Brokers relying on Canada’s growing Iranian community are in a bind, as most lenders move to make it virtually impossible for immigrants to transfer funds from that sanctioned country.
"As recently as last fall, we were doing deals where TD was accepting money transferred from a client’s account in Iran, funds for a downpayment,” Afshin Nejaddehghan, a broker with Mortgage Central in Richmond Hill, told MortgageBrokerNews.ca. “Since January, it’s become tougher to get that kind of deal done and now I expect almost all the lenders to reject them.”
The concerns come on the heels of TD’s move to close the accounts of some of clients in order to comply with new federal regulations tied to sanctions against Iran.
TD’s letter to those affected customers cites changes to the “Special Economic Measures (Iran) Regulation,” which ostensibly blocks Canadian lenders from providing financial services to anyone in Iran or for the benefit of Iran.
That sanction applies to sending or receiving money via wire transfer to or from friends and family in Iran. It’s also bad news for brokers, most of their clients using funds from businesses or their sale of property in Iran to come up with a down payment for a Canadian home.
As it is now, said Nejaddehghan, he is now advising clients to turn to one of the few banks still allowing clients to transfer funds to their Canadian accounts from those Iran. The challenge is that the bank, CIBC, is readying to shut its link to brokers outside of the Mortgage Centre family.
It means Nejaddehghan is opening himself up to possible poaching from CIBC branch staff in sending them to the bank to open an account.
Other brokers have called on mono-lines to help them retain that business by bringing their demands for paperwork attached to money transfers in line with CIBC.
“Most of the non-banks are asking clients for more information than the big banks are,” Ellhe Rezai, principal broker with Ace Mortgage Centre, in Markham told MortgageBrokerNews.ca in last year. “They want to see where the money is coming from, a wire exchange receipt, the exchange cheque, the foreign withdrawal receipt, record of the monies deposited in the Canadian account, and if the money was a gift, they want to see the account of the gift-giver as well as a gift letter. All the banks generally ask for is a gift letter and to see the money deposited in a Canadian account.”
That too has now changed, making it even more challenging to get deals approved, charge brokers.