Quote:
Originally Posted by albertGQ
Tied selling is illegal. I've been in the banking industry for over a decade.
You can get in very big trouble if you would only approve someones mortgage if they brought more business over
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Giving discounts for business is common but it can't be a condition. The more business the easier to offer a rate discount. Often there are specific parameters based on the level of business. But they can't be forced to bring over more business to get approved (unless required if it is cash secured by a GIC or something).
Quote:
Originally Posted by Slava
You should hear the things clients tell me. Yesterday in fact a very good client told me his bank wouldn't give him the mortgage without buying an insurance policy. Could be that he misunderstood, and surely that would be the banks position, but its just wrong.
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If a rep from an FI told a client that they would only get approved if they bought the credit insurance then that is the definition of tied selling and is illegal.
It is even too common where a loan officer will include the insurance in the deal and paperwork and not even mention it to the consumer that it is not required. When the client balks at the insurance then that's when you'll see the truth come out that they can waive it if they want. It's sleazy but that's what happens when sales targets determine your pay grade.