CMP 16.10

MPAMAG.COM/CA ISSUE 16.10 | $12.95

Brokers

ON LENDERS 2021

Which lenders continued to deliver excellent service in a year full of challenges?

RESPONDING TO MARKET MAYHEM

Ways to help clients navigate economic fears and off-the-charts prices

00_OFC_OBC_SPINE-SUBBED.indd 2

THE BANK OF CANADA STAYS THE COURSE But could the central bank be moving too slowly in raising interest rates?

THE POWER OF RELATIONSHIPS

How one lender’s connections paid off at the height of the pandemic

05/10/2021 1:53:33 am

IFC-03_TOC-SUBBED.indd 4

05/10/2021 2:08:50 am

ISSUE 16.10

CONTENTS

Brokers 19

ON LENDERS 2021

SPECIAL REPORT

CMP checked in with brokers to find out which Canadian lenders have been able to maintain stellar service in a relentless mortgage market

Opportunity is often simply a matter of seeing it first.

With over $3 billion under administration and ready for immediate deployment, Romspen is a boutique non-bank mortgage lender specializing in commercial real estate in Canada and the US. For your financing of $10 million to $400 million we bring speed, agility, and a commitment to complex execution you will not find in larger institutions.

Blake Cassidy or Pierre Leonard | 800 494 0389 | www.romspen.com

DATE:

IFC-03_TOC-SUBBED.indd 1

JUNE 25, 2021_2:40PM

License # 10172

LIVE:

NA

7.25” x 5” TRIM: www.mpamag.com/ca BLEED:1 NA

AD NUMBER: ROM CMP 21 03

COLOUR: CMYK

AD / JOB TITLE: OPPORTUNITY

CLIENT: ROMPSEN

PUBLICATION / RUN DATE: CMP / JULY-AUG-SEPT 2021 ISSUES

CREATIVE TEAM: BENSIMON/PARKER

B E N S I M O N P A R T N E R S 4 4 6 S P A D I N A R O A D , S U I T E 2 0 7, T O R O N T O , O N TA R I O , M 5 P 3 M 2 , C A N A D A

T E L . 4 1 6 5 905/10/2021 7 9 7 0 0 FA X.416 2:08:41 am5 9 7 9 7 0 7

ISSUE 16.10

CONNECT WITH US Got a story or suggestion, or just want to find out some more information?

CONTENTS

twitter.com/CMPmagazine facebook.com/MortgageProfessionalCA

32 08

UPFRONT 04 Editorial

Why brokers should aim for constant communication

06 Statistics

Key data that should be on your radar this month

10 Bank update

UPFRONT

NEWS ANALYSIS

How are brokers helping clients make sense of the still-hot mortgage market during a time of growing economic unease?

38

FEATURES

THE RELATIONSHIP BUSINESS

VERICO president and COO Mark Squire is using his decades of banking experience to bring a new level of broker-lender synergy to the network

16 2

The commercial segment gets a boost in the second quarter

14 Opinion

Giving back to the community is a must for successful brokers

FEATURES How Home Trust is working to meet brokers’ expectations

PEOPLE

INDUSTRY ICON

12 Commercial update

35 Building partnerships through knowledge and commitment

By making the most of its ties to builders in the GTA, Falcon Ridge Management was able to successfully navigate the storm of the pandemic

PEOPLE

Will the Bank of Canada’s caution on interest rates come back to haunt it?

TAILOR-MADE TO PERFECTION

At Bespoke Lending Solutions, Shaun Francis makes sure every client gets a customized experience

40

44 Doing business with MERIX

What the lender is doing to make itself a true partner to brokers

46 Three ways to future-proof your success

How to build a sustainable business by fostering good mental health

PEOPLE 48 Other life

Going the distance with triathlete and mortgage exec Trevor Daly

FEATURES

OPENING UP THE WORLD OF PRIVATE LENDING How CMI became a go-to partner in Canada’s private lending space

MPAMAG.COM/CA CHECK IT OUT ONLINE

www.mpamag.com/ca

IFC-03_TOC-SUBBED.indd 2

05/10/2021 2:09:09 am

Rates as low as

3.79%2 | 4.61% APR3 1 Year Fixed Reverse Mortgage Flex Lite

IFC-03_TOC-SUBBED.indd 3

05/10/2021 2:09:06 am

UPFRONT

EDITORIAL

www.mpamag.com/ca ISSUE 16.10

The value of staying in touch

I

n recent weeks, CMP has been speaking with a host of mortgage professionals to find out what approach they’re bringing to their business as the fall market takes shape. After a cooldown in the summer, the market is beginning to pick up steam again – despite the fact that Canadians are increasingly uncertain about the country’s economic future as the COVID-19 pandemic drags on. According to the latest Bloomberg-Nanos Canadian Confidence Index, only 32% of Canadians expect the country’s economy to become stronger in the next six months, while 30% foresee static economic performance and 27% anticipate a weaker economy.

Against that backdrop, many mortgage brokers have been taking the time to let clients know that they’re always available for a chat or consultation, no matter what stage of the mortgage process they’re currently in. For brokers, breaking down a client’s financial situation and giving them a clearer idea of the overall picture – even if they’re not on the verge of making a move – can be an excellent way to build trust and establish yourself as a source of expert information.

Breaking down a client’s financial situation and giving them a clearer idea of the overall picture – even if they’re not on the verge of making a move – can be an excellent way to build trust That’s doubly relevant in light of Canadians’ increasing uncertainty about the country’s economic situation, not to mention the new changes to the qualifying rate for both insured and uninsured mortgages that took place over the summer.

For the average would-be homebuyer, those new realities – coupled with little clarity on where interest rates are headed and ever-climbing house prices across the country – make the task of securing a mortgage in the current market seem like a daunting one.

Yet for brokers, the ability to provide reassurance and guidance to clients isn’t just a means of demonstrating a sense of authority on the market. It’s also an excellent way of making sure that your name is the first one that comes to mind when your clients are asked by friends and family for a recommendation – helping to drive new business and ensuring you’re making the most of a market that shows little sign of slowing down.

The team at Canadian Mortgage Professional

EDITORIAL

SALES & MARKETING

Managing Editor Paul Lucas

Publisher Chris Anderson

Editor Fergal McAlinden

National Account Manager Corey Bahadur

Writers Ephraim Vecina Mallory Hendry Chris Davies Copy Editor Clare Alexander

CONTRIBUTORS Paul Meredith Anastasia Massouras

ART & PRODUCTION Designer Joenel Salvador Production Manager Alicia Chin Production Coordinators Loiza Razon Kat Guzman Client Success Coordinator Cole Dizon

Sales Executive Alan Stewart Project Coordinator Jessica Duce

CORPORATE President & CEO Tim Duce Office/Traffic Manager Marni Parker Events and Conference Manager Chris Davis Chief Information Officer Colin Chan Human Resources Manager Julia Bookallil Global CEO Mike Shipley Global COO George Walmsley

EDITORIAL INQUIRIES

fergal.mcalinden@keymedia.com

SUBSCRIPTION INQUIRIES

tel: 416 644 8740 • fax: 416 203 8940 subscriptions@kmimedia.ca

ADVERTISING INQUIRIES

chris.anderson@keymedia.com

Key Media Canada (Mortgage) Ltd. 317 Adelaide Street West, Suite 910 Toronto, ON M5V 1P9 tel: +1 416 644 8740 www.keymedia.com Toronto • London • Denver Sydney • Auckland • Manila • Singapore

Canadian Mortgage Professional is part of an international family of B2B publications, websites and events for the real estate and mortgage industries MORTGAGE PROFESSIONAL AUSTRALIA claire.tan@keymedia.com T +61 2 8437 4772

AUSTRALIAN BROKER

simon.kerslake@keymedia.com T +61 2 8437 4786

NZ ADVISER

alex.rumble@keymedia.com T +61 2 8437 4708

MORTGAGE PROFESSIONAL AMERICA katie.wolpa@keymedia.com T +1 720 316 7423

Copyright is reserved throughout. No part of this publication can be reproduced in whole or part without the express permission of the editor. Contributions are invited, but copies of work should be kept, as the magazine can accept no responsibility for loss

4 www.mpamag.com/ca

04-05_Editor's Letter-SUBBED.indd 4

05/10/2021 1:54:57 am

gordon_ross@centum.ca | thecentumnetwork.ca ®/™ trademarks owned by Centum Financial Group Inc. (C) 2021 Centum Financial Group Inc. The intent of this communication is for informational purposes only, and is not intended to be a solicitation to anyone under contract with another mortgage brokerage operation.

04-05_Editor's Letter-SUBBED.indd 5

05/10/2021 1:55:05 am

UPFRONT

STATISTICS HIGHER DEBT DOESN’T EQUAL MISSED PAYMENTS

INSOLVENCY RATE CONTINUES TO FALL

ALBERTA

-8.3%

Canadian consumer insolvency remains below pre-pandemic levels – the number of Canadians who filed for insolvency dropped by 22.6% during the 12-month period ending July 31, according to the Office of the Superintendent of Bankruptcy.

However, André Bolduc of the Canadian Association of Insolvency and Restructuring Professionals warned that these numbers should not be taken as wholly positive sign, as they’re “likely masking some of the financial struggles that are just below the surface for many Canadians – those whose income has been heavily impacted due to COVID-19 and have had to supplement that income with government aid or credit.”

$393,887

Average debt load of Canadian homeowners

$20,183

MANITOBA

-26.2%

SASKATCHEWAN

Average debt load of non-owners

BRITISH COLUMBIA

-6.1%

-11.9%

CONSTRUCTION INVESTMENT WEAKENS ANEW

11%

Investment in construction across Canada fell by 1.7% month-over-month in July to $18.07 billion, according to Statistics Canada. This drop was largely driven by the residential construction segment, which saw investments decline for the third straight month in July following a record peak in April. The single-family home sector, which weakened by 4% in July, was a particular drag.

Share of homeowners with missed bill payments

$20bn

$10bn

21%

Proportion of non-owners with missed bill payments

$0 Jun 2020 Jul 2020 Aug 2020 Sep 2020 Oct 2020 Nov 2020 Dec 2020 Jan 2021 Feb 2021 Mar 2021 Apr 2021 May 2021 Jun 2021 Jul 2021

Source: Borrowell

6

Source: Statistics Canada

www.mpamag.com/ca

06-07_Stats-SUBBED.indd 6

05/10/2021 1:55:50 am

MORTGAGE NUMBERS DIP FOR NON-BANK LENDERS

DECLINE IN CONSUMER INSOLVENCIES, JULY 2021 ONTARIO

Non-bank lenders provided fewer mortgages in the first quarter of 2021, which Statistics Canada attributed to slowing demand and expected seasonal decreases. The total value of non-bank residential mortgage loans fell by 9.9% in Q1 to $51.9 billion. The total number of non-bank mortgages dropped by 17.3% quarterly, though it was up 34.4% year-over-year.

CANADA

-11.2%

-11.3%

TOTAL NUMBER OF NON-BANK MORTGAGES

QUEBEC

-7.1%

240,000

NEWFOUNDLAND AND LABRADOR

200,000

-28.7% PRINCE EDWARD ISLAND

160,000

-30%

120,000

80,000

NEW BRUNSWICK

40,000

NOVA SCOTIA

-27.9%

-13.9%

0

Q1 2020

Q2 2020

Q3 2020

Sources: Office of the Superintendent of Bankruptcy, Canadian Association of Insolvency and Restructuring Professionals

Q4 2020

Q1 2021

Source: Statistics Canada

HOUSING GAINS SEND NET WORTH SOARING

WHERE WILL FUTURE BUYERS COME FROM?

