CMT Team·
Mortgage Broker NewsMortgage Commentary
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Call for Special Pricing!

Secret-Rates

Some
lenders like to write “call for special pricing” on their broker rate
sheets.

For you lenders
who do this, can we all pause for a moment and ask: Are your unpublished rates
truly that special and exclusive?

When a broker has
to phone you, only to hear that your 5-year unpublished rate is the same as the published rate of six other
lenders, that’s misusing one thing everyone is short on:
time.

There are few
secrets in this business when it comes to rates and products. It’s futile for
lenders to pretend otherwise and inconvenience brokers in the process.

The ironic thing
is, Business Development Managers at other lenders often know
their competition’s top-secret “unpublished” rates before most brokers do.

Some say that
lenders use the “call us” tactic to make brokers more reliant on them. It’s akin to a
lender telling the broker, “You better keep in touch, stay on our good side and
keep sending deals if you want to get our ‘special’ unpublished
rates.”

If true, that’s
unfortunate, and certainly inefficient.

Time-conscious and busy
professionals:

  • Pull
    their hairs out one by one when they have to look for, and can’t find, a lender’s best
    rates in writing
  • Would
    rather call their mother-in-law to recap the latest episode of The Young and the
    Restless than search for a lender’s phone number, call up their BDM, make small
    talk for 10 minutes, and then ask for rates. Note to my BDMs: This doesn’t apply to you! ;)

Brokers who don’t
know (or who forget) a lender’s unpublished rates will sometimes skip the extra
steps and send an application to a competing lender that offers the same terms
and fully disclosed pricing.

So, who wins with
“call us for pricing” policies?

Email your
answer to wehavenoidea@pointless.com*

(* Not a real email)

Rob McLister,
CMT

CMT Team
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10 Comments

  3. I understand this rob. I’m a bdm and it’s some times frustrating to be required by our company to reach out by phone or “call for details” to get the info. The truth is it’s hard to contact 200 people by phone or more to put the word out. It’s there to encourage communication — but also to keep it off the official record where a competitor can -and usually do- copy it – especially in the case of an “actual special”. The worst part is we want the business and it makes it harder to actually bring it in. For you – good luck getting a hold of a bdm in a timely mannner as usually a game of “phone tag” ensues. To agree with your point – all this is complete waste of time if the “special” isn’t really that special !!

    Reply

  4. Why would a lending institution promote their unpublished rates out to the public and brokers if they are called “Unpublished Rates” hence why it is your job to make sure you contact the lender or BDM to discuss. Take into account unpublished rate also have restrictions to them and by law lenders do follow regulations set out in place where these are not mandatory to be promoted out public brokers.
    We all complain about the competition but reality is competition is good for the organization and the field we are all in. Stop complaining about other Brokers, Mortgage Specialist, Lending Insttituions if you have not done your full research and have actual facts supported by the lending institution and such then you by all means go right ahead and post comments like this.

    Reply

  5. I am quite positive the reason that they do this is because they don’t want the unpublished rates to get in the hands on someone visiting their retail channel, which would create massive headaches for both channels.
    For the non-bank lenders though, I have no idea.

    Reply

  6. National Bank publishes its best broker rates and it has a retail channel. In most cases I find the unpublished rates are the same or worse than what you’d get by walking into a branch. So I agree. What is the point?

    Reply

  7. Hi JMAN,
    The underlying questions are: (a) are “unpublished rates” genuinely necessary, and (b) are they more trouble than they’re worth?
    In speaking with lenders, I have yet to hear a reason that truly justifies why a widely available 5-year rate of 2.99%, as an example, should be unpublished. (If the rate were 2.79% maybe it would be more understandable.) In some cases, the lender’s own retail channel is doling out the same 2.99% rate like candy, and putting it on customer-facing collateral.
    The fact that a rate has restrictions doesn’t preclude it from being published. Banks and non-banks publish rates with restrictions all the time.
    Regarding competition, there is no complaint about competition here. It’s quite the opposite. Publishing rates creates a more efficient market, which improves competition.
    Cheers…
    Rob

    Reply

  8. Hi Rob
    Another great article. One thought to add. Some lenders offer rates at renewal that are same as the published broker rate. They are attempting to establish a defensible case that renewals and IRD calculations are at their published rates – which are higher than their “actual broker rates”
    so they say call us for the real rates

    Reply

  10. Rob first smile of my day is when you said “brokers would rather call their mother in law or pull their hair out than call for rates and make small talk with BDM. Funny but true! And please excuse my BDM too!

    Reply

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