CMP 10.12 Alternative Lending Guide

BACK FROM THE BRINK Rescuing clients without stellar credit WIN MORE DEALS Follow this formula for every deal

MORTGAGEBROKERNEWS.CA SPECIAL GUIDE

STEPPING UP TO THE ARTS Equitable Bank’s raising the channel profile

ALTERNATIVE LENDING GUIDE Closing more deals and collaborating successfully so everyone wins

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ALTERNATIVE LENDING GUIDE

CONTENTS

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CONNECT WITH US Got a story or suggestion, or just want to find out some more information? twitter.com/CMPmagazine plus.google.com/+MortgagebrokernewsCa facebook.com/MortgageBrokerNewsCA

FEATURES 04 A winning formula

Get all the information right the first time so deals go through smoothly

12 Deal secrets shared

Getting self-employed, salaried and bruised-credit clients approved

14 Joining forces

More lender/broker collaboration than ever before is paying off for everyone

16 Capitalizing on the arts

An A-space giant launches an award bound to boost the channel’s profile

SPECIAL REPORT

A FORCE TO BE RECKONED WITH

Brokers lamenting the lack of common-sense lending in the A space are applauding sensible underwriting in the alternative one

10 Q&A

A CEO’S PERSPECTIVE

Equity Financial Trust CEO Michael Jones shares his views on the alternative lending space

MORTGAGEBROKERNEWS.CA CHECK IT OUT ONLINE www.mortgagebrokernews.ca

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ALTERNATIVE LENDING GUIDE

RISE OF THE A-SPACE

A force to be reckoned with Brokers lamenting the lack of common-sense lending in the A space are applauding sensible underwriting in the alternative one

NO LONGER the lender of last resort, the alternative space has blossomed into a force making even A lenders sit up and take notice.

They’re the darling of the mortgage broker channel. Alternative lenders have opened doors for clients who never would’ve dreamed a home was within their financial grasp, and restored the dignity and faith of many who’ve come back from near bankruptcy.

“There are two types of alternative clients,” says Brian Gentles, AMP, with TMG The Mortgage Group Alberta. “The first type is those who know that they have chosen to be business for self and declare less income, those that know that their credit is not the best, or those that know that they are pushing the boundaries on typical A lender affordability factors. These clients are very pleased that alternative lending exists.”

Most people forget the 3.99% with a 1% fee is pretty attractive compared to renting, where you’re at the whim of the landlord and you aren’t building any equity, Gentles told CMP. “Also something to consider is the high-ratio fee for non-standard, Alt-A income qualification needs to be factored into the equation as part of the total cost of going through an A lender,” he says. “At 85% LTV the high-ratio insurance premium is 3.35% of the mortgage amount. The fee on a combination B lender plus private mortgage to 85% LTV is typically 1%.

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Struggling economy supports alt market In addition, rising self-employment numbers are creating a lucrative opportunity for brokers, who have much more to offer these clients than big-bank counterparts.

“A-lenders used to have business-for-self (BSF) equity programs but they are non-existent now,” says Christine Xu of Mortgage Architects. “It’s pretty much only alternative lenders doing insurance for self-employed people who want investment properties as well.”

BFS clients don’t have salaried work histories to qualify for mortgages in the prime space. So brokers and alt lenders have been able to flourish in what remains a hot housing market.

According to Statistics Canada data, the value of loans underwritten by alternative lenders grew by a staggering 25% over the past 12 months. The overall mortgage market grew by a mere 4% over the same period – with much of this growth due to an increase in subprime lending.

“Alternative lending gives brokers and their clients relief from the often stringent requirements of traditional lending institutions,” says Dimitri Kosturos, vice president of VWR Capital. “Alternative lenders give clients another option to complete a purchase or reduce their monthly debt obligation.”

www.mortgagebrokernews.ca

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Greater choice, greater flexibility “If people have less choice with their bank, they need to find an alternative, and that is often to go to a broker,” says Bryan Guertin, a mortgage broker with Mortgage Intelligence.

“We have alternative financing options, whereas the banks have one program and clients have to qualify under that program.”

While self-employed deals pose unique challenges, brokers seem up to the challenge “Often we have to put self-employed clients with B-lenders and qualify their gross

racked up a poor credit rating. Brokers can start the conversation and become the white knight riding in to save the day.

