Exclusivity agreement leads to poor service?

Exclusivity agreement leads to poor service?

Exclusivity agreement leads to poor service? Despite a recent negative experience with a broker and an exclusivity agreement, this client still chooses to support the broker industry.

“I’ve never seen one and I’d never think of using one,” Nick Bachusky, a broker with Verico The Mortgage Advisors, told MortgageBrokerNews.ca. “That broker even used legal threats against the client.

“Hopefully getting this story out there will prevent other brokers from treating their clients that way. Stuff like that gives our industry a bad name.”

A client turned to Bachusky to get a mortgage following a poor experience with another industry professional who insisted on using an exclusivity agreement.

“Nick (Bachusky) was great; it was smooth and I didn’t have to worry about anything,” the client, Stephan Gauthier, told MortgageBrokerNews.ca. “He even showed up at my house to sign documents.”

Gauthier shared the negative experience, explaining he was asked to sign an exclusivity agreement that stipulated he could not work with another broker for 120 days.

“There were inaccuracies throughout the documents, including having a line of credit on there twice; (instead of rectifying it), the broker told me to use my rental income to offset that,” Gauthier said. “I had to catch that myself and explain it to the broker.”

Gauthier said he also inquired about what sort of porting and bridge financing options were available.

“His answer was that if I’m not planning to move in five years not to worry about it.”

Gauthier says he insisted he wanted to work with a different lender, First National, and after much back and forth the broker presented him with another set of mortgage documents.

After he had had enough, Gauthier contacted the brokerage to sever the business relationship, and the broker of record allowed him to, noting that Gauthier’s original broker had left the brokerage.

Still, the broker sought $3,000 in compensation for work already rendered, according to Gauthier.

Even after the experience, Gauthier decided to work with another broker to finalize his mortgage. He said that despite the negative experience, he doesn’t paint the entire mortgage industry with the same brush.

Of course, Gauthier’s original experience is certainly not the norm.
  • Cameron Mackie 2015-11-24 10:09:31 AM
    I just had a client come to me with a similar exclusivity agreement from another mortgage agent. However, the agent was not able to get the rate promised because rates went up prior to the max rate hold. This left the client extremely frustrated.

    Tactics like this tarnish our industry and put us at the same level of other industries the have "slimy sales agents"

    If you're going to grow your business, do it with integrity.

    Ask yourself.... do you like contracts. What do you think of business' that make you sign them.
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  • Ron Butler 2015-11-24 3:15:46 PM
    A mortgage is a contract, a car lease is a contract, a credit card is a contract, most people sign employment contracts or commission contracts. Contracts make our world go around.

    Let's be rational, businesses and consumers need contracts, we are a society that functions under the rule of law and that is one of the very best things about this country.

    Those of us who use service agreements need to use them a carrot not a weapon. We should only guard against those who never intended to deal with us at all and always intended to take our low rates to their existing lender and stay with that lender.

    NEVER should a termination agreement be used as a weapon or a trap that is not what this is about.
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  • Paul 2015-11-24 11:30:19 PM
    Oh my god. What a collective group of rank amateurs. Quoting one story vs another story likely completely out of context. News flash folks, CONTRACTS are how business is conducted. You can't even use a smart phone app without accepting the terms and conditions. If you wish to uselessly donate your time and cross your fingers feel free, but don't critique the professionals, and don't confuse yourself with a business.
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