What makes a good broker/lender relationship?

One of the most important aspects of a mortgage broker’s job is their relationship with the lenders they deal with on a daily basis – and vice-versa. But what are some of the main things that both need to keep in mind about how to help each other be as successful as possible? CMP caught up with Community Trust’s Grant Armstrong and Citadel Mortgages’ Tristan Kirk for a closer look at what makes a solid broker/lender relationship.

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Fergal: [00:00:26] Hello again and thanks for joining us on another edition of CMP TV. I'm Fergal McAlinden, CMP's News Editor. And on today's episode, we'll be taking a closer look at one of the most important aspects of the mortgage brokers job their relationship with the lenders they work with on a daily basis. We'll be delving into some of the biggest things that brokers should keep in mind to make dealing with lenders as smooth as possible and vice versa. And joining me on today's show, we have leading figures in the industry from both the lending and brokerage communities on the lender side. And very pleased to welcome Grant Armstrong, Director of National Sales and Lending Community Trust. Grant, thanks for joining us today. How are things with you?

Grant: [00:01:01] Fantastic, Fergal. Thanks for having me today.

Fergal: [00:01:04] Great to have you on and on the brokerage side. Very pleased to be joined by none other than Tristan Kirk, principal broker and managing partner with Citadel Mortgages. Tristan, thanks for being with us today. How are things with you?

Tristan: [00:01:13] Thanks for having me. I'm looking forward to this. 

Fergal: [00:01:17] It's great to have you both on. And I want to start with you just talking about some of the ways that we can improve the relationship between brokers and lenders. What are some of the characteristics of the top brokers that you work with that make them so successful? 

Grant: [00:01:30] Thanks for asking that. And there's when I think back, the two key characteristics that I think are really of our best partners are the number one being organized brokers that organize with their clients, organize with their referral sources, the processes that they put in on their end before the deal is even submitted into a lender is critical. And then compare that with someone that's communicative with the underwriters, with our teams, with their clients. Those are the attributes and characteristics of brokers that are just very successful. They make sure their applications are smooth, their clients are happy, and that it's a seamless and a very efficient process working together. 

Fergal: [00:02:11] Tristan, on the other side, is there anything from a broker, a broker perspective, sorry, that you see the best lenders doing or any of the characteristics that make them standout? 

Tristan: [00:02:21] The best lenders really are the best ones that have good systems, processes and communication all in place. Right? When you start working with a lender, it's super important that the underwriter, the compliance team, they're all in sync with one another. If there's any gaps in between that process, that creates issues for US brokers, because then we don't know what's going on with our files, right? So the biggest difference between the lenders really is the ones that have a good foundation in their business and have good communication with really good quality underwriters and compliance teams. They're the ones that stand out from the rest. 

Fergal: [00:02:53] For sure. Well, Grant, going back to you, is there anything in particular that you think brokers should focus on or anything that they should keep top of mind to have the best possible relationship with their lender? 

Grant: [00:03:03] Know the lender. And I know that sounds very similar to as simple to say, but get to understand their processes, their policies. You know, very much a lot of times some brokers will assume that lenders have the same process as the same policies. What's acceptable at Lender A is acceptable at Lender B. Unfortunately, every lender, just like every brokers, are unique, every client's unique. And then in the alternative lending space, for me specifically, every application is looked at with a different lens to be able to provide the best solution. So pick up the phone and talk to your BDMs, buy them a cup of coffee and ask them, What do I need to do to work with you? What are your tips? What are your tricks, what are your niches? And then learn. And when you're not sure. Don't assume. Call them and say, hey, you've got this condition on the commitment. I'm not really sure what you're asking for or how do I make this or what should I provide you? And the underwriters, the mortgage officers, or in our case are fantastic mortgage advisory team are really great at providing some clarity on the conditions to help it. A very simple process. So that's that's the advice I have. 

Fergal: [00:04:11] Picking up on that Tristan, you're obviously quite a prominent broker in the industry. Is there anything that you focus on yourself to ensure that you have the best relationship possible with lenders that you deal with? 