“Brokers need to understand the story behind bruised credit,” says Gleb Loussoufovitch, director of sales and marketing with XCEED Mortgage Corporation. “Most of the time it is a result of an unfortunate life event, however sometimes people just get carried away by excessive spending.

Understanding how clients’ credit became bruised is “critically important” to putting

“Our philosophy is that every single person has ups and downs. So wherever they are, it is like giving them really good technical advice – a blueprint – of where they ... need to go” income instead of their net income,” says Guertin. “When we go to a B-lender, they ask for 12 months’ worth of bank statements and that’s how they qualify the client.”

One Toronto-based mortgage agent has carved out a niche market in helping down-and-out clients, making the pages of a magazine feature.

“We handle a lot of powers of sale, foreclosures, that kind of stuff; Toronto Life was looking for situations in Toronto where people were being kicked out of their house or being foreclosed on,” says Matrix Mortgage Global’s Ronald Alphonso. “They called me and I gave a few cases of clients we’ve worked with.”

One of those cases was a power of sale for a house in the Davenport Road and Dupont Street area in Toronto. Alphonso says he stepped in and convinced the lawyers working the case not to sell the home, and halt the clients’ eviction.

“It took about three to four months to sell the house, but the lawyers eventually got paid,” Alphonso says. “Clients purchased a house in Bobcaygeon (Ontario), and I arranged the financing for them, based on the fact that the other house would be sold.”

Lenders want the full picture No one usually wants to talk about how they’ve

them back on the road to recovery because “alt lending is essentially a ladder which will bring such clients’ credit back up to prime lending space,” says Loussoufovitch.

That tough-love message Brokers are finding the conversation is about more than just rates and product news. It’s also turning to investment and lifestyle advice for clients as brokers become more investment advisors and lifestyle coaches.

And it’s a message that needs to be shared with clients, says Graeme Moss, last year’s CMP Broker of the Year for alternative lending (complex work), and principal broker for Fair Mortgage Solutions in Hamilton, Ont. “It does help them to hear the honest truth,” says Moss. “A big issue can be people living within their means. People are afraid to give that sort of advice or tell a person what to do – but it really does help them, and they appreciate hearing the honest truth. And they respond to it.”

Moss likens it to being a lot like a lifestyle coach.

“Our philosophy is that every single person has ups and downs,” he says. “So wherever they are, it is like giving them really good technical advice – a blueprint – of where they are and where they need to go.”

www.mortgagebrokernews.ca

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ALTERNATIVE LENDING GUIDE

DEAL-WINNING FORMULA

Would I buy this house?

Getting all the right information – and getting it right – is key to seeing deals go through smoothly the first time

BROKERS KEEP asking lenders the same question: What do you need to make this deal work the first time?

For the underwriters at Eclipse, there’s a very simple formula for brokers to use: “Use Deal RUN 5-on-5 to assess your file and share it with Eclipse to get answers fast,” says Steve Lydon, national sales manager with Eclipse. “The 5-on-5 has two components: it determines LTV and determines pricing.”

According to Lydon, the components brokers need to be aware of break down this way:

Determines LTV (5)

1

The property location. Please provide the street address if possible.

“In line with our real-estate first philosophy our underwriting platform has a link to Google Maps from the subject property address,” he says. “Eclipse underwriters look at the house to see if it’s on a residential street and if the subject property conforms to the neighbourhood.

“We do ask the question, ‘Would I buy this property?’”

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Is it a purchase or refinance? Please confirm if subject property is owner-occupied or rented. If it’s a purchase, where is the down payment from? (e.g., sale proceeds, inheritance) “If the deal is a refinance we want to know how long the applicants have lived in the property,” says Lydon. “If it’s a purchase we

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want to know how much of the actual down payment is from their own savings.”

3

What’s the current LTV? Please comment on how you assessed the value of the property.

“It’s always good to know if the broker has reviewed recent sales in the neighbourhood or if they have taken the applicant’s suggested value of their home,” he says. “Eclipse underwriters obtain reports to review the recent neighbourhood sales and to get an idea if the equity position is realistic.”

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What’s the current condition of the subject property? (e.g., is the property renovated or updated?)

“How old is the home? If it’s older and requires some kind of repair or update it’s very important for brokers to disclose that information,” says Lydon. “We don’t want any surprises when we look at the appraisal report. Homes need to be at least 97% completed as per our guidelines.”

