big bank or monoline, big banks, monoline lenders, difference

Bank or Monoline?

Author: Victor And Taufeeq | | Categories: best mortgage rate , mortgage rates , variable rate , CMHC Insurance , Easy Mortgage Approval , First Time Buyer Mortgage , fixed rate , High Ratio Mortgage , Lowest Mortgage Rate , MDI , Mortgage Agent , Mortgage Approval , Mortgage Broker , Mortgage Default Insurance , Mortgage Features , Mortgage Insurance Premium , Mortgage Penalties , Mortgage Refinance , Mortgage Renewal , Mortgage Services , No Money Down Mortgage , Private Mortgage , Reverse Mortgage , Self Employed Mortgage

Debt Consolidation Milton

For most of us who do not work in the mortgage industry the only lenders we know of and come across when needing a mortgage related service are the traditional schedule “A” Banks.

There are 5 major banks in Canada. Royal Bank of Canada, Toronto Dominion, Bank of Montreal, Scotiabank, and CIBC. However, there are many more lenders, who do not fit the brick and mortar profile of the traditional bank but have been in the mortgage market for many years.

These lenders are known as monoline lenders, because their primary focus and often the only product/service is mortgage related.

So what are the main differences between a major bank and a monoline lender.


Major Bank                                                                                                    Monoline

Brick and mortar business with many branches                            Totally online services


Offers many different services                                                              Focus is only mortgages and mortgage related                                                                      products


Operating  across all Provinces                                                              Operations may be provincial or national


Penalties calculated as posted to discount rate                             Penalties are usually contract to contract rate

(generates the highest penalty for borrowers)                             (Generates lower penalty for borrowers)


Cross Selling Involved and expected by Managers                       No Cross Selling Involved


Can register mortgage as a Collateral Charge                                 Mostly registers mortgage as a standard charge

(Generally higher legal cost when breaking)                        


Staff usually handles multiple products for borrowers             Staff only work on mortgages and mortgage

(Lack of expert knowledge may be an issue)                                 Related products


They are balance sheet lenders                                                           They are often security backed lenders

(They use our money to lend back to us)                                         (They have investors who pool funds together

                                                                                                                      To invest in mortgages)


Some of the largest mortgage lenders in Canada are monoline lenders such as First National (largest non-bank lender), Equitable Bank, MCAP and more.


As with everything else, there are no lenders 100% good or bad for you. It all depends on your financial, credit and down payment situation, what you are trying to achieve and your future lifestyle goals.

And with us by your side, you get to have us shop both the banks, credit unions and monoline lenders to find the most suitable products and lenders for your particular needs.