The value of residential real estate owned by Canadian households rose by 2.6% during the second quarter of 2021, pushing the housing sector’s net worth to $14.23 trillion, according to Statistics Canada. Since the first quarter of 2020, households have added almost $3 trillion to their net worth.

Canada’s future home purchasing power will likely be concentrated in the nation’s highest-earning households, if Statistics Canada’s latest data on savings is any indication. While all households improved their savings in 2020, the bottom 40% of Canadian households still weren’t able to save at all.

NET SAVINGS RATE

HOUSEHOLD SECTOR NET WORTH IN CANADA

$15 trillion

2019

2020

150% 100%

$10 trillion

50%

9.1%

0%

-100% -150%

$0

-28.0%

-50%

$5 trillion

Q1 2020

Q2 2020

Q3 2020

Q4 2020

Q1 2021

Q2 2021 Source: Statistics Canada

-61.4% -114.2% Bottom 20% of households

-3.7%

Next lowest 20%

9.9% 19.6%

25.7% 33.1%

-6.9%

Middle 20%

Next highest 20%

Upper 20% of households

Sources: Better Dwelling, Statistics Canada

www.mpamag.com/ca

06-07_Stats-SUBBED.indd 7

7

05/10/2021 1:55:55 am

UPFRONT

NEWS ANALYSIS

Brokers come to the fore Mortgage market activity is continuing at a rapid pace, even as Canadians’ confidence in the economy plummets. How are brokers helping clients navigate this landscape?

WITH A sudden spike in COVID-19 cases and provinces like Alberta announcing a return to a state of emergency, Canadians’ confidence in the economy plunged in August. Concerns about the economy and the country’s heated housing market were viewed as some of the main culprits for the drop in the Bloomberg Nanos Canadian Confidence Index, which, on August 27, registered its largest weekly decline since April 2020.

The Conference Board of Canada’s Index of Consumer Confidence echoed that growing unease, recording an overall drop for the first time since April.

In the mortgage industry, news of

time in 2020, they were still at “historically active” levels, trending somewhere between pre- and peak-pandemic extremes.

For many mortgage brokers, the collision of growing economic uncertainty with a hectic housing market only highlighted the need for a trusted advisor to steer would-be homebuyers through the increasing complexity of the mortgage process. Tracy Valko, owner and founder of Valko Financial in Kitchener, Ontario – a market that’s been particularly challenging – says she’s been emphasizing to each of her clients the need for strong, consistent communication with mortgage professionals at each stage of the

“Because mortgage rules are changing, and because of what’s going on in the economy, you really have to have a strong partnership with your mortgage broker” Tracy Valko, Valko Financial Canadians’ increasing pessimism about the future had little impact on the pace of market activity. The Canadian Real Estate Association said that while national home sales declined substantially in August compared to the pandemonium witnessed at the same

8

home-buying journey.

“Because mortgage rules are changing, and because of what’s going on in the economy and the demand on the market, you really have to make sure you have a strong partnership with your mortgage broker,”

Valko says. “They’re going to be able to help you and navigate you through these times, understanding where you are financially, what you can afford and where you are with your income.”

Perhaps the most significant change in the mortgage space in recent months has been the much-publicized stress test hike, which increased the qualifying rate for both insured and uninsured mortgages across Canada. That measure, which took effect at the beginning of June, was viewed as a move by the federal government to curb red-hot activity in the country’s housing market.

However, Christelle Mwamba, a mortgage agent at Mortgage Scout in Toronto, says it has caused significant problems for prospective first-time homebuyers – an unwelcome development during such uncertain times. She was surprised that the topic

www.mpamag.com/ca

08-09_News Analysis-SUBBED.indd 8

05/10/2021 1:56:25 am

CONFIDENCE FALLS, BUT PRICES KEEP CLIMBING

1.6

Points the Bloomberg Nanos Canadian Confidence Index dropped on August 27, the largest weekly decline since April 2020

31.5%

Year-over-year change in the benchmark home price in New Brunswick in August

16.8%

Year-over-year change in the benchmark home price in BC in August

15.1%

Year-over-year change in the benchmark home price in Ontario in August Sources: Bloomberg/Nanos, Canadian Real Estate Association

wasn’t a more prominent point of debate during the recent federal election campaign, given that the country’s housing crisis

the market. I think that should’ve definitely been an issue they should’ve addressed. I think it should be revisited, the way they

“I think [the stress test] should be revisited – it should definitely be lower in order for people to enter the market because prices are high” Christelle Mwamba, Mortgage Scout received ample coverage throughout that six-week period.

“The Bank of Canada qualifying rate was at 4.79%, and now we’re at 5.25%,” Mwamba says. “That doesn’t really give a lot of opportunity for young couples and families to enter

calculate it – it should definitely be lower in order for people to enter the market because prices are high. Now, since the stress test and the qualifying rate have gone up, that’s also what has factored in the slow home sales.”

Ryan La Haye, president of the Quebec-

based brokerage Groupe RLH, says one of the main things he’s advising clients to keep top of mind is that amid the current uncertainty on the economic front, buyers shouldn’t assume they’ll always reap the rewards of a hefty gamble in the mortgage market.

Instead of encouraging clients to take on a mountain of mortgage debt, La Haye says, brokers should be frank and detailed about the economic challenges that exist in the pandemic era. While some brokers might point to skyrocketing house prices across the country as a reason for their clients to take out a mortgage as a long-term investment plan, La Haye says they need to understand the factors that caused those increases – which might not necessarily remain consistent.

“The second the supply issue is resolved, we’re going to have a pretty flat real estate market – maybe for a decade,” he says.

“Brokers are always talking about this increasing asset class, [but] they might disappoint a lot of their clients who come back five years from now and realize that their property value is essentially the same.”

www.mpamag.com/ca

08-09_News Analysis-SUBBED.indd 9

9

05/10/2021 1:56:32 am

UPFRONT

BANK UPDATE NEWS BRIEFS RBC makes two key promotions on its leadership team

RBC has promoted Nadine Ahn to chief financial officer to replace Rod Bolger, who is leaving the bank after a decade of service. The move will make Ahn, who currently serves as head of investor relations and finance chief for the company’s capital markets arm, the only female CFO at one of Canada’s Big Six banks. RBC has also expanded the role of Neil McLaughlin, head of personal and commercial banking. McLaughlin will assume responsibility for RBC Ventures, the bank’s innovations arm, from Mike Dobbins, who is departing RBC on November 1.

TD Bank delays its return-tooffice plans until 2022

TD Bank has delayed plans for employees to resume work in its offices until at least next year due to the threat posed by emerging COVID-19 variants.

While many TD staffers have already returned to company sites like bank branches, trading desks and data centres, the bank cannot “expect a broader return to TD locations before calendar 2022,” said chief human resources officer Kenn Lalonde. TD is requiring employees to be vaccinated before returning to offices; workers are expected to register their vaccination status by the end of September.

Laurentian sees strong income growth in the third quarter

Laurentian Bank Financial Group has reported strong annual income growth for the fiscal third quarter, despite a decline in residential mortgages and personal loans over the nine months ending July 31. The bank posted net

income of $62.1 million and diluted earnings per share of $1.32, significantly higher than the $36.2 million and $0.77 per share reported for the same period last year. Return on common shareholders’ equity was 9.4%, up from 5.8% during Q3 2020. Laurentian’s residential mortgage loans amounted to $15.7 billion as of July 31, shrinking by 4% over a nine-month period.

CWB reveals a significant jump in net income for Q3

In its results for the fiscal third quarter and nine-month period ending July 31, CWB Financial Group reported net income of $86 million – up by 20% quarterly and 39% annually – and adjusted earnings per common share of $1.01. CWB’s pre-tax, pre-provision income of $138 million represented an increase of 9% from Q2 and 15% from last year. Total revenue for Q3 was $263.2 million, up by 16% annually. Loan volume reached $32.3 billion during the third quarter, growing by 9% year-overyear, which CWB attributed to a 10% annual volume increase in Ontario.

VersaBank shares begin trading on the Nasdaq

Digital-exclusive Canadian bank VersaBank has closed its IPO in the US, and shares have begun trading on the Nasdaq exchange. The bank issued 5.5 million shares at a price of US$10 per share. The offering was conducted through a syndicate of underwriters led

by Raymond James & Associates and Keefe, Bruyette & Woods, along with their respective Canadian broker-dealer affiliates. VersaBank said it expects to use the US$55 million net proceeds of the IPO for general banking purposes and that it would qualify as Common Equity Tier 1 capital for the bank.

Is the BoC being too cautious?

Some economists feel the Bank of Canada is playing with fire by waiting on rate movement There’s been an air of inevitability about each of the Bank of Canada’s recent interest rate announcements, with little change from one to the next. Since pushing forward the date at which it expects to begin raising rates – from 2023 to some point in 2022 – the bank has made consistency the name of the game throughout the summer.

That approach is viewed as a cautionary strategy amid continuing economic uncertainty and fragility as the pandemic shows little sign of slowing down. In its September announcement, the BoC referenced rising cases of COVID-19 in many regions as a risk to the continuing global economic recovery. It also noted weaker-than-expected performance for Canada’s economy in the second quarter of 2021, when GDP fell by 1.1% on an annualized basis.

However, some economists have suggested that the bank is exercising undue caution on rates, and its approach could potentially run the risk of getting on the wrong side of inflation.

Among those voices is CIBC deputy chief economist Benjamin Tal, who believes the housing market would be able to withstand gradual rate increases, totalling up to 0.5% by the middle of next year, to stave off that risk of inflation.

“Raising interest rates a bit earlier, slowly, can guarantee stability as opposed to [having to raise] them quickly,” he says. “I’d be much happier to see the Bank of Canada moving earlier, and be ahead of inflation, as opposed to

10 www.mpamag.com/ca

10-11_Bank Update-SUBBED.indd 10

05/10/2021 1:57:09 am

[waiting]. I think the housing market can easily take 25- or 50-basis-point increases by mid-2022 without really derailing it in any significant way.”

Tal adds that reacting too slowly to the possibility of inflation could present challenges for the housing market and economy down the line.

“If you wait and wait too long until inflation is way too close, then you start chasing a lagging indicator … and therefore you start raising interest rates way too quickly,” he says.

“If there is a risk to the housing market and the economy as well, it’s the rapid increase in interest rates when you chase inflation. This is something that we have to consider.”

“Raising interest rates a bit earlier, slowly, can guarantee stability as opposed to [having to raise] them quickly” However, National Bank economist Warren Lovely acknowledged that the housing affordability crisis has put the BoC in a difficult position with regard to interest rates.

“We’re seeing an erosion in affordability, really, across the country,” he told BNN Bloomberg. “We’ve had a significant reliance on housing in our Canadian economic model.

At the same time, affordability is getting away from a lot of Canadians and may require a policy response – not just from politicians ... but ultimately from our monetary policymakers as well.”

Q&A

MATT LIRANTZIS Head of marketing and business development RFA MORTGAGE CORPORATION

Years in the industry 18 Fast fact The RFA team holds an official Guinness World Record for the most people running/jogging online simultaneously

Doubling down on service What’s new at RFA? In 2021, we launched our RFA Insider program to reward our brokers for their hard work. One of the most valuable benefits of this program is unrestricted access to our full product suite.

RFA Insiders can take advantage of our B lending program, Alternative, to provide a holistic offering to their clients. In addition to Alternative, Insiders benefit from periodic pricing and compensation promotions.

We’ll be expanding our Insider offer into 2022, so keep an eye out for some exciting advancements, perks and rewards!

What do you view as the company’s value proposition in the mortgage space?