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Income source – provable or business for self (BFS)? Please confirm to us what documentation you have collected if BFS. “Fully verifiable income will positively influence pricing. MCAP Eclipse does call to verify employment on all job letters,” he says.

“For BFS income, continue advising the brokers to refer to our BFS guidelines so they understand what kinds of documents we

require and can accept.”

Determines Pricing (5)

1

Beacon score(s) – If there is a low credit score tell us why. Share the

story.

“If there’s a life event that has impacted the credit we want to know,” he says. “Maybe there was an illness? Whatever has happened, it’s important to understanding the deal and how it arrived at Eclipse. It can also illustrate the client’s credit worthiness and financial willingness to deal with their debts and obligations.”

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Is the current mortgage up-to-date?

“If the client has struggled to make

www.mortgagebrokernews.ca

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A SNAPSHOT OF MCAP ECLIPSE Lender markets: major and minor urban centres across Canada (except Quebec at this time ) Niche/focus: beacons 500+up to 80% LTV, BFS, refinance to payout CRA, property taxes, spousal buyout, consumer proposal balance Products: Lunar Eclipse, Solar Eclipse, Total Eclipse which respectively are a one-, two- and three-year fixed product Customer type: main applicant, co-applicant up to four people on the mortgage, can have a guarantor or co-signer who doesn’t live in the home Property type: residential, single-family homes, up to a four-plex, condos, rentals on exception Maximum LTV: 80% (Champions League brokers get 85% LTV) Minimum Beacon: 500 mortgage payments to their current lender it’s imperative for brokers to disclose,” says Lydon. “We will at times condition for the most recent 12 months’ bank statements showing good mortgage repayment. If the client is consolidating a first and second and we’re providing a significant monthly cash savings, this will help re-establish credit and position the file for success.”

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Is their property tax arrears?

“If there are property-tax arrears we want to consolidate them into the mortgage. Of course, it’s best to know this detail when the application is submitted,” he says. “It’s usually never good when we discover property-tax arrears at funding from

the solicitor confirming a shortfall.”

4

If an applicant is BSF, do they owe the Canada Revenue Agency (CRA)?

“If an applicant owes the CRA more than $5,000 we want to consolidate the arrears into the mortgage,” says Lydon. “If they do owe, it’s important to disclose why – was their file re-assessed?”

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Is there a previous bankruptcy or consumer proposal? If yes, share the story.

“Again, if there has been a major life event that impacted the clients to go down the road of a bankruptcy or consumer proposal it’s important for the broker to disclose,” he says.

Terms: one-, two- and three-year Rate types: fixed only Maximum amortization: 30 years Fees: 1% of the loan amount, but negotiable Maximum residential loan amount: $500,000; with exception, up to $750,000

www.mortgagebrokernews.ca

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SPECIAL PROMOTIONAL FEATURE

HOME TRUST COMPANY

Trusted alternative market expertise Current economic conditions mean mortgage brokers have more opportunities – especially in the growing alternative market, writes Pino Decina

THE CANADIAN housing market continues drawing close scrutiny over concerns that – in parts of the country at least – properties are over-valued and a price correction is imminent.

The Bank of Canada recently downgraded its earlier growth projections for 2016, noting the economy would continue underperforming well into the new year.

For those of us who have been in the industry for a while, we’ve been through these cycles before. And while it may be necessary to adjust the sails a bit, we’ve yet to encounter a headwind too strong to overcome.

Our view is the current economic conditions actually present increased opportunities for professional mortgage brokers, particularly within the growing alternative market.

And when it comes to understanding the alternative market, we believe no other lender can boast Home Trust’s level of experience.

Alternative market expanding 25% each year The alternative mortgage market may be small

THE HOME TRUST ADVANTAGE almost 30 years of experience and expertise dedicated team of BDMs and underwriters applications reviewed by individual experts extensive product line for best client solutions

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www.mortgagebrokernews.ca

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SPECIAL PROMOTIONAL FEATURE

HOME TRUST COMPANY MORTGAGE MARKET GROWTH RATE

THE ALTERNATIVE MARKET AT A GLANCE

25% per year

growing about 25% a year

4% per year Alternative compared to the overall housing market. But it continues growing much faster than the prime market. A Financial Post article earlier this year noted the alternative market keeps increasing by roughly 25% a year compared to the 4% gain the prime market managed to record during the same time.

