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Commemorative five-year supplement

Celebrating five years





Happy birthday to us Hello and welcome to this special commemorative issue, celebrating the 5th year of publication of Canada’s leading independent magazine for mortgage brokers and professionals, Canadian Mortgage Professional. Launched in 2006, CMP is dedicated to all the latest news, developments and changes that affect the industry along with dedicated sales and marketing features that enable Canadian mortgage brokers to further develop their businesses. Over the years we’ve developed popular annual issues, including Top 50 Brokers, Brokers on Lenders Survey, Broker Sentiment Poll and beginning in 2007 have put on the hugely popular Canadian Mortgage Awards, which has grown each year and was attended a few months ago by more than 500 industry professionals. Along the way we also grew our Internet presence with, which now features daily breaking news and video interviews with leading mortgage industry professionals. To kick-start the year, we’ve taken a trip down memory lane by revisiting more than 60 back issues to pull out some of the most important stories and issues we’ve covered. We’ve reproduced them here for your perusal and it’s interesting to note how many of the same topics continue to affect and shape brokers and the Canadian mortgage market. As well as reprinting a number of stories from each year, we’ve also collated a selection of headlines, statistics, award and survey winners from each 12-month period, to provide some context. We’ve also put together a collection of photos from the Canadian Mortgage Awards – see if you can spot yourself! It is no mean feat for a trade publication to be celebrating its 5th birthday, but it is a milestone we couldn’t have reached without the ongoing support of our loyal readers and advertisers. Thanks to everybody who has read CMP, provided comment or articles, advertised in our pages, attended one of our events or recommended us to a colleague. We look forward to bringing you another special edition in five year’s time. Cheers. John Tenpenny Editor

A special word from our first editor, Cindy Freiman... “It’s hard to believe that five years have passed since I visited the printing house to watch the first issue of CMP roll off the presses! It was an extremely exciting and proud moment that would not have been possible without the overwhelming support of key personnel within a number of mortgage brokerages, lenders and insurers. I hit the streets running in those early days and was openly invited into this great industry by many of its veterans who never got tired of my endless questions, and openly shared their opinions and thoughts about industry issues, and the benefits of the independent voice KMI Publishing could offer to the Canadian mortgage brokering landscape through CMP. Happy Birthday, CMP!”

special edition CMP’s inaugural issue  




What key factors make this kind of business thrive?


Scott Ede

THE MISSING BRAND Why don’t Canada’s brokers have a national branding effort?


Greg Nowik


IssuE 1.11

Timeline PLUS: SPECIAL FOCUS Technological lifesavers REFERRER SERIES Appraising accountants PROFILE Sheila Hawkins

underwriter evolution


Publications Mail agreeMent #41261516

sPEcIAL FOcus:

Embracing technology

Top 3 banks

Banks speak out

a natural progression

SPECIAL FOCUS Home inspections CONTEST MARKETING A winning option


charity involvement

swap order

Broker gripes met head on

e: Exclusiv 2nd Annual Brokers on Banks Survey Results PUBLICATIONS MAIL AGREEMENT #41261516

PUBLICATIONS MAIL AGREEMENT #41261516 front cover.indd 1

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»» Dominion Lending Centres launches

»» Filogix acquires TMTG

»» Interbay Funding leaves Canada

»» Bridgewater receives chartered bank status

»» GMAC purchases Resmor Trust

»» Ontario Mortgage Brokerages, Lenders and Administrators Act enacted

»» Axiom Mortgage Partners launches

»» CMHC no longer insures 40-year amortizations

»» CIMBL becomes CAAMP

»» Mortgage Alliance acquires Meridian Financial Services

»» First Credit Education Week held »» Street Capital Financial launches

»» Abode enters Canadian mortgage scene

»» PMI Mortgage Insurance Company enters Canada

»» BMO cuts ties with broker channel

»» RMAI Financial Group launches national broker network »» GE Money leaves Canada »» Invis acquires Mortgage Intelligence

NO. 7


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Guide to broker networks




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»» Scotia Mortgage Authority launches

»» AIG United Guaranty sold and becomes Canada Guaranty

»» HSBC closes its doors to brokers »» More Canadians refinancing mortgages due to low interest »» CHIP becomes chartered bank »» FSCO suspends 79 brokerages »» Xceed to apply for bank status

»» Feds introduce mortgage rule changes »» acquires Mortgage Architects »» Abode closes »» Mortgage market surpasses $1 trillion »» DLC signs Don Cherry for new TV ads



The Mortgage Centre became Canada’s first national mortgage broker organization.


We launched the Stay In Touch program, providing our brokers with an automated tool to help maintain a lasting relationship with their clients.


We’ve proven our staying power through the many ups and downs in the market. As far as we’re concerned 2011 is only the beginning for The Mortgage Centre!

Continuity, Endurance, Quality, Respect. The Mortgage Centre has earned its good name through years of industry experience. We believe that the key to success lies in our investment in our brokers, franchisees, and employees. By offering competitive compensation and a host of dynamic sales tools, we’ve empowered a new generation of mortgage brokers to grow their business.