At RFA, we’re brokers first. We know that when our service is top-notch for our brokers, it makes the client experience even better. We’re focused on one-touch underwriting for our deals, and we’re continually looking at ways to expand our policies and products to give brokers a competitive toolkit in the marketplace.

From application through to post-funding, we want brokers to feel supported by us every step of the way.

Could you tell us a little bit more about the company’s approach to customer service?

Our approach to customer service is consistency and compassion.

Buying a home is usually the largest purchase any of us will ever make, and we don’t take that lightly. Our goal is to keep the process as simple and clear as possible.

As a newer brand in the mortgage space, we’re also looking at ways we can innovate the client experience. Just like with our brokers, from application to renewal, we want the entire process to be memorable.

What are some of the main things brokers need to keep in mind about the current market?

Given the pandemic, it’s clear that having a lender partner who can service both prime and alternative loans will continue to be an asset. Alternative programs are designed for times like these – extenuating circumstances that are out of our control. Many Canadians have found themselves out of work and are perhaps relying on higher credit use to get them through this crisis.

It’s a tough situation, but as people’s financial situations stabilize, they may need help to qualify untraditionally. We’re here and ready to support them with our RFA Alternative program.

What’s the best way for interested brokers to get involved with RFA? Please visit rfa.ca/brokers to find the contact information for a regional vice-president of sales in your region. We’re excited to work with you!

www.mpamag.com/ca

10-11_Bank Update-SUBBED.indd 11

11

05/10/2021 1:57:05 am

UPFRONT

COMMERCIAL UPDATE

A commercial surge in the second quarter The latest statistics show that Canada’s commercial market grew nearly 30% between Q1 and Q2

“A lot of these major companies and financial institutions are pulling back [on] the idea of subletting their properties and shrinking their commercial properties – because people are coming back to work in a big way,” he said.

While the strongest activity was in industrial, multi-family and ICI land, and the retail sector saw something of a rebound, CBRE noted that office and hotel investment was still in a pandemic-induced slump. Offices saw $1.1 billion in volume during the quarter, while hotels raked in $200 million and the retail

“A lot of these major companies are pulling back [on] the idea of subletting their properties” Projections of a commercial market upswing in Canada appear to have proven accurate.

Commercial real estate firm CBRE reported $14 billion in commercial property investment in the second quarter of 2021, up 29.3% over the previous quarter and a stunning 149.2% from the same period last year.

That activity was spurred by transactions under $20 million, which accounted for $7.9 billion of the quarterly total. There was a sizeable uptick in the number of deals; the 2,550 transactions in Q2 represented a 79% year-

NEWS BRIEFS

over-year increase. CBRE attributed the jump in activity to a growing pipeline of property listings and an improving COVID-19 outlook, in addition to significant capital backlogs.

Earlier in the summer, Jonathan Hacohen, a partner at Toronto-based real estate and corporate law firm Kormans, told CMP that, based on the number of commercial deals landing on his desk, the market was on “a huge upswing,” with many companies beginning to rethink the idea of reducing their downtown footprint as Canada slowly reopened.

Office vacancy levels reach multi-decade high

As employees continue to work from home, Canada’s office vacancy rate has reached its highest level since 1994, according to CBRE. The national vacancy rate hit 15.7% in the third quarter, exceeding the levels seen during the dot-com bubble and the global financial crisis. However, the trend of companies relinquishing space has “largely abated,” CBRE said. “Instead, leasing activity is steadily building ... and four out of the 10 Canadian markets recorded positive net absorption this quarter – a first since the onset of the pandemic.”

sector chalked up $2 billion. That compared to $4.1 billion for industrial, $3.7 billion for multifamily and $2.9 billion for ICI land.

According to Michel Durand, founder and CEO at MCommercial, the retail and hotel sectors are only likely to show prolonged recovery when investors and lenders are convinced that turning the COVID-19 corner is a real prospect.

“Those asset classes are not going to get back to financing capacities that they’re used to until 12 to 24 months from now, once they’ve been able to show to a lender that they can sustain the recovery,” he told CMP.

Warehouses are the backbone of the industrial sector

With the flourishing of e-commerce during the pandemic, Canada’s industrial market is seeing a sustained appetite for warehouses, according to CBRE. In Q3, the industrial market reached a national availability rate of 2% (down by 30 basis points quarter-over-quarter) and an average asking rent of $10.03 per square foot (up by $0.21). The greatest rent growth came in Toronto (74.1%), Montreal (56.2%) and London (50.7%). Vancouver, London, Toronto and the Waterloo region all had availability rates of 0.9% or lower during Q3.

12 www.mpamag.com/ca

12-13_Update Commercial-SUBBED.indd 12

05/10/2021 1:57:49 am

Q&A

David Boyle Vice-president, origination MCAP

Years in the industry 22 Fast fact Boyle joined MCAP eight years ago, originally serving as vicepresident of investment management

A broker-focused approach to commercial lending How has 2021 been for MCAP so far?

[It’s] on track to be another year of record growth at MCAP. We are seeing substantial increases not only in our new commercial mortgage volumes, but also in our mortgages under administration and renewals. Overall demand for MCAP’s commercial mortgage products continues to be exceptionally high across Canada.

Multi-family is an asset class that has proven its resilience throughout the pandemic. A continued low interest rate environment, coupled with an undersupply of affordable housing and sustained positive immigration trends, has driven high demand from investors who see the long-term value of owning apartments. As one of the leading multi-family lenders in Canada, our commercial mortgage group has been focused on broadening our programs, recruiting new talent and successfully adapting to a flexible working environment. These achievements meant we were well prepared to meet increased demand, and this played a significant role in our growth in 2021.

Do you have anything in the pipeline for 2022?

We are continually focused on growth, including broadening our product offering to ensure that it aligns with our brokers’ needs. For 2022, we are excited to share that we will be significantly more active with our CMHC Flex program, which will include both construction and term financing.

Another area in which we have experienced increased demand is our bridge financing product. We are further expanding this program to better meet the needs of our clients.

What do you view as MCAP’s value proposition on the commercial side?

As the largest mortgage finance company in Canada, MCAP has an established a reputation for providing a broad range of competitive financing solutions, which we deliver in a reliable and timely manner. Our commercial mortgage group mirrors this approach, providing expert advice and working with our brokers to understand the needs of their clients so that we can tailor appropriate solutions. This approach, coupled with consistent and timely execution from first contact right through to final

How can commercially inclined mortgage brokers get involved with MCAP? While we have experienced record volumes yearover-year, our goal remains the continued growth of our network of loyal broker relationships. We enjoy developing new partnerships and supporting brokers who are actively expanding their presence in the commercial mortgage space. I would encourage any commercial-oriented brokers to reach out to any one of our expert team members to learn more about how we can support their business.

CMLS Financial names new chair of advisory committee

Commercial lender CMLS Financial has appointed Brydon Cruise as chair of its advisory committee. Cruise has more than 30 years of global real estate experience focused on M&As and corporate finance in both North America and Europe.

According to CMLS’ Pierre Bergevin, Cruise’s “extensive leadership experience, deep relationships, community and client-centric approach, and demonstrated success in building businesses complement our strong entrepreneurial culture and enhance our coast-to-coast service capabilities.”

repayment, has created a wide network of loyal broker relationships that we value and greatly appreciate.

Brokers value our commercial mortgage group’s broker-friendly approach. We do not broker commercial mortgages; instead, we focus on supporting our broker network by providing first-in-class technology that allows us to respond to our brokers’ queries in a fast and efficient manner with guaranteed turnaround times.

Multi-family still propping up the commercial market

Multi-family is the most in-demand investment property type in Canada, more than compensating for the weakness in other commercial segments, according to Colliers Canada. Across North America, multi-family properties have drawn renewed investment, which Colliers called “a positive sign after a year of uncertainty.” The firm noted that “multi-family and industrial [properties] remain the top investment choices by volume. Canadian volume increased 84% over year-ago figures, with $8.3 billion traded.”

Edmonton office segment slowly bouncing back

The Edmonton office segment is showing signs of steady recovery, with touring activity and inquiries on the rise amid the workforce’s gradual return to the office, according to Avison Young. In its latest report, the firm said Q2 marked the first quarter since the onset of the pandemic where “the optimism we have seen is starting to manifest itself into tangible signs.” The vacancy level in Edmonton’s financial district stood at 17.1%, while the reading in the government district was at 17.4%.

www.mpamag.com/ca

12-13_Update Commercial-SUBBED.indd 13

13

05/10/2021 1:57:55 am

UPFRONT

OPINION

GOT AN OPINION THAT COUNTS? Email mortgagebrokernews@kmimedia.ca

The gift of giving back Mortgage brokering is itself a contribution to the community – but there are plenty of other ways brokers can make a difference in the lives of those around them, writes Paul Meredith ONE OF the best parts about being in the mortgage business is that we get to help people, which is the true nature of our field.

We’re not in the business of mortgages – we’re in the business of helping people.

The more people we help, the more successful we become. We’re fortunate to be in a thriving industry when so many others are struggling.

Giving back to the community should be an important part of any successful business, brokers included. Giving to others is a truly rewarding experience, and it’s a great feeling to know that you’re contributing to a worthy cause. I find it also helps with building the morale of my team, as they know that while we’re building our own success, we’re also making a difference in the lives of others.

Mortgage brokers are a key component in making homeownership possible. However, not everyone is fortunate enough to be in a position to buy a home, and homelessness continues to be a problem. We help people realize their homeownership dreams, so why not also help those who don’t have a home at all? Homeless charities tie in beautifully with mortgage brokering, which is why they receive more than 90% of my charitable donations.

There are several ways to give back to the community other than donating money.

When I wrote my book, Beat the Bank: How to Win the Mortgage Game in Canada, my main goal was to help people to better understand their options with mortgages. I

14

take great pride in the quality of the advice I give to my clients, so why not put together a resource to make my advice available to everyone?

I didn’t write Beat the Bank as a promotional tool. Nowhere in the book do I talk myself up, promote myself or so much as even hint for the reader to come to me for their mortgage. The exception is the last line, which says “I look forward to helping you out on your next mortgage.” That’s it.

Beat the Bank was written to help more

as a result, and they gave me a number. I wrote them a cheque for that amount.

Volunteering is another great way of giving back to your community. We’re all busy, but if you can block off some time to do some volunteer work, it can be a rewarding experience. You can also get your team involved as well, which is great for building team spirit.

My team and I took an entire day off to help build a home with Habitat for Humanity. After a day of carpentry work, it was clear that we should stick to mortgage brokering, but we had a great time! We even met the person who was going to be living in the home. She was telling us about her kids and her life. It was close to Christmas, so I also gave her $150 to buy presents for her kids. The feeling you get from giving can be priceless.

Giving starts the receiving process. The more you give, the more you get back. I’ve believed in this concept long before I became successful in this business. Years ago, I opened up a separate bank account solely for charitable donations. Every time I get paid, I transfer a portion into that account. When the account reaches a certain amount, the full balance gets donated to charity.

“Giving to others is a truly rewarding experience, and it’s a great feeling to know that you’re contributing to a worthy cause.

I find it also helps with building the morale of my team” people with their mortgages, and 100% of the proceeds are donated to the Canadian Alliance to End Homelessness.

I’ve also been active with the Blind Sailing Association – I’m one of their top fundraisers at the Toronto Boat Show each year. It’s a small charity that relies heavily on the proceeds from the show to fund its program. Because the Toronto Boat Show was cancelled this year due to COVID-19, the Blind Sailing Association lost a major source of funding. I asked them how much they lost

Any successful business should be involved with its community in one way or another. It reflects well on your brand and can lead to greater success. It not only shows the community that you care, but it’s a great feeling knowing that you’re making a difference in people’s lives.