Several factors support this rapid growth, including regulatory changes in recent years intended to “cool” the housing market. As a result, many borrowers who formerly qualified for a prime mortgage are now being turned away by the banks. Many of these individuals have well-established credit histories and represent little, if any, additional risk.

Prime mortgage experts representing clients, it’s up to brokers to not only source the best deal for their clients, but also to help clients understand their options and guide them through the mortgage application process. This is the added value mortgage brokers provide – whether alternative or not. If all Canadians understood the benefits of working with a mortgage broker, far more would choose this path.

Dedicated teams combined with expertise Home Trust has specialized in lending to the alternative market for almost 30 years. This is a segment we understand and we believe

“If all Canadians understood the benefits of working with a mortgage broker, far more would choose this path” We’re also seeing an increase in the number of self-employed borrowers. This includes business-for-self clients as well as those caught up in the move by companies to shift more workers to contract positions in a bid to reduce overheads. In what’s rapidly becoming the new normal, roughly one in every five working Canadians is now considered self-employed.

These borrowers represent an emerging opportunity for the broker community, but it does come with certain responsibilities. As

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several factors supporting growth, including tighter lending rules

it’ll will only keep growing in overall market share. We have a highly dedicated team of BDMs and underwriters with the knowledge and experience needed to accurately evaluate creditworthiness for each individual request.

Having said that, we understand why there’s hesitancy on the part of some brokers to take on more alternative business. It’s fair to say alternative deals do often require a little extra work compared to a prime deal; this is because of the additional documentation typically required to support

market growth means more opportunities for brokers

more self-employed borrowers alternative deals. However, Home Trust has a very-well defined process that clearly lists the required supporting documents. And with the launch of our new Loft broker portal, we’ve simplified the process for submitting and managing supporting documents.

Ultimately, each deal presented to Home Trust is reviewed by individual experts who arrive at their decisions based on a thorough review of the information. This level of consideration does call for a few more supporting documents, and it may add a little bit to the turnaround time. But this extra diligence – together with Home Trust’s extensive product line – ensures far more positive results. For brokers working with Home Trust, this gives you the best opportunity to get the deal done for your clients.

I’ll say it again: Home Trust has specialized in supporting the broker channel and the alternative mortgage space for almost three decades. The entire Home Trust team is committed to supporting our many broker partners as they help deserving Canadians achieve their financial goals. It’s a responsibility we take very seriously.

www.mortgagebrokernews.ca

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ALTERNATIVE LENDING GUIDE

EQUITY FINANCIAL TRUST

A CEO’s perspective on Alt A CMP sat down with Michael Jones, the CEO of Equity Financial Trust Company, to get his take on the alternative lending space

CMP: Brokers are lamenting the lack of common-sense lending from A lenders, while applauding this lending from the alternative space. Why is that?

MICHAEL JONES: Equity Financial Trust has a clearly defined, board-approved lending policy that covers all aspects of its lending operations. Embedded in that policy is a concept of common-sense lending that helps ensure the solution meets the broker’s and customer’s needs, while protecting its depositors and shareholders.

That means brokers who do repeat business with Equity get used to consistent responses, and therefore know in advance how best to advise their customer.

CMP: Underwriting from the A space is driving brokers to the alternative lending space. What’s the difference?

MJ: There are two big differences: One – There’s no third-party mortgage insurer standing by to make the lender whole if the borrower defaults and there’s a loss.

Two – There are no cookie-cutter deals in the B space. Although every deal has to be underwritten with reference to the lending policy, each deal is unique, and our underwriters know they have to work handin-hand with their broker partners to craft solutions that work for both sides.

CMP: The alternative lending space has exploded in recent years. What’s contributing to this?

MJ: At Equity we think the demand has

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always been there, but as new lenders (such as Equity) arrive on the scene, brokers can offer more choice to their customers – which means more deals get done.

It’s also true that prime lenders and insurers have tightened their guidelines in recent years, pushing more borrowers into the B space.

CMP: What do brokers need to do to ensure loans are approved on the first submission, so underwriters aren’t put into the position of sending applications back?

Send in complete deals where possible, and ensure you give us adequate time to review documentation – especially towards month-end.