Isn’t it time you invested in your good name? For more information on a rewarding career with The Mortgage Centre, or to inquire about franchise opportunities, Contact Eddy Cocciollo at (416) 309-3930. The Mortgage Centre is a division of CIBC Mortgages Inc., a member of the CIBC group of companies. ® The Mortgage Centre is a registered trademark of CIBC Mortgages Inc.

2006 ++ Dominion Lending Centres launches

Canadian Mortgage Award Winners Best Newcomer (Individual): Scott Ede Lifetime Achievement: Bob Ord Mortgage Broker of the Year (Independent): John Zieman

++ Ontario Mortgage Brokerages, Lenders and Administrators Act enacted

CMP Archives July 2006

Forty-year amortization mortgage enters the market Just weeks after 30- and 35-year mortgages hit the market, GE Money Mortgages trumped them all with the launch of a four-decade- long product. Rick Lunny, president of the Mississauga-based company, says its introduction of a 40-year amortization in late April is providing would-be homeowners an opportunity to leave apartment life behind, even in the face of rapidlyrising real estate values. He says it is also targeted at those who want more for the money they are spending. Lunny says despite their length, he doesn’t anticipate these mortgages will start outliving their owners. “Many of our customers choose to pay weekly or bi-weekly. That in itself accelerates the amortization,” he said, noting lump sum payments can also be put down on the mortgage on its anniversary, or payments can be increased when it comes up for renewal. GE Money mortgages are currently offered via brokers in Ontario, Alberta and BC with plans to expand nationwide by the end of the year.


CIMBL changes its name The Canadian Institute of Mortgage Brokers and Lenders is no more — or it won’t be, as of May 1 2007. At the association’s annual meeting in Halifax on October 16, CIMBL agreed to change its name to the Canadian Association of Accredited Mortgage Professionals (CAAMP). There are many reasons for the name change, which has been in the works for quite a few years, Jim Murphy, senior director of government relations and communications, said. The most important reason is that the association wants to include its Accredited Mortgage Professional (AMP) designation in its title. The inclusion is intended to send a message that the mortgage industry and its national association have raised the bar on professionalism. “We want to say to the regulators, media and the public that we are mortgage professionals, and that we have a commitment to ethics and lifelong learning,” Murphy said.

The name change also brings a reduction in membership categories. While CIMBL currently has 13 different categories for its members, CAAMP will have four: honourary members, accredited mortgage professionals, regular members (with two years to get their AMP designation), and business members. Within the next three to four months the association will start introducing its new brand with a new website and logo.



2006 Average Home Price:


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++ Bridgewater receives chartered bank status 2006

++ CIMBL becomes CAAMP Average Home Price: 2006 Average Home Price:

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Fixed funding ratio receives broker nod CMP Archives August 2006

In a recent survey conducted by CMP, 64% of brokers believed that having a set funding ratio of 75% was a step in the right direction for the industry. The most popular reason for brokers being in favour was because it would afford them more time to chase real deals. Dan Putnam, president of Mortgage Centre Canada, an advocate for higher funding ratios, openly supports lender initiatives that would see brokers with higher funding ratios, or their customers rewarded for reaching such targets. “Sixty-four per cent is a promising number from brokers. This indicates that there are a lot of respectable brokers out there who want to take responsibility and help the lenders.” Many lenders believe the industry needs to move towards a more efficient way of submitting

deals to reduce their costs. These, they claim, have reached a staggering $750—1,000 per hedged deal, regardless of whether it funds, and such wasted costs have to be paid for somehow. Of the 36% of brokers who are against set funding ratios, the main concern for many was that consumer choice would be limited, as brokers would be forced to submit fewer deals. Thirty eight per cent of brokers predicted that having a fixed funding ratio of 75% would lead to a decrease in the number of applications they submit to lenders. Others argued that higher funding ratios would only benefit lenders. Paul Whatmore, broker/owner of Mortgage Concepts Inc. in Stoney Creek, Ontario, believes introducing a set funding ratio would be a bad idea, claiming that when he sends a deal to a lender for pre-approval, and the client doesn’t come back to him, the deal crashes and he has no control over the turnout. “This month alone, I have lost three deals due to failed inspections,” he said. “Instead of putting fixed funding ratios in place, lenders should be concentrating on building relationships with brokers to ensure the right deals come in.”  


VERICO: Setting The Standard The original mortgage network that revolutionized the industry.

VERICO founders, Colin Dreyer and John Kelly reflect on the journey to becoming Canada’s #1 Network.


ix years ago when John and I looked at the opportunities in the Canadian marketplace to create a national brand, all the conditions for success were there,” says Colin Dreyer, President of VERICO Canada, from his office overlooking downtown Vancouver. “We were on the upside of a booming housing market that thrust the real estate industry into the media spotlight; which in turn, generated awareness of the mortgage brokerage industry like never before. “Six years later, today, we are in a very different market place having been through a global recession driven by the credit crisis and a US housing crash that still has yet to recover. Here at home, although the Canadian real estate market and mortgage sectors remains strong, we’ve faced mortgage regulation changes, media scrutiny


