February 2010, 5.2
piece fits Fin din ga
FOCUS Credit Unions: Why they could work for you
nic he to bo ost yo ur bu sin ess
ANALYSIs Education, regulation, and the future of the market
PROFILE Wayne Kainu: Memories of speedskating and Olympic dreams PUBLICATIONS MAIL AGREEMENT #41261516
54 Tapping into credit unions Credit unions haven’t always been seen as broker-friendly, but many are now looking to build business through this channel. CMP talks to credit union representatives and brokers to get the lowdown on accessing a flow of funds from this lender category
5. 02 issue
44 If the piece fits: finding your niche One of the keys to many a top brokers’ success has to do with one thing – finding a niche. Not only does it allow you to become an expert in that field, but because of it people will come to you, rather than you seeking them out. CMP asks five successful brokers how they found theirs
WEB COMMENTS 8
recently gathered at the Mortgage Finance Summit to do just that, hoping that history doesn’t repeat itself
A collection of stats and comments from mortgagebrokernews.ca.
IN THE COMMUNITY 10 Mortgage Intelligence’s Toronto gala; Mortgage Alliance’s kickoff sales rally
AIG Canada’s new ownership; Abode’s future plans; Nick Kyprianou’s latest venture; Royal LePage’s 2010 forecast; a new private lending tool; FSCO’s audit plans; Genworth’s year-end results; and more…
NEWS INTERVIEWS 32 Q&A: New Home Trust president wants to keep “servicing the underserved”: After serving as Home Trust’s treasurer for more than two years, Martin Reid assumed his new role as the company’s president in December. CMP caught up with Reid to talk about Home Trust’s recent push in the B lending market and its plans for 2010 76 International perspective: Q&A with Australia’s Kathy Cummings: Kathy Cummings is the executive general manager of third-party banking at Commonwealth Bank, one of Australia’s top four financial institutions. She attended the CAAMP conference in Toronto in November and shared her thoughts on the Canadian mortgage market with CMP
NEWS ANALYSIS 38 What we can learn from the crash: Hindsight is 50/50, so what better time than the present to look back at what went wrong over the last two years in the mortgage industry? A group of industry experts
66 Lacing up for success With his co-founded mortgage business booming after only two years, Erin Letson looks at how Wayne Kainu’s early career as a competitive speedskater put him on the path to success – even if it wasn’t in the form of Olympic gold
72 Provider: Bank benefits: After more than two decades in business, the company behind the CHIP Home Income Plan made the move to a chartered bank last October. CMP talks to HomEquity Bank’s senior vice-president, Greg Bandler, to find out what the change means and how the transformed company is working with mortgage brokers 74 Insight: A simple formula for success: RDM Financial is not only the oldest franchise in the Mortgage Centre network, but it’s also been the top producing franchise in that network for the last four years. CMP caught up with broker/owner Bob MacDonald to see what keeps his business flourishing 78 Favourite Things: Mary Gronkowski, Regional Manager, Mortgage Intelligence, Toronto
regulars 34 International News 36 This time last year 79 CMP Service Directory Follow us on Twitter Twitter.com/CMPmagazine
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When you join most superbrokers, you give up your local personality in favour of a faceless national brand. But at The Mortgage Centre®, we understand that your success is based on your relationship with your local market. Even though we maintain Canada’s longest-established national franchise network, we make sure all our programs and marketing tools spotlight you. To learn more about the exceptional independence we offer, contact firstname.lastname@example.org The Mortgage Centre is a division of CIBC Mortgages Inc., a member of the CIBC group of companies. ® The Mortgage Centre is a registered trademark of CIBC Mortgages Inc.
Olympian focus With the Olympics just finished, there is a good chance that you are a member of one of two camps: you think the last few weeks of television broadcasted some of the most entertaining and inspiring moments of the year, or you’re thankful the Winter Games are over and your regularly scheduled shows are finally back on. Either way, one thing is for certain. Canada’s Olympians are definitely representative of what one can achieve by focusing their attention on a specific goal and working endlessly to achieve it. The same could be said about many of the brokers featured in our cover story this issue, which is all about finding a niche market and really focusing on serving it the best way possible (Finding your niche on page 44). It’s no secret that if a broker can find a niche, then that is one of the key factors to a successful, long-term career. One type of lender that can really help brokers service these niches are credit unions, and on page 54, we take a closer look at exactly what you can expect from them, including the pros and cons, and the best ways to deal with them. Fortunately, it seems that credit unions are getting ready to open their flow of finances to the broker channel, and while some may be as specific as only working with farmers, for instance, others are surprisingly broad in scope. In fact, as CMP found out, they may be the only place you can still find B, alt-A and prime products all in one place - it’s just a matter of knowing how to deal with them. Turning our gaze back to the Olympics, our senior writer Erin Letson talked with Calgary broker Wayne Kainu, a former professional speedskater who, after making it the Olympic trials but just missing the cut, went into a finance career. Even though he has been a broker now for just over two years, he didn’t forget about his passion, offering his time to be a part of the Olympic athlete services for the Canadian speedskating team. He strapped the skates on for us again when we caught up with him just before the Olympics began. I hope you enjoy the read as much as you enjoyed (or didn’t enjoy) the Games. Regards, Jesse Kinos-Goodin Editor Jesse.email@example.com
5. 02 issue
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“Anybody in Grade 6 can write an A loan, and with 10,000 agents in Ontario, the 200 who are successful have all found niches.” - Robb Nelson, an agricultural broker in Chatham, Ont. on the importance of niches. Page 44
“Where credit unions stand out is their service at the branch level – it tends to be better than at a bank and it’s less of that ‘big bank’ experience that some consumers don’t like.” - Brent Irving, a DLC broker on the strength of credit unions. Page 54
“If you look back a year ago, there was a lot of uncertainty in the financial markets and at this stage of the game, we have a better sense of where things are and we’re pretty comfortable with the real estate market.” - Martin Reid, the new president at Home Trust. Page 32
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Right where I want to be.
Hi everyone, Gerri here. Running a successful brokering business takes time and effort, and so does raising a family. And with Invis on my side, I can balance my business and my life. My work days are busy. I’m focused on my mortgage clients… and doing everything it takes to make sure they stay satisfied clients. But life’s busy, too. Caring for my family keeps me on the go. Being there at my kids’ ball games. Checking homework. Serving in my community. With all this on my plate, Invis is a fantastic team to have working for me. I love it that brokers have a strong voice at Invis. Managers at all levels are just a phone call away. They get what we as brokers need. They get problems solved. At Invis, they make it easy for me to work with my colleagues. We don’t solicit each other’s referral sources. We share information and best practices. We share our successes. We know that we’re in this together. Invis gets the value of a solid reputation. They’re leading the charge for greater professionalism in our industry. Quality matters, and I benefit directly from the respect and credibility Invis has with lenders. I have choices and I choose Invis. I’m right where I want to be.
Making her home in Edmonton, Gerri Vaughan is the number one individual mortgage associate with Invis in Canada. At her kids’ softball games, Gerri can be found in the bleachers firing up the cheering section.
Gerri Vaughan Senior Mortgage Associate Invis Inc. Edmonton, AB
Reader’s Write Web comments
I think your government trying to put a lid on further house price escalation in the near term is a good call. Increasing the minimum down payment would certainly help a bit. Here (in the U.S.), we’ve always been taught that home prices normally increase about four per cent to five per cent per year, on average. We went through a three-year period where they went up 15 per cent or more per year and now we are all paying for it. I hope you can avoid what has happened here, and also in the U.K. shortly after us. - Ken Lambert, homeequitybuilder.com (New England, U.S.) Islamic mortgages – a divided issue
I am not an expert on the Qur’an, but what is wrong with amending the way we do mortgages to accommodate an ethnic community? We do this somewhat now for new-to-Canada residents as well as other niches such as business owners. I think all the Muslim community wants is to restructure the wording of the mortgage documents so that it supports their religious beliefs in how they borrow money. Having more niches and mortgages that serve the diversity in Canada is another way to ensure lender profitability and respect the ethnic diversity of Canada. - Joe Ornato, on the news of Islamic financing coming to Canada I have lived and worked in the banking system in the Arab Gulf States where Islamic banking is good business for international banks only because they have to do it – but Canada doesn’t have to do it as we have a very efficient system in place. You cannot introduce Islamic financing by creating one product or making small changes to existing products like the program for new immigrants. You will have to create a whole new system with different rules, so you can’t just add different names and new administration and paperwork. It will be complex and costly. I am against it. - John Nordstrom
the early 2000s). Ask them what their salary base was for the past five years. If they’re already at 40 per cent TDS and they expect their salary to increase enough that the TDS in five years will be either lower or the same at 6.5 per cent, then by all means these clients should get their home. However, if they have had steady salary for the past five years and their total increase in salary amounts to three per cent to five per cent total, and their TDS with 6.5 per cent in five years is at 55 per cent, then guess what? Maybe they can’t afford that home. - Sergio Bogani
do you think Canada is experiencing a real estate bubble? Every month CMP will have a new broker poll on mortgagebrokernews.ca. Here are the results of the latest one.
Yes, without a doubt
No, but it’s coming
Not at all
Total Votes: 66 Poll Date: 12/01/2010
Do the math
I agree that as mortgage agents, we have an obligation to ensure our clients take on mortgages they can afford. So do the ratio calculation. If they are buying a new home with five per cent down, calculate what their ratios would be in five years if the rate was at 6.5 per cent (actual normal rate in
If you have something to say and would like to potentially see it in the pages of CMP, you can either comment on mortgagebrokernews.ca or send a letter to Jesse.firstname.lastname@example.org. Letters and comment may be edited for length and clarity.
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In the community Above Mortgage Intelligence held the first of its regional broker appreciation galas in Toronto on Jan. 9, with more than 300 brokers and their spouses in attendance. Galas were also held Jan. 30 in Halifax and Feb. 20 in Montreal. (From left to right: Stan Falkowski, Dale Bilton, Liz Hynes, Gord Dahlen) Bottom On Jan. 21, more than 1,000 Mortgage Alliance brokers gathered in four locations across Canada to participate in the annual January kickoff sales rally. A live broadcast of the event streamed to 300 other Mortgage Alliance members, with 25 lenders also participating. To read about the tool Mortgage Alliance launched at the rally, turn to page 12.
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News bites Home Capital Group was named one of the 10 “star stocks of the decade” by The Globe and Mail at the beginning of January. According to the newspaper, the company’s stock grew by 1,942 per cent over the last 10 years. “Given the subprime mortgage disaster in the United States, you’d think a company that bills itself as ‘Canada’s leading alternative lender’ would be about as popular with investors as a boil on their backside. Wrong,” wrote investment reporter John Heinzl, adding the company’s dividend “keeps rising.” (To read an interview with Home Trust’s new president, Martin Reid, turn to page 32) CMP Verico recently introduced a free website tool called VERIsite to its member brokers. The tool allows users to customize their website with a wide variety of colour schemes to match their company logos and includes video, blog and social media capabilities. It also has a function called “arrange a call back” that maps online appointment requests from customers back to the Verico CRM system. CMP Mortgage Alliance launched a new off-line application system called MortgageBOSS at the beginning of January as part of its kickoff sales rally events in Ontario, New Brunswick, B.C. and Alberta. The system allows brokers to input
client’s mortgage application information on their computer even if they don’t have Internet access. Once they do have access, the broker can submit the application in minutes. Mortgage Alliance CEO Michael Beckette said the technology allows brokers to do business “everywhere, anywhere, anytime.” CMP MCAP has teamed up with Habitat for Humanity Canada to launch its new Key to Hope program, something the company says lets brokers give back to their communities. “We have lots of survey data showing Canadians want products and services where there’s a donation to a good cause,” said Nigel Aplin, director of communications at MCAP. To take part in the cross-Canada program, brokers must make a minimum donation of $500 to Habitat for Humanity. Clients who take out any mortgage with a participating broker can then add a donation of their choice to each mortgage payment and these donations will be matched by MCAP. CMP
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AIG United Guaranty set to come under Canadian ownership The private investment department of the Ontario Teachers’ Pension Plan announced on Jan. 5 that it entered an agreement to buy AIG’s Canadian mortgage insurance business. “We believe the mortgage insurance industry in Canada to be an attractive market, and that United Guaranty Canada is well-positioned to grow its market position,” said Erol Uzumeri, senior vice-president of Teachers’ Private Capital. “The company has a strong management team, and Teachers’ is prepared to support the growth of the business.” According to the Financial Post, First National president Stephen Smith is also part of the deal. He reportedly teamed up with the Ontario Teachers’ Pension Plan to purchase the mortgage insurance business through his private family holding company, National Mortgage Guaranty.