Paul Meredith is a mortgage broker at CityCan Financial and the author of the book Beat the Bank: How to Win the Mortgage Game in Canada.

www.mpamag.com/ca

14-15_Opinion-SUBBED.indd 14

05/10/2021 1:59:42 am

t. 866.441.3775 | f. 866.477.8897 | e. brokerpartner@cwbank.com Broker login Username: broker Password: #1lender

OPTIMUMMORTGAGE.CA OBSESSED WITH YOUR SUCCESS™ 14-15_Opinion-SUBBED.indd 15

05/10/2021 1:59:47 am

PEOPLE

INDUSTRY ICON

BANKING ON SUCCESS VERICO president and COO Mark Squire tells CMP how his extensive banking experience gave him unique insight into the broker profession THROUGHOUT A decades-long career in banking, it was always the mortgage side of the business that caught Mark Squire’s attention. Squire started out at CIBC straight out of university and went on to hold variety of roles in retail banking, from bank manager to community manager. Yet he found himself gravitating toward mortgages, an interest that began when he worked as a business development manager for CIBC Mortgages, supporting the branch channel.

It’s perhaps no surprise, then, that Squire’s career has taken him to the helm of VERICO Financial Group, one of the country’s largest broker networks, where his track record on the lending side has been an invaluable asset.

“I understand it from both sides,” he says.

“I can have conversations with the lender and then, in turn, with our broker-owners and agents to help them understand the lender’s perspective. While my lending experience far outweighs the length of time I’ve been on the broker side, I’ve been working with brokers since 2008. I can also turn around and say to the lender, ‘But you have to see it from the broker’s perspective as well.’ I can provide balance, and I think I add value on both sides of the business.”

Changing channels Prior to joining VERICO in 2019, Squire held a host of prominent roles on the banking

16

www.mpamag.com/ca

side, serving as general manager of Imperial Service and business banking at CIBC before moving over to National Bank to manage the company’s national broker division outside of Quebec.

During his tenure with National Bank, the company’s mortgage volume skyrocketed from $324 million to $3.24 billion; Squire’s role prominently focused on both sales and operations, as well as dealing extensively with the company’s mortgage broker network

overall management.

Through those decades of experience in banking and mortgages, Squire has gained firsthand insight into the critical role brokers play throughout the home-buying process, noting that the profession has changed substantially during his time in the business. While brokers once might have been unfairly typecast as an option of last resort for aspiring homebuyers who couldn’t qualify at a bank, Squire says that perception has

“I understand it from both sides. I can have conversations with the lender and then, in turn, with our broker-owners and agents to help them understand the lender’s perspective. I can provide balance, and I think I add value on both sides of the business” – experience that gave him a solid foundation for his eventual move to VERICO. Squire then went on to spearhead Manulife’s broker outreach as head of mortgage broker services before taking the reins at VERICO as president and chief operating officer, charged with executing the network’s growth strategy and overseeing its

changed drastically, and the unparalleled advice brokers can bring to the table is now widely accepted.

“The role of the mortgage broker has evolved so much since I started out,” he says. “Mortgage brokering has become more mainstream as an alternative to going to the banks – clients increasingly understand the

PROFILE Name: Mark Squire Title: President and COO Company: VERICO Financial Group Based in: Toronto Years in the industry: 32

www.mpamag.com/ca

16-18_Industry Icon-SUBBED.indd 17

17

05/10/2021 2:00:36 am

PEOPLE

INDUSTRY ICON

value of going to a mortgage broker.”

That transformation has come about as regulatory developments and increasing red tape in the Canadian mortgage market have made the purchasing process ever more complex for prospective homeowners, Squire says.

“With regulatory changes, getting a mortgage became more complicated, and the value of the broker became even more important than it was five or seven years ago.

A mortgage broker has become the subjectmatter expert when it comes to credit planning and credit management for clients.”

An evolving profession One of the most noteworthy changes that Squire has witnessed during his time in the mortgage world is the increasing prominence of bonuses based on efficiency rather than

This has been particularly apparent during the COVID-19 pandemic as brokers have faced the dual challenges of providing stellar guidance to their clients while also coping with a massive surge in housing market activity and interest. While Squire doesn’t foresee the red-hot market of earlier this year returning, he does envisage continuing prosperity for Canada’s mortgage broker community.

“I think we’re going to still see business continue to grow and prosper,” he says. “I don’t see any doom and gloom, for sure. There might be some levelling off, but [growth] will continue.”

Overseeing a company as vast as VERICO, with more than 2,500 mortgage advisors dotted across Canada and an annual loan volume of $18 billion, might seem like a daunting task. Yet Squire, who likes to unwind

“With regulatory changes, getting a mortgage became more complicated. A mortgage broker has become the subject-matter expert when it comes to credit planning and credit management for clients” volume. It’s a trend he was at the forefront of at National Bank, and one that he says is a further recognition of the crucial advisory role played by brokers.

“The broker can talk to the client, understand the client’s credit and financial goals, and then match them up with the product from the lenders that the broker deals with that’s going to best meet those needs,” he says. “Over the years, we’ve come to understand that credit management is an important aspect of a person’s financial situation and plan. That’s part of the value that the broker can bring, helping the client with that.”

18

with family at the cottage and on the boat out in Muskoka, takes it all in stride – a feat that’s made easier by the clear affection he holds for the mortgage industry.

“Since I decided to make the leap and come onto the broker side of the business when I came to VERICO, I’ve loved it,” he says. “I think that coming to VERICO has allowed me to provide the brokers within the VERICO network that lender aspect and that lender understanding. We all get hung up in our roles, and we sometimes don’t understand it from someone else’s perspective.

That’s the value I can bring to the member firms of the VERICO network.”

MARK SQUIRE’S CAREER TIMELINE

1989

Starts at CIBC and goes on to hold various roles, including branch manager, community manager, business development manager, and general manager of Imperial Service and business banking

2008

Moves to National Bank of Canada, where his roles include assistant vice-president and director of mortgage broker services

2017

Becomes head of mortgage broker services at Manulife Bank of Canada

2018

Serves as senior vice-president of private label at Paradigm Quest

2019

Is named president and chief operating officer of VERICO

www.mpamag.com/ca

16-18_Industry Icon-SUBBED.indd 18

05/10/2021 2:00:34 am

SPECIAL REPORT

Brokers

ON LENDERS 2021

Brokers name the lenders across the country that have raised the bar for turnaround time, support, commissions, technology and more over the past year

CONTENTS

PAGE

Feature article .............................................. 20 Methodology ................................................ 21 Brokers on Lenders 2021 winners ............. 24 Profiles .......................................................... 27 Winning lenders by category ..................... 30

www.mpamag.com/ca

19-31_CMP Brokers on Lenders 2021-SUBBED.indd 19

19

05/10/2021 2:03:48 am

SPECIAL REPORT BUSINESS STRATEGY

BROKERS ON LENDERS 2021

EXCELLING IN AN INTENSE MARKET ASK ANY mortgage broker about the most critical aspects of ensuring their day-to-day work functions smoothly, and chances are that lenders will feature near the top of the list. As mortgage professionals strive to unearth the best possible deals for their clients, the value of having a lender that’s responsive, flexible, efficient and prompt can’t be overstated.

It’s been especially significant over the past 18 months, when an already heated housing market dialled up several notches and created an environment in which speed of response, turnaround time and swift issue resolution have proven paramount for brokers and their clients.

“There are periods when there’s more volume than the lender can efficiently manage – not a bad thing. You just need to set the right expectation with your clients” Ron Swift, Radius Financial Each year, CMP puts lender performance in the spotlight, surveying brokers across Canada to find out how their lending partners stacked up in a variety of categories. This year’s survey proved especially informative,

WHAT ISSUE WILL HAVE THE MOST IMPACT ON THE BROKER/LENDER RELATIONSHIP OVER THE NEXT 12 MONTHS?

12%

Lender concerns about fraud during originations

37%

The move to an efficiency ratio

11%

Commissions

40%

Higher volume requirements from individual lenders

20

highlighting the lenders that were able to maintain smooth, effective service in the face of a relentless mortgage market.

Overall, lenders increased their average score in nearly every category compared to 2020, registering particularly large increases in product range, interest rates, BDM support and transparency of commission structure.

For the two categories where lenders’ average score dropped from 2020 – broker support and overall service levels – the decline was comparatively minimal.

In total, 13 lenders were awarded medals in at least one category this year – and for these top-performing lenders, the survey results are an affirmation of the organization, dedication and commitment they demonstrated to maintain exemplary service levels and broker support during a challenging and intense time for the mortgage industry.

Meeting service expectations Given the frenzied market that’s developed over the past 18 months, it’s little surprise that the ability to fund a deal swiftly and smoothly has remained one of the top prior-

www.mpamag.com/ca

19-31_CMP Brokers on Lenders 2021-SUBBED.indd 20

05/10/2021 2:03:51 am

ities for brokers when dealing with lenders.

Overall, lenders managed to keep pace with their 2020 performance on turnaround time, netting an overall average score of 3.97 for the second year in a row. However, turnaround time ranked as the lowest-scoring category for lenders on this year’s survey.

Ron Swift, CEO of Radius Financial, which earned a gold medal from brokers for turnaround time, says responding quickly during periods of high demand requires a combination of strong internal processes and clear communication with mortgage brokers to make sure each party is on the same page.

“Hire the best people you can afford, or train your people so they can better manage the heavy volume workloads,” Swift advises.

“Make sure your processes are as streamlined as possible; fewer steps make for fewer

the reallocation of resources, adjusting the distribution of workloads, moving applications amongst underwriters, and enhancements to technology to help ensure rapid and efficient turnaround times.”

On the communication side, Valko says providing consistent deal and document decisions and setting clear expectations are some of the main things lenders can do to ensure there are no mixed messages.

For lenders to provide unparalleled service to their broker partners, it’s also important that they have a dedicated team of business development managers that brokers can call upon at any moment to provide clarity and support. Overall, lenders made great strides in BDM support this year, earning an average score of 4.31 – a significant improvement on 2020’s 4.22.

“Reallocation of resources, adjusting the distribution of workloads, moving applications amongst underwriters, and enhancements to technology [can] help ensure rapid and efficient turnaround times” Bruno Valko, RMG Mortgages bottlenecks. Educate your brokers on what and when you need to eliminate last-minute rushes. Communicate – the reality is no lender can provide exceptional service 100% of the time. There are periods when there’s more volume than the lender can efficiently manage – not a bad thing. You just need to set the right expectation with your clients.”

Bruno Valko, vice-president of sales at RMG Mortgages, which earned bronze in the turnaround time category, likewise points to communication and consistency as important factors in maintaining positive broker relationships. He advises lenders to meet brokers’ expectations by “[working] on

“It’s imperative that the BDMs understand their customers – who they are, how they like to work and what their needs are,” Swift says. “Once they understand their customers’ needs, they can then implement a plan that will deliver the service levels required to meet or exceed their customers’ expectations.”

Valko adds that strong communication between underwriters and brokers at all stages is also an integral aspect of a successful deal. Providing admin support to underwriters so they can focus on processing deals and applications can help lenders deliver that service, he says, as can “[shifting] resources from other areas to help ensure

METHODOLOGY To uncover the best lenders in the eyes of Canada’s broker community, CMP reached out to brokers across the country, asking them to rate the lenders they work with across 10 key areas, including turnaround time, interest rates, product range, broker support, overall service levels and more. As in previous years, CMP also asked brokers to weigh in on important aspects of the brokerlender relationship, such as how commissions and bonuses might change and why they choose to send deals to the banks rather than monoline lenders.