on housing bubbles and increasing competition from banks,” says Dreyer. “Yet, in spite of the change in the economic climate and challenges faced by mortgage brokers, VERICO has flourished and is continuing to grow; that is a testament to the strength of our value proposition,” adds John Kelly, COO of VERICO Canada. Dreyer, a CAAMP Hall of Fame recipient and one of the most recognized figures in the mortgage industry, and Kelly, co-founder of VERICO and an innovative leader in franchising, technology, and brand strategy, have actualized one of the most ambitious visions in the industry. When the business partners first assessed the Canadian mortgage landscape in the mid-2000s, each recognized an opportunity. “No one had established a brand for the elite level of brokers. No one was bringing together the top echelon of the industry. We looked at the industry and realized that this opportunity was untouched. So, we developed a value proposition around this niche and created a space for the top mortgage broker firms. We wanted a network of the best of the best,” says Dreyer. To attract the top percentile of the top performing mortgage agents and mortgage firms in Canada, VERICO set out to offer a unique value proposition that would ultimately change the landscape of the mortgage industry. “We believed that quality brokers want to work with the best. We believed that brokers want to build equity into their own brands and business. We also recognized that equally important to the success of our brokers, is a great partnership with lenders; and this was how the ‘Mortgage Network’ concept was born,” says Dreyer. “By the time we signed our first brokerage, we laid the groundwork to building a network that would create a new way of doing business between mortgage brokers and lenders and create value for both sides.   This concept revolutionized the industry.”   “To this day, I think our value proposition is so unique that we differentiate ourselves completely from other brands that are out there. Other brands that have come since VERICO may use our terminology and business methods, but at the end of the day, there is only one VERICO,” says Dreyer. “We don’t sell VERICO; we explain the opportunity to individuals and companies; they take a look at that opportunity and say ‘that’s where I want to be, that’s where I want my future to be, those are the people I want to be associated with.’ So we don’t really compete against anybody in our niche.  VERICO is the # 1 network when it comes to elite mortgage originators.” The coveted reputation of the VERICO Network was even acknowledged in 2010, by an independent report conducted by Deloitte, which recognized VERICO as having captured the niche of the “high-end mortgage broker.”

Today, VERICO is Canada’s premiere network with 190 brokerage companies with over 2000 agents that generate over $10 billion in mortgage volume. Dreyer says that the success could not have come without partnerships with lenders. “We’ve developed tremendous relationships with lenders and we thank them for believing in our vision six years ago. Our partnerships help us to continually develop new products that better meet the needs of Canadians consumers.” “Our strength is our commitment to VERICO firms; along with our talent for developing innovative ideas and business-generating initiatives that add value for our members,” says Kelly.  “We have continued to develop industry firsts in the areas of technology, mortgage products, marketing and business systems.” “We were the first national brand to create a complete Brand Corporate Customization Program, which enables each of our brokerages to re-brand almost all of our systems and technology so that it reflects their corporate colors and logo. This included everything from email, websites, mobile apps, leads management, CRM, news blogs, and even our mortgage academy and our automated payroll system. The intent is to provide our members with the systems and tools that support their brand, not just ours. It’s simple,” says Kelly, “their brand is the one they own.” Recognizing the power of video and social media as corporate communications tools; in 2010, the company launched VERICOTalks, a network wide linked-in system, VERICO TV, a monthly video communication, and – the perfect place to get industry news and start the day off with a cup of coffee. “By fall this year, we will also be launching two integrated enterprise class technology platforms,” announces Kelly. “This is an end to end business system that we have built specifically for mortgage brokers to streamline their business, eliminate administrative work and, most importantly, drive profits. These platforms will revolutionize the way that mortgage business is done.” Verico Dynamics will help mortgage agents manage each stage of the mortgage origination process from Leads management to Transaction management and through to CRM.  The system offers leads funneling, intelligent reporting, seamless integration with D+H Expert and also an accounting component – Verico Payroll - that automatically calculates commission splits and trailing revenues. Kelly, who led the development of this massive technology project, says that Verico Dynamics and Verico Payroll is a game changer. “This is the single biggest system we have ever undertaken to build. Verico Dynamics will support our brokers in their business and help agents maximize lead opportunities.  One of the most powerful benefits of this system is that it enables agents to inform and engage customers in the mortgage process while increasing confidence, comfort level and client commitment to the agent.” “We are looking forward to presenting it to our network. But technology is just one pillar of our

value proposition. What separates VERICO is the standard that we apply to everything we do.” That method of excellence is evident from product development to membership application. “VERICO is not for everyone. In order to keep the integrity of our value proposition, we have a stringent application process in place to ensure that those who join the VERICO network are able to offer Canadian consumers the expertise and great service levels that only comes from being an elite member of the industry,” adds Kelly. “Collectively as a network, VERICO is setting the industry standard and we have positioned ourselves as the brand of choice for higher performing mortgage brokers who share our commitment to professionalism, advocacy, and ethical conduct.” “John and I had a vision six years ago; to create a network of elite mortgage brokers and present a new perspective on broker and lender relationships,” says Dreyer. “We were the first to recognize a need beyond the super broker model and a need for successful brokers who were ready to take the next step towards business ownership. “Looking at our network now, we have succeeded in what we wanted to do. We are so proud of what we have built and we are excited about the quality of the people that have joined.  “We will continue to deliver on the commitment that we’ve made to our members, which is to support them in their business by providing the tools and services that help them drive business,” says Dreyer. When asked about the future, Dreyer is adamant that the mortgage industry will continue to grow and prosper. “Six years ago, we pioneered a way forward to revolutionize the industry. Today, John and I have a new vision. Personally, I very much look forward to the next six years at VERICO. The opportunities seem endless and the challenges are interesting and exciting in this vibrant industry. I think I can speak for both myself and John when I say we’re only just getting started.  


