"This is an important agreement that leverages the distinct capabilities and strengths of both parties," Stephen Smith, chairman and chief executive officer of First National said in an official release. "For First National, it provides a new source of income that we hope will grow over time."
The transition will be a tiered, region-specific rollout that will be Canada-wide by mid-2015.
According to the release: “Under the strategic agreement, First National will employ a customized software solution based on its industry leading MERLIN technology to accept mortgage applications from the TD mortgage broker channel and underwrite these mortgages in accordance with TD's credit policies, compliance standards and controls. TD will fund all the mortgages underwritten under the agreement and retain full responsibility for underwriting guidelines, mortgage servicing and the client relationship.”
The move signals a vote of confidence in the quality of one of the broker channel’s preferred lenders.
"We are very pleased to be chosen for this mandate," Smith said. "It's a clear endorsement of our industry leading technology and expertise in the independent mortgage broker channel by one of Canada's premier financial institutions."
First National announced Wednesday it has struck a deal with Toronto Dominion (TD) Bank to provide underwriting and fulfillment processing for mortgages originated by the big bank through the mortgage broker channel.