The transaction, which is subject to closing conditions and regulatory approval, is expected to close later this quarter, according to a representative from the Ontario Teachers’ Pension Plan. As of last September, AIGUG had a total equity of $127 million and assets of $274 million. Uzumeri told the Financial Post that Teachers’ Private Capital has been studying the Canadian mortgage market for two years and had “good discussions” with a number of potential bank customers before deciding to buy AIGUG, which has been in Canada since 2006. He added Teachers’ plans to rebrand the mortgage insurer when the purchase is completed. “Our plans are modest,” Erol Uzumeri told the newspaper. “CMHC is, and always will be, a dominant provider of mortgage insurance in Canada, but there is room for third-party providers.” CMP
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Construction and bridge lending specialists Firm Capital Corporation is a non-bank direct lender that provides financing solutions for residential and commercial projects that fall outside of the typical bank lending criteria
irm Capital Corporation is a boutique mortgage lender that provides a full spectrum of product offerings, including first and second mortgages for: bridge and short-term; construction; land and development; term debt; mezzanine debt; and joint venture capital. Since its inception in 1988, Firm Capital’s mission has been to deliver creative and innovative financial solutions to builders, developers and real estate investors of all sizes. The company’s construction programs, for example, offer a lower pre sale test or leasing test than is required by a Schedule A bank. The company’s focus is on projects requiring short-term financing between 12 and 18 months. “Our bridge and short-term financing program offers funds for three to 12 months, interest-only payments and is fully open without any pre payment penalties,” says Michael Carragher, the company’s vice president of mortgage investments. Firm Capital deals with both commercial and residential brokers. “From a lending or investment perspective, if the deal doesn’t meet the underwriting guidelines of a Schedule A bank, then your next call should be to us,” he notes.
On a typical transaction, the company lends up to 70% LTV of purchase price or appraised value, and 100% of hard construction costs. Funding capabilities range between $500,000 and $20 million. In 2009, Firm Capital funded more than $230 million in volume. Today, the company manages a $548 million portfolio of residential and commercial mortgages. With a national scope in mind, Firm Capital has invested in Ontario, Alberta, British Columbia, Quebec primarily the Greater Montreal Area Manitoba and Saskatchewan. However, their primary focus is the Greater Toronto Area and Southwestern Ontario.
Firm Capital’s Mortgage Lending Group is comprised of 10 professionals who have experienced many real estate cycles, and work very closely with mortgage brokers, says Carragher. “This gives us the ability to understand a transaction very quickly and customize it to the needs of the client.” Having a small, dedicated team of professionals has its advantages, he says, adding that the underwriters are also involved in the decision-marking process, allowing for quick solutions for brokers and their clients.
FIRM CAPITAL QUALIFIED PROJECTS INCLUDE: • • • • • • •
The company aims for a 24-hour turnaround on deals where all of the paperwork is in order, and 10-day funding. Firm Capital Corporation is the mortgage banker for a number of different entities, including Firm Capital Mortgage Investment Trust, which is publicly traded. Other funding sources include the company’s mortgage investment corporation , and other institutional and private lenders.
Firm Capital focuses on property types such as storefront/apartments; rental plazas; mixed-use projects; industrial/ warehouse/self storage; industrial and commercial land; and offices. The company provides first, second and equity mortgage transactions to assist borrowers with the purchase, refinance or construction of commercial and residential properties including multi-use residential and single-unit infill construction projects. (See box for more details on qualified projects.) Projects the company will not finance include: hotels; gas stations; and other business-related real estate. Regardless of the type of project, Firm Capital provides a personal level of service to both the experienced investor looking to structure complex mortgage financing and to newcomers who require some guidance while getting started in the industry. CMP
Infill construction financing Small commercial buildings irm Capital’s years of experience as a leading Boutique Mortgage Multi-residential properties Lender has earned us the Trust of its clients, through the Innovation Owner-occupied industrial buildings Large single-family homes and cottages brought to each financing transaction that in turn has built long lasting Investment properties Relationships. Land and development financing
Abode coming back, finder’s fees top priority With many rumours circulating regarding the future of Abode Mortgage Corporation, the prime lender that shut down its mortgage business back in November 2009, CMP was able to speak with David Nelson, CEO and chairman of the board, to attempt to clarify a few of them. Not only will Abode continue to function as a lender in the broker channel, he said, but one of the key bargaining points was paying any outstanding fees to brokers. “We plan to reactivate all brokers,” said Nelson. “Paying outstanding finders’ fees was very important to us when negotiating with the new purchaser.” He added that the company has been negotiating for the past two months with the purchaser and it has “finally reached a point where [it is] going to be able to talk about it soon.” He said talks were going well with two large supporters, CMHC and Deutsche Bank, and that Abode will be back with even more product offerings than before. CMP
Canadians cautious with mortgages, CAAMP survey finds Canadian homeowners and lenders are increasingly cautious when it comes to borrowing and granting mortgages, according to a new CAAMP survey of its members. “This new research shows that Canadians are assessing their abilities and vulnerabilities,” said Jim Murphy, president and CEO of CAAMP. “The vast majority of Canadian mortgage borrowers are not taking on undue risks. They have factored rising interest rates into their mortgage decisions.” The survey includes data from CAAMP members who issued more than 40,000 mortgage loans last year. The findings show 86 per cent of homebuyers chose fixed-rate mortgages last year and 70 per cent of those buyers chose a term of five years or more. In addition, CAAMP said the “vast majority” of people who took out their first mortgage in 2009 borrowed less than the full amount they qualified for. “The bottom line from the simulations is that even though mortgage payments will probably rise for most borrowers, the increase in their incomes will more than offset the higher payments,” said CAAMP chief economist Will
Dunning, who authored a report accompanying the survey research. “All in all, the degree of risk from rising mortgage rates appears to be small and manageable.” CMP
Former Home Trust president to head up new mortgage lending operation Financial services firm Grey Horse hired former Home Trust president Nick Kyprianou to lead a new alternative residential mortgage lending operation through its subsidiary, Equity Transfer and Trust Company (ETT). Nick Kyprianou Kyprianou – who left Home Trust at the end of December after 17 years – joined the company Feb. 1 as president of mortgage operations and will lead an initiative for ETT to become a deposit-taking institution and
mortgage lender. He is also investing $1 million in Grey Horse Corporation common shares. “This initiative fits with our strategic direction by expanding the scope of ETT’s trust business, generating new revenue stream for the corporation and further diversifying Grey Horse’s activities in the financial services sector,” said Grey Horse president and CEO Paul G. Smith. “Mr. Kyprianou is a strong and respected business leader whose many years of industry experience position the corporation well to build a competitive mortgage lending business.” Once it gains approval to become a deposit-taking institution, ETT said it plans to partner with mortgage brokers for originations and use deposit brokers and financial planners to generate deposits. CMP mortgagebrokernews.ca
Products and services
Companies collaborate to launch private mortgage tool A new tool called Pri-Mor Systems – which uses technology from both MorWeb and Syndi – has launched to help brokers manage privately funded mortgages from origination to discharge. “We recognized that the private mortgage market was Paul Bath underserviced – it was unorganized, there were no efficiencies, and it required a lot of manual processes, making it hard for brokers to ensure they follow compliance rules,” said Tim Brown of Marlborough Stirling, the parent company of MorWeb. To combat this problem, Pri-Mor Systems, which primarily targets brokers, created an interface between MorWeb and Syndi. MorWeb is used for inputting the private mortgage application and links to Syndi after the loan is underwritten and approved. Syndi prepares reports and fully tracks mortgage payments and balances, and also assists with compliance. Pri-Mor Systems president Roy Prince collaborated with Centum mortgage broker Paul Bath on developing the product, which became available in February. (It was previewed at the CAAMP conference in November.) Bath said the system will also help brokers who focus on private mortgages to build a “saleable book of business” and develop better relationships with private lenders and investors. Although Prince wouldn’t reveal pricing, he said the system can be tailored for individual or group use and would be beneficial for brokers who count private mortgages as a portion of their business. CMP
Former Wells Fargo BDO creates mortgage finding tool Tony Roberts, a former Wells Fargo BDO, launched a new product search engine tool for brokers called Adunatio. The web-based tool, which costs $29.99 a month, asks brokers to input basic client information like credit score, location, LTV required and whether the deal is a purchase or refinance. It then searches for a list of mortgage products that fit the criteria. Roberts said the tool currently has access to close to 30 lenders and is steadily adding more, including commercial, private and regional lenders. “We wanted to capture something that was very user-friendly and we wanted to make sure it was simple and affordable,” said Roberts, adding Adunatio took about a year to develop. “It was a huge challenge.” CMP
Two lenders roll out short-term variablerate products With signs that record-low interest rates will be around for at least a few months longer, Street Capital and Home Trust both announced the introduction of one-year term and three-year term variable-rate mortgages. Street Capital president Paul Grewal said borrowers who choose the variable-rate option (there is also a five-year term available) can lock into a fixed-rate mortgage at any time with no fee. “We believe a mortgage broker can best advise a client on which (ARM) option is suited to their needs,” he said. “If a borrower thinks discounts on ARMs will increase, they now have the flexibility to choose a shorter ARM term. If a borrower thinks fixed-term rates will be increasing, they now have more ARM choices to time their move to lock-in.” Home Trust introduced its short-term variable products through its prime-focused Accelerator program and said the guidelines were the same as for its five-year variable product, including guidelines around prepayment penalties. “We’ve noticed there has been an increased demand for shorter-term mortgages because some people think that rates have not bottomed out,” said Armando Diseri, vice-president of mortgage lending for Home Trust’s Accelerator program. “In order to satisfy this demand and give our brokers and consumers more options, we felt introducing the one-year and three-year variable-rate mortgage was the sensible thing to do.” CMP
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Strong forecast for 2010 real estate market in Canada Growing confidence in an economic recovery this year will boost an already “unusually strong” housing market, says a Royal LePage survey. Part of that growing confidence comes from the already higher-than-expected housing prices, according to the report. Phil Soper, president and chief executive of Royal LePage Real Estate Services says there’s strong momentum heading into this year that shouldn’t let up through the first half of 2010. “The stimulus effect of low borrowing costs has contributed to a sharp rise in demand that has driven activity levels to new highs,” he says. “This demand, coupled with a typical seasonal
undersupply of homes for sale, should cause home prices to continue to appreciate significantly during the early months of the year.” As supply eventually starts to rise again and as prices rise for houses, the market should start to moderate to a slower pace in the second half of the year, Soper says. The numbers from 2009 that predicted momentum. Nationally, the average price of detached bungalows rose to $315,055, a six per cent increase, according to Royal LePage. Standard two-storey homes rose to $353,026, up 5.2 per cent, and the price of a standard condominium rose to $205,756, up 6.4 per cent. CMP
Percentage of Canadians who think interest rates are going up in the next six months, according to RBC’s latest Canadian Consumer Outlook Index.
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Mortgage rates, debt don’t 36% pose big risk: CIBC
Increase in condo sales in the Greater Toronto Area from the end of the third quarter to the end of the fourth quarter, according to Urbanation.