20 06 20

Canadian Mortgage Award Winners Mortgage Broker of the Year (National Network): Garth Ellis Mortgage Brokerage of the Year (Independent): Canada Mortgage Direct Mortgage Brokerage of the Year (National Network): Invis

++ Macquarie acquires Cervus Financial

++ Abode enters Canadian mortgage scene

++ BMO cuts ties with broker channel

CMP Archives April 2007

CMHC consumer survey bodes well for brokers and lenders In 2006, the vast majority of mortgage consumers were satisfied with the services provided by either their mortgage broker or lender, according to Canada Mortgage and Housing Corporation’s 2006 Mortgage Consumer Survey, released in February. Results showed that 91% of consumers who dealt with brokers thought that they made a good decision with a good understanding and 85% thought the same of lenders, said Pierre Serré, vice president of insurance products and business development for CMHC. While the proportion of purchasers using the


services of mortgage brokers has remained unchanged from 2005’s level of 27%, the percentage of consumers who turned to mortgage brokers for renewal and refinance transactions increased in 2006. The survey also indicates that Canadians are well served by the mortgage industry with an overall satisfaction rate of 84%. “It’s a really competitive marketplace out there and the consumers are very well served by having both brokers and lenders actively looking for their business,” said Serré. A growing majority of Canadians who refinanced

in the last year (71%) did so before the scheduled renewal time. Among those who refinanced, the most common reason was home renovations and improvements, followed by reducing overall interest costs. Eighty six per cent of respondents indicated that it is somewhat or very important that their lender be a Canadian institution. Relationships with their current financial institutions are very important to recent mortgage consumers. While 2006 saw a slight increase in the percentage of

consumers who switched to another financial institution when renewing, the majority of mortgage consumers remained loyal. CMHC’s Mortgage Consumer Survey is conducted each fall to examine consumer behaviour, attitudes and expectations when acquiring, renewing or refinancing a mortgage. The survey is based on a national probability sample of active mortgage consumers comprised of first-time buyers, repeat buyers, mortgage renewers and refinance consumers.

2007 ++ Murphy appointed CEO of CAAMP

Canadian Mortgage Award Winners Best Newcomer (Individual): Mathieu McCaie Mortgage Brokerage of the Year (National Network): Invis Mortgage Broker of the Year (Independent/ Non Franchise): Vince Gaetano,

+Filogix acquires TMTG

+ PMI Mortgage Insurance Company enters Canada

CMP Archives August 2007

Ontario announces details of new mortgage legislation

Brokers on non-bank Lenders Survey – Overall Ranking 1. GMAC Residential Funding 2. First National Financial 3. Abode Mortgage Corp. 4. Merix Financial 5. Macaquarie Brokers on Lenders Survey – Overall Ranking 1. Scotiabank 2. Bridgewater Bank 3. TD Canada Trust 4. Laurentian Bank 5. CIBC

Ontario’s new Mortgage Brokerages, Lenders and Administrators Act, 2006 will take effect on July 1, 2008, the Ministry of Finance and the Financial Services Commission of Ontario (FSCO) announced in July. The Act will require individuals and businesses conducting any of the regulated activities (dealing in mortgages, trading in mortgages, carrying on business as a mortgage lender or carrying on business as a mortgage administrator) to be licensed by FSCO. Each brokerage will also need to designate a principal broker to act as its chief compliance officer. The transition will force the province’s brokers and agents to fulfill a number of administrative requirements, one of which will involve registering on a new electronic system. Brokers and agents will be provided with a four-month transition period — from March 1, 2008 to July 1, 2008 — to register in the database, as well as fulfill other administrative

and operational obligations required by the new Act. The new legislation will also improve the education standards and qualification requirements for brokers and agents, with the intent to make the mortgage process safer for consumers. Qualifying Standards for agents will involve a focus on technical skills, The standards focus on the skills required by an agent to perform duties such as completing a mortgage application form and assessing a borrower. Agents are currently not required to meet any education requirements. Qualifying Standards for brokers will focus on supervisory and compliance process safer for consumers skills to ensure that a broker is equipped to perform tasks such as implementing policies and procedures to make sure agents are complying with the

provisions of the new Act. FSCO is still working on how the transition will work in terms of qualifying standards, eg recognition of people already in the industry. In terms of education, FSCO plans to improve the offerings available to mortgage brokers and agents by monitoring the courses available. Mortgage agent education will include a final exam that meets standards to be established by FSCO. This will ensure that all final exams administered by course providers can be measured against an established benchmark. For mortgage broker education there will be a single course provider, to be selected through public tender. Broker competencies will be assessed through an exam created and administered by FSCO or its agent.  



