• I Am A Mortgage Broker… Not A Magician!

  • I love brokering mortgages but I get frustrated when clients think that we are magicians and can make their deal happen just like that.

    Unfortunately the lending climate has changed in Canada and no longer can we get a deal done with limited paperwork and a hand-shake. I think the problem is that while we as brokers have had to adapt to the new guidelines, our clients are unfortunately still in the dark and thus when we request paperwork (NOA, T1, T4, Financial statements, etc) it is very hard to get it from the client as they simply don’t understand the need for it or accept that it is the lender’s requesting it. When we try to explain or educate our clients, they are resistant as they were able to get it done when they bought their house 2-3 years ago, so how can it be so different now?

    magician

    Well it has changed and drastically! Paperwork is everything to a lender and not only do we need to verify income but we need to verify why a client might be taking out the equity of a paid-off property or we might need to verify where the funds for the down-payment are originating from.

    We are just middlemen and women doing our jobs to get the deals done! I would love nothing more than to be able to pick up the phone, have a conversation with the lender telling them all the wonderful points about my client and their request for funds but it does not work like that – not anymore at least!

    Furthermore if the client is self-employed and does not fully qualify – ie. they are stated income, we must have the paperwork to verify their income.

    Recently, my client after 3.5 months of working on a deal for her son, refused to come with the paperwork to close the deal. There were too many mitigating facts to go into in this short blog – but she could not produce the paperwork and could not understand why it was so difficult to get the lender to approve the deal.

    Were I a magician I would approve every deal that comes across my desk – but alas I am not!

    Word to the wise! If your broker is asking for paperwork there is a reason – please provide the paperwork or face up to the facts that the deal may not close. Period!