For each category, lenders were ranked in order of merit according to an average score calculated from the ratings they received from brokers.

The top three A lenders and alternative lenders in each category received a gold, silver or bronze medal. Lenders’ combined average score from all categories determined the overall gold, silver and bronze medallists.

48% of survey respondents have been working as a broker for 11 years or more

79% of brokers have submitted deals to five or more lenders over the past year

51% of brokers said the mortgage stress test has had zero impact on their business over the past year

www.mpamag.com/ca

19-31_CMP Brokers on Lenders 2021-SUBBED.indd 21

21

05/10/2021 2:03:57 am

SPECIAL REPORT BUSINESS STRATEGY

BROKERS ON LENDERS 2021

HOW WELL DID LENDERS PERFORM ON AVERAGE?

2021

2020

2019 4.50 4.36 4.30

Transparency of commission structure

4.31 4.22 4.17

BDM support

4.24 4.13 4.00

Satisfaction with credit policy Product range

3.91

Underwriter support

3.97

4.17 4.16 4.16 4.18

Broker support

4.00

Interest rates

4.13 4.03 4.00

Overall service levels

4.06 4.10

3.85

IT/technology

3.71

Turnaround time

4.03 3.89

3.77 1 Very poor

2 Poor

strong underwriter support.”

A longstanding expectation brokers have of their lenders is a transparent and fair commission structure – and this is an area where lenders are clearly excelling. Not only was transparency of commission structure the highest-scoring category in this year’s Brokers on Lenders survey, but lenders managed to considerably raise their overall average score, from 4.36 in 2020 to 4.50 in 2021.

Swift says it’s important for all lenders to make sure their commission structures are reasonable, clear and easily understood by the broker.

“If it’s important to your organization, and you’re going to compensate brokers for meeting or exceeding results, then it should be transparent for everyone to see,” he says.

“Bottom line, whatever results you’re trying to incentivize need to be transparent, or it won’t be as effective as it should be.”

22

4.22 4.09

3 Average

3.97 3.97

4 Good

5 Very good

What other concerns do brokers have?

In addition to asking them to rate their lenders, CMP also pressed brokers for their thoughts on evolving commission structures, why they would submit a deal to a bank versus a monoline lender, and the challenges and successes they’ve had with lenders over the past 12 months.

While the volume of funded mortgages has risen dramatically over the past year and a half, a majority of survey respondents said they expect lender commissions and bonuses to remain largely static over the next year or two. More than 60% of brokers said they thought commissions would stay the same, while around 23% anticipated an increase and 15% thought a decrease was in the cards.

When asked why they might submit certain deals to banks rather than monoline lenders, a majority of brokers (58%) said the banks’ product offerings were the biggest

consideration. Another 28% said it came down to client preference, while 18% said they were swayed by the service they received from the bank’s underwriter and/or BDM. As for their biggest challenges with lenders over the past year, many brokers unsurprisingly brought up turnaround times. “Some lenders just don’t have adequate staff,” one broker noted, while another acknowledged that “it’s just the sheer volume, so it has created some backlogs at times.”

Communication was also a frequent sore point; many brokers said communication often takes a back seat when volume gets heavy. “Actually talking to someone on the phone can be tough,” one broker said. “Most people want to communicate via email or portals. It’s not the same as talking through a file for three to five minutes versus three to five days of emails where you can’t tell someone’s tone.” Another broker was empathetic but straightforward with their feedback: “We are all struggling with workloads, and we understand. Ignoring or just not communicating is the worst possible thing to do. Even if it is bad news, we need communication.”

Finally, many brokers were frustrated with the documentation step of the process.

Several mentioned slow turnarounds on document review, while others were vexed by seemingly endless requests for documentation. “When they finally respond, there are more requirements on the checklist – even though some of the documents were previously provided, they are not acceptable,” one broker said.

It wasn’t all bad news, though – brokers had plenty of compliments for lenders as well. When asked about the best thing a lender had done for them over the past 12 months, many brokers mentioned a willingness to expedite deals and make exceptions on certain files. Above all, brokers seem to be most pleased with lenders who are willing to engage with them as a true partner. As one broker put it: “Having a great relationship with a lender is the best thing – that relationship means they pick up the phone, you send the deal and get it approved and funded.”

www.mpamag.com/ca

19-31_CMP Brokers on Lenders 2021-SUBBED.indd 22

05/10/2021 2:04:00 am

Behind every mortgage, there are people.

The ones who are consistently there, with the answer when you need them most.

Discover Blue Culture Watch the video at MCAPblue.com/discover

MCAP Service Corporation | Ontario Mortgage Brokerage #10515 | Ontario Mortgage Administrator #11692

www.mpamag.com/ca

19-31_CMP Brokers on Lenders 2021-SUBBED.indd 23

23

05/10/2021 2:04:06 am

SPECIAL REPORT BUSINESS STRATEGY

BROKERS ON LENDERS 2021

Brokers TRANSPARENCY OF COMMISSION STRUCTURE

TOP LENDERS

CMLS Financial

Radius Financial

RMG Mortgages

Alta West Capital

Equitable Bank

RMG Mortgages

Radius Financial

CMLS Financial

TOP ALTERNATIVE LENDERS

Alta West Capital

Hosper Mortgage

MCAP

24

Radius Financial

RMG Mortgages

Manulife Bank

Radius Financial

TOP ALTERNATIVE LENDERS

CMLS Financial

Alta West Capital

Hosper Mortgage, CWB XMC Optimum Mortgage Mortgage Corporation (tie)

TOP LENDERS

TOP ALTERNATIVE LENDERS

MCAP XMC Mortgage Corporation

Scotiabank

Radius Financial

Hosper Mortgage

Alta West Capital

CWB Optimum Mortgage

BROKER SUPPORT

UNDERWRITER SUPPORT

TOP LENDERS

TOP LENDERS

PRODUCT RANGE

SATISFACTION WITH CREDIT POLICY

TOP LENDERS

2021

BDM SUPPORT

TOP ALTERNATIVE LENDERS

Hosper Mortgage

ON LENDERS

TOP ALTERNATIVE LENDERS

Hosper Mortgage

Alta West Capital

CWB Optimum Mortgage

TOP LENDERS

RMG Mortgages

Radius Financial

TOP ALTERNATIVE LENDERS

MCAP

XMC Mortgage Corporation

Hosper Mortgage

Alta West Capital

www.mpamag.com/ca

19-31_CMP Brokers on Lenders 2021-SUBBED.indd 24

05/10/2021 2:04:29 am

27_Op

CWB Optimum Mortgage shows its mettle In a year that brought with it many challenges as the industry navigated through the COVID-19 pandemic, CWB Optimum Mortgage’s well-rounded approach to what they do got them through – and the proof is in the medals the lender landed in this year’s Brokers on Lenders survey.

Underwriter Support

Overall Service Level

Interest Rates

BDM Support

Product Range

IT/Technology

Keeping a lens on the different areas of the business versus focusing only on one area has assisted in Optimum’s success – and helped them medal in six different categories, which is no small feat in a competitive pool of other lenders.

Thank you, from all of us Optimum wants to take this opportunity to thank everyone who completed the survey and took the time to provide their honest feedback. The voice of the broker community is important, it’s valued, and we hear you – that voice is what helps shape this industry. Your team at Optimum sincerely appreciates everybody’s participation and this amazing broker community. Thank you. www.mpamag.com/ca

19-31_CMP Brokers on Lenders 27_Optimum-SUBBED.indd 162021-SUBBED.indd 25

25

05/10/2021 11:36:46 2:04:18 am 30/09/2021 pm

SPECIAL REPORT BUSINESS STRATEGY

BROKERS ON LENDERS 2021

Brokers INTEREST RATES

Radius Financial

TOP ALTERNATIVE LENDERS

CMLS Financial

Hosper Mortgage

Alta West Capital

CWB Optimum Mortgage

IT/TECHNOLOGY

TOP LENDERS

RMG Mortgages

Radius Financial

TOP ALTERNATIVE LENDERS

MCAP

Alta West Capital

Hosper Mortgage

CWB Optimum Mortgage

TURNAROUND TIME

TOP LENDERS

MCAP

2021

OVERALL SERVICE LEVELS

TOP LENDERS

RMG Mortgages

ON LENDERS

Radius Financial, RMG Mortgages (tie)

TOP ALTERNATIVE LENDERS

First National

Hosper Mortgage

Alta West Capital

CWB Optimum Mortgage

TOP LENDERS

MCAP

Radius Financial

TOP ALTERNATIVE LENDERS

RMG Mortgages

Hosper Mortgage

Alta West Capital

Magenta Capital Corporation

OVERALL TOP LENDERS

TOP ALTERNATIVE LENDERS

Radius Financial

Hosper Mortgage

CMLS Financial

26

RMG Mortgages

Alta West Capital

XMC Mortgage Corporation

www.mpamag.com/ca

19-31_CMP Brokers on Lenders 2021-SUBBED.indd 26

05/10/2021 2:04:41 am

HOSPER MORTGAGE Phone: 416-904-9749 Email: jerry@hospermortgage.com Website: hospermortgage.com

E

Jerry Wieliczko, broker relationship manager

very day, the Hosper team is pursuing one mission – to be “the best alternative to a traditional bank.” For Hosper’s brokers, this manifests itself as three core pillars of service: impressive speed, exceptional customer service and unfailing consistency.

“Speed and service are baked into everything that we do,” says Jerry Wieliczko, Hosper’s broker relationship manager.

Hosper Mortgage is quickly becoming the first choice for many brokers when the bank says no, winning overall gold in CMP’s Brokers on Lenders survey two years in a row.

Hosper offers fast approvals and flexible terms on residential mortgages in every market in Ontario. Its goal is to provide a range of straightforward, equity-based solutions as fast as clients need them. “Brokers want a lender who is transparent with the terms and conditions from the very beginning – they want a lender who will collaborate and work towards a solution,” Wieliczko says.

Hosper has found success because it has been able to deliver on its three core pillars.

Speed and service always come first – but it is equally important that the process is consistent every time. “Once you’ve closed one mortgage with Hosper,” Wieliczko says, “you know what to expect for the next 10.”

PEACE OF MIND for the price of a medium almond milk, triple shot, pumpkin spice latte with extra whipped cream

Visit purview.ca to learn more

www.mortgagebrokernews.ca

19-31_CMP Brokers on Lenders 2021-SUBBED.indd 27

27

05/10/2021 2:04:37 am

SPECIAL REPORT BUSINESS STRATEGY

BROKERS ON LENDERS 2021

Ron Swift, CEO

RADIUS FINANCIAL Phone: 416-366-4321 Email: sales@radiusfinancial.ca Website: radiusfinancial.ca

R

adius Financial’s results in the 2021 Brokers on Lenders survey could hardly have been more spectacular – the lender came away with nine gold medals and one bronze in 10 categories and also won gold for overall performance. That amazing haul represents the best performance in the survey’s 15-year history.

CEO Ron Swift attributes the company’s impeccable reputation among mortgage brokers to the fact that, as former brokers, its founders have an innate understanding of the profession and what’s required to service the broker community.

“This company was founded by mortgage brokers for mortgage brokers,” Swift says.

“Our ownership, senior management and our people are only focused on servicing our broker customers. Understanding those customers, working with them, listening to them and being accessible to them has proven to be a real differentiator for us.”

28

With the broker channel representing the company’s primary focus, it goes without saying that Radius has placed huge importance on putting together the right group of people to support that client base. Alex Haditaghi, the company’s chairman, says the superb and experienced team Radius has assembled is one of the biggest reasons why it has been so successful among brokers.