CIBC released a report in late December stating Canada is not at risk of a “U.S.-style housing and mortgage blow-up,” adding the Bank of Canada should not move prematurely to raise interest rates. “Historically, it’s clear that mortgage arrears rates are highly correlated with the unemployment rates, with little or no correlation with changes in interest rates,” wrote CIBC chief economist Benjamin Tal. Tal listed a number of other “buffers” protecting Canada from a U.S.-style housing and mortgage crisis, including the fact that many households with a debt-to-service (DSR) ratio greater than the standard 40 per cent have already accumulated a significant amount of equity in their homes. The report said out of the
five million Canadian households with mortgages, only an estimated 350,000 have a mortgage with a LTV greater than 80 per cent and a DSR greater than 40 per cent. The report also noted that most at-risk and lower-income borrowers have already locked into fixed-rate mortgages. This differs from the U.S., where a large number of low-income households opted for variable-rate mortgages. “There is nothing in Canada akin to the huge excesses in lending that led up to the housing and mortgage crisis experienced in the U.S. in the past few years,” Tal wrote. “Existing debt burdens appear to be manageable for the vast majority of Canadians .... The magnitude of the problem is not big enough to justify a premature tightening move by the Bank of Canada.” CMP
mortgages in the press
Regulators dole out ABCP penalties to lenders Seven banks and investment dealers have agreed to pay a combined total of $138.8 million in penalties and investigation costs as a result of their participation in the asset-backed commercial paper market, which was frozen in August 2007 amid fears of U.S. subprime mortgages. National Bank Financial has agreed to pay $75 million, the largest penalty, followed by Scotia Capital ($29.27 million), CIBC ($21.7 million) and a number of other lenders. The penalties were approved by securities regulators in Ontario and Quebec, as well as the Investment Industry Regulatory Organization of Canada (IIROC). As reported by CBC News, the regulators found that the banks and investment firms did not do enough to ensure their salespeople understood the complexities of the ABCP before it was sold to clients as a low-risk, liquid investment. The $32-billon ABCP market seized up in 2007 at the beginning of the financial crisis. Several subprime lenders who used the market for funding went out of business or changed their lending focus as a result of the freeze. CMP
CMP sees record FSCO announces 2010 nominations for audit plans 2010 CMAs CMP received more than 700 nominations for this year’s Canadian Mortgage Awards – a record number since the awards started in 2007. This year’s event will have 20 categories, up from 18 last year, and the winners will be announced April 23 at a ceremony at the Liberty Grand in Toronto. The 2010 CMAs promise to build on last year’s awards with an early-1960s theme inspired by Mad Men and Canadian comedy star Jessica Holmes serving as host. The awards finalists will be announced online at mortgagebrokernews.ca and in the March issue of CMP. CMP
The Financial Services Commission of Ontario says it will be conducting another audit “early in the New Year” to ensure mortgage brokerages have errors and omissions insurance. The commission said it will be collecting data from insurance providers and contacting brokerages that don’t appear to have the mandatory insurance. Enforcement action will be taken for those without the coverage. “Non-compliance drives up FSCO’s costs for regulating the mortgage brokering industry, which must be supported through fees that are collected from this sector,” read a statement from the latest FSCO newsletter for mortgage brokers. The results of FSCO’s last audit, conducted in October 2008, found that 79 Ontario brokerages did not have errors and omissions insurance. These brokerages faced a $1,000 penalty and company names were published on FSCO’s website. CMP
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More consumers turning to brokers for their next mortgage A growing number of Canadians are opting to use mortgage brokers instead of going to the bank branch, a recent study said. According to Maritz Research, which conducted the study on behalf of CAAMP, the mortgage broker channel handled 23 per cent of all mortgage activity in 2008. This number was higher in Western Canada, (34 per cent in Alberta and 27 per cent in British Columbia), as well as amongst females (26 per cent), who were more likely than men (20 per cent) to deal with brokers. “In the past, the first or only place a person would go when looking for a mortgage was to their local bank, however more and more Canadians are now seeking out the services of mortgage brokers to help them navigate the biggest purchase of their lives,” said study author Rob Daniel, managing director, Maritz Research Canada, to the Financial Post. Another strong demographic for mortgage brokers was with young Canadians. In the 18 to 34 demographic, brokers represented a 28 per cent share. With 53 to 54 year olds this decreased to 24 per cent, and with the 55 and older crowd it was even lower, at just 17 per cent. CMP
Canada’s six most magnetic spots for migrants A study of the 50 largest metro areas in Canada has revealed the six most attractive spots to newcomers, regardless of origin. The study by the Conference Board of Canada found that regardless of the educational background of the individual, the six most appealing metro areas in the country in terms of ability to attract newcomers were Waterloo, Richmond Hill and Ottawa in Ontario, as well as Calgary, Vancouver and St. John’s. The judging factors included society, health, economy, environment, education, innovation and housing. CMP
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Genworth MI Canada sees positive year-end results
2,600 The number of jobs Canadian employers cut in December.
Genworth MI Canada ended 2009 on a positive note, with a $6 million increase in new insurance written in the fourth quarter compared to the previous quarter and net income for the year climbing to $87 million. “Our strong execution against our business objectives combined with improving housing fundamentals contributed favourably to our overall results this quarter,” said Brian Hurley, chairman and CEO of the company. “In addition, our proactive Homeownership Assistance Program contributed to lower delinquencies and a corresponding lower loss ratio.”
Along with the strong housing market, the private mortgage insurer also said its positive year-end results were “favourably impacted by improving customer confidence and market position gains with key lenders.” The financial standing for 2009 was also marked by Genworth MI Canada’s initial public offering last July to raise money for its parent company in the U.S. The offering generated $850 million, with close to $97 million allocated for the Canadian arm of the company to pay off debts and build business. The IPO raised Genworth MI Canada’s stock from $19 to a current trading rate of $25.56, according to The Financial Post. CMP
14% Broker sees alternative to potential mortgage restrictions
Lenders should start qualifying borrowers at posted rates to minimize risk of a housing bubble, said Mortgage Alliance broker Mark Herman in response to Finance Minister Jim Flaherty’s suggestion to raise minimum down payments and decrease amortization periods. “Qualifying using posted rates of 5.49 per cent would correct two trouble areas with one action and keep the fragile economy moving in a positive direction,” said Herman. “Firstly, the higher rate would reduce maximum dollar amount buyers could qualify for. Also, when rates return to their long-term average of about 6.5 per cent they will be able to swallow that one per cent increase and not look at rates increasing by three times.” Herman added that 92 per cent of his clients use the five per cent down payment option, so raising that number would “slam the brakes” on a real estate recovery and shut out many firsttime buyers. In December, Flaherty told CTV that if he continued to see evidence that there is excessive demand in the housing market he may have to take steps to minimize the risks of borrowers overextending themselves. CMP
Percentage of Canadians surveyed for a Manulife Financial poll who said their top financial priority in 2010 was to pay down their mortgage, up from 11 per cent in 2008.
Mortgage market strong, housing bubble nonexistent: Carney Bank of Canada governor Mark Carney said Canada is not experiencing a housing bubble and he doesn’t see the need for structural changes to the country’s mortgage market, according to a report in Reuters. “The Canadian mortgage market has functioned I think exceptionally well during the course of the last decade...we’ve seen the strength of the system of mortgage insurance and it’s provided an important funding avenue for the banks as well,” said Carney after a speech in Winnipeg on Feb. 4. The speaking engagement also gave Carney a chance to address the current talk of a housing bubble forming in Canada due to explosive home sales and escalating prices. He said the strength in the housing market was “expected” due to where monetary policy was and said the bank is “following it closely.” “We want to caution people that rates are extraordinarily low right now, they’re low for a reason...but it’s a means to an end,” he said. CMP
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mortgages in the press
Canada Mortgage Bond program grows under the radar The CMHC-backed Canada Housing Trust issued $47 billion worth of mortgage bonds in 2009 – the biggest issuance in the Canadian marketplace last year, according to a story in the Financial Post. The growth is another sign of success for the Canada Mortgage Bonds program, which was launched in 2001 as a way for financial institutions to sell some of their mortgages to the government for liquidity and to lower borrowing costs. The program has proved popular among both financial institutions and investors, the Post said. “Investors have responded extremely well to the safety and security of Canada’s mortgage market as well as the AAA backing from the Canadian government,” Doug Bartlett, managing director and head of government finance for CIBC World Markets, told the Post. The five-year bonds are still the most popular product in the CMB program, but the 10-year bonds have also done well since being introduced to the market in November 2008, with a total of $9.2 billion being sold as of December. CIBC executive director Warren Lovely told the Post the program is “very mature” after the explosive growth it has experienced in the past few years. CMP
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Canada’s safe banking system got it right In a recent editorial in the New York Times, Paul Krugman wrote about how Canada’s “boring” banking system made it a “very important role model.” Krugman said the U.S. and Canada faced the same economic environment over the past decade, including low interest rates and large financial institutions, yet managed to avoid government bailouts, bank collapses and a subprime mortgage crisis. The key, he pointed out, was that Canada “limited the extent to which banks can take on risk,” including limiting banks’ ability to borrow as well as their process of securitization. He also attributed Canada’s independent Financial Consumer Agency as helping restrict subprime mortgage lending. CMP
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Latest BoC report stays on track with October forecast The Bank of Canada stuck to a positive-butcautious outlook in its latest Monetary Policty Report, saying that while its outlook for global growth is stronger than it predicted in October, the recovery continues to depend on stimulus and “extraordinary measures” taken to support financial systems. As for Canada, the Bank said economic growth resumed in the third quarter of 2009 and CPI inflation turned positive in the fourth quarter. However, with considerable excess supply and a strong dollar, the Bank still projected the Canadian economy won’t return to its full capacity until the third quarter of 2011. As expected, the Bank of Canada reiterated its conditional commitment to keep interest rates low until the second quarter of 2010. With some lenders posting “prime minus” rates, this puts a number of variable-rate mortgages below the two per cent mark. The Monetary Policy Report said the low rates have contributed to solid growth rates in mortgage and consumer credit, the latter driven by draws on personal lines of credit and HELOCs. CMP
appointments Equitable Trust named Dorothy Micallef as a residential underwriter, Justin Smith as regional business manager for GTA North, Declan Murphy as a mortgage officer, Virginia Shaw as a marketing communications specialist and George Misik as a commercial mortgage underwriter. Axiom recently welcomed three brokers to its network: Dan Wowk (Oakville, Ont.), Byron Dailey (Orillia, Ont.) and Dave McKitrick (Calgary, Alta.)
4,986 The number of existing home sales in Toronto in January, an 87 per cent increase over January 2009.
Commercial vacancy rises in Canada
Office space vacancy rates in Canada are expected to rise to 10 per cent by year-end 2010, but there will eventually be a strong recovery in commercial real estate, said Avison Young in its annual report. “Opinion remains divided on the question of whether Canada’s economy will see the beginning of a sustainable recovery in 2010, or whether a further correction is to come before things start to look up,” said Bill Argeropoulos, Avison Young’s VP and director of research in Canada. But he says Canada still remains in better shape than the U.S., and many others around the world, and “is poised for a more rapid recovery,” particularly in the retail sector. The downside of the report was the prediction that the national office space vacancy rate will likely rise by one per cent in 2010. Two of the country’s strongest markets – Calgary and Toronto – have been hit the hardest, both with vacancy rates already just above 10 per cent. This has largely been due to new supply hitting the market, said the report. Things could get even worse in Calgary, where office space vacancies are predicted to reach as high as 18 per cent by 2012, according to Avison Young. In Vancouver, the rate is expected to rise three percentage points higher than a year ago to reach eight per cent. CMP
New Home Trust president wants to keep “servicing the underserved” A
fter serving as Home Trust’s treasurer for more than two years, Martin Reid assumed his new role as the company’s president in December and says – very optimistically, we might add – that he “couldn’t have asked for a better situation to come into.” CMP caught up with Reid to talk about Home Trust’s recent push in the B lending market and its plans for 2010. Home Trust recently launched its Classic Program of B lending products. What has been the response so far?
It’s been very good. If you look back a year ago, there was a lot of uncertainty in the financial markets and, at this stage of the game, we have a better sense of where things are and we’re pretty comfortable with the real estate market. Business is still pretty brisk both in the A product and the B product, so the response to the Classic Program has been very favourable. With both the Accelerator program and the Classic program now in place, do you find a lot of the B or alt-A clients Home Trust takes on are able to eventually renew as A clients? Yes. We’re getting clients who, when we didn’t have our Accelerator program, may have been lost to the big banks on renewal but now we’re keeping that client because we’re able to offer products to keep them when they’ve improved their credit. That’s worked out really well for us. Also, if a broker is coming to us with a deal that’s on the border, we’re able to offer both A and B alternatives and that’s getting a very favourable response. How has the fluctuation in house prices over the past few months affected Home Trust? A year ago, there was a lot more uncertainty and that’s when we were a little more conservative.
We’re feeling a lot better about the real estate market now – there’s not a lot of inventory so there’s pretty good demand – and we’re very comfortable about where things are in Ontario and east at this point. Alberta saw a bit more of a downtick in housing values, but it’s showing signs of stabilizing. We’re still a little bit cautious in B.C. and there’s still some question marks surrounding what happens after the Olympics. But most of Canada is in pretty good shape. The media has recently covered the situation of subprime borrowers who took out mortgages with lenders who have since left Canada or changed their business. The concern is about where these homeowners will go when they need to get their mortgages renewed. If these types of borrowers approach Home Trust, how will they be addressed? At the end of the day, it comes down to the underwriting and we need to be comfortable with the risk, but we’re always trying to come up with a solution. Our core business has always been about the stuff that the big banks won’t look at, so we’re used to that type of client where the credit history is not very long or damaged, and we analyze that and underwrite that and understand what the risks are. That’s the type of business we’re very comfortable with. With the expansion of the B product line, has the company’s underwriting department expanded? We have expanded and continue to expand. We increased our organization by 20 per cent in 2009 and through 2010 we see really strong growth. January was a fantastic month – it was well over our expectations.