CMP: What common issues do underwriters encounter that derail a loan?

MJ: Income not coming in as disclosed; documents that can’t be validated; appraised value coming is less than anticipated; and inability to prove the existence of a business.

“Hiding information in hope the lender won’t find out can backfire ... not just for the current deal but also for future submissions” MJ: Talk to your BDM or underwriter that looks after your brokerage before sending in your first deal. Even when you begin to feel comfortable with how we administer our lending policy, it still helps to talk to your underwriter first if only to understand how we will approach the deal.

Alternative deals are “story loans.” Brokers should make sure they explain all aspects of loans (the good, the bad and the ugly), so the underwriters have the information they need to make a good decision. Hiding information in hope the lender won’t find out can backfire ... not just for the current deal but also for future submissions.

CMP: Who are the clients coming to the alternative space? Are you seeing people coming to you for loans first, instead of the A space?

MJ: We have three major customer groups (and I suspect the same is true for other lenders): BFS, bruised credit, thin/no hit credit. It’s possible for some customers on the fringe of prime that brokers use a B lender as an “insurance policy.” Because we police funding ratios carefully, we don’t recommend making a habit of that.

CMP: Rates and terms are very competitive in the alternative space – even

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competing with the A space. Where’s the alternative space headed?

MJ: Right now we think the additional spread available in the B space is adequate compensation for the additional risk the lender takes on. If the economy slows down, or real estate values fall, there may have to be some adjustment.

“One advantage of operating as a trust company or a bank is that we can source deposits at a reasonable cost and can pass on that benefit ... ” We are today in an all-time-low interest rate environment, which is why we recommend brokers and borrowers try to lock in their rates for as long as possible – especially if they don’t expect to qualify for a prime loan in the near future.

CMP: What market disruptors are out there now – or around the corner – that will be a challenge for alternative lenders?

MJ: The core skill required in our business is the ability to grant credit safely and soundly.

As we’ve said, B deals tend to be more complicated and harder to decide by reference to a single algorithm such as a beacon score or an LTV ratio. If market disruptors wants to succeed in our business they’ll have to master the skill of making lending decisions based on a multitude of factors, the mix of which is different for each loan.

In addition, one advantage of operating as a trust company or a bank is that we can source deposits at a reasonable cost and can pass on that benefit to our borrowers. It’s a unique advantage Equity and other lenders in our space possess.

www.mortgagebrokernews.ca

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ALTERNATIVE LENDING GUIDE

OPTIMUM MORTGAGE

Alternative lending demystified Rejean Roberge, senior marketing manager of Optimum Mortgage, Canadian Western Bank, shares some secrets on how to get deals done

A FEW years ago, if we asked a broker for the breakdown of funded volume – A deals versus alternative deals – the ratio would look quite different than it does today. As a result of regulatory changes, many Canadian borrowers no longer qualify for traditional A financing. So brokers now find themselves navigating the alternative lending space more often.

We’ll let you in on a little secret…we’re on your side. We’re all working to find the best possible solution for borrowers and ensure they can afford to repay their mortgages.

Tips for getting deals funded Since we’re on the same side, here are some tips from one of our BDM and underwriter teams to help get those difficult deals funded: • Ask for all documentation up front. How many times have clients quoted their salaries only for you to find out they’ve included something that materially changes the deal?

By collecting documents up front, you’ll know right away whether you have an A deal, alternative deal or private deal.

• Tell us the story. Once you’ve determined the file is an alternative deal, find out why.

We generally see two categories: bruised credit or a self-employed applicant who can’t prove their income. Sometimes, it’s a combination of the two.

• Google. Do you Google your client, the subject property, the employer? You’d be amazed at what you’ll learn prior to submitting a deal to a lender.

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Stated income If you have self-employed clients who write down their incomes so they no longer qualify for the mortgage, you have a stated-income deal. B-20 requires lenders to demonstrate how the client can afford the mortgage. We accomplish this by collecting business and/or personal bank statements. That’s right – we said personal bank statements. Why? They demonstrate self-employed clients pay themselves. Remember, our main litmus test here is affordability. If you think the client can afford it, call us.

