A lawyer in one of Canada’s busiest housing markets is confirming a trend that costs some monoline clients more in legal fees, and he argues it’s up to his industry to change that.
Brokers can – perhaps surprisingly -- count this lawyer as an ally, following the discovery of just how much other real estate attorneys are tabbing onto monoline files.
“As a lawyer in Toronto I can confirm that many law firms charge additional amounts for monoline mortgages,” Mark Morris of Axess Law wrote on MortgageBrokerNews.ca, noting that he does not charge extra fees for those files.
Morris says he has worked with monolines for over 15 years and those files have gotten easier with experience.
“Monolines present a significant funding challenge when their requirements are not met (unclear ID, PAP form etc.),” Morris wrote. “(Law firms should) checklist those items in advance and understand the standards of quality that those same banks expect the documentation to be in when received.”
That conversation was sparked after a mortgagebrokerNews.ca investigation identified at least one recent case where the client of a Toronto broker was charged an extra $100 “monoline surcharge” by their lawyer. A torrent of broker complaints around the practice has since been posted to the story.
In the case highlighted in the MortgageBrokerNews.ca article, that added expense was tabbed onto to a bill for closing costs and specifically meant to compensate the lawyer for a protracted and confused closing process.
It’s a trend that has long frustrated brokers – one that has been reported across the country – and has influenced which lawyers they recommend to their clients.
“The choice to use a monoline is one that has upside and downside and the key is knowing how to mitigate accordingly,” Dustan Woodhouse
, a B.C.-based broker with Dominion Lending Centres
wrote. “(For example) have a relationship with specific lawyers offices and maintain control over the client experience.”