Is Home Trust planning to continue its involvement in the Canadian Mortgage Bond program this year? We’ve been involved in both the CMHC-sponsored securitization programs – the NHA-MBS (Mortgage-Backed Securities) program as well as the Canada Mortgage Bonds program. Both have proven very strong throughout the financial crisis and so we see our participation continuing. We are largely an on-balance sheet lender, but we are also very active in securitization through both MBS and the CMB program. Do you see the company growing more on the securitization side? Over the last year with the market uncertainty, we were more conservative in our core lending,
which is on-balance sheet. We’re much more comfortable with the real estate markets today, so we see growth in both areas. We’ll continue growing the securitized portion of the business, but we see a lot of good growth in the on-balance sheet in 2010. Also, we’re much more comfortable now with our core product than we were a year ago. Being one of the largest alternative lenders in Canada, how do you plan to keep Home Trust ahead of the game? Our strength has been servicing the underserved part of the market, so wherever we see that we can add value, we’ll look to take advantage of those opportunities. CMP
australia The curtains have finally been opened on the new aggregator body backed by Macquarie Bank Limited in Australia. Vow Financial is the merged entity of The Mortgage Professionals, National Brokers Group and The Brokerage. It represents more than 900 brokers nationally and, as of December 2009, had a combined loan book of about $16 billion, making it one of the five largest aggregators in Australia. Once the merger has been finalized, CEO Jeff Zulman promised that value and income growth would be a priority. “Initially, we are looking to increase value through internal growth and acquisition of other mortgage loan aggregators. Longer term our ambition is to diversify the business into the broader financial services sector and offer nonmortgage products.” Dr. Peter Neustadt, who is taking over as non-executive chairman, said, “Vow’s promise to empower brokers will make it the first aggregator that’s been deliberately structured to respond to their needs. It means that brokers get to choose their level of service, determine the extent to which they diversify, control the number of products they access, select their commission structure and even select the number of applications they plug into their Vow CRM platform.” Macquarie Bank Limited holds a minority interest of less than 20 per cent in the Vow group. The founding aggregators (Neustadt and Zulman) hold the rest of the shares. CMP
The U.K.’s central bank has kept the key interest rate at 0.5 per cent since last March and economists do not expect it to raise rates until the economic recovery is further underway. The news service said the rates have resulted in some experts saying the resulting lower mortgage costs are staving off more home foreclosures and repossessions in the U.K. CMP
u.s. Home and auto lender GMAC – which exited the Canadian subprime mortgage market after the financial crisis hit – posted a record quarterly net loss of almost $5 billion in Q4 of 2009 as a result of declining mortgage assets. The losses come as GMAC continues to try and sell its mortgage lending business, ResCap, and focus on its auto financing business. The company said it contributed about $2.8 billion of capital to ResCap, according to Business Week. GMAC received a third bailout payment from the U.S. government in December, bringing its total in aid to $16.3 billion and giving the government a 56 per cent stake in the lender. Following the announcement of the fourth quarter results, GMAC said it would cut 554 jobs, including 313 positions at ResCap. “GMAC has undergone significant transformation in 2009 and, as a result, is better positioned to pursue business and market opportunities going forward,” CEO Michael Carpenter said in a statement. On a positive note, GMAC said deposits at its subsidiaries, ResMor Trust and its division, Ally Bank, jumped 56 per cent in 2009. CMP
u.k Prominent U.K. mortgage brokerage John Charcol said 81 per cent of the mortgages it arranged in December were variable rate (dubbed “trackers” in the U.K.), according to a story in BBC News. “With the average difference between the fixed rates and the initial rate on the best trackers around 1.5 per cent in favour of trackers, it will currently take a substantial rise in bank rates for a borrower who takes a tracker to be worse off than one who opts for a fixed rate,” Ray Boulger, senior technical manager at John Charcol, told BBC News. He added that clients who want the security of fixed-rate payments should look at a five-year, rather than two-year term when considering value for money.
The percentage of borrowers in Australia who found about their mortgage broker via an Internet search - Source: RFI research
Inaugural broker sentiment poll
2009 CMP CANADIAN MORTGAGE AWARDS NOMINEES HIGHLIGHTING THE BEST AND BRIGHTEST IN THE MORTGAGE INDUSTRY
MARKETING WHAT YOU NEED TO KNOW ABOUT STOREFRONTS
PROFILE LORI DUPUIS
this time last year Xceed reports strong ’08 fourth quarter despite losses
After paring down staff and implementing a new business model, Xceed Mortgage Corporation reported a strong fourth quarter in 2008 despite a net loss of $12 million in the fiscal year. During that time period, Xceed finished selling all of its uninsured mortgages to securitization vehicles, marking its shift to providing only insured mortgages. One year later, and Xceed’s profits fell by 50 per cent in the fourth quarter of 2009 compared to the same period in 2008. Revenue for the year dipped from $22.3 to $9.4 million. “Since the collapse in August 2007 of the ABCP market, which profoundly affected our business and the funding model for nontraditional mortgages in Canada, and despite the prolonged period of economic weakness in Canada and internationally, Xceed has made steady progress in refocusing, stabilizing and establishing a growth platform for our business,” said the company’s president and CEO Ivan Wahl in the year-end report for fiscal 2009. The good news is that Xceed reported only a quarter of the net losses that it saw in 2008 – $3.3 million compared to $12 million. Mortgage originations were also up 46.3 per cent from 2008, all on insured mortgage products. Xceed re-iterated its plans to become a chartered bank in 2010 to increase its capital (it’s still waiting for approval from the Office of the Superintendent of Financial Institutions). The company’s primary source of revenue has been from the sale of pools of mortgages to off-balance sheet entities. CMP Otera Capital enters commercial lending market
Otera Capital, a new subsidiary of Caisse de depot et placement du Quebec, entered the commercial mortgage lending market and introduced a new management team. President Jean Lamothe said the Montreal-based Otera Capital would work with mortgage brokers across Canada and expand to include international transactions.
One year later, and Otera Capital announced senior management changes in December, including replacing Lamothe with Ross Brennan, the company’s former executive vice-president. Otera – which classifies itself as a “primarily balance sheet lender” – also announced that outgoing origination of new loans will be divided geographically between Pierre Leduc (Quebec and Eastern Canada) and Paul Chin (Ontario and Western Canada), who is based in the company’s newly opened Toronto office. In addition, the lender has expanded its commercial mortgage operations and is now active in Canada, the U.S. and Europe. CMP Central Bank forecasts recession rebound in 2010
In its January 2009 Monetary Policy Report, the Bank of Canada forecast the Canadian economy to grow by 3.8 per cent in 2010, a statement it later pulled back on. The 2009 first quarter report also said governments were taking “bold and concerted” policy actions to stabilize the economy, but that it would take time for financial conditions to stabilize. One year later, and the Bank of Canada is forecasting the Canadian economy to grow by 2.9 per cent in 2010 and 3.5 per cent in 2011, after contracting by 2.5 per cent in 2009. “Economic growth in Canada resumed in the third quarter of 2009 and is expected to have picked up in the fourth quarter,” the Bank’s January Monetary Policy Report read, but added excess supply and a strong Canadian dollar was slowing growth. It also said it doesn’t expect the Canadian economy to return to its full capacity – or the core inflation rate to hit two per cent – until the third quarter of 2011. As expected, the Bank of Canada reiterated its conditional commitment to keep interest rates low until the second quarter of 2010. With some lenders posting “prime minus” rates, this put a number of variable-rate mortgages below the two per cent mark. CMP
Hindsight is 50/50, so what better time than the present to look back at what went wrong over the last two years in the mortgage industry? A group of industry experts recently gathered at the Mortgage Finance Summit to do just that, hoping that history doesn’t repeat itself
the crash What we can learn from I
n February, industry experts from the broker, lender, insurer and technology realms gathered at the Business Television Network (BCN.tv) studios for what was called “After the Storm,” a series of discussion panels that were broadcast to groups across Canada. CMP was with the Toronto group during this interactive CAAMP event that allowed participants to e-mail questions and thoughts to the various experts. While the topics covered were varied, one common thread that could be taken away from it was that Canada fared better than the U.S. during the financial downturn with the help of a little planning and a lot of luck. Moving forward, the Canadian mortgage professional industry needs to pay attention to regulation, education and maintaining close lender relationships if it wants to continue to be a model for the rest of the world.
Top: Peter Aceto Bottom: Peter Vukanovich
Apples to oranges When comparing the U.S. and Canadian markets, all experts agreed that the Canadian system was different enough to escape the same hardships our neighbours south of the border face. But it’s also important to look at what was so different between the two countries, and whether it is enough to keep Canada on the high road into the New Year. For starters, one major difference between the two systems was the way Canadian lenders operate. “The way we find our mortgages, by and large, most of it is on the balance books so it’s underwritten rigorously,” said MCAP’s Ron Swift. “In the U.S. it just kept getting moved on and no one had any skin in the game. In Canada when you lend it’s your own money.” While this had a large part to do with why we avoided a U.S. scale meltdown, it also had to do with timing. “Were we lucky? Let’s not kid ourselves,” said Swift. “We were headed towards the edge of the
cliff, and we were able to see the U.S. go over it and stop before we got there.” For Peter Vukanovich, president and COO of Genworth Financial, it was less of a difference between Canada being lucky or smart, but just being different, primarily when it comes to insuring loans. “In the U.S., the lender and the underwriter have the pen, and insurance is only handled when the claim comes in,” he said, adding bluntly that it’s as simple as “garbage in, garbage out. You just need to act like you are lending your own money.” Keeping a close eye on regulation Currently broker share in the U.S., said Vukanovich, has gone from being around 20 to 25 per cent around 18 months ago, to around 12 to 15 per cent today. Throughout the day, most experts blamed this on over-regulation in the U.S. in reaction to the recession (which right or wrong, brokers shouldered a lot of blame for) and fortunately Canada has not followed its example, yet. “The pendulum will swing to over-regulation,” warned Peter Aceto, president and CEO at ING Direct, adding that it’s “something [Canadians] need to watch for.” Swift agreed, saying that while the Canadian system is not “over-regulated now, [Federal Finance Minister] Flaherty has mentioned that the government might have to step in and do something. We have to be careful about that and be sure not to over-react to a local phenomenon.” The mention of a local phenomenon was in reference to a comment made by Jason Smith, president and CEO at Solidifi, who said that technologically speaking, Canada is treated like it is just one giant market, when, in fact, it is made up of several regional markets, each with their own strengths and weaknesses. While he said that
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technology needs to adapt so as not to treat every market the same, the media and government also have to be careful when talking about bubble scenarios. “There is one national interest rate and its low,” he said, “but in terms of a bubble, it is a regional issue.” As such, it should be treated like one. As an interesting side note, Gerrard Schmidt, president and COO of Davis + Henderson, offered that “super brokers are actually better positioned to take the increased cost of regulation,” even though, he added, the big banks’ mobile sales forces are growing faster than the mortgage market in Canada overall. “Super brokers need to think about how they will compete,” he said. Education is key Currently on Genworth Financial’s website there is a homebuyer survey that asks some very basic questions, such as: True or false, by reducing your mortgage amortization period you will save interest costs over the life of the mortgage; and, which payment frequency pays down your mortgage the fastest, monthly, semi-monthly or bi-weekly accelerated? On average, homeowners answer five of the 10 questions correctly, said Vukanovich. “If the U.S. has taught us anything, it’s that people are going into this without knowing anything. Education is key, and the mortgage professional and the consumer were just not in sync. The more consumers know the better.” Unfortunately, test results like these point to the fact that consumers are very much still in the dark about their mortgages, and the onus falls on those who deal with the consumers most. “Those who are sitting in front of the consumer, it’s their responsibility to educate the consumer,” said Swift. “People just want the cheapest monthly cost, but it’s one thing to be able to afford homes at historic low rates, it’s another when rates go up. Mortgage professionals have to educate consumers to make the right decisions.” Aside from educating the consumer, the consensus was that slowing down and making sure all the proper information is obtained is a crucial step in keeping the Canadian mortgage market ahead of the curve. “I’m hearing a lot about the Canadianization of the mortgage world – U.S., Mexico, Europe and Asia,” concluded Vukanovich. Now it’s up to us to be sure we are setting the right example.
words of wisdom “The emphasis on speed has not trained any of us to be as diligent as we could be. Slow things down and get the right information. What’s so important that it needs to be answered in two minutes? With the right information there is nothing wrong with lending to somebody with no money down.”
- Ron Swift, president, MCAP Service Corporation, on the importance of lenders taking their time before granting loans to consumers in order to avoid a U.S.-style crash.
“We need to remember that the capital markets are global. Securitization and secondary markets will come back to Canada.”