Bridgewater Bank

Established in 1997 and purchased by its current parent, the Alberta Motor Association (AMA) in 2000, Bridgewater Bank attained full chartered bank status on January 1, 2006. Now, celebrating its fifth anniversary, and with no intention of slowing down, Bridgewater Bank is poised for growth. We sat down with Todd Poberznick, Vice President, B2B Solutions, to learn more about the bank, its past, present and future.

quick and adaptable wins the race Where was Bridgewater Bank five years ago? We started out as a small mortgage company and a lot of our success today can be traced back to the strong relationships we built with our brokers. Key to our success is our continued focus on our mortgage business. We stayed true to our roots which helped us thrive in the challenging environment of an economic downturn and a changing regulatory landscape. Now, having seen many of the products, services and relationships become a reality, we’re starting to plan for what’s next on the horizon. What were some of the keys to the Bank’s success? We realized quickly we needed to establish strong relationships with key partners such as being one of the first to sign up with AIG (now Canada Guaranty) to offer brokers and customers another insurer to work with. This move was a big win for us as it proved to the brokers we could adapt quickly and get systems in place that they required. We earned a reputation of being an early adopter and signing up for new services that we felt benefitted the brokers. We also made sure to commit to programs for the long haul to make sure brokers could take full advantage of these programs and services. Our hard work paid off and two years (2007 and 2008) in a row Bridgewater Bank was voted No. 1 in the Broker Support category in the CMP Brokers on Lenders Survey. Where is Bridgewater Bank now? Today Bridgewater Bank is a schedule one chartered bank, managing a portfolio of close to


$3.5 billion in residential mortgages, savings solutions and MasterCard products. Our main office is located in Calgary, Alberta and we now have more than 220 employees proudly serving more than 60,000 customers across Canada. We continue to remain focused on our mortgage business and have a strong team of business development managers situated across Canada supporting our brokers. This talented team is well versed in their assigned markets and committed to providing quick turnaround times, follow-up and effective communications to individual brokers and brokerage houses. We’ve also recently launched other new products from the Lending Solutions group to position us more competitively in the market. What’s next on the horizon? Today, after more than five years in operation, the bank has attracted a strong leadership team, thrived in an unstable economy, introduced new lending and deposit products, and – most recently – partnered with the Canadian Automobile Association (CAA) to launch the CAA MasterCard®. Now, as it looks forward to the next five years, the Bank continues to look for ways to enhance its services and product offerings to all of its stakeholders including brokers and brokerage houses. One of the most exciting developments for the broker network is the new online web portal helping to streamline reporting, paperwork and transactions. To ensure a smooth implementation, the site is being rolled out in stages and will be available to all brokers by the end of 2011.

Todd Poberznick

Happy 5tH CMp! thank you for serving the broker community so well.

Important milestones don’t just come along every day. Neither do great partnerships — like the ones CMP enjoys with brokers everywhere. As Bridgewater Bank also celebrates its fifth anniversary, we want to thank CMP and our brokers for contributing to our success. We couldn’t have done it without you. And, we look forward to many more years of continued growth together.



Personal. Efficient. Committed.

20 07 20

Canadian Mortgage Award Winners Mortgage Brokerage of the Year (Independent/Non Franchise): Mortgage Broker of the Year (National Network) : Laurie Furness Lifetime Achievement: Colin Dreyer

++ Axiom Mortgage Partners launches

+ First Credit Education Week held

+ Street Capital Financial launches

CMP Archives September 2007

Xceed feels the sub-prime pinch

Shortly after Coventree Inc. announced that due to “unfavourable conditions” in the market, the company would no longer be able to place new asset-backed commercial paper (ABCP) to fund the repayment of previously issued ABCP that were maturing, Xceed’s shares on the Toronto Stock Exchange began to plummet. By the end of the day, the share price had dropped 20.18%, closing at $4.51, and prompted Xceed to issue a statement. The statement highlighted that, while Coventree did serve as a securitization agent for the lender, it focuses on the company’s medium-term ABCP facility that holds approximately $1.3 billion of Xceed’s mortgages. The mortgages were sold to Coventree on a non-recourse


basis, and are being funded for an extended term of 364 days, the company said. Xceed’s mortgages are placed in diversified funding programs that are divided between short, medium and long-term financing options for its portfolio of mortgages. Short-term funding is provided by a warehouse facility arranged with Deutsche Bank AG that is priced based on Bankers’ Acceptance rates. The

medium-term funding is provided by the ABCP market and the longer-term funding is provided by the term market. Xceed’s portfolio that is funded by extended term ABCP is expected to have a negative impact on Xceed’s profitability and cash flows, the company said. But the company hopes the warehouse facility will adequately provide funding for new mortgage originations for several months. “In pursuing the continual enhancement and diversification of funding

sources, Xceed’s management has been negotiating with several Canadian and international banks over the course of the past few months,” said Ivan Wahl, chairman and CEO of Xceed. “This is management’s top priority. While there are no assurances that new facilities will be available during this time of market disruption, management expects to be successful in arranging additional funding for Xceed’s business.”

“ in pursuing the continual enhancement and diversification of funding sources, Xceed’s management had been negotiating with several Canadian and international banks. ”

IssuE 2.1

2007 Average Home Price:




Are youIENT RETENT feedin ION g the pip eline?

