Get money-saving tips in your inbox.

Stay on top of personal finance tips from our money experts!

News & Resources

High Mortgage Volumes Leading to Approval Delays

June 4, 2021
4 mins
A woman flips through her daily calendar at a desk

In case you’re wondering what's taking so long for your mortgage approval, here’s why.

Lenders are busy. And when I say busy, I mean deluged. Some are struggling to approve at least twice as many applicants as normal.

“We’re doing volume that is 100% greater year-over-year,” John Webster, who runs Scotiabank’s mortgage business, told VERICO mortgage brokers on Thursday.

Webster characterized this mortgage market as a "once-in-a-lifetime experience" and added that, “…application flows [are] up over 200%."

When that happens, approval times suffer. Instead of a 24- or 48-hour turnaround, some mortgage applicants are seeing approvals come back in 4-5 days or more—sometimes a lot more. There are actually some credit unions quoting over three-week lead times. And some of the biggest credit unions have had to cut off refinance business from brokers altogether in order to reduce their application queues.

One big reason for the bottleneck is that, as Webster notes, “no one had staffed up” ahead of this surge. That’s because virtually no one expected this kind of volume coming off a global pandemic with nationwide lockdowns.

As a borrower, this means two things:

  1. You’ll need to allow plenty of time for financing in your purchase agreement, especially if your lender’s mortgage rate is rock-bottom (the lower a lender’s rate, the busier they usually are), and
  2. You’ll want to get pre-approved ahead of time if you’re purchasing with a mortgage.

A pre-approval gets your application into the lender’s system so that it just needs a quick update, document review and appraisal, to get final approval.

If you choose a lender that reviews your documents during the pre-approval process (most don’t), and one that does automated valuations, that can speed things up as well.

All of this is something to keep in mind if:

  • you’re bidding on a home
  • you need to insert a financing condition in the contract, and
  • you want to present the most appealing offer you can.

Keeping your financing condition timeframe to the typical five business days (instead of 7 to 10) makes your offer more appealing to the seller. For those in a multiple-offer situation, every edge counts.

Rob McLister

Rob McLister has been informing mortgage consumers and professionals since 2007. In that time, he’s written more than 2,500 mortgage stories for publications ranging from the Globe and Mail — where he presently serves as mortgage columnist — to the National Post, Maclean’s, Canadian Mortgage Trends and Regularly quoted throughout the media, Rob is a committed advocate of greater transparency in the mortgage industry. He’s also been a vocal consumer advocate for more sensible mortgage regulation. In 2011, he launched two mortgage fintechs: mortgage comparison website and digital mortgage broker intelliMortgage Inc. The former is the go-to source of Canadian mortgage news and the only site comparing all publicly advertised prime mortgage rates. The latter is Canada's leading online mortgage provider for self-directed borrowers. Both companies were acquired in 2019 by RATESDOTCA Group Ltd.

Latest mortgage articles

Should you ask your retired parents to co-sign your mortgage?
Parents can help their adult children break into the housing market by co-signing a mortgage. But there are risks to consider.
3 mins read
Then and now: How much more expensive is it to buy a home in 2024 vs. 1994?
The average home in Canada now is 133% more expensive than it was in 1994, despite income being only modestly higher. Find out why.
5 mins read
Bank of Canada cuts rate for the first time in four years: The policy rate is now 4.75%
After 11 months at 5%, the Bank of Canada has finally started cutting their policy rate, marking a turn for the Canadian economy.
5 mins read

Subscribe to our newsletter

Stay on top of our latest offers, relevant news and tips!

Thanks for joining!

You'll be hearing from us shortly - stay tuned.