During the broker panel at the national association’s conference in Toronto, broker Croft Axsen told those in attendance about a file he lost because a client’s bank account showed $1,600 of unaccounted income that Axsen couldn’t verify.
He couldn’t verify the income because it was made at a garage sale and, as anyone who has ever hosted or attended a garage sale – so virtually every Canadian – knows, there is no paper trail or receipts.
“We can’t do this file,’ the lender said,” Axsen, co-owner and broker at Jencor Mortgage, told the audience. “Because (we) couldn’t prove the income was from garage sale.”
Axsen , along with several other panel members, were critical of recent regulations that requires brokers to spend an increasing amount of time on verifying income.
“Every day, instead of working through improving productivity and how we can do our jobs better, instead we’re in this regulatory environment that requires us to spend hours and hours and hours chasing redundant paper,” Axsen said. “(It’s an) overzealous regulatory environment that turns a two hour job into a 15 hour job.”
And income verification has been a hot topic among brokers recently.
Another recent example that caused frustration from one broker: A lender required Jeff Evans, a broker with Mortgage Architects
Canada Innovative Financial, to hand over details from the account of a sibling who had gifted his sister -- Evans’ client – part of her down payment.
“I was asked not only to confirm my client’s account, the lender also wanted three month’s history for her relative’s account (who the gifted funds came from),” Evans recently told MortgageBrokerNews.ca.
Brokers often talk about the hoops they are forced to jump through to verify income, but this one example may take the cake.