“I just sent a (bank) a letter because I submitted a deal on June 4 and I didn’t hear back from them until the ninth and the client had gone into the branch on the sixth and received an approval within 24 hours,” Rishi Sharma of Centum Smart Mortgages Inc. told MortgageBrokerNews.ca. “I’m not sure why it happens – perhaps the banks are back-logged with brokers and the deals seem to be expedited in the branch; they may use a different system or know shortcuts,”
Sharma’s submission – which was sent in before the client visited the branch – was declined because the bank already had an open file on the client.
“That client is gone and practices like this undermine the relationship banks have with brokers,” Sharma said.
It’s a prevailing problem mentioned by a number of brokers, who are irritated enough to send fewer deals to the big banks in favour of the monolines.
“I work with major banks and they challenge I find is that some clients I bring to them are denied a mortgage only to be approved when they go into a branch themselves,” Avijit Ghatak of Centum Home Loan Inc. told Mortgagebrokernews.ca.
Still, it’s an issue that is only compounded by -- what brokers perceive to be – tighter stricter underwriting in the monoline channel.
“Underwriting on the broker side is much tighter,” Ghatak said “Our clients may get denied by the lenders but they get approved by the banks.”
Have you had a similar experience? Mention it in the comments section below.
Brokers are frustrated by increasingly lengthy processing times when dealing with the banks – especially when those same banks expeditiously approve broker clients in-branch.