Emerg trend ing

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++ Canadian Tire rolls into market

+ GMAC purchases Resmor Trust

+ PMI Mortgage Insurance Company enters Canada PLUS: MARkE TINg


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CMP Archives April 2007

Canadians handle Mortgage their mortgages industry Although they may not want to, the majority of Canadians could tolerate an increase in interest rates by as much as one half point, a recent survey revealed. The Canadian Association of Accredited Mortgage Professionals (CAAMP) conducted a phone survey in February “ that showed 80% of Canadian homeowners Canada is economically strong could handle their and Canadians are financially mortgages even if there fit, and the mortgage market was a small hike in interest rates — leading reflects this. the association to believe ” the Canadian mortgage market is much more stable than its US counterpart. “Canada is economically strong and Canadians are financially fit, and the mortgage market reflects this,” said Jim Murphy, president and CEO of CAAMP. The survey also revealed that Canadians are, in general, conscious consumers when it comes to their mortgages. For instance, they’re aware of various alternative lending products that are available on the market — 51% said they knew of interest-only mortgages, longer amortization periods and no down payment mortgages. Thirty-six percent responded positively to the alternative products, while 27% were negative and 31% reported a neutral view. Seventy-three percent of respondents preferred fixed term mortgages — compared to 67% a year ago. Variable rate mortgages make up 21% of the total mortgage market while combination mortgages make up only 6% — down from 11% last year.

experiences record growth

Filogix’s latest Canadian Mortgage Broker Market Report revealed that the Canadian mortgage industry has experienced tremendous growth for the second year in a row. In 2006, the industry grew by 16.7%. Non-conforming/sub-prime lenders had the highest growth on a year-over-year/ year-to-date basis at 30.37%. Mortgage banks and credit unions also experienced strong year-over-year growth at 28.64% and 12.58% respectively. The month of December – which is typically a slow month for the mortgage industry – experienced a 26.67% year-overyear growth in volumes over November 2005.  


2008 ++ HSBC sells Invis to brokers and senior management

Canadian Mortgage Award Winners Mortgage Brokerage of the Year (National Network): Verico Mortgage Brokerage of the Year (Independent/Non Franchise): Mortgage Broker of the Year (National Network): Greg Williamson

+ Interbay Funding leaves Canada

CMP Archives November 2008

Invis acquires MI Two of Canada’s strongest mortgage brokerages joined forces to become the country’s largest superbrokerage – representing in excess of 20% of the broker market – when Invis acquired Mortgage Intelligence in early October. The deal saw the companies leverage their combined strengths and volumes – yet continue to operate under their independent brands – while sharing efficiencies of scale ranging from marketing and back-end systems, to combined clout with lenders and suppliers. Best practices from both models will likely be adopted but, when it comes to company culture and brand, it is business as usual – running side by side as two separate competing entities much like Future Shop and Best Buy. “In these tougher times, we have to be economically viable, so if we can do something that’s not going to affect the broker negatively, but deliver faster, better service, that’s what we’ll do,”said Fiona Campbell, an executive vice president with Invis. With about 800 Invis brokers and 880 Mortgage Intelligence brokers – with combined funding volume of $15 million in 2007 – the company heads believe they will be a force to be reckoned with. And with Invis’ main broker concentration falling in the West and MI’s centred in the East, the two companies definitely look good on paper. It was no surprise to many in the industry that GMAC was looking to off load Mortgage Intelligence. What was surprising and seen as a bold move was that Invis jumped in and acquired Mortgage Intelligence in as little as 10 weeks. “We can empathize with the folks at MI not knowing what the leadership was going to look like and what was going to happen, and whether it would be another institution buying them because we had gone through all of that,” said Gord Dahlen, an executive vice president with Invis, in reference to Invis’ sale this past February that saw brokers and senior management purchase the brokerage from HSBC.

+ GE Money leaves Canada

$94 billion The year-over-year increase of Canada’s total outstanding residential mortgage debt

18% The decrease of Canadian home resales in March 2008

$19.7 billion The amount Canadian homeowners spent in 2007 on renovating their homes


8,035 The number of consumers that declared bankruptcy in April, up 19.3% from a month earlier and up 18.3% year-over-year

130% Canadians debt-to-income ratio in 2008, an increase of 8% from a year earlier.

79% Number of respondents that expect a decline in property values across Canada in 2009


2008 Average Home Price:


NO. 7

Guide to broker networks





rs ke ro












do you need another

++ CMHC no longer insures 40-year amortizations

+ PMI pulls out of Canada



CMP Archives April 2008




T #412 61516

Macquarie sets minds at ease

After announcing that it was cutting back its lending services in Australia and no longer generating new loans in the US in March, Macquarie Financial said its Canadian operations aren’t going anywhere – for a variety of reasons. “Canada is fundamentally different from other mortgage markets internationally, predominantly because of the effect of long-term funding plans,” said Grant MacKenzie, CEO of Macquarie Financial’s Canadian operations. MacKenzie was referring to the Canadian Mortgage Bond (CMB). The governmentbacked form of sovereign credit is well-traded in Canada, and provides longterm liquidity and funding for Canadian mortgage providers, MacKenzie said. This is different than in markets such as Australia and the United States. Like a lot of international securitization markets, Australia’s has run into some issues in the past few months, MacKenzie noted, and the company thought it was an appropriate time to pull out. “We felt it quite prudent, if you can’t securitize, to scale back our lending activities in the Australian market,” he said. “In the United States market, which is considerably different than both of the Canadian and Australian markets, we could generate the assets. We

