Opinion divided following one client's mortgage denial

Opinion divided following one client's mortgage denial

Opinion divided following one client

“For those siding with the lender, right on; credit is a priviledge for which you have to qualify, not a right,” one anonymous commenter said. “The applicant that is pregnant is currently a non-permanent resident … absolutely the lender has to evaluate the risk inherent in the situation and determine whether this fits within their risk tolerance.

“This is not about someone being pregnant - this is about risk.”

And when it comes to maintaining relationships with lenders, it’s better to disclose all the details, suggested a number of readers. Though they also suggested asking for an exception on special cases such as this one.

“At the end of the day brokers should be realistic and respectful of who's money is at risk but we also must be the public's champion with the lender, I never see anything wrong with asking for an exception even if there is only a slim chance of getting it,” Ron Butler of Verico Butler Mortgage said.

“Ask for an exception certainly & provide full supporting details so they are able to review it fairly," Pamela Wyant of Dominion Lending Centres Northern Mortgage Solutions added. “But my recommendation is: don't forget the disclosure if you wish to retain the lender relationship.”

Related:

Lender denies client because of pregnancy: Broker

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8 Comments
  • John Benstead 2014-04-10 11:51:33 AM
    I think the lender, in this case, is acting in a prudent way. Work Visa applicants, by nature, are considered differently. Has anyone considered why, after 4 years someone's status is still Visa based and not permanent resident.

    I would like to throw another case into the mix! I had 2 young clients attempting to purchase their 1st home. It was clear from the outset that the ratios would not work. As this was before the need to have a cosigner live in the property, big sister stepped up and agreed to "join" the deal. She worked for a global organisation, where approx 25% of her income came from bonus. I did not need the bonus but I submitted 3 years of NOAs to prove anyway. It was declined and the underwriters reason..........."what would happen if she got hit by a bus"

    Still scratching my head on that one!!
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  • Omer Quenneville 2014-04-10 12:07:58 PM
    Responsible lending... if it were your money, what would you do.
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  • Nick D. 2014-04-10 1:23:08 PM
    How do we actually KNOW that the lender declined it becasue she was pregnant? We only have the word of the broker - who is in truth just trying to use the publicity angle to get the deal approved. The fact is that the client is not a permament resident and is here on a work visa – that alone changes things. The fact that her income will be dropping – regardless of the reason – is important for the lender to know. If the clients cannot service the mortgage on the reduced income then it is reasonable that the lender should have concerns over the risk associated with the approval of the mortgage. The client will potentially out of the workforce for a period of 12 months. How are they going to maintain the home during that period with the very high costs of having a new child? What happens if her work visa expires during that time? Anyone consider that remification? Perhaps the broker should think before going on a stupid public rant.

    This story is all about a broker who got a decline that is trying to sensationalize the situation and force the lender into approving a deal. If I was that lender, this deal would not only be declined, the broker would be cut off for life from ever sending business to me again. Why would I want to partner with a broker that is so quick to throw me under the bus?

    Brokers wonder why lenders get so frustrated… as someone who used to once underwrite for a lender, I can tell you this… brokers are BY FAR the most difficult to deal with. 1000% more difficult than dealing with the consumer directly. I have yet to meet a broker that at one time or another has not been rude to an underwriter because they could not get their way. I can name several that have yelled at underwriters, some of them have posted on this very string of comments. This is just another case of a broker being elitist and ranting because they could not get their way – and shame on them for doing it.
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