Did you know that you could be missing out on higher compensation and a more flexible mortgage for your clients by not applying for the full amount they qualify for? It's true!

Manulife One pays brokers compensation on the full approved amount, but brokers must apply for that amount when submitting the Manulife One mortgage application.

We often see clients qualify for a higher amount. When you as the broker see that your client qualifies for a higher amount than they wish to draw down on, you can ask the client if they want to apply for the higher amount. With their consent, and if approved, they would have access to additional money at any time, without having to apply again.

Qualifying amount + application to include that amount = clients have access to those funds!

Here's an example of how the broker and the client may lose out on the qualifying amount and the corresponding broker compensation:

Qualifying amount
$700,000

Client could potentially apply for up to $700,000

  • But the broker must do so in the next step
Approved amount
$250,000

Broker only put $250,000 on the application

  • Now client can only access $250,000
  • Broker is only compensated 90 bps on $250,000
Borrowed amount
(drawn down by client)

Can only be up to $250,000

  • The client can't access the other $450,000 for which they qualified
  • The broker is not compensated on the other $450,000 because it was not included as part of the intial application

It is always important to make the client aware that if they increase the amount in their initial application, and if approved, they do not get charged interest unless they draw down on those funds. Clients only pay interest on money borrowed and continue to have access to the rest of the approved funds if and when they are needed in the future, without the need to re-apply for more credit.

Commissions are paid only on the approved amount, not on the qualifying amount and not on the amount drawn down by the client.

Knowing the approved amount your client needs and including that on the initial application helps avoid future requests from the client to refinance. This is the whole concept of Manulife One. 

If in doubt, contact your Business Development representative. They are always happy to chat!