CMP Top 50 Broker Larry Barkley

were just – like most other lenders – not in a position to be able to sell them.” MacKenzie went on to say that Macquarie is a company that focuses on securitizing and selling mortgages, as opposed to maintaining a balance sheet. “The balance sheet costs have gone up for everybody as well, so it’s become uneconomical to continue to carry them,” he said. While the company acknowledges it has scaled back in both Australia and the US, MacKenzie wanted to make it clear that both businesses are still servicing clients, and they’re providing other products, where appropriate. “We’re certainly not abandoning anybody. We’re not selling anything – we’re just maintaining status quo and providing good service to our customers,” he said.  



Home Trust Company

turned down? you have options P

urchasing a new home can be an overwhelming experience, but for the 20 percent of Canadians who don’t qualify for a mortgage from a traditional financial institution, it can be even more so. Being new to Canada, self-employed, having no credit history, or a bruised one are often reasons for being turned down for a mortgage from a traditional lender. But the solution can often be found through an alternative lender, and utilizing the help of an accredited mortgage broker will make it even easier. The process in applying for a mortgage is the same as if one were going through their bank, with the stipulation that a 20 percent down payment is required.

Home Trust is Your One Stop Mortgage Lender®

Home Trust Company is Canada’s leading alternative mortgage lender. We offer Canadians a wide range of financial product and service alternatives, including mortgages, deposits and Visa cards. We focus primarily on a unique segment of the Canadian marketplace: consumers who do not have traditional credit backgrounds and whose specific needs are not addressed by larger financial institutions. We cater to self-employed entrepreneurs, people with past credit issues, and borrowers with equity in their Recreating credit property who do not qualify due to lack of Using an alternative lender will not only get a provable income or little credit history. mortgage, but will also help repair or create a Home Trust is a federally regulated credit history that will make someone more trust company carrying on business across marketable, so they can be approved for a Canada. Originally incorporated in Ontario mortgage with a traditional bank. “The average in 1977 as Home Savings and Loan client will stay with us for about two years,” says Corporation, the Company was continued Pino Decina, senior vice president of mortgage under the Trust and Loan Companies Act lending at Home Trust, Canada’s largest (Canada) on March 9, 2000. We are a wholly owned subsidiary of Home Capital alternative lender. “The scenarios that prevented someone from being approved for a mortgage at a Group Inc., a publicly held company that traditional lender can be fixed within two years.” trades on the TSX under the symbol HCG. Home Trust is also a member of the A hidden option Canada Deposit Insurance Corporation, Because Home Trust and others like it aren’t set and the Visa Canada Association. With offices across the country from up on every street corner, people aren’t aware of Halifax to Vancouver, and our head office their options. One of the myths that some have of in downtown Toronto, we are able to offer alternative lenders is that they will have to pay thousands of Canadians the alternative more in fees and interest rates, but Decina says lending solutions they need. Whether it’s this isn’t the case. “If a five-year rate is offered to someone with an A credit rating at 3.99 percent, an helping you buy your first home, alternative lender would offer the same, but maybe consolidating higher-interest loans to save you money, or renovating your dream for a one or two year term,” he says. “And all they house, we’ve got the flexible, alternative need is two years to build up a good credit history, financial solutions to help you meet and then they can apply for mortgage at a your goals. traditional bank.”


Pino Decina

20 08 20

Canadian Mortgage Award Winners Mortgage Broker of the Year (Independent/Non Franchise): Dave McNabb Best Newcomer (Individual): Greg Martel Best Lender Underwriter: Anne Warner Best Lender BDM: John Simmons, Lifetime Achievement: Dave Nichol

++ No. 1 on Profit magazine’s Hot 50 List

RMAI Financial Group launches national broker network

Competition Panel results are in CMP Archives August 2008


The Competition Policy Review Panel – a government panel created to review competition in Canada – released its final report in June, offering numerous recommendations to various government bodies, including those responsible for regulating mortgage default insurance. The report was of particular interest to mortgage insurers PMI Canada and Genworth Financial Canada – two companies that submitted papers to the panel earlier this year, encouraging a review of competition in the mortgage insurance industry. In its submission, PMI Canada requested that the government review the state of   

competition in the mortgage default insurance industry, arguing that fair competition will ultimately benefit consumers. The company suggested reviewing the level of guarantee offered to

if government involvement was still required in the mortgage default insurance business. While the Competition Panel’s verdict was favourable to PMI and Genworth, it was hardly

responsibility is dispersed among a large number of people, with no truly identifiable leader, making federal-provincial overlap commonplace and a revamping of the system difficult. The Panel’s suggestion to select

mortgage insurance providers and either provide all insurers with the same level – 100% – or eliminate it all together. The company also wanted the government to examine creating a separate Crown Corporation for the mortgage insurance side of CMHC and evaluate

