of which route you take, ask these questions before committing to a mortgage:

1. What is the actual interest rate I will pay, and is this rate guaranteed in writing?
2. What are the prepayment options? — Can you make lump sum payments or increase your regular payment without penalty?
3. What is the penalty for breaking the mortgage early? — This matters if you sell, refinance, or pay off the mortgage before the term ends.
4. Are there any fees or restrictions I should know about? — Discharge fees, appraisal fees, or restrictions on porting the mortgage.
5. How long is the rate hold, and what happens if rates drop before closing? — Most lenders offer 90 to 120-day rate holds.
6. What is the qualification process, and what documents do I need? — Understand what is required upfront to avoid delays.

If your bank or broker cannot answer these questions clearly, that is a red flag.

The Bottom Line

Here is the honest truth: most buyers get a better deal working with a mortgage broker. More options, better rates, no cost, and personalized problem-solving. Banks are excellent at many things, but mortgage shopping is not one of them.

That said, if you have a deep banking relationship, premium pricing, or a simple renewal at a genuinely competitive rate, going directly to your bank can work.

The key is making an informed choice. Do not default to your bank out of convenience. Do not assume your broker is always cheaper. Compare, ask questions, and make sure the deal you accept is the best deal available to you.

If you want to see what 60+ lenders can offer you, use the mortgage payment calculator to estimate your costs, and then reach out for a real quote. It takes one conversation, and it costs you nothing.

You deserve the best deal available. Sometimes that is at your bank. Most of the time, it is not.