- Jason Smith, president, CEO, Solidifi, talking about one of the three things we need to keep in mind when thinking about how technology needs to adapt to the new landscape.
“There is a transformation of the broker industry – it’s not just volume, but profitability. Brokers are often described as overpaid, and lenders are described as not having enough products, so why has broker share grown?”
- George Hugh, VP treasury and broker sales, ING Direct, on the future of the Canadian mortgage industry and the importance of brokers and lenders maintaining a close relationship. “In Australia, 50 per cent of the commission goes to the house that reinvests in higher branding – rugby stadiums, billboards and talk shows. Aussie Home Loans is actually more recognizable than some of the big banks. In Canada it’s an inverse economic model, with about a 95/5 commission split on average - a vast majority flowing towards the agent. This will continue to see people carve themselves off from the super brokers and create more competition.”
- Gerrard Schmidt, president, COO, Davis + Henderson, arguing that the future commission structure for super brokers in Canada, if they follow the global trend, will mean less money upfront for the individual broker, and more for the house. CMP
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One of the keys to many a top brokers’ success has to do with one thing – finding a niche. Not only does it allow you to become an expert in that field, but because of it people will come to you, rather than you seeking them out. CMP asks five successful brokers how they found theirs
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t’s no surprise that many of today’s top performing brokers all have one thing in common – they have found a valuable niche market to focus their attention on. Of course there are exceptions, and several brokers still have a considerable amount of success dealing with broad markets in the residential and commercial realms. But when a broker can carve themselves out a niche to differentiate themselves from the pack, it makes success that much easier. Just ask Peter Kinch, last year`s CMP Top 50 broker, who deals specifically with real estate investors. At the annual CAAMP expo in Toronto, he told the audience that finding a niche and becoming an expert in that field could be one of the most effective ways to grow your business. “There weren’t many players in the sandbox [of real estate investment] so I realized you could become an expert quickly,” he said of the secret behind his success. “The clients value the info so much that they just want you to do the mortgage based on you being the source of that info.” That`s why CMP sought out the advice from several other successful brokers who have each found their own niche, and, not surprisingly, they agreed with Kinch`s reasoning. Simply becoming an expert in any given field, whether it’s first time buyers, real estate investors, newly landed immigrants or farmers, allows you to provide your clients with the best full service package imaginable. If you have the answers to their sometimes very specific questions, then the chances they will refer one of their family members or friends to you grows that much more. While all the niches listed in the following pages may not be for you, there are literally thousands more out there just waiting to be tapped into. Hopefully the advice from the brokers who have been successful at finding their niches will help you on your journey to find yours.
Mortg age P rofess Broke ional: Cholo Locat Niche rage: Insua io n: L : Newly In landed ower main vis la immig nd, Va rants, n mostly couver from t he Phil ippine s
Welcome to Canada Cholo Insua: Well I’m an immigrant as well – I came here 20 years ago from the Philippines – and I noticed that a lot of misinformation comes in, and since immigrants tend to gravitate towards their community they ask a lot of people who really don’t know what’s right and wrong.
involved with it does help. You must be active in the community, advertise within it, give good service so that word of mouth spreads and people can know you are legit. I used to hold seminars for first-time buyers, which were great and that helped a lot, but I don’t do that anymore because once word spreads in a tight community, you can depend mostly on referrals.
CMP: What is the best way to successfully serve this niche?
CMP: How do you educate yourself in the area of newly landed immigrants?
CI: I do a lot of talks in the community and advertise in the community paper, and these people are very loyal once you serve them right so I get a lot of referrals. The demographics for new immigrants has changed so much over the years as well, whereas before you had people with no money coming here and now you have to be skilled in a trade and have $10,000 in the bank per adult in order to get in. These are A clients now, they just don’t have a credit bureau.
CI: There are a lot of newspaper articles on the changing demographics of this market, so it’s not really a special thing. In the last two years, especially last year, the changes have been crazy with government policy. Now a new immigrant doesn’t have to be here 100 per cent of the time right away, and can travel back and forth between Canada and their country for up to five years while still building a credit history. The first thing I tell them though is that as soon as you land, put your money in a bank, take out a pre-paid credit card and establish credit. They don’t know this because in the Philippines and Asia, for instance, they don’t like credit – they want to pay everything in cash. It’s just a different mindset and I need to tell them they can’t do that here.
Canadian Mortgage Professional: How did you identify your niche?
CMP: What is the best way to identify a niche in general? CI: The process I did when I first started was that I looked at what sort of people I would feel comfortable with, and, of course, being an immigrant this made sense. You just need to look at your local neighbourhood, to the sports you play and things like that. Eight-five per cent of my business is now new immigrants, and it’s something that just came naturally.
CMP: What are the specific demands of your niche? CI: Trust, and being from the community definitely helped. It’s not a closed community, but being
CMP: What specific financial products are available for this market? CI: I depend on CMHC’s program for new immigrants that allow them to put 10 per cent down. The government recognizes that they are a big source of business, not to mention that their arrears rates are non-existent – they would rather not eat than not pay their mortgage.
Mortga ge Pro fess Broker age: Mo ional: Vic Leh an rtgag Locatio n: Leam e Architects Niche: ington, A grow Ont. ing Men nonite populat ion
An old world niche Canadian Mortgage Professional: How did you identify your niche? Vic Lehan: I realized a good portion of my community was from this certain population – the Mennonites. A lot of them, whose ancestors originally moved to Mexico, were starting to move back because of the large agricultural opportunities in this area. I’m not even the only broker that deals with this population, and it still makes up about 60 per cent of my business.
CMP: How do you educate yourself in this area so you can relate?
VL: Strange as it may sound, just from being myself. I’m pretty easygoing, and it has made it easy for them to deal with me. They are reserved so if you come on strong it would deter them from dealing with you. Also, they speak what is called Low German, which is part English, part German, so for five years I have produced a German CMP: What is the best way to identify a niche? newsletter, which I get from the Mennonite community in Mexico. They gather up VL: I think you have to look at people who you see pressing news for the community and are coming to your area more and establishing different groups in North America and I themselves, whether it’s a religion, a culture or enlarge it so it’s easy to read, put my ad on the language, and make sure it’s one you can deal with back, print it and distribute it. I don’t actually or at least have someone in their population you have to write it or speak it. I just worked out a can deal with. For instance, I don’t speak any deal to reproduce it. German, which most of the Mennonites do, and am CMP: What is the best way to successfully not religious, but I have someone translate any documents between Spanish, English and German. serve this niche?
VL: Find a way to introduce yourself, either through someone who can speak in their VL: A lot of them come to me not even realizing language or that is from the community, and they need a down payment, and they haven’t really gain their confidence that way. With this group established any credit yet. they need to feel secure with you.
CMP: What are the specific demands of your niche?
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Mortg a Broke ge Profes siona rage: l: Coll D in Locat ominion L endin Bruce ion: E g Cen Niche dmon tre to : Real estate n, Alta. invest ors
It takes one to know how to serve one Canadian Mortgage Professional: How did you identify your niche? Collin Bruce: I did some investing before brokering and was actually involved in flipping houses, because dealing with investors definitely takes a different type of broker. An investing background is definitely an asset.
CMP: What is the best way to identify a niche? CB: I just started with people that I knew. A lot of my clients were other investors. You have to love what you do to succeed in a niche.
CMP: What are the specific demands of your niche? CB: It’s not a transactional point of view, but rather looking at where they want to be in five years and finding a way to get them there. Once you get past that fourth rental with someone, that’s when you really need to be an investor broker. You need to know what order of lenders to hit, which ones are non-portfolio and which ones are.
it’s all about the rate, monthly payment and paying down the mortgage faster, but with investors it’s all about getting the best cash flow, because you shouldn’t be buying on speculation that values are going up. It’s just a bonus if that does happen.
CMP: How do you educate yourself in the area of real estate investors? CB: You need to sit down with a broker who is experienced in it, and joining an investment club like REIN (the Real Estate Investment Network) and talking to investors is great. Also, just go over different lenders’ rental programs, because it’s a totally different mentality with rentals. Not only are they generally the smallest part of a lenders’ portfolio, but they also have the highest amount of defaults so you need to understand why lenders are so strict. Also, keep up in the local economy, which is why a network is good to join. Just know your market and take a long-term approach, because there is a lot of short-term boom and bust.
CMP: What do you mean by non-portfolio?
CMP: What is the best way to successfully serve this niche?
CB: With some lenders even if you own four rentals with other lenders, but none of them are with that particular lender, they won’t give you a loan. Portfolio lenders aren’t as concerned about this. But in terms of specific needs for investors, you also have to be able to analyze and manage their portfolio and cash flow. For a first-time homebuyer
CB: With rentals you need to set the expectation upfront and never over promise. You might not be able to get them the loan because with a rental property it has to be totally clean, no exceptions. Lenders can always come back for more documents as well. If you are a new broker and someone comes to you with 14 rental properties, where do you even start?
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Mortg age Pr o Broke rage: T fessional: R ob rytech mortga b Nelson Locatio ge par n : C tners h a Niche: t Agricu ham, Ont. ltural le nding
Down on the farm Canadian Mortgage Professional: How did you identify your niche? Robb Nelson: I’ve worked in the agricultural community for some time and I noticed that there was a very limited amount of lenders available, aside from a few banks and the farm credit union, with loans for agricultural. A lot of big banks go in and out of the farm business, and even then they only deal with the cream of the crop. I devised a model that had farmers lending to farmers, essentially a collective of private agricultural lenders with a few hundred million dollars to lend. The risk is essentially zero because the people loaning the money are retired farmers. They know what is going to work and what isn’t, looking at the value of the crop, the yields and so on, and I check the financial viability. I’m not a farmer whatsoever, but I’ve been in this side of the business long enough and surrounded myself with people who are very knowledgeable in it that I’ve learned a lot.
CMP: What is the best way to identify a niche? RN: You really have to find out what lenders can’t give to the general marketplace, then try to find a way to introduce that. I have a background of restructuring businesses that are in trouble, so I picked up a lot of private lenders who like to think outside the box. Anybody in Grade 6 can write an A loan, and with 10,000 agents in Ontario, the 200 who are successful have all found niches.
CMP: What are the specific demands of your niche? There are a number of them, such as looking at input costs, funding and business strategies. The farming industry went from having a 100-acre plot with a house and a barn on it, living and dying by that land, to now where you have 5,000 acres. It’s this third generation of farmers that need to learn the business end of it, and we’ll teach them that here.
We also bring people together, sharing expensive equipment especially, and we help build these relationships. It’s actually all part of the exit strategy we build for them, because a power of sale is not an exit strategy.
CMP: How do you educate yourself in that area? That’s just years of strategically helping business and creating business plans. We have someone in the office with an MBA and acts as a business consultant, an accountant and an IT person, which is all part of offering our consulting strategies. Not only can we use this expertise for our own business, but it’s a very good additional revenue stream.
CMP: What is the best way to successfully serve this niche? You need to know that there are different agricultural businesses in different areas, and you basically need to think how to help bridge the gap between the non-traditional lender and the traditional one. The non-traditional can be used to create a good business in the short term, but only in order to fit back into the traditional realm. How do you get them back into that box? Know which lenders have what amount of agricultural money available, because out of every $100 they have $1.50 for farms per year. You need to know who has the money and who doesn’t. In fact, the banks will refer business to us, and we always work to try to eventually bring that client back.
CMP: Would you recommend agricultural mortgages for another broker looking for a niche? It’s a tough business to break into, plus you have to have the agricultural and business background. I learned it while I was at another brokerage, and the only way a farmer is going to trust you is if you have knowledge of their business.
Mortg age P Broke rofessiona rage: l: Nico Mo le Locat rtgage Cent Drummond Niche ion: O re Can : Gove ttawa ada rnmen t and m , Ont. ilitary reloca tions
Military Canadian Mortgage Professional: How did you identify your niche?
CMP: How do you educate yourself in the area of government workers and military?
Nicole Drummond: My husband was in the military so I got to know the procedures as well as the fact that there was a lack of knowledge that was in the community as to what their options were.
ND: You need to know your clients’ needs. Some need to be answered at 7:30 a.m. so I have an assistant coming in then, for instance. We stagger the times so someone is here from 7:30 a.m. to 9 p.m. Also, always try to stay ahead of changes, which I can do from getting a defence department newspaper. It doesn’t give you much info on how to serve them, but keeps you in touch so you have more to talk to clients with. Also, you need to know, for instance, that the Air Force will be different than the Navy, which will be different from the Army.
CMP: What is the best way to identify a niche?
