Bank bars broker from attaining financing for client

Bank bars broker from attaining financing for client

Bank bars broker from attaining financing for client One broker is frustrated by a major bank’s refusal to allow him to work with any client who had previously inquired about a mortgage at the branch level.

“If a client has had any mortgage consult with the bank at all we are barred from dealing with them in any way shape or form,” charges a Toronto-based broker speaking to MortgageBrokerNews.ca on condition of anonymity. “I lost two deals because of it.”

According to the industry player, one of the big banks operating in the broker channel – a preferred lender of his – has recently blocked his efforts to win a mortgage for clients who already have a file open with the branch.

“I’m assuming it’s a money thing; it’s cheaper for them to deal with the client in the branch than to pay a broker for the exact same work,” he said. “We were told the client is already dealing with the branch and that they couldn’t deal with us even though they were willing to sign a letter to say they would rather deal with us.”

MortgageBrokerNews.ca contacted a number of brokers who also deal with that bank.

“I do know the policy is that if you do go into a branch and then subsequently to the broker, the broker won’t be able to do anything until the branch relinquishes the file,” Bill MacDonald, a Halifax-based Invis mortgage broker said. "The bank is not going to have two applications at the same time."

On these files the bank has advised MacDonald to speak with the client to determine if he or she prefers to work directly with the bank or through the broker.

For his part, Rick Dumas of Mortgage Architects Duet Financial hasn't hit a brick wall regarding clients who initially had gone into the branch. Though he says he would understand if it was the bank’s policy.

“I haven’t had any experience like that with them, myself, but I assume that that would probably be true just if they’ve started the process at one end,” Dumas said. “I expect the reverse to be true as well: I assume if a broker starts the application and then goes to a branch, the bank will suggest the client work with the broker.”

That isn't necessarily what other brokers believe. Over the years several have complained to MortgageBrokerNews.ca that files they've submitted to banks have been rejected only to then be accepted through the branch system.
 
 
 
 
 
14 Comments
  • KJL 2014-04-30 11:51:34 AM
    Your problems can be solved very quickly - STOP sending the deals to the banks. This has been a known fact for the 42 years I have done this ! They play the "bully's" - just like the school kids. There are 21 mono line lenders and majority have a better package than any of the banks and/or credit unions. Stop feeding the fire !
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  • Silly Rabbit 2014-04-30 11:54:06 AM
    Why do you deal with a bank in the first place? so they can steal your client on renewal?

    You deserve to lose money if you're that blind to what banks do for a living....
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  • Kevin Duffy 2014-04-30 11:54:32 AM
    Just another example of brokers not realizing that the Bank is not your friend. I really fail to see why brokers deal with Bank lenders at all. I don't
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