“We’re in the relationship business,” Haditaghi says. “The better the relationship we have with our customers, the better service we can provide. We’re very fortunate to have great people, and this unprecedented win is a credit to all of them and our senior management team.”

Innovative process changes have also helped to drive Radius’ unparalleled service, Swift adds. “We also did something practical – implementing the need to have some supporting documentation submitted with the initial submission. We won’t underwrite

a deal until the required initial supporting documentation is provided.”

That small change has been “a true win-win” for Radius and its brokers, Swift says, making a positive impact on its service levels and allowing brokers to get faster answers, commitments with few or no conditions, and fewer cancellations after the fact.

Swift says it’s essential for brokers and lenders to determine whether they’re a good match for each other – a conversation brokers can start with Radius by contacting the company on any of its channels.

Haditaghi paid tribute to the brokers who took the time to answer this year’s survey, as well as every member of the well-oiled Radius team that has helped the company cement its status as one of Canada’s leading lenders.

“Thank you to everyone who has supported our company over the past year and a half,” he says. “We wouldn’t be here without their support.”

www.mpamag.com/ca

19-31_CMP Brokers on Lenders 2021-SUBBED.indd 28

05/10/2021 2:04:46 am

www.mpamag.com/ca

19-31_CMP Brokers on Lenders 2021-SUBBED.indd 29

29

05/10/2021 2:04:53 am

SPECIAL REPORT BUSINESS STRATEGY

BROKERS ON LENDERS 2021 SUMMARY: BROKERS ON LENDERS WINNERS BY CATEGORY Lender

Transparency of commission structure

BDM support

Satisfaction with credit policy

Product range

Hosper Mortgage Phone: 416-904-9749 Email: jerry@hospermortgage.com Website: hospermortgage.com MCAP Website: mcap.com

Radius Financial Phone: 416-366-4321 Email: sales@radiusfinancial.ca Website: radiusfinancial.ca RMG Mortgages Website: rmgmortgages.ca

Alta West Capital

CMLS Financial

CWB Optimum Mortgage

Equitable Bank

First National

Magenta Capital Corporation

Manulife Bank

Scotiabank

XMC Mortgage Corporation

30

www.mpamag.com/ca

19-31_CMP Brokers on Lenders 2021-SUBBED.indd 30

05/10/2021 2:05:16 am

Underwriter support

Broker support

Interest rates

Overall service levels

IT/technology

Turnaround time

www.mpamag.com/ca

19-31_CMP Brokers on Lenders 2021-SUBBED.indd 31

31

05/10/2021 2:05:23 am

FEATURES

LENDER SPOTLIGHT

The relationship business Falcon Ridge Management’s Pino Decina tells CMP how the company’s strong relationships with clients have allowed it to provide reassurance and an expert approach in challenging times

ONE OF the most valuable assets in business is the ability to point to a proven track record – a clear pattern of achievement that instills confidence in business partners and clients alike. While Ontario-based mortgage administrator Falcon Ridge Management is still relatively young – the company was founded in 2018 – it had the immediate advantage of being able to call upon the experience of its top executives, many of whom had developed lasting partnerships in the mortgage industry.

That’s proved to be a particularly invaluable edge for the company. In addition to residential mortgage loans and residential land acquisition loans, Falcon Ridge has carved out a successful niche in the residential construction sphere over the past 18 months, bringing its relationships to the fore to address the challenges of borrowers in that area.

Pino Decina, Falcon Ridge’s co-founder and president, says long-lasting ties with builders and developers meant that the lender was able to quickly establish itself as

32

a trusted voice in the sector, one with a deep understanding of its various complexities.

“The important thing about the construction program is that even prior to the inception of Falcon Ridge, we’ve had partnerships or relationships with a lot of custom infill builders in the GTA,” Decina says. “Those are longstanding relationships; we know these builders, who they are and the product they deliver.”

Building solutions The establishment of Falcon Ridge coincided with a period in which construction financing programs were somewhat underserved

by Canada’s mainstream banks, leaving an opportunity for the company to step in and provide funding solutions for builders that couldn’t be secured elsewhere. Then, as the COVID-19 pandemic struck and the impact rippled through the economy, the mutual trust Falcon Ridge had built up with builders allowed it to help construction projects

www.mpamag.com/ca

32-34_Sector Focus_Business Spotlight-SUBBED.indd 32

05/10/2021 2:00:59 am

continue uninterrupted, despite supply shortages and other complications.

“During COVID, with pandemic closures and lack of materials in the construction space, none of our builders actually had to delay their projects,” Decina says. “In the past couple of years, projects have continued as normal. We’ve assisted builders where necessary to make sure that they got the building materials required to continue their builds and deliver products on a timely basis.”

Decina highlights the element of trust that goes into that program. The relationships Falcon Ridge and its executives have established in the construction realm – many of which have lasted more than a decade – made the process much easier for all concerned.

“Builders that are established have been through this type of thing – maybe not a pandemic, but swings in the market, certainly – and the best way to navigate through it is continue a project, complete it as quickly as

BEYOND THE GTA Remote and rural construction outside the Greater Toronto Area had already been increasing even before the COVID-19 pandemic led scores of Canadians to abandon downtown cores for more spacious settings. Pino Decina believes that while custom-built infill property construction will continue inside the GTA in coming years, the development of larger subdivisions will likely keep expanding beyond those boundaries.

“One time, subdivision builders would make their decision based on the accessibility to downtown Toronto from a work environment standpoint,” he says. “One of the things they would watch was GO Train lines. Even though that is still in their minds today, it’s less of a factor than it was pre-pandemic.”

“During COVID, with pandemic closures and lack of materials in the construction space, none of our builders actually had to delay their projects” Pino Decina, Falcon Ridge Management possible, provide good quality and move on to the next project,” Decina says. “Those are the types of builders that we deal with. The builders that we partner with or lend to had the ability, during supply shortages, to buy certain materials upfront in bulk, delivered on site, to ensure that they had the necessary building materials they required to complete a project.”

Accommodating that meant that Falcon Ridge often had to demonstrate flexibility in its construction advances, and trust in its partners allowed the company to offer viable

solutions. It’s an approach that has reaped ample rewards and should drive repeat business well into the future. Decina says many of the builders Falcon Ridge serviced during the pandemic are already acquiring land for construction in 2022, suggesting that activity for next year is ramping up significantly.

The broker factor While builders represent the end borrower, Falcon Ridge’s target clients are mortgage brokers. Because the lender opted against establishing a brick-and-mortar presence,

www.mpamag.com/ca

32-34_Sector Focus_Business Spotlight-SUBBED.indd 33

33

05/10/2021 2:01:05 am

FEATURES

LENDER SPOTLIGHT

FALCON RIDGE AT A GLANCE

Year established 2018

Markets served GTA and Southern Ontario

“We maintain close ties with our broker partners, we listen to their needs, and it’s a relationship that’s worked for me and my staff for decades”

Specialities Residential mortgage loans, residential land acquisition loans and residential construction financing

Pino Decina, Falcon Ridge Management Decina says its growing broker network is an essential element of its ability to get its message out.

“As more and more mortgage brokers hear about Falcon Ridge, and more importantly about the individuals who are here, we get calls on what we do and our product lines,” he says. “We’re selectively expanding that broker base that we deal with. I think every good mortgage broker will have lender partners that they deal with that will cover off all the mortgage sides – be it prime mortgage solutions or alternative – and we would certainly like to be one of those alternative solutions for our broker partners.”

For Decina, there’s nothing complicated about why Falcon Ridge has been such a hit with brokers: Its service is based on the simple motto of providing mortgage solu-

34

tions to qualified individuals who don’t meet a bank’s requirements.

To drive that goal, Falcon Ridge has invested carefully in recruiting talented staff, making sure that its employees have the right ethos and enthusiasm to serve the company’s client base – whether the mortgage broker or the end borrower.

“We have a great team environment here – they’re all passionate about the motto, and they take pride in delivering it to our clients, be it our broker partners or the end homeowner themselves,” Decina says.

Falcon Ridge’s success with brokers has also been based on reciprocal communication with the community, taking into account what brokers are saying about the market and modifying its services and products based on that feedback.

Leadership Pino Decina, co-founder and president; Rob Filomena, co-founder and chief operating officer; Frank Femia, director of underwriting

“The other thing is, we really listen to our partners,” Decina says. “The key is that mortgage brokers are the ones who are front and centre, face to face with the end user, and they’re the first individual who hears where or what that deficiency is in the marketplace.

If that’s something that Falcon Ridge can fill from a product or service perspective, then certainly we’re going to look to do that. We maintain close ties with our broker partners, we listen to their needs, and it’s a relationship that’s worked for me and my staff for decades. We’ll continue to do that on a go-forward basis.”

www.mpamag.com/ca

32-34_Sector Focus_Business Spotlight-SUBBED.indd 34

05/10/2021 2:01:16 am

SPECIAL PROMOTIONAL FEATURE

ALTERNATIVE LENDING

Building partnerships through knowledge and commitment CMP chats with Home Trust’s Pierre Martin about the many ways the lender is working to meet the needs of its broker partners

HOME TRUST began in 1977 with a goal to help Canadians achieve their dreams of homeownership. The lender accomplishes this goal by understanding broker partners’ business needs and providing solutions for borrowers across the country.

Pierre Martin, vice-president of residential mortgage lending, leads the Home Trust sales force with this goal at the top of his mind. Martin joined Home Trust in 2018 as vice-president of residential underwriting, bringing more than 15 years of leadership experience in mortgage lending. His current role began as a secondment, and due to its success and his valuable insights, he transitioned to sales in January 2021.

Martin’s deep understanding of underwriting has elevated the confidence of the sales team at Home Trust and encouraged a focus on the specific needs of the company’s broker partners. CMP sat down with Martin to get his views on the importance of knowledge and commitment and the impact those key elements have on winning trusted partnerships.

CMP: How does deep knowledge of underwriting best practices help business development managers meet the needs of broker partners?

Pierre Martin: I think the best way to answer this question is with an anecdote from the sales conference we held virtually in February 2021, where we invited a select group of our broker partners to participate in a Q&A session. One of the questions we asked was, “Why do you choose to work with Home Trust?” Three distinct themes emerged in their responses.

Partnership: A sharp focus on building and maintaining lasting partnerships helps to build trust.

Knowledge: Broker partners recognize that knowledgeable BDMs foster a culture of mutual respect between brokers and lenders.

Communication: Clear, transparent communication is critical to a successful partnership between brokers and lenders.

Ultimately, brokers are looking for partners who can provide them with knowledgeable service to ensure that when a deal is submitted, it has the greatest chance of success.

CMP: You said that brokers consider communication critical to their business. Can you explain how your team delivers on this theme?

PM: Communication is about honesty and transparency. Transparency is critical to set and build trust. When we are upfront

with our broker partners about our lending areas and appetite, it helps ensure that we are not misusing our time or that of our broker partners.

This transparent flow of information helps break down silos and ensures that our BDMs can assess the merits of a deal.

The information broker partners receive comes from a place of deep knowledge and understanding to achieve the best possible outcome for their clients. Further, it honours two of the corporate values that we hold dear: win as a team and know your business.

CMP: How have you structured the team to maximize efficiencies and drive stronger partnerships?

