Forget July 9. Brokers may have considerably less time to get their applications in ahead of a start date for new mortgage rules.
“I received notice from one lender this morning that brokers will have to get applications on July 3 in order to have them considered under the old rules, and not the new,” said Karen Monteiro, principal broker for Mortgage Alliance Maximum Results Financial Services. “I was a bit surprised.”
She’s not alone, with brokers across the country reacting to a similar email this week from at least one other channel lender. Others – among them mono-lines and banks – are expected to follow suit by Friday, setting application deadlines as much as a week before default insurers officially adopt the new rules.
That truncated deadline will likely send brokers scrambling to get client paperwork in order and before underwriters by the end of this week, an effort to ensure refi- and 30-year amortization deals have time to win approval.
At least one lender has argued the tighter deadlines as necessary to preventing last minute overload and client frustration.
Still, some industry insiders have viewed the early deadlines as arbitrary and a possible indication lenders are rushing to implement new underwriting standards in advance of their official implementation.
Luckily, the industry hasn’t seen any real signs that broker lenders have moved in that direction, said Chad Robinson, with Verico Best Interest Mortgages, in Ottawa.
Those that need and want the business aren’t likely to, either, said Monteiro, based in Cambridge, Ont.