Tristan: [00:04:21] Yeah, actually, our process is very simple. We're 100% broker complete before we submit any deal to the actual lender. Right. So everything right down to the pad form for the client. We're 100% broker complete. And I think if more brokers operate in that model, right, our lenders will be able to turn the files around faster. They'll be able to provide us with more exceptions or comp because we're saving them their time and their underwriters time and their cost of doing business. Right. So the biggest thing for me is, is all files are submitted the same way. It doesn't matter if it's a purchase or a refi, every piece of document is there. We have a very detailed note structure. So our notes are very, very detailed as well. So that's that's the biggest thing. 

Fergal: [00:05:04] So I often hear from lenders, Grant about some of the most common mistakes or misconceptions that they see brokers making in their interactions with lenders. Is there anything that you think stands out that you'd like brokers to do a little bit better? 

Grant: [00:05:17] There's a couple of things I think, and I'll start from the application process. I mean, sometimes, you know, down payment, a little topic like that, they'll say, well, it doesn't matter if it's a gift or own savings or whatever. They're just it's 100,000. We'll deal with where the money is coming from later, knowing that information upfront, how self employed clients, not how much they make necessarily, right. I mean, that's important and a critical part, but how do they get paid? A lot of times some brokers might forget to ask those questions. We're very focused on the end result, but not the journey that we're going to get there. So asking the client, how do you get paid that's going to help you documentation? It's going to help simplicity. It's going to make the transaction go through. The other part is, and maybe this is a lender, we could do a great job of explaining, but everything does take a little bit of time on a lender. We do need an opportunity to review the documents. It's you know, we we have to look at the appraisal in detail. We have to look at the income. We have some validations that we have to do. So it's sometimes we get documents last minute, it's like, okay, well, here's the doc you can find out. And it's unfortunately, it's not that easy. It's we've got the doc, we've got a review. We've also got 100 other great business partners that we're working with. So understanding that some things do take time, but this is where that relationship comes up. Pick up the phone, call your BDM, work with the underwriting team and say, Hey, what's the turnaround time that you need so that the experience some applications are last minute. Not every application gets a 90 day closing with a clients that provide their docs. Some things might take a little longer something good things, or some things will happen to good people. This is where understanding the timelines of your partner will make a huge difference in the experience that you offer. 

Fergal: [00:07:08] Okay. Excellent. And Tristan, do you have any advice for brokers to avoid common mistakes when they're dealing with lenders?

Tristan: [00:07:14] Yeah, I think a couple of them is don't try to work with every single lender, know your business, know your lenders. Right. Oftentimes, brokers seem to be doing one deal with this lender, another deal with this lender, another deal with this lender, trying to build with each lender. You really only need three or four lenders at the end of the day, right? Like figure out which ones you gel with the most, figure out where your business is, and figure out from there what products we line up. And then once you have that, you focus in on that with your particular lenders and you'll see your turnaround times, your your approvals, your conversions. They'll all be much better at the end of the day because you're building a rapport with that lender. Right. And you're understanding their process and you're sending them the deals that are going to be approved. So I think that that's that's key, especially in this environment. Just work with the right lenders. You don't need everyone. 

Fergal: [00:08:01] That's obviously a really interesting point, Grant, because turnaround time is so important to successful brokers in the current climate and with things so busy in the market, is there anything that brokers and lenders as well can do to ensure that it's as fast as possible and that turnaround time is effective?

Grant: [00:08:17] That's a great question. And even for myself, historically, I always thought turnaround time was 100% responsibility of the lender over the last few years, turnaround times, a partnership, you know, from the application coming in fantastic notes, speed up the turnaround time, having an application submitted and that says good deal, please approve actually takes a lot longer because you've now got to understand what are the missing piece? Where is the the data between the lines, where's the clarity, where's the explanations? So really good. Detailed notes make a big difference and actually speed up the process. Tell us in advance where the challenges are going to be, where are the gaps and how are you mitigating it? Don't let us discover the gaps because that's just like driving down the highway and hitting a pothole. It's going to slow you down for a couple of minutes, but turn around time again, package everything up if you can, and went in one package, piecemeal documentation. So for us, we have a 2 to 3 business day turnaround time on our documentation. So if you get a job letter that's 2 to 3 days, then you get a pay stub 2 to 3 days, then you get a T4 it can add that process. So take the time, meet with your client, go through the conditions and collect everything. What's really nice for us is, well, we brought a lot of technology work with lenders that embrace technology, know they have an amazing portal that has all the conditions. You can actually upload conditions right to it that makes your life simpler and you get a really good visualization of what's outstanding. 