B20 also requires we verify income and, if needed, explain the difference between the stated income and the claimed income. For this reason, we look at business financials, T1 General including the Statement of Business Activities or contracts. This gives us an idea of what clients are writing off and what we can add back to income to make the deal work.

asking difficult questions; this is to help improve your clients’ current positions. Was there a mitigating factor that caused the credit issues? If they have credit issues, have they paid their mortgage as agreed? This is very important to an alternative lender. Depending on the state of the credit we may request to see six to 12 months of bank statements for demonstrating good mortgage repayment.

Where affordability fits Whether clients are self-employed or salaried, there may be other income we can leverage to strengthen the deal. They may have a non-conforming rental suite, a spouse in the background or they receive Child Tax Credit. Or perhaps they’re a high-net-worth, self-employed client with liquid assets in the background they could draw on if required.

What if your client’s salaried?

About the property

We just need a paystub and job letter.

Unfortunately, our industry sees a lot of fraud.

If the documents don’t look right to you, keep investigating. They may be perfectly legitimate, but do your due diligence until you’re satisfied. If you’re questioning the documentation, call your underwriter and let him or her know.

Is it in good, marketable condition? Is it on well and septic, or an acreage? What’s the zoning?

These are important facts for determining the loan to value of the deal. Are we paying out a second mortgage? If so, please find out the reason for the second mortgage. Often, the client consolidated but didn’t have the equity at the time to do a first mortgage only. That’s perfectly fine, but we need to know.

We hope these tips help you evaluate your alternative deals and help get them funded.

When in doubt, call your BDM or underwriter before submitting.

For clients with bruised credit, tell us the story If there’s a bankruptcy or a consumer proposal, do you know the reason? Don’t feel awkward

www.mortgagebrokernews.ca

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Bank Trust Wealth Management

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Thank you for choosing Optimum Mortgage as your #1 alternative lender.

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““To our brokers, a challenging yet successful year for all of us in the residential mortgage market. At Optimum, we have you to thank for our best year ever. You told us we are the number one alternative lender—thank you! We are all so very proud of this accomplishment.

We promise to continue to work hard to find ways to bring added value to your business— hassle free, error free and on time. Thank you for your support during 2015 and continued success to us all in 2016.” Lester Shore; Vice President, Optimum Mortgage

T. 1.866.441.3775 / F. 1.866.477.8897 / OptimumMortgage.ca /

@OptimumMtg

A CWB Group Company

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2/12/2015 10:27:57 AM

ALTERNATIVE LENDING GUIDE

CLOSE TIES FOR CLIENTS

Bringing clients back from the brink Alternative lenders are working more closely with brokers than ever before – and a lot of hard work and flexibility is turning into deals for clients and dollars for the mortgage channel

IT’S GOOD to be an alt-A broker – but you have to be good. And being good means working with a lender that is flexible in finding the lending that will close a deal.

“If you want to be a good alternative A broker and you want to capture that business – in a lot of places outside the GTA – you’re going to have to shore up the loan-to-value shortage,” says Adam Hale, a broker with The Mortgage Centre, who appreciates the extra mile alternative lenders will go to make a deal work. “Some of these lenders have brought back bundled products where they do a first and second mortgage for you and it’s a way to get clients to 80 per cent loan-tovalue.”

While alternative lenders are pushing the envelope to make deals work, they’re still working within the parameters of the regulations.

By being creative brokers are benefiting – albeit with a lot more work, but with greater rewards as well.

“My dad (Bruce Hale, with whom Adam shares the office with and who does the convention deals) probably does double the transactions I do, but we make the same income. I’m adding a lot more value and they’re seeing that. You can charge $2,500 on a $150,000 mortgage because you’re

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adding that extra strategy: We’re going to get you here in year two. That’s why we’re doing a two year term.”

The introduction of tighter regulations in 2012 has made lending a much tougher game for business-for-self clients with credit ratings that are less than stellar. “... the banks are declining deals because of these new policies,” says Hale. “They don’t want to stick their necks out and explain to you what’s going on in the industry.”

So explaining to clients why they’ve been declined by their bank due to imperfect credit falls to brokers.

And that leads to what Hale calls his “exit strategy” for clients with bad credit, bringing them back into the A lending space.

“As much as they’re frustrated, our job is to still say, ‘It’s OK, we can get you back there,’” says Hale. “And they want to get back there, even if it’s not with the lender that declined them.”