PM: We know that brokers are looking for great service levels, and we have aligned our most efficient brokers to be supported by our sales force, led by our sales directors, Rose Butera and Sebastien Kuperhause, who provide extensive product knowledge and deep-rooted relationships in the industry to the team. Our new broker partners, or broker partners learning the alternative business, are supported by our inside sales organization, led by Cristie Smith, director of sales, who developed a targeted training program that educates brokers on our business.

www.mpamag.com/ca

35-37_HomeTrust-SUBBED.indd 35

35

05/10/2021 2:01:51 am

SPECIAL PROMOTIONAL FEATURE

ALTERNATIVE LENDING

“Higher efficiency improves service levels and timing in general. It’s a win-win for our broker partners and us” Pierre Martin, Home Trust We developed training programs led by Calvin Fernandes, director of sales, to keep our sales teams informed and up to date, break down silos, and drive stronger broker efficiencies. In addition, we have developed a robust training curriculum for our broker partners. The bottom line is that higher efficiency improves service levels and timing in general. It’s a win-win for our broker partners and us.

CMP: How can an organization use cross-training among different divisions to better equip their teams?

PM: Cross-training helps our broker partners find the right solution for their clients.

36

To date, over 50% of our sales team members are former underwriters. This front-line support ensures our brokers are given the information they require to select the best product for their customers and fund the deal as seamlessly as possible. Of course, this specialized knowledge is not a requirement to succeed in our business, but it certainly helps us adhere to another one of our company values: say yes first.

Cross-training can be formal, like secondments and internal transfers, but it is primarily about day-to-day communication between divisions. For example, sales leadership encourages BDMs to meet with their underwriting teams regularly to discuss the

pipeline and any current broker pain points.

We have also integrated this approach when it comes to structuring internal project teams. The newly formed LOFT agile team brings together experts in different divisions to improve the platform for our broker partners. When we bring teams together who interact with the broker during each phase of the lending process, we get a better picture of their business, needs and clients to provide the right solutions.

By adopting a multi-directional approach to training in different business areas, we understand each other better and provide improved, more informed service to our broker partners. Cross-training helps to hone both the technical and interpersonal skills that enable us to succeed.

By taking stock of what is valued by our broker partners and fostering a culture of knowledge and transparency, Home Trust can focus on what matters. Subscribe and listen to our new podcast, I Love ALT Mortgages with Home Trust, and contact your business development manager to learn more.

www.mpamag.com/ca

35-37_HomeTrust-SUBBED.indd 36

05/10/2021 2:01:58 am

Together, we can empower your clients with products that secure their financial future.

Classic mortgages Accelerator mortgages Equityline® Visa*

Count on our partnership.

To learn more go to hometrust.ca/partners ® Registered trademark of Home Trust Company. *Visa Int./Home Trust Company, licensed user of mark.

35-37_HomeTrust-SUBBED.indd 37

05/10/2021 2:02:07 am

PEOPLE

BROKER INSIGHT

Tailor-made to perfection For Bespoke Lending Solutions and its principal broker, Shaun Francis, versatility and the ability to offer a customized solution for any borrower’s needs are indispensable assets

WHAT’S IN a name? For Burnaby, BCbased Bespoke Lending Solutions, it’s a particularly apt way of reflecting one of the company’s key value propositions: its ability to deliver highly customized solutions, tailored to the individual needs of each client.

Company founders Shaun Francis, Usman Rathore and Sean Saffri have their roots in banking; all previously held prominent positions with major banks. Francis says the trio decided to make the switch to the broker channel precisely because it offered the chance to provide a range of personalized options for each customer – something the banks couldn’t always do.

“We had a desire to move into the broker space because being a broker gives us opportunities to add more value to our clients and have a more significant relationship with them,” he says. “Ultimately, why we decided to start Bespoke was that we wanted to take that professionalism that we learned at the bank and then incorporate it into the broker space.”

It’s perhaps unsurprising that versatility is one of Bespoke’s strongest selling points – its principals have expertise servicing a variety of different banking customers.

Francis’ roles, for instance, included account manager, business account manager and mortgage specialist, which helped him build

38

experience with small business owners and upsizing clients. Rathore cut his teeth as an account manager before moving into financial planning, while Saffri’s track record as a top-producing alternative mortgage solutions representative allowed him to develop a thorough understanding of the alternative space.

The company’s cadre of mortgage consultants also boasts a wide range of specialties, which Francis says allows Bespoke to offer options to a host of customers with different circumstances and concerns.

“Some of the newer agents will deal with more first-time homebuyers – customers who are high-ratio clients,” he says. “We have other team members who are more experienced. One of our team members is Ukrainian, and she caters to the Russian and

Ukrainian market. A lot of them are new to the country – that takes another level and skill set. If you can cater to them and be helpful to them and the Realtors who deal with them, then you’re going to get more of those types of clients.”

Whether on the A or B side or private lending, Bespoke has demonstrated its expertise and authority through the varied skill sets of its staff. That’s the result of a deliberate strategy to carve out a niche in various segments of the market.

“We try to have our hands in every aspect of the financing space,” Francis says.

Bespoke’s attentiveness to the varying needs of its clients has also been a constant throughout its time in business – something Francis says is essential to ensure the longevity and success of any brokerage.

THE VERSATILITY FACTOR In addition to serving a variety of customers on the residential side, Bespoke Lending Solutions has also established a foothold in commercial and reverse mortgages – part of the brokerage’s bid to offer as comprehensive a service as possible to its clients.

“We try to stay on top of all aspects of the mortgage experience,” Shaun Francis says. “We have contacts on the commercial side of things where we can add value to clients who are self-employed or buying commercial properties or holding companies. There’s no space we wanted to not be involved in.”

www.mpamag.com/ca

38-39_Broker Insight-SUBBED.indd 38

05/10/2021 2:03:07 am

FAST FACTS: BESPOKE LENDING SOLUTIONS

PRINCIPALS Shaun Francis, Usman Rathore and Sean Saffri

LOCATION Burnaby, BC

NUMBER OF STAFF 18

SERVICES Residential (A, B and private), commercial and reverse mortgages

“If you can find a solution and present it to [clients] in an easy format and make it quick for them, they’re going to love you” “What we learned is that if you can add value and make [clients’] lives easier, they’re going to stay with you and be loyal to you,” he says. “If you can find a solution and present it to them in an easy format and make it quick for them, they’re going to love you. That’s what I learned on the bank side, and that’s

what a good broker can do – add value to clients by saving them cash or reducing their payments, saving them money in interest, or giving them increased cash flow.”

Francis believes a broker’s value also lies in being able to introduce clients to trusted referral partners who can provide them with

AWARDS AND ACCOLADES Finalist for New Brokerage of the Year at the 2021 Canadian Mortgage Awards

unsurpassed knowledge and guidance.

“If you can have all that at your fingertips, you’re going to be able to have a lifelong client,” he says, “and that’s what we pride ourselves on – giving them solutions that they were not anticipating they even needed.”

www.mpamag.com/ca

38-39_Broker Insight-SUBBED.indd 39

39

05/10/2021 2:03:15 am

SPECIAL PROMOTIONAL FEATURE

PRIVATE LENDING

Opening up the world of private lending CMI’s Daniel Joseph tells CMP how the company became the private lender of choice for a growing community of broker partners AS ONE of the largest and most highly regarded private lenders in Canada, Canadian Mortgages Inc. (CMI) has grown exponentially during the last seven years.

“When I started back in 2014, there were four of us,” says Daniel Joseph, CMI’s director of broker relations. “Now the CMI team is more than 70 strong. We have grown extremely fast and continue to expand across all departments.”

That growth has gone hand-in-hand with the evolution of private lending. Once laden with often unwarranted negative connotations, private lending has become a popular avenue

40

for brokers and clients, and has gained respect as a key segment of the Canadian financial services marketplace. CMI’s approach has been pivotal to this, due in no small part to the company’s commitment to transparency.

“We work very closely with brokers to educate them and train their staff,” Joseph says.

“We go out and do presentations at trade shows and symposiums, as well as in office seminars and lunch-and-learns for smaller groups.

“It’s important to help our broker partners identify borrowers who could benefit from a private mortgage. They all have clients they believe won’t qualify for traditional bank

financing – and that’s where we can help. We will consider any deal on its individual merits, regardless of location, and work with the broker to provide a common-sense solution customized to each borrower’s unique needs.

“That flexibility is a game-changer. In an environment of increasingly strict lending guidelines, a private mortgage can be a lifeline to those frozen out by traditional lenders.”

Joseph says there are a few key factors that have contributed to CMI’s success in cultivating strong and lasting broker partnerships.

“First is our flexible, common-sense approach; second is our industry-leading

www.mpamag.com/ca

40-43_CMI-SUBBED.indd 40

05/10/2021 2:06:06 am

Experience the CMI Difference We work exclusively with our broker partners to secure the mortgage financing your clients are looking for - quickly and easily. No jumping through hoops to justify credit scores and non-traditional income sources. Just honest, transparent and flexible mortgage solutions that fit the unique needs of your clients.

Our team excels at putting together complex mortgage deals that don’t align with conventional lending guidelines.

“We know brokers because we used to be a brokerage. We’re here to support brokers, not compete with them.”

— Bryan Jaskolka,

Founder and CEO, CMI Financial Group

Common Sense Approach with no minimum beacon score Creative options like prepaid mortgages, mortgage bundles & custom terms Quick digital deal submissions and fast approvals

canadianlending.ca/brokers info@canadianlending.ca | (888) 465-8584

40-43_CMI-SUBBED.indd 41

05/10/2021 2:06:11 am

SPECIAL PROMOTIONAL FEATURE

PRIVATE LENDING turnaround time; and third is our exceptional service. We strive to deliver a client experience unmatched in our industry. Our goal is to build a relationship with a brokerage where we’re viewed as an indispensable part of their team, as if we are part of their staff.

“We’re innovators, and we think outside the box. We’re able to really speed up and simplify the approval and funding process. We have industry-leading platforms and processes in place that allow for easy, quick, and secure information and document submission once a broker integrates with us.”

To communicate the benefits of private lending effectively to brokers, Joseph continually takes stock of the changing industry landscape. One of the main changes he’s seen in the private lending sector during his time at CMI is that “there’s more competition, but there is also less transparency around rates, fees and lending criteria. In a highly competitive industry like private lending, players tend to hold their cards close.

“When submitting a private deal, brokers often aren’t aware of what the end cost is going to be. Many lenders aim to attract business with low rates upfront, but that’s not a complete picture. These low rates are typically subsidized by other fees on the back end, like closing costs, as well as discharge and renewal fees, that can be astronomical.

“We routinely have brokers come back to us once they see the all-in costs at the end of an experience with a different lender. We may have been a quarter point higher than the rest on our rate, but after factoring in all of the competitor’s fees and costs, the client could end up paying as much as three times the amount they would have with us. Fee transparency is critical, and it’s something we are steadfastly committed to.”

Another growing trend is ever more restrictive lending criteria at the banks, which means private lending often offers the best – or only – solution.

“We have seen many triple-A clients that have gone to traditional lenders to refinance or renew their first mortgage or get a line of credit and been declined,” Joseph says. “We can offer them a second mortgage – maybe at a slightly higher rate, but it’s something the

42

“Our goal is to build a relationship with a brokerage where we’re viewed as an indispensable part of their team, as if we are part of their staff ” Daniel Joseph, CMI banks don’t offer, and it’s only for a short term of six or 12 months. At the end of that term, they can reapply with their bank to roll this into their first mortgage and get the benefit of a single payment at a lower rate. In this way, we’re acting like a bridge. We help meet the borrower’s immediate need and provide an exit strategy to achieve a better long-term solution for the client at renewal or discharge.

“There has been a little resistance to private lending from brokers who typically deal with triple-A or B lenders. The solution is reaching out to them, educating them

and making them aware they have another option in their toolbox when they come across clients that have challenged credit or other circumstances traditional lenders won’t consider.