Fergal: [00:09:48] From the other side. Tristan, is there anything that you look for from a lender to help make turnaround time as quick as possible? 

Tristan: [00:09:55] Yeah, again, it's a process, right? How quick are they on communication with us? But also the technology is a huge part of it as well. There's a big difference between the lenders that use technology and there's a big difference between the lenders that don't write job verification CRA verification documents. That's something that we've bank statements we've integrated from day one. And the lenders that I work with understand that every piece of document that we're getting is coming from either the bank or a third party service provider that can verify it and the lenders that accept that, those are the ones that get the business because they're ahead of the curve. So those two things between communication and technology are huge. 

Fergal: [00:10:32] And Grant, we talked a little bit about what brokers and lenders need to ensure the best chances of success. Is there anything the Community Trust is doing in particular to go above and beyond to help brokers? 

Grant: [00:10:44] Absolutely. I love that there's two things that lenders can do, and that's the products and solutions that they offer for their clients. But it has to be paired with a credible service. So you have to have products that meet the needs of Canadians. And over the last few years, we've seen the Canadian personal financials evolve. There's more gig economy employees, there's more commission, there's more self employed. So you need a lender and a partner that really has the agility and flexibility to work with those clients, but they've got to match it with incredible service. So a community trust, specifically on top of some of our great products that we've offered, including our new 35 year amortization, our non-conforming programs we built about a year ago, our mortgage advisory team. Our mortgage advisory team is open 8 a.m To 8 p.m. Eastern Standard Time. So I think an Ontario broker can call us at 7 p.m. and get an underwriting quality individual that can talk to them about a live deal, a new deal conditions, what's going on with funding so you don't have to work when the underwriter is available. You get to work when you're available and brokers are busy, brokers are out there working. It's a different it's a hard time. They want to get out there. They're building up more referrals. So you need that service and that's what Community Trust is. We've doubled down on our service abilities. 

Fergal: [00:12:01] Is there anything else for you, Tristan, that stands out in terms of things that the best lenders do to give brokers the best possible chance of success? 

Tristan: [00:12:08] No. Those are great points. I think that's what we as brokers are looking for at this day of age is flexibility on schedule, right. Being able to communicate because we're working longer hours, we're working weekends, we're working all kinds of different things going on in the market. I keep us busy, right? So having lenders that are flexible with us, that's that's going to be the game changer moving forward in the future. 

Fergal: [00:12:33] And just to kind of wrap things up, is there anything in particular that you think a successful broker should be expecting from their lender? 

Grant: [00:12:40] They should be a successful broker. And I mean, I look at this as a successful broker that has strong efficiency, whether it be that your commit to fund your submit to funds, one that's a true business partner, they should expect some preferential service. They should expect their business partner to have a program that rewards it, recognizes the contributions and the efficiencies. Community Trust has our Amazing Bear Start program. Brokers should expect lenders that want to continue to deepen that relationship. They want to be able to have people that say, You know what, I like the way you do your business, how to work more together. How do I help you grow your business? Well, I grow my business, and that's what they should be expecting from a business partner. 

Fergal: [00:13:23] And on the other side. Tristan, is there anything in particular that you think lenders should be expecting? The top brokers should be the boxes they should be taking. 

Tristan: [00:13:31] Yeah, I actually think more lenders should hold brokers accountable and how they submit their applications. Right. And making sure that the notes are detailed, making sure the documents are detailed, because at the end of the day, we're moving into more of an online generation platform and it's easier to get and we need to. So I would love to see more lenders have those tough conversations with brokers and hold them accountable for for for their business. That will make it easier for us, people like myself and my brokers, that we continuously do do a great job. We should get everyone on that same page and everyone has better efficiencies at the end of the day. 

Fergal: [00:14:08] Okay, excellent. I think that's a really good place for us to leave it today. Grant, Tristan, thanks to you both for coming on. As always, much appreciated. And I'm sure we'll catch up very soon and have you back here as soon as we can. 

Grant: [00:14:19] Thank you. 

Tristan: [00:14:20] Hey, thanks for having me. Really enjoyed the time today. 

Fergal: [00:14:23] That's just about all we have time for. On today's show are many thanks to Community Trust and Citadel mortgages for joining us on this episode of CMP TV. Thanks to you for watching and we'll see you next time.