ND: Look at yourself and what you enjoy. If it’s sports you will most likely have friends who will be doing these things. Just know your likes and you will be able to find people with something in common. Then it’s easy to associate with them because you have to be comfortable doing cold calls. CMP: What specific financial products are available for this market? You can also join things like the local Business Improvement Area and create an interest for Most people take a five-year fixed, and no one people to call you. takes a variable because they don’t have the time CMP: What are the specific demands of your niche? to monitor rates. It could only be a two- or threeyear job placement so I will have to fit that into it ND: Definitely my hours. These people have no as well. Portability is very important, and you have time to handle their personal business during the to time when the lenders want their payments, day so I need to be accessible outside of their because all government workers are paid on the working hours. It’s a big decision to buy a house so same day and sometimes that doesn’t work with not something you can do when you’re answering when lenders want their pay. e-mails or you have a meeting in 10 minutes. I Prepayment is another important option. Someone work the same amount of hours but just shift it to could be going to Afghanistan and coming back with a later on. Most people actually start calling me at large sum of cash and they don’t want to be penalized 4 p.m. - nobody calls at 8 a.m. for paying down their mortgage early. CMP
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Special focus Credit unions
credit unions Credit unions haven’t always been seen as broker-friendly, but many are now looking to build business through this channel. CMP talks to credit union representatives and brokers to get the lowdown on accessing a flow of funds from this lender category
Special focus Credit unions
erry Feth has only good things to say when asked about working with credit unions. The Burlington, Ont.-based mortgage agent sends more than half of his clients to them and says he doesn’t miss doing larger volumes with banks. “A lot of big lenders are very policy-driven with little leeway on guidelines, but the credit unions I work with look for a way to get the deal done and they’re very, very flexible,” says Feth, who is part of the RMAI network and often sends deals to First Ontario and Your Neighbourhood credit unions. “I also find they’re more personal and they have almost instantaneous service.” With smaller asset sheets and marketing budgets than big banks, credit unions often fly under the radar, but they’re no small portion of the financial market. There are 427 credit unions affiliated with the Canadian Union Central of Canada, a trade association, and more than five million Canadians are members of a credit union. From big or small, niche or broad-focused, the common thread among these financial institutions is the mandate to offer a regional and community appeal. And even though only a small number appear to promote working with mortgage brokers for originations, there are also signs their
outreach to this channel could be expanding. “I think there are more and more credit unions that are seeing the value of brokers, particularly if they need more assets on their books or need to diversify and expand their customer base,” says Jane Kulbida, vicepresident of residential mortgages at Concentra Financial. “It’s very individualized – you look at some of the bigger credit unions in B.C. that have broker desks and then there are the smaller, niche one-offs that also deal with brokers.” To that point, CMP found that the five largest credit unions in Canada – Vancity, Coast Capital Savings, Servus, Meridian and Envision – all work with mortgage brokers and aim to offer competitive compensation
“ I think there are more and more credit unions that are seeing the value of brokers, particularly if they need more assets on their books or need to diversify and expand their customer base ”
credit unions facts and figures • The idea of the first credit unions in Canada was to copy European lenders with the creation of co-operative financial institutions that were controlled by the working class and small business owners. • Rather than having the goal of earning capital for shareholders, credit unions are in place to service their members, who are usually associated through common relationships such as profession, religion or, most commonly, community. • Credit unions in Canada can be attributed with being the first institutions to offer open mortgages, home equity lines of credit, payroll deduction services and daily interest savings. • According to the 2009 third quarter results from the Credit Union Central of Canada, total combined assets of Canadian credit unions were reported at $119.2 billion, an increase of $35.1 billion (42 per cent) over the last five years. • Credit unions are the second largest lender to small businesses in Canada.
Source: Credit Union Central of Canada, compiled by Andrea Loziuk
“ a lot of big lenders are very policy-driven with little leeway on guidelines, but the credit unions I work with look for a way to get the deal done and they’re very, very flexible ” rates in line with other lenders. In addition, a number of smaller credit unions, such as IC Savings & Credit Union in Ontario, are also open for broker business. 1 2/8/10 3:02 PM 1002_IC_Lending:Layout
Service levels With the large number of lenders competing for mortgage broker business, what makes credit unions stand out? As Feth points out, their regional focus often translates into excellent customer service and, in general, more efforts to accommodate the borrower. And instead of being “customers,” those who join a credit union become “members” and take part ownership in the company. Even customers who aren’t part of a credit union when they take out a mortgage from one are usually required to open a chequing account to attain member status. The community mandate and focus on service levels also means credit unions are more particular about their scope of lending. Meridian Credit Union, for example, is Page 1
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Special focus Credit unions
licensed to lend across Ontario, but will only grant mortgages to clients who are in close proximity of a Meridian branch. This is so that the credit union has “the opportunity to engage with that member” and “demonstrate the quality of service,” according to Meridian’s vice-president of marketing, Dave Roberts. He adds that because mortgage brokers deal directly with the credit union’s branch staff, there is also an opportunity for stronger broker/lender relationships to be built. Brent Irving used to work as an investment adviser at Vancity and now, as a broker with Dominion Lending Centres, he still likes to work with credit unions on a regular basis. Irving says he sends close to 20 per cent of his clients to credit unions like Vancity, Coast Capital Savings, North Shore and Interior Savings. “Where credit unions stand out is their service at the branch level – it tends to be better than at a bank and it’s less of that ‘big bank’ experience that some consumers don’t like,” says Irving. “I’d definitely encourage a mortgage broker to build a relationship with at least one credit union in their area because of their service and because they tend to be more open-minded with the alt-A business.” Deal flexibility The willingness to bend to make an alt-A or B deal fit is another feature of many credit unions that can be an advantage to mortgage brokers. While many banks or A-focused lenders don’t accept borrowers who are self-employed, have untraditional income sources or damaged credit, these applications can often be serviced at a credit union. Case in point: IC Savings & Credit Union, which lends in the Golden Horseshoe region of Ontario, started in the B mortgage lending space when it opened in 2000. It has since grown to include A clients, as well as commercial mortgages. “The ability to do business in the manner that we do from A to alt-A to B is sometimes
surprising to mortgage brokers because other lenders aren’t able to be as flexible,” says Bruce Savage, vice-president of lending services at IC Savings. Feth agrees, saying one of the biggest perks of a credit union is their flexibility. He gives the example of a recent client who had income coming from a rental property, a part-time job and a pension. While he says he would have had to fight to get the deal done at a bank due to the income sources, the credit union made it work. “Credit unions are far more flexible, especially on conventional deals,” says Feth, adding as long as the clients don’t have “terrible credit,” there is likely a way to make a deal work.
“ where credit unions stand out is their service at the branch level – it tends to be better than at a bank and it’s less of that ‘big bank’ experience that some consumers don’t like ”
Top: Jeff Mayer Middle: Brent Irving Bottom: Bruce Savage and Phil Fiuza
Jeff Mayer, a broker at Mortgage Intelligence in Toronto, says many brokers automatically jump to a B lender if they can’t get a deal done at a bank when they could be looking at a credit union for better rates. He refers to a recent deal he worked on in the Kitchener area that he couldn’t get a bank lender to do. Mayer searched the Internet and sent the deal to a local credit union and was surprised to learn it didn’t pull the credit score but instead only looked at the client’s repayment history. “That really helped the deal,” he says, adding he secured a rate that was lower than it would have been at an alternative lender.
Friendly, community-focused service
Limited scope of lending
Flexibility on alt-A and B deals
Harder for brokers to access directly (no BDMs)
Other financial product offerings aside from mortgages
No volume bonus or loyalty programs for mortgage brokers
Special focus Credit unions
the five largest credit unions in Canada by asset size (Fact: They all work through the mortgage broker channel 1. Coast Capital Savings Credit Union (B.C.): 53 locations, 427,158 members 2. Vancity (B.C.): 60 locations, 410,934 members 3. Servus Credit Union (Alberta): 97 locations, 334,850 members 4. Meridian Credit Union (Ontario): 43 locations, 222,137 members 5. Envision Credit Union (B.C.): 22 locations, 90,566 members (only work with brokers in the following markets: Ridge Meadows, Newton, Vintage Hills)
Source: Credit Union Central of Canada
Rates and products Credit unions offer a standard range of mortgage products, with the five largest institutions citing five-year fixed-rate mortgages as their most popular product. Their rates are generally in line with banks and other institutional lenders. “Credit unions have become really competitive when it comes to interest rates, especially in the past six months – they’ve had some of the best rates in the lower mainland [area of Vancouver],” says Irving. Mayer also says credit unions have offered better rates in the past few months, saying he thinks cheaper access to money and relatively low delinquency rates have made it easier for them to be competitive. On the product side, he highlights a second line of credit that he says has been a great fit for several of his clients.
“ credit unions have become really competitive when it comes to interest rates, especially in the past six months – they’ve had some of the best rates in the lower mainland [area of Vancouver] ”
“One of the biggest struggles in the mortgage industry is finding second lines of credit at a decent rate,” says Mayer. “But Meridian offers a second mortgage for four per cent on a line of credit, so a lot of people are not aware of it and I guess the biggest thing is that most people are not aware that some credit unions offer this type of product.” Other credit unions can also be flexible in dividing the mortgage into a part fixed rate and part variable rate, while one of Irving’s noted credit union products is the readvanceable mortgage at Vancity, which allows a borrower to increase the amount of their mortgage without having to have it rewritten. And, like banks, credit unions offer lines of credit and other products that are in line with banks, which can be advantageous if a client want to consolidate debt. “Let’s say a client’s car payment is $600 a month and the mortgage deal doesn’t qualify because the car payment is too high,” Feth says. “From my experience, credit unions look for a way to make a deal work. For example, I could wrap the car loan up with other loans in a line of credit to lower the monthly payments. That’s a situation where having a side loan facility is definitely an advantage.” Commission structure One shortcoming of working with credit unions is that most of them don’t have loyalty or bonus programs in place for mortgage
brokers. However, the credit unions that openly work with brokers can pay commissions that are comparable with other lenders. IC Savings, for example, doesn’t offer volume bonuses, but pays brokers 100 bps upfront on a five-year deal as opposed to the standard 80 bps. Meridian pays 75 bps on four- and five-year closed mortgage deals. For smaller or more niche credit unions that don’t pay brokers commission on mortgages, the alternative is for a broker to charge a fee to the client that is on par with what they would be making as a regular commission. This is something Mayer did when he secured the aforementioned Kitchener mortgage from a small local credit union that offered his client lower rates than an alternative lender. The credit union didn’t pay broker commissions, but Mayer says since he was able to show the client a way to decrease his costs, the client was fine with paying a broker fee. While, at this point, the majority of credit unions don’t offer extra incentives beyond commission for mortgage brokers, it’s something that could be changing. John DeRose, director of mobile sales and brokerage at Vancity, says the company is looking at introducing a loyalty program for mortgage
“ what mortgage brokers have to understand at the end of the day is that we’re a financial institution, we’re a lending institution – we don’t like them to consider us just this itsy-bitsy place ” brokers in the next three to six months, which could set a standard for other credit unions. “Our broker division is not as big as it used to be and the goal is to ramp it up,” says DeRose. “I think we need to be in all the channels - the branches, our mobile team and the broker channel.” IC Savings & Credit Union says it could add a volume bonus program as it grows, and Dave Roberts of Meridian also expresses interest in working with a larger pool of mortgage brokers. “Right now, Meridian only works with a handful of brokers, but we’re looking to work with more.”
Compete and win clients • • • • •
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Special focus Credit unions
Relationship building Another difference mortgage brokers may notice when it comes to working with credit unions is the lack of BDMs or sales managers, another side-effect of them being smaller, mostly regional organizations. Without a designated representative to promote services to brokers, there is more of an onus on the broker to build a relationship with a credit union rather than the other way around. This is also important because every credit union works differently and, like other lenders, targets a certain set of clients and offers different products. “Getting to know a credit union’s products and its risk tolerance is huge,” says Mayer. “It’s all about understanding the back end of the lender rather than saying, ‘why won’t you do this deal?’” The relatively lower amount of capital credit unions have also means they’re more interested in building relationships with a broker and working with them on a more regular basis versus having a large list of brokers as origination sources. “We want to work with mortgage brokers, but we want to work with them beyond just that one deal or beyond just being an approval,” says DeRose, adding he
understands having competitive rates and products is a big part of building up broker referrals. But aside from some minor differences, the process of sending a mortgage to a credit union is not all that different from working with a traditional lender. “The No. 1 thing is that we have our own balance sheet and we’re a deposit-taking lender. We operate branches and we take deposits – that’s very important to us,” says Savage, who also wants to clear the misconception that credit unions are too small to consider doing business with. He cites a recent phone call he received from a broker who said he didn’t want to send a deal to IC Savings because it was a “tiny place” that did “limited deals” – something Savage quickly refuted. “What mortgage brokers have to understand at the end of the day is that we’re a financial institution, we’re a lending institution – we don’t like them to consider us just this itsy-bitsy place. We want them to think of us as business partners.”
