Lenders are understaffed and dealing with record volume, according to one former underwriter, which explains the increase in last minute audits and the resulting problems with files.
Those last minute reviews are done by an auditor that oversees underwriters’ work according to Hill, who worked as an underwriter for Street Capital for over three years before moving to the broker side of the business.
An increasing number of brokers are reporting issues late in the mortgage origination process with last minute audits.
For his part, Robert Clancy of Verico Safebridge Financial argues these last minute audits are being exacerbated by lenders who all interpret mortgage regulations differently.
“A lot of the time there is an issue with conditions being added on by lenders at the end of deal; all of a sudden lenders call and ask for more documents,” Clancy told MortgageBrokerNews.ca. “It seems to be the monolines grappling with the regulation changes; everyone seems to be interpreting them differently.”
One specific example Clancy encountered was when a lender requested – at the last minute –that a number of debts to be paid down.
“They requested this days before closing, and even though we showed them their calculations were wrong they still forced us to deal with it.”
Luckily Clancy was able to work with the client and eventually got the deal funded. But not all brokers have the same luck at the last minute.