A Waterloo-based broker has one question: What changed to make the same bank approve a deal that had been repeatedly rejected when he presented it?
“If the deal had to be tweaked, why didn’t you tweak it with me?” Jason Breau, a broker with Mortgage Intelligence
asked the bank. “We appealed this deal twice, so it had to go up the chain at the bank, and it was turned down. Then the client goes to the local branch, and he is approved. What changed?”
It all started when Breau was referred a client living in the Northwest Territories by another one of his clients.
“He was looking to refinance – another 5-year-fixed mortgage like the one he currently had – on a house with a pressure-treated wood foundation,” he told MortgageBrokerNews.ca. “Nothing new in NWT, as about 85 per cent of the market there has pressure-treated foundations.
“Anyway, I present the deal and it is turned down. ‘We don’t do that’ I was told, so I went back to the bank representative and they said ‘No’ again.”
During the second appeal at TD Bank, Breau was told the underwriters would approve “if it is CMHC approved.” But CMHC informed Breau that they do not do “that type of mortgage,” adding that their decision was credit-based.
That is when the story takes a strange twist.
“The client tells me he’s willing to try and go in to his local branch,” says Breau, “and then a few days later he asks for the appraisal. I tell him the bank already has it in their system. Then the deal gets approved!”
Upon hearing this, Breau once again approached the bank’s road rep and asked what had happened.
“The policy is black and white,” Breau told the rep. “I asked him ‘Why did you make us do all that work if it could be done at the local branch?’ I don’t know if it was done through their underwriting department, or if the branch has unilateral approval power. All I want to know is what happened to change the rejection to an approval?”
Breau took his story to his broker of record and to the regional manager at Mortgage Intelligence, and they have forwarded their concerns to the bank.
Although upset that a potential deal was seemingly sabotaged, Breau is glad that the client got his refinancing.
“I’m not going to stand in his way or sabotage the deal,” he says. “I only want to know what happened.”