Broker: Lender staffing issues leading to last-minute deal issues

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Lenders are understaffed and dealing with record volume, according to one former underwriter, which explains the increase in last minute audits and the resulting problems with files.

“There is often another level of review after the underwriter signs off on a deal before it gets funded; the underwriters sometimes miss something and it’s a function of underwriters being overwhelmed,” Tim Hill of Dominion Lending Centres Primex Mortgages told “Volumes for lenders are also as high as they’ve ever been, and a lot of documents are being looked at very late in the process.”

Those last minute reviews are done by an auditor that oversees underwriters’ work according to Hill, who worked as an underwriter for Street Capital for over three years before moving to the broker side of the business.

An increasing number of brokers are reporting issues late in the mortgage origination process with last minute audits.

For his part, Robert Clancy of Verico Safebridge Financial argues these last minute audits are being exacerbated by lenders who all interpret mortgage regulations differently.

“A lot of the time there is an issue with conditions being added on by lenders at the end of deal; all of a sudden lenders call and ask for more documents,” Clancy told “It seems to be the monolines grappling with the regulation changes; everyone seems to be interpreting them differently.”

One specific example Clancy encountered was when a lender requested – at the last minute –that a number of debts to be paid down.

“They requested this days before closing, and even though we showed them their calculations were wrong they still forced us to deal with it.”

Luckily Clancy was able to work with the client and eventually got the deal funded. But not all brokers have the same luck at the last minute.
  • Carmen Perdomo on 2015-09-02 11:42:01 AM

    Very good piece of information, I am agree 100%

  • Jeff on 2015-09-02 4:51:01 PM

    Even if the file manages to close, this causes a great deal of panic for clients and could make them hesitant to work with the agent in the future due to the stressful experience. It's bad for the reputation of the agent, and the lender.

  • Ross Taylor on 2015-09-04 8:36:12 AM

    Jeff - your point is so right. We work so hard to attract clients - away from their comfort zone, and then when these situations arise we stress them out and they question why oh why did they not just go to the bank like their friends and parents told them to.

  • Lynn on 2015-09-06 7:29:34 PM

    I just had a instance with a lender (not sure if I can mention the name so I am leaving that out). I had sent them the documents that they asked for late in the game 5 business days until closing...I sent them their request the next day and on closing day at 3:20 in the afternoon they said the file was broker incomplete. I did not find this out until 4pm. After contacting the lender and telling them they have the document and them finding it amongst their pile of documents they then had to scramble to get the deal funded. And of course it had to go through FCT before the deal could actually close. Lawyer would be closing their doors at 5pm. It was after 5:20 when the lawyer received the funds. We were just lucky that the lawyer was willing to stay until 5:30 to look after the clients. The deal closed but this is just an example of what is happening out there and it does affect the relationship with the agent and the client. Oh by the way the lender said they are just so busy it got missed.

  • Sunny Vig on 2015-09-07 1:57:24 AM

    Great insight. This issue should be addressed by the lender rather than the broker having to deal with an angry client who could potentially lose there deposit. Let's hope lenders are ready for next springs rush.

  • Layth Matthews on 2015-10-25 2:39:13 PM

    Same thing just happened, I received an "Urgent" email on the morning of closing, "verbal income verification came in light" Need more docs... Every deal is a documentation nightmare these days.

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