A fix for slow underwriting times

A fix for slow underwriting times

A fix for slow underwriting times In a bid to remain competitive with the big banks during the year’s busiest season, one broker is suggesting lenders need to revamp underwriting paperwork policies to expedite the deal process.

“Lenders don’t often look at documents at the same time they get a mortgage request, they generally view them after and you’ve got different people looking at the documents and different people doing the underwriting, so there is a real disconnect, in my opinion,” Denny Segal of Dominion Lending Centres Origin told MortgageBrokerNews.ca. “That could be smoothed out if you had some people in power to do both – make a credit decision and review the documentation, which could break up the disconnect.”

The spring and summer markets are traditionally busiest for the real estate industry, and now that that season is underway, brokers are encountering more frustration completing deals.

Toronto, for example, just had a record month for sales in April, with a reported 11,303 homes sold last month.

“Lenders provide service level agreements, generally speaking, that say they will turn something around in a specified time but you can’t control volumes in the marketplace,” Segal said. “And sometimes not having the ability to communicate directly with the underwriter is frustrating. We have to speak with a document clerk … who isn’t as familiar with the file.”

Still, some brokers are more efficient with underwriting turnaround times, according to Segal.

“It’s just process,” Segal said. “These lenders are big institutions that have way of doing things … there are some in the broker community that are much better than others and that’s where the business goes.”
  • Rosemary Madden 2015-05-07 9:52:20 AM
    Well said and I agree 100% that there is definitely a disconnect between the Underwriter and the "document specialist" the lenders have to realize that a 48 hour or more turn around time for documentation review is not acceptable.
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  • Ross Kay 2015-05-07 10:12:21 AM
    Lenders want to extend and not decrease turn around times for outside agents and a Mortgage Broker must take proactive steps to reduce this issue.

    Of the 11303 homes sold by TREB members last month only 28% were first time buyers who should have all been Pre-Approved to a point where only the home's appraisal is contingent upon the Approval being a commitment.

    Mortgage Brokers need to get into the real estate offices and educate REALTORS on how to maximize the process in their clients best interest.

    Allowing REALTORS and Consumers to follow mortgage approval processes that really mean nothing benefit the lenders and harm mortgage brokers.

    Brokers are the experts. Brokers are Licensed. Brokers save clients $1000's. Brokers need to lead this cause through proactive engagement with both the re sales rep community and the public at large.

    What consumer would forgo a trip to the Bahamas or a new car free of charge simply in order to use a bank directly.

    Bizarre folks, just bizarre
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  • Ferdinand Gatt 2015-05-07 10:20:00 AM
    When the "No Fee" Mortgage Broker system first started 27 years ago, we used to get 4 hour turnaround from several Lenders. Now the benchmark is 24 hours from one Lender and that often ends up being 48 hours because of volumes or vacations or at month end. We have definitely gone backwards as far as turnaround times.
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