Since the introduction of a mortgage-payment deferral plan to help homeowners cope with the financial impacts of the COVID-19 pandemic, Canada’s biggest banks have reported an increase in mortgage-related calls, reaching hundreds of thousands.
According to the Canadian Bankers Association, more than 213,000 requests to defer or skip payments have been completed or are being processed since the announcement more than a week ago. The figure accounts for about 5% the banks’ total number of mortgages.
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“The large number of customers that have been helped continues to grow as the result of concerted efforts by front-line workers, contact-center agents and operations teams working diligently,” Mathieu Labreche, spokesman for the Canadian Bankers Association, said in an interview with BNN Bloomberg.
On March 17, Royal Bank of Canada, Toronto-Dominion Bank, Bank of Nova Scotia, Bank of Montreal, Canadian Imperial Bank of Commerce and National Bank of Canada released a joint statement introducing mortgage-deferral measures to aid Canadians homeowners experiencing financial hardships due to the coronavirus outbreak. The lenders said that customers in good standing can apply with deferrals available for an indefinite period.
Under the plan, payments are skipped for a period of time and interest accrued is added to the mortgage’s outstanding balance. The additional interest is incorporated in future monthly payments when they resume or upon renewal at the end of the mortgage’s term.
At the end of January, the banks’ combined mortgage balances amounted to about $1.06trn. The figure accounts for nearly two-thirds of the country’s overall mortgage market, according to data from Bank of Canada.
“Last week, our contact centers in Canada received close to 80,000 calls per day, with calls to our mortgage and loan teams up 500%,” Scotiabank chief executive officer Brian Porter said in a March 22 statement.
Toronto-Dominion is “receiving thousands of requests daily for mortgage deferrals, and have processed thousands already,” spokeswoman Julie Bellissimo said in a statement emailed to BNN Bloomberg. “We are moving quickly through applications so that we can help provide our customers some immediate financial relief.”
“The need of Canadians for relief and support is at a scale and urgency we have never seen before as an industry and as a bank,” Laura Dottori-Attanasio, who oversees personal and business banking in Canada, said in a statement. “While we have helped tens of thousands of clients in the first week, we know we have much more to do.”