“ getting to know a credit union’s products and its risk tolerance is huge. It’s all about understanding the back end of the lender rather than saying, ‘why won’t you do this deal?’ ” Savage’s broader message is one that hasn’t been lost on mortgage professionals like Jerry Feth, who needed no convincing that credit unions are a worthy lender to send business to. When asked if he had any criticisms, Feth paused briefly before almost surprising himself with the response. “I know it sounds pretty strange coming from a broker because we’re always finding a reason to complain, but there’s not really a whole lot bad to say about them. I can’t think of anything.” CMP
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Street Capital is your non-bank business partner and we listened! Here is what we have introduced in the last year after listening to YOUR feedback • In May 2009 launched a conventional product suite.
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• In July 2009 opened our Western Canada Underwriting Centre serving Western Canada brokers in British Columbia, Alberta, Saskatchewan and Manitoba.
• Street Capital launched in November 2007 as a
• In August 2009 launched our very successful Top Broker Service Level Promise. This Service Level Promise includes dedicated underwriters, guaranteed turnaround time on approvals, response time on emails and phone calls, plus notification of status of deals.
• Street Capital introduced a Prime lending program in
• In January 2010 launched 1 year and 3 year Adjustable Rate Mortgage terms offering brokers and their clients choice and flexibility. • We now have more brokers participating in our Status programs. Our CEO & President Clubs allow you the valuable tool of discretionary pricing and increase your competitiveness in the marketplace. You are eligible to use up to 10bps in discretionary pricing for buying down our lowest rates on all mortgage products. • January 2010, at our inaugural Broker Appreciation Trip to Las Vegas, we celebrated with our Top 25 brokers across the country. At the Awards Dinner we recognized our Top 5 brokers for outstanding achievement with Street Capital: Congratulations! • • • • •
Jora Purewal, Invis Judy Benteau, Axiom Jencor Mortgages Brad Unrau, Dominion Lending Centre Alta Pacific Irina Antipova, Axiom Assured Mortgages Art Appelberg, Northwood Mortgages
In 2010 we will continue working with our mortgage broker partners soliciting your ideas through our Broker Feedback Sessions held across Canada. We need to know how we can help grow your business! TM Trademark of Street Capital Financial Corporation
Canadian owned residential mortgage lender, 100% dedicated to the Canadian mortgage broker channel. January 2008.
• In less than a year Street Capital’s market share grew
from 34th to 9th largest mortgage broker lender in Canada.*
• Street Capital’s value proposition is our experienced team
and our ability to respond quickly to market needs.
We are proud to announce Street Capital has received 6 CMP Canadian Mortgage Award 2010 nominations. 4 nominations for Best Lender Underwriter of the Year and 2 nominations for Best Lender BDM of the Year!
Street Capital prides itself on offering a broad spectrum of high ratio and conventional mortgages, competitive interest rates and exceptional customer service. Street Capital is proud to work with mortgage brokers to help more Canadians find financing solutions for home ownership.
For more information contact your Street Capital Regional Vice President, www.streetcapital.ca *Filogix Report Q3 2009 FSCO Licence No. 11428
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Broker Poll Q. Have you employed new tactics on retaining clients in the past six months?
OF THE HERD
ONTARIO’S With Ontario’s new mortgage brokering legislation now in effect, not even two thirds of the province’s mortgage professionals were registered with the Financial Services Commission of Ontario (FSCO) by the July 1 deadline
s of the Canada Day deadline, almost 3,300 mortgage agents from across Ontario found themselves in contravention of the new provincial act, putting themselves at risk for reprimand by the provincial regulator. With an estimated 9,000+ agents in Ontario, this translates into approximately 37% who failed to hold approved licences by the deadline. Ontario’s mortgage agents were bombarded with stern notifications CAAMP, IMBA and FSCO in June, enforcing the fact that, after July 1, mortgage agents not registered under the new Mortgage Brokerages, Lenders and Administrators Act 2006 are forbidden to practice in Ontario. The low number was a surprise to some. After all, the act was designed to improve the mortgage brokering profession by implementing educational requirements, mandatory errors and omissions insurance, and introduce a whole slew of other factors to ensure the safety of consumers and, consequently, improve customer confidence.
The fact that such a low number of agents took the steps to proactively stand behind it led some to believe that a large percentage of Ontario’s mortgage agent population didn’t care about the best interests of the industry. Others said there were a number of factors at play.
Agents being agents Up until a week before the deadline, Jeff Atlin, vice president and chair of government relations for IMBA, had only received a handful of queries regarding the new act. That number escalated in the week leading up to the mandatory changes – signifying that many mortgage agents weren’t apathetic, they were merely disorganized. “It seems mortgage professionals tend to do things last minute – so, in many ways, it doesn’t surprise me,” he said. “On the other hand, I am surprised that there isn’t a stronger sense of urgency.” While the lack of urgency might be disturbing, Phil McDowell, president of AMBA, said it’s not uncommon. Alberta
With his co-founded mortgage business booming after only two years, Erin Letson looks at how Wayne Kainu’s early career as a competitive speedskater put him on the path to success – even if it wasn’t in the form of Olympic gold
success up for
Photo by Devon Boulton-Mills
algary-based mortgage broker Wayne Kainu was one of the millions of people who flew to Vancouver for the 2010 Winter Olympic Games in February, but he didn’t go as a spectator. Kainu travelled to the Games as an athlete services volunteer for long-track speedskating – the same sport that almost took him to the Olympics as part of Team Canada more than a decade earlier. It was December 1997 when Kainu competed in the Olympic trials for one of four spots on the long-track speedskating team heading to the 1998 Winter Games in Nagano, Japan. He had been training in a renowned program at the Olympic Oval in Calgary for eight years and was surrounded by some of the country’s top skaters, including Catriona Le May Doan and Mike Ireland. But the competition was stiff and the clock wasn’t on Kainu’s side the day of the trials. He came in seventh in a race where the difference between the first and 10th place skater was a slim 2.21 seconds. “The Canadian team was the best team in the world at that point – Jeremy Wotherspoon and Kevin Overland went on to win medals that year – so it was really, really tough,” says Kainu, who retired his amateur athlete status shortly after the trials at age 25. “It was hard to walk away from because I dedicated so much time and effort and I was almost there.” Despite leaving the world of competitive speedskating, Kainu says he hasn’t forgotten the lessons he learned on the ice. After working as a bank employee for 10 years, Kainu, along with his co-worker, Christopher Cabel, made the jump to mortgage brokers and business owners in early 2008. (Coincidentally, Cabel was a competitive golfer and went to school in the U.S. on a sport scholarship.) Their business, Verico Boomerang Financial, produced almost $80 million in mortgage volume last year and their new storefront is set to open in March.
Photo by Devon Boulton-Mills
“Every moment when you’re skating, you’re thinking about how you can be better because you know that if you’re not doing the right things, your competitor will be a step ahead of you,” says Kainu. “I’ve been lucky to be able to take that mindset and apply it to where I want to be as a very successful mortgage broker.” Skating days Kainu started practicing speedskating at age 12 in his hometown of Kitchener, Ont. as a way to improve his skills as a hockey player and get more ice time during games. By age 15, he made it onto Ontario’s provincial speedskating team, and two years later, in 1991, he moved to Calgary to train full time as part of the Canadian Olympic development program. He went on to participate in competitions across North America, including the Canada Cups. “The training was really intense – it would be twice a day for three to four hours each session and you only got one day off a week,” says Kainu. With so little time outside the rink, he adds, the skaters in the program became a tight-knit group. “To be in it, it was pretty amazing – we were fierce competitors but also best friends and we really encouraged each other.” Although training was a full-time job, Kainu still wanted to go to school and enrolled in parttime studies in economics at the University of Calgary. He got his first taste of the banking world when he took on a part-time job at Scotiabank – a necessity, he says, in the days when athlete sponsorships weren’t as prominent as they are today. After the disappointment of not making it to the Olympics, Kainu says it took him a year to return to the rink. But his love for the sport led
him back to the Winter Games as an athlete services volunteer, first with the International Olympic Committee at the 2002 Games in Salt Lake City, then at Torino in 2006, and with the Vancouver Olympic Committee at the 2010 Games. “Being part of the Olympic development program, I watched speedskating evolve in Canada over the years,” says Kainu. “I still know a lot of the athletes, so it’s great to watch them compete and now it’s great for me to be a part of the Olympics in a different capacity.” Banker to broker After leaving the world of competitive speedskating, Kainu took on a full-time role at Scotiabank, learning more about investments and earning his Personal Financial Planning (PFP) certificate through the Canadian Bankers Association. His eventual move to the mortgage side, he explains, was more of a coincidence than a plan. “Really, the only reason I got into mortgages was because a position opened up at Scotiabank on the mortgage side and it was higher paying,” he says with a laugh. “Then I started learning about mortgage sales forces at banks and became interested in that side of things.” That interest led Kainu to a job at TD Financial Group on the sales team in the residential mortgage division, a move from a salaried job to a commissioned role. It was on the sales team that Kainu met Christopher Cabel, his future business partner. The two quickly became good friends and both turned out to be top volume producers for the bank. “I was more the builder and he was more the financial planner and we joined forces and were able to service both sides – it was a perfect gel,”
says Kainu. “A year after being sales partners at TD, we started thinking that if we did this on our own, we could do extremely well.” Kainu and Cabel left the bank to launch Boomerang Financial in March 2008. But Kainu says moving from the banking world to the broker channel was more challenging than both of them thought – especially getting to know as many as 40 lenders when they were used to working with just one. After almost two years in business, Kainu and Cabel have carved a place in the Calgary market, using their banking background to target financial planners as their main source of referrals. Their offbeat name has also drawn attention and allowed them to raise awareness of their brand. “It’s a very competitive market out there and at times it can be cut-throat, but I think that’s where Chris and I excel,” says Kainu. “The biggest advantage we have now compared to before is that
“ every moment when you’re skating, you’re thinking about how you can be better because you know that if you’re not doing the right things, your competitor will be a step ahead of you ” we can shop around and we know exactly who has the best rates and the best programs.” And having been on both sides of the mortgage business – the bank sales force versus mortgage broker – Kainu says he doesn’t see banks looking to completely cut their ties with brokers, a common fear in the industry. “Even though the banks are growing, there is always going to be a need for mortgage brokers,” he says. “There’s plenty of business to go around.”
Quick Q&A with Wayne Kainu + Toughest challenge? Leaving work at work, and not just paperwork – I always seem to have my business on my mind. + Unfulfilled ambition? Although I’m part of the Olympics in a different capacity now, my ultimate goal was to become an Olympic athlete in the Games. + Greatest risk? Leaving TD Mortgage Sales Force with an established network of referral sources and starting Boomerang Financial. I risked losing some or all of those referral sources. + If you were not in the mortgage industry what would you be doing? When I was with Scotiabank I completed my PFP (Personal Financial Planning designation), so if I wasn’t selling mortgages today, I would probably be a financial planner selling investments. + Hobbies? Working out (a.k.a. trying to stay in shape), travelling. + What words would you use to describe yourself? Ambitious, positive, trustworthy and professional
The next project for Boomerang Financial is a new storefront in northwest Calgary, somewhere Kainu says is “very home” to him because of its close proximity to the university. He and Cabel are also looking into the idea of hiring brokers and working toward the goal of becoming “the best mortgage brokerage in Canada.” With all this on his plate, Kainu says he is grateful for his background in competitive sport. “My whole life has been thinking about the future, my whole life has been thinking about performing to the best of my abilities and that’s why I strive for nothing but the best in everything I do – it always goes back to speedskating,” he says. “My career is certainly the evolution of what I was trained to do and what I learned.” And while he doesn’t have much free time to spend on the ice these days, Kainu says he plans to change that in the future, with hopes to one day coach kids in the sport he took up in his childhood. “I would love to be able to put more back into speedskating and someday I will,” he says. After a short pause, he adds, “I still have my skates sharpened.” CMP
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After more than two decades in business, the company behind the CHIP Home Income Plan made the move to a chartered bank last October. CMP talks to HomEquity Bank’s senior vice-president, Greg Bandler, to find out what the change means and how the transformed company is working with mortgage brokers
hile the CHIP Home Income Plan Corporation had been planning to become a deposit-taking bank as part of its long-term strategy, Greg Bandler says the credit crunch was the catalyst to make the big move. The company became HomEquity Bank last October and kept the CHIP reverse mortgage as its main product offering. “We wanted and needed to diversify our sources of capital, and because it was always our strategic objective to become a bank, we had the financial knowledge and infrastructure in place to complete the process quickly,” says Bandler, adding the company was the only financial institution in Canada to achieve Schedule I bank status in 2009. Less than a month after becoming a bank, HomEquity lowered its interest rates on reverse mortgages to 3.75 per cent for the variable-rate option and 5.95 per cent for the five-year fixed-rate option (there are also six-month, one-year and three-year fixed-rate terms). The bank also offers further discounts to clients who make annual interest payments. “Becoming a Schedule 1 Bank allowed us to lower our costs and pass those savings onto the consumer because we can raise capital the same way other banks do,” says Bandler. “The relative cost of reverse mortgages transforms them from a niche solution to a mainstream way of accessing home equity over the long term.” Reverse mortgages 101 The CHIP Home Income Plan is a reverse mortgage that lets Canadians who are 60 and older access the equity in their home and lets them opt out of making monthly interest payments (although they can do so whenever they choose). Some uses of the additional income include travelling, investing, estate planning and renovating or hiring in-home help.