Hale’s secret to closing deals is that he types out for each clients what he is going to do.

“I know what’s going on and in B-lending you should know what you can do, even in a worst case scenario,” he says. “That includes pricing for first and second mortgages. I spell it out for them in black and white.”

NO DOCUMENTATION SHORTCUTS CHARTERED BANKS Mandatory documents: • Two most recent years of Notice of Assessment (NOA) to confirm there are no income taxes owed and to test reasonability of income exception being requested (in most cases stated income of more than $100,000 will not be approved) • Statement of account to confirm taxes paid, if NOA shows taxes due • Two most recent years of accountant-prepared T1 General tax returns to confirm sources of income CREDIT UNIONS Mandatory documents: • Two most recent years of NOA MBS (NON-BANK) LENDERS Mandatory documents: • Notice of Assessment for two most recent years • T1 general tax returns for two most recent years • Business licence for two years INSURED BUSINESSES Mandatory documents: • Minimum 10% down. Half from personal resources; additional half can be gifted with one insurer.

• Notice of Assessment for two most recent years, to confirm there are not taxes owed and to test reasonability of income exception being requested (in most cases, stated income of more than $100,000 will not be approved) • T1 general tax returns for last two years • Business licence covering two years • Notice of Articles • Accountant-prepared business financial statements • Corporate bank statements for six to 12 months The maximum mortgage offered by chartered banks is determinted on a case-by-case basis. With credit unions, the maximum mortgage now offered is $500,000. Each lender above (except insured businesses) also has additional documnents that may be required. Check with the specific lender.

www.mortgagebrokernews.ca

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2/12/2015 10:28:05 AM

Get the light shining on your next deal

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Contact Eclipse lending at: Eclipse Underwriting Centre DEAL RUN desk 1 866 260 D-RUN (3786) Fax 1 866 289 7390

2/12/2015 10:28:12 AM

SPECIAL PROMOTIONAL FEATURE

EQUITABLE BANK

Getting artistic in the broker channel Equitable Bank steps up to the plate with artistic support and exposure set to lift the broker channel’s profile

THE BIG Five banks have long viewed support for the arts as a way of increasing their profiles in the community. As Equitable Bank – a giant in the alternative lending space – now moves into this realm, Toronto-based multimedia artist Colin Rosati is the first recipient of the bank’s Emerging Digital Artists Award (EDAA).

With fanfare at the Art Gallery of Ontario, Rosati received the $5,000 prize Oct. 30 for his winning entry, Autocidal After-Image. The video animation explores the structure of digital and online space through user-generated data. The work will become the first new-media piece in Equitable Bank’s collection of almost 150 modern and contemporary works of art, mainly comprised of pieces by Canadian artists.

Rosati is a third-year Integrated Media student at Toronto’s OCAD University. He’s also a multimedia artist who works with 3D modelling; the visual programming language Max MSP; single and multi-channel video; and interactive installations. Rosati said he was “honoured to be the first recipient” of the

inaugural EDAA. “It’s encouraging to see Equitable Bank proactively support digital artists, which is essential to the development and growth of new media art in Canada,” Rosati said.

Rosati was one of five finalists. The four other emerging-artist finalists – Santiago Tavera, Yi Xin Tong, Brianna Lowe and Zinnia Naqvi – each received $1,000.

Equitable launched the new award in July.

“This award signals our commitment to supporting Canadian contemporary art and our growing investment in digital technologies,” says Andrew Moor, CEO of Equitable Bank. “Alongside the development of our digital banking platform, EQ Bank, the EDAA highlights our interest in using these technologies toward experimentation and innovation in the finance sector and arts sector alike.”

EQUITABLE BANK SNAPSHOT Schedule 1 bank regulated by Office of the Superintendent of Financial Institutions

about $14.4 billion total assets under management

ninth-largest independent Schedule 1 bank in Canada

wholly owned subsidiary of Equitable Group

founded in 1970

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400 employees serves residential, retail and commercial customers across Canada

offers numerous savings and mortgage lending products provides prime and alternative single-family lending services; commercial lending services; and a variety of savings solutions including high-interest savings products and GICs

www.mortgagebrokernews.ca

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2/12/2015 10:28:22 AM

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2015-07-09 12:13 PM 2/12/2015 10:31:27 AM

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2/12/2015 10:31:38 AM