Yup. I've seen this within families. "Grandma" has a bunch of money in GICs. Grand-daughter needs a mortgage. They go shopping, find the difference between the best rate from a mortgage broker, and the best rate possible from a GIC broker. Split the difference, and set it up with a security interest in the property (mortgage) pledged in favour of "Grandma". "Grandma" picks up an extra half-percent on her investment portfolio. Grand-daughter saves a bit of $$$ compared to a bank mortgage. Everyone's happy!
Some mortgage brokers even do the same, play both sides, as there are individuals who approach them with savings. It becomes beneficial for both the investor and saver because the mortgage broker is usually able to arrange a better rate because there's less overhead involved.
Nope, not pointless at all. It also happens between RRSP trusts and individuals.Seems like another pointless argument since you have never had a mortgage before. Such lenders, if they exist will actually charge you a higher rate of interest if anything.