HomEquity Bank Quick facts + Formerly the Canadian Home Income Plan Corporation, which pioneered the concept of reverse mortgages in Canada in 1986. + Completed the transformation to a Schedule 1 Bank on Oct. 13, 2009. + Originates and administers Canada’s largest portfolio of reverse mortgages (the number totalled 7,000 mortgages with an accrued value of $865 million as of Dec. 31, 2009) + Offers GICs in terms of one to five years through independent deposit brokers. + Works with a referral network of banks, credit unions, mortgage brokers, and financial and investment planners across Canada.
Bandler describes the plan as turning “illiquid home equity” into immediate, tax-free cash. He does, however, emphasize that HomEquity Bank will only allow homeowners access of up to 40 per cent of the value of their home and says the amount owing on a CHIP reverse mortgage cannot exceed a home’s market value. The client’s costs associated with CHIP include an appraisal (HomEquity Bank mostly lends in urban centres), independent legal advice, and closing legal and administrative costs, which can be deducted from the income provided by the reverse mortgage. Should a mortgage balance on a home exist at the time of taking out a CHIP reverse mortgage, the proceeds must be used to pay out the original mortgage. Working with brokers Bandler says CHIP mortgage originations generated by the mortgage broker channel have grown, on average, by 50 per cent or more annually over the past few years. “The mortgage broker channel has become very important to us and we’re really gathering momentum in this channel,” he says. Brokers who recommend a CHIP Home Income Plan to a client are required to send a referral form signed by the client to HomEquity Bank. After the form is submitted, the bank’s BDMs go through the education and fulfillment process with the client, including getting the mortgage commitment signed and collecting documentation. If the deal funds, the broker receives a referral fee of between 50 and 75 basis points. “The key difference with our referral fee is that once the referral form is signed, the broker doesn’t do any other work,” says Bandler. “It’s a really simple process.” CMP
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RDM Financial is not only the oldest franchise in the Mortgage Centre network, but it’s also been the top producing franchise in that network for the last four years. CMP caught up with broker/owner Bob MacDonald to see what keeps his business flourishing
a simple formula
for success T
he main branch of RDM, a strictly Ontario franchise under the MCC banner, is located in Mississauga, with other branches in the Niagara Peninsula, Toronto, Oakville and Burlington, ensuring that it thoroughly covers the western part of what is referred to as Ontario’s “Golden Horseshoe” area. Beginning in Welland in 1992 with what was then called The Mortgage Centre Firstline, MacDonald would begin to grow his business by acquiring another MCC branch in Mississauga (which was at that point the oldest in the country). Since then he has seen a lot of changes in the industry. “I remember in the early ’90s there were only 600 or 700 broker/agents in Ontario. Now, I don’t know what the number is,” says MacDonald, adding that with the disappearance of so many institutional second mortgage lenders, just a few B lenders are left to serve a once large market, not to mention that private mortgages are currently back to where they were in the ’90s. But despite these ups and downs, RDM has not only stayed afloat, but has continually grown alongside the growth of the MCC network. “When I first bought my franchise there were only, I believe, 14 MCC franchises at the time,” he says. “There were two of us, then I took over the franchise in Mississauga and at that time there were two agents there. But we now have 23 agents, myself included, and five assistants to some of these agents.” Quality in, quality out The secret to RDM’s success, says MacDonald, is simple. His team consists of top producing agents and brokers, some of which CMP has taken notice of in its Top 50 poll, and others who are actively out in the community teaching, speaking at events and generally giving back to the broker industry.
“With the nucleus that I have, this attracts respected agents who are better than average producers. I have been selective in who joins this team, which has worked well over the years,” says MacDonald. And fortunately for MacDonald, he doesn’t need to actively recruit. “I have actually sought out very few of my agents, most of them came to me to join the team,” he says. “For the top producers, their success has continued to grow as the relationship grew.” A simple structure Dealing with 23 agents though can be a lot of work, so MacDonald makes sure the structure of the company is straight forward and simple. Each agent will submit their own deals, with several of the agents having status relationships with specific lenders. For the agents without status, they simply submit their deals to those lenders through the status agent. “This works very well and easily with the technology,” he says. “The owner of the deal handles the whole process from start to finish.” MacDonald also considers each agent a “business partner,” he says, and he gives them the independence that the position deserves. “Each person’s business is what they have built themselves,” he says, adding that he presents the means to deliver their business to the market, deal with incoming funds, outgoing pay, and all of the other day-to-day tasks involved in owning a franchise. “For them I am not an employer,” he says. “I am the broker that allows them to deal in mortgages under my brokerage licence in a manner that frees them to focus on continuing to grow their business.”CMP
Q&A with Australia’s
Kathy Cummings Kathy Cummings is the executive general manager of third-party banking at Commonwealth Bank, one of Australia’s top four financial institutions. She attended the CAAMP conference in Toronto in November and shared her thoughts on the Canadian mortgage market with CMP
CMP: What brought you to the 2009 CAAMP (Canadian Association of Accredited Mortgage Professionals) conference in Toronto? Kathy Cummings: I was interested to learn how Canadian mortgage brokers had managed their business through the global financial crisis and how the relationship between banks and brokers was developing.
CMP: What similarities do you see between the Australian and Canadian mortgage industries? KC: Both have emerged from the global financial crisis with strong and stable economic markets, due mainly to the strength of banking regulations and systems. Both have groups of major banks (Australia has four, Canada has five) that are the main pillars of banking.
CMP: What are the main differences? CMP: What did you take away from attending the conference? KC: There is a need for mortgage brokers everywhere to embrace technology and new-wave marketing, particularly things like Twitter and Facebook.
CMP: Broker/lender issues were discussed a few times at CAAMP, including efficiency ratios and risk management. Are there similar issues facing brokers and lenders in Australia? KC: Yes, absolutely. It is an area which Commonwealth Bank (CBA) is leading the market in encouraging and rewarding best practice in quality applications. Related to that, I was surprised that the issue of customer ownership is contentious between brokers and banks. In Australia, we accept the “customer owns the customer” and they will go where the proposition is best for them.
KC: There are three things. One, the majority of Australian mortgages are variable rate, so trail for ongoing service is viable. Two, Australian banks have largely embraced mortgage brokering with CBA, Westpac and National Australia Bank (NAB) now having equity stakes or 100 per cent ownership of brokering houses. And three, Australia has a large investment housing segment (due to favourable tax treatment) and the government stimulus to first-time homebuyers has created a surge in this segment.
CMP: What big changes are facing the Australian mortgage industry in 2010? KC: Regulation – new credit reform legislation nationally will impact all consumer credit and mortgages from June 2010 onward. This means brokers will now be jointly liable for the information and advice given to consumers regarding the suitability of products recommended and the level of borrowings. CMP
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Favourite Things Place to be James Gardens park in Etobicoke. It’s around where I grew up and there are trails and a lot of places where you can just sit and think or read a book. It’s peaceful.
BOOK Deja Dead by Kathy Reichs. It’s a mystery novel.
Celebrity George Clooney – what woman wouldn’t say that? Vacation spot Aruba. It’s a small island and the beaches are gorgeous. You feel very safe there, especially when you’re travelling with children. Drink Cosmopolitan. HOBBy Tennis – I’ve been playing since I was a kid. Movie The Curious Case of Benjamin Button
Food It would have to be pasta – specifically, fettuccine with king crab marinara sauce.
Bridgewater Bank www.bridgewaterbank.ca Ph: 1 888 837 2326 Page 19
HomEquity Bank www.homequitybank.ca Ph: 1 866 522 2447 Page 37
Macquarie Financial www.macquariefinancial.com Ph: 1 877 462 3788 Page 49
Concentra Financial www.concentrafinancial.ca Ph: 1 800 788 6311 Page 61
MORCAN Financial Inc www.morcanfinancial.ca Ph: 1 877 732 2801 Page 59
IC Savings www.icsavings.ca Ph: 416 784 0200 Page 57
National Bank www.nbc.ca Ph: 1 888 483 5628 Page 31
Moskowitz Capital www.moskowitzcapital.com Ph: 416 781 6500 Page 2
Genworth Financial Canada www.genworth.ca Ph: 1 800 511 8888 Outside Back Cover
Abode Mortgage Corporation www.abodecorp.com Ph: 1 877 226 3305 Page 75
Capital Direct www.capitaldirect.ca Ph: (780) 868-0550 Page 47
Equitable Trust Company www.equitabletrust.com Ph: 1 866 407 0004 Page 28
FirstLine Mortgages www.firstline.com Ph: 1 800 387 2020 ext. 6044 Inside Back Cover
Home Owner Soon www.homeownersoon.com Ph: 866 702 4334 Page 63
Home Trust www.hometrust.ca Ph: 1 877 903 2133 Page 21
Optimum Mortgage A Division of Canadian Western Trust www.OptimumMortgage.ca Ph: 866 441 3775 Page 23
Peoples Trust www.peoplestrust.com Ph: 1 800 663 0324 Page 15
Street Capital www.streetcapital.ca Ph: 877 416 7873 Page 39
TD www.tdfinancingservices.com Ph: 866 694 4392 Page 27
The Money Source www.mymoneysource.ca Ph: 416 699 2274 Page 35
Vector Financial Services www.vectorfinancialservices.com Ph: 1 866 483 8018 Page 24
Axiom www.axiommortgage.ca Ph: 1 866 504 0516 Page 11
Centum Financial Group Inc. www.centum.ca Ph: 1 604 257 3940 Page 41
Dominion Lending Centres www.DominionLending.ca Ph: 1 888 806 8080 Page 51
Home Loans Canada www.hlcmortgages.ca Ph: 1 866 452 1821 Inside Front Cover
Home n Work Mortgages www.homenwork.com Ph: 1 866 658 0492 x 100 Page 33 & Classified
INVIS www.invis.ca Ph: 1 866 854 6847 Page 7
Verico The Mortgage Practice Inc email@example.com Ph: 905 458 4222 Page 12
Mortgage Intelligence www.mortgageintelligence.ca Ph: 1 877 667 5483 Page 53
GoMax Solutions www.gomaxsolutions.com Ph: 1 877 492 5164 Page 22
RMAI Financial Group www.rmaifinancial.com Ph: 1 866 955 7624 Page 29
Filogix Limited Partnership www.filogix.com Ph: 1 866 345 6449 Page 25
Nexus Investment Corp www.nexusinvestment.ca Ph: 1 604 664 7079 Page 69
ROMSPEN investment corporation www.romspen.com Ph: 1 800 494 0389 Page 1
The Mortgage Centre Canada www.mortgagecentre.com Ph: 1 800 423 0107 Page 3 Technology/Software
TDMP.com www.tdmp.com Ph: 1 866 500 8886 Page 5
Adunatio www.adunatio.com Ph: 1 888 312 3757 Page 9
The Mortgage Group www.mortgagegrp.com Ph: 877 899 1024 Page 70
Canadian National Association of Real Estate Appraisers www.cnarea.ca Ph: 1 888 399 3366 Page 76 Services
VERICO www.verico.ca Ph: 1 866 983 7426 Page 13
Applied Business Software www.absnetwork.com Ph: 1 800 833 3343 Page 26
Get Smarter with Show your clients how to pay off their mortgage 50% faster without changing their current budget! View Smart Equity™ Now! Short Online Video at www.gregstanley.ca
Contact Greg Stanley CFP AMP 866.658.0492 Ext 100 © Stanley 2009 all rights reserved.
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