“Many Canadians face difficulties in their financial situations – particularly in the wake of the COVID-19 pandemic – and are looking at an alternative lender because they don’t fit certain boxes. The private sector has become essential in providing financing for these clients that would otherwise be unavailable to them.”

www.mpamag.com/ca

40-43_CMI-SUBBED.indd 42

05/10/2021 2:06:17 am

COALITION OF INDEPENDENT MORTGAGE BROKERS OF CANADA

EMPOWERING INDEPENDENT

MORTGAGE BROKERS

TO BUILD THE VALUE OF THEIR BRANDS

WHAT CAN A CIMBC MEMBERSHIP OFFER YOU?

BECOMING A CIMBC MEMBER CAN: › BUILD THE VALUE OF YOUR BRAND › BE MORE PROFITABLE AND EFFICIENT IN YOUR BUSINESS › OPPORTUNITY TO PARTICIPATE IN REVENUE SHARING › WORK WITH BEST-IN-CLASS TECHNOLOGY SOLUTIONS › PROTECT YOUR CLIENT DATA AND SO MUCH MORE!

“THE BEST KEPT SECRET BY DESIGN” CONNECT WITH US TO BECOME A PART OF THIS REVOLUTIONARY GROUP @CIMBC

CIMBC.CA | INFO@CIMBC.CA | 1.866.448.3343 40-43_CMI-SUBBED.indd 43

05/10/2021 2:06:20 am

SPECIAL PROMOTIONAL FEATURE

LENDING

Doing business with MERIX Get to know more about one of Canada’s leading monoline lenders

BROKERS LOOKING for a true partnership from start to finish need look no further than MERIX Financial. MERIX is committed to providing brokers with choice and innovative solutions. As a broker signed up with MERIX, you choose how you are compensated. The lender offers two different commission structures: MERIX’s trailer fees and Lendwise’s upfront compensation.

Trailer fees pay residual/passive income annually, allowing brokers to earn on assets under administration, not just transactions.

This structure is what MERIX was founded on; since inception, the lender has paid out more than $60 million in trailer fees.

Prefer to maximize your upfront earnings? The Lendwise brand offers an upfront compensation structure, and also features bonuses for efficiency and insured/insurable deals. But MERIX doesn’t tie brokers to one option or the other – brokers are welcome to choose their preferred compensation structure on a deal-by-deal basis.

MERIX also offers unique incentive programs. The basisPOINTS program allows brokers to earn credits on every deal funded, which can be used toward rate buydowns at their discretion, while the Status program provides brokers who reach certain volumes with incentives that include appraisal reimbursements, lead generation, exclusive rate promos, accelerated basisPOINTS earnings and more.

For clients who need more taken into consideration than just credit, MERIX has an alternative division called NPX. This

44

MERIX works hard to elevate broker partners’ reputations as the key point of contact for clients innovative, full-suite alternative product offers qualification at contract rate; extended ratios; and fixed, ARM and interest-only options. It’s now available in both Ontario and British Columbia.

MERIX involves brokers every step of the way with their clients, and everything from beginning to end emphasizes that partnership. MERIX works hard to elevate broker partners’ reputations as the key point of contact for clients. For example, welcome

letters and all other resources throughout the renewal process are co-branded with the broker’s name and details, communication with customers is customized to fit within the broker’s business, and MERIX also provides brokers with ongoing marketing materials to help them grow their business.

Doing business with one of Canada’s lead­ ing monolines goes beyond unique compensation, incentives and offerings – MERIX is a true partner to brokers.

www.mpamag.com/ca

44-45_Merix-SUBBED.indd 44

05/10/2021 2:06:50 am

YOUR REOCCURRING REVENUE STREAM IS HERE TO STAY.

MERIX Financial is 100% committed to paying you Trailer Fees over the life of every mortgage you fund with us, so you can have peace of mind while enjoying your reoccurring income.

With MERIX Trailer Fees, you will be paid at closing and again every year on the anniversary date of the original funded mortgage. As long as the original deal stays with MERIX, trailers will continue to be paid to you.

This residual/passive income can amount to a lot over the years!

Since launching in 2005, MERIX has paid out over $60 million dollars in Trailer Fees. Allow us to demonstrate the power of Trailer Fees for your business so you are well-informed of your options and prepared for whatever the future brings.

VISIT INFO.MERIXFINANCIAL.COM/TRAILER-FEES FOR DETAILS

44-45_Merix-SUBBED.indd 45

05/10/2021 2:06:54 am

FEATURES

MENTAL HEALTH

Three ways to future-proof your success To build a sustainable small business, you must have three pieces of the mental health puzzle in place first, writes Anastasia Massouras are compounded when you aren’t big enough to afford dedicated HR support and don’t have systems or processes in place to deal with everything you’re required by law to do.

Yet we rarely hear stories about small business owners’ lack of support or mental health problems, which research shows that more than one-third of people are reluctant to reveal. Workplaces of all sizes are impacted by poor mental health, and evidence suggests psychological distress is most acute for sole traders.

What to do? There are three key mental health elements you need to address to make sure you have a sustainable business, no matter what size you are.

1

SMALL BUSINESSES everywhere are struggling. They’ve been hit especially hard by the COVID-19 pandemic – according to Statistics Canada, 29.5% of businesses with fewer than 100 employees reported a

46

revenue decline of more than 30% in 2020.

But even before the pandemic, spiralling overheads and payroll costs, working up to 80 hours per week, and struggling with cash flow were all too common. These challenges

Be aware of what’s going on

If you aren’t aware of yourself, how can you effectively lead yourself ? If you’re not effectively leading yourself, then how can you effectively lead others?

This begins by gaining awareness of the thoughts, beliefs and values that drive your decisions, behaviours and actions. What are your motivators, passions and goals in life?

How do you respond to triggers, stressors and difficult situations?

It’s important to achieve clarity about why we do what we do in our business and in our lives. If we have a clear vision of purpose and meaning, we are more likely to maintain a growth mindset, negotiate challenges and

www.mpamag.com/ca

46-47_Bizstrat_Future Proof-SUBBED.indd 46

05/10/2021 2:07:25 am

make good choices.

Identifying areas for growth and then connecting with the right professionals to fill those gaps will accelerate your success, as well as continuously maintain your health and happiness.

2

Cultivate a growth mindset

The way you think has a ripple effect in every aspect of your life. Limiting thoughts and limiting beliefs about yourself and your capabilities will restrict your progress and success. Hence, cultivating a growth mindset could be the single most important thing you ever do to help you achieve success.

As Carol Dweck explains in Mindset: The New Psychology of Success, the passion for stretching yourself and sticking to it, even (or especially) when it’s not going well, is the

hallmark of the growth mindset. This means seeing and embracing failures as opportunities for growth, as lessons to be learned and applied. This is what will help you navigate the high and low tides that always come with running your own show.

3

Maintain your stamina

Running your own small business is a 24/7 activity, which is why you need to be mentally healthy, fit and strong. There will always be pressure – it will never go away. There will always be setbacks, failures and obstacles. What counts is how you deal with that pressure, with those setbacks and obstacles. It’s essential to move away from simply reacting to events and toward responding to events. Making conscious choices each day about what to eat, when to

exercise, and how to switch off from work and on for home is the recipe for success and stamina in business.

Your awareness, mindset and stamina are like three cogs in a machine. They must be connected and coordinated to work smoothly and effectively together. Maintaining and sustaining this takes real work, and the only person who can do it is you. Your mental health, well-being and happiness are key to your success and your future.

Anastasia Massouras is the CEO of Work Happy, which provides well-being and employee assistance programs and tailored advice for companies. She is also the founder and CEO of Pure Insights, a consultancy specializing in mental health intervention.

www.mpamag.com/ca

46-47_Bizstrat_Future Proof-SUBBED.indd 47

47

05/10/2021 2:07:30 am

PEOPLE

OTHER LIFE

TELL US ABOUT YOUR OTHER LIFE Email mortgagebrokernews@kmimedia.ca

In the Ironman, Daly had a maximu m of 17 hours to complete a 3.86km swim, a 180. 25km bike ride and a 42. 2km run

3h58m

Daly’s finish time in his first marathon in 2003

14h13m Time it took him to complete his first Ironman in 2013

2h27m

His finish time in the Escape from Alcatraz triathlon in 2017

THE RULE OF THREE The rigours of the triathlon have been valuable training for Trevor Daly’s work as a mortgage executive TREVOR DALY has been participating in triathlons for nearly as long as his two-decade mortgage career, but the seeds of his desire to compete were planted far earlier.

“When I was eight years old, I was given a watch for Christmas, and the symbol on that watch was the Ironman symbol,” says Daly, vice-president of DLC Forest City Funding. “At that moment, I knew I wanted to be an Ironman someday, not really knowing what that meant.”

Although he participated in school track teams and athletics groups, Daly’s first major endurance event was the Toronto marathon in 2003, which he completed in just under four hours. Eventually, he learned about the Ironman triathlon

48

through a friend, which led him to discover the origin of the symbol on his old watch.

“That image I knew as an 8-year-old came back to me,” Daly says. “This time, I had a full-on mission: I was going to fulfill a lifelong goal and become an Ironman. So I started training and training and training and waking up at 4 a.m. to swim and bike and run in the dark – and then after work, either swim, bike or run again.”

For Daly, the journey is as valuable as the act of completing the race. “Both the good days and the bad days, I find that the triathlon is like life,” he says. “It’s all a journey when you start out – a little nervous, but you have a lot of energy and excitement. And once you get warmed up and get your rhythm, you can get going.

Things can be good, or you can get kicked in the head, and now you have to give up or move forward. Then you get out of the water and transition onto your bike, much like in life when we have to transition our modes of thinking. The bike is the longest part of the race, and so you really have to be consistent or things can go wrong real quick for you.”

The mind of steel needed to complete a triathlon translates especially well to the demands of the mortgage industry, Daly adds. “Success is in the mundane. The mundane is the training that you do every day when nobody is watching you – no fans, nothing but the proper training that gets you to the finish line with a smile.

Consistency pays off every time.”

O

www.mpamag.com/ca

48-IBC_Other Life-SUBBED.indd 48

05/10/2021 2:07:59 am

1-905-428-3144

CONTAMINATED PROPERTY? ENVIRONMENTAL INCIDENT? Secure Legal Claims Solu�ons specializes in Environmental Law with over 25 years of experience in environmental li�ga�on and representa�on.

Our Counsel has represented banks and lenders; Officers and Directors; Insurers and Insureds; polluters and vic�ms of pollu�on to obtain the best possible outcome for our clients.

We have acted in environmental class ac�ons and have extensive experience in dealing with and nego�a�ng with the Ministry of the Environment, Conserva�on and Parks.

We are happy to speak to you about your environmental issue.

Howard Kohn is the co-author of “Environmental Harm: Civil Ac�ons and Compensa�on”, one of the most comprehensive textbooks about Environmental Law and has, in the past, been recognized as a specialist in Environmental Law by the Law Society of Upper Canada.

Call Howard to discuss your environmental issue at 905- 428-3144 x181

Environmental Damages

Lenders, Receivers Liability

Insurance Coverage Disputes

Bodily Injury Claims

Officers/Directors’ Liability

Oil Tank Failure

Our passion is achieving the results that benefit our clients.

48-IBC_Other Life-SUBBED.indd 49

securelegalclaims.com 05/10/2021 2:08:07 am

Together, we can empower your clients with products that secure their financial future.

Classic mortgages Accelerator mortgages Equityline® Visa*

Count on our partnership.

To learn more go to hometrust.ca/partners ® Registered trademark of Home Trust Company. *Visa Int./Home Trust Company, licensed user of mark.

00_OFC_OBC_SPINE-SUBBED.indd 3

05/10/2021 1:53:37 am