mortgage-industry specific. “In many of the submissions to the Panel and through our consultations, we heard that federal, provincial and municipal regulatory processes constrain Canadian competitiveness,” the report said. “An unintended consequence of regulation can be the anticompetitive effect of preventing the entry of new products into the Canadian market.” The report went on to say that there are more than 20,000 regulators in the federal government working in more than 20 different departments and agencies. Political

leaders to oversee regulatory reforms and make each federal regulatory department more transparent was good news for the mortgage default insurers – although PMI believes this is just the first step. “PMI Canada has advocated for a consistent and transparent system of regulatory review,” said Janet Martin, PMI Canada CEO. “We are encouraged by the Panel’s recommendations that a more broad system of regulatory reform be undertaken with the goal of maintaining and increasing competition within the marketplace.”

2009 + Scotia Mortgage Authority launches

Canadian Mortgage Award Winners Mortgage Brokerage of the Year (more than 25 employees): Dominion Lending Centres Mortgage Broker of the Year (more than 25 employees): Gary Meger Mortgage Broker of the Year (less than 25 employees): Lou Perotta

+ Otera Capital enters commercial lending market

+ HSBC closes its doors to brokers

Private mortgage insurers denied full guarantees by government The CMHC remains the country’s only mortgage insurer fully guaranteed by the federal government after private insurers’ attempts to increase their 90% guarantee failed to make the 2009 budget. “Lenders are under pressure to obtain the strongest possible assurances on their credit enhancement, and the 10% difference between the CMHC and Genworth Financial Canada has impacted lender decisionmaking,” said Peter Vukanovich, president of Genworth Financial Canada. “As a consequence, over time, both consumers and lenders will have less choice, fewer products and less price competition if this imbalance is not corrected.” Finance minister Jim Flaherty said the government will “move forward to make mortgage insurance more transparent, understandable and affordable” through greater disclosure to borrowers, but didn’t mention boosting private insurers’ guarantees to match the CMHC’s. CMP Top 50 Broker “We believe

CMP Archives February 2009

Peter Kinch

“ as a consequence over time, both consumers and lenders will have less choice, fewer products and less price competition if this imbalance is not corrected. ”

increased competition has greatly benefited the Canadian market and has resulted in a number of positive changes within the mortgage default market, including more affordable premiums and the elimination of almost all mortgage insurance application fees,” said Andy Charles, president and CEO of AIG United Guaranty Mortgage Insurance Company.

Vukanovich said a full guarantee by the government would not be akin to a private industry bailout because the probability of a default on Genworth’s behalf is remote, and the insurer also has approximately $4.5 billion in assets for potential future claims payment.

Brokers on Lenders Survey – Overall Ranking 1. First National Financial 2. Home Trust 3. Merix Financial 4. Bridgewater Bank 5. ING Direct  


The Mortgage Group With a network of over 700 Mortgage Professionals nationwide, TMG has assisted more than 250,000 Canadians find the mortgage to best suit their financial needs. TMG operates on the premise that a mortgage broker provides the best value for consumers and has the knowledge and expertise to assist anyone seeking mortgage financing advice. TMG's programs, systems training and technology are always tested against the principle: Does it support a broker in their business and does it support a customer? st TMG celebrates its 21 Anniversary in July and was named Broker Network of the Year in 2011. In its early years, the company operated as Kirk capital Corp. and opened its first franchise in British Columbia under London, Ontario-based “The Equity Centre,” led by industry pioneers Grant and Debbie Thomas. Four years later, CIBC purchased the master franchisor and changed the name to The Mortgage Centre. In 1997, Kirk Capital Corp. parted ways with that franchise network and changed its name to The Mortgage

For Debbie Thomas, Partner of TMG, education is the key to helping brokers and agents develop their business. “When we started, mortgage brokers had a bad rap and were considered as a last resort. I wanted to educate the public of the benefits of using a broker,” she said. Although the industry has made inroads into gaining market share, it's still not enough. “We just have to keep sending our message out to consumers and make sure our brokers are well-trained.” Debbie's goal is to instill confidence in consumers in the values of dealing with brokers. Today, TMG continues to develop unique training programs, customized payroll systems, and personalized marketing materials. One groundbreaking development is the delivery of broadcast training programs through its secure

Group, becoming an independent privately-owned mortgage

website. TMG has built its own broadcast studio and remodeled its

brokerage firm.

training facility with full HD, Green Screen, broadcasting

Named Broker Network of the Year in 2011, TMG celebrates its 21st Anniversary in July. “TMG is very family-oriented and we work quite well together as a team,” says Corrie Chenier, Manager of Operations, who has been with TMG for 11 years. “The culture here also promotes a high degree of professionalism and we do all we can to help our brokers succeed - from our marketing department to our regional managers – we are focused on their success.”

capabilities. Recently TMG celebrated a first in their broadcast training, which was well-received. The company offered a Webcast on Estate Planning to brokers but also gave their clients access. Aside from training programs, which also includes sessions with industry speakers, brokers have the option to produce personal videos to assist their own marketing. These videos can go on their websites or as part of their e-mail signature. TMG has also developed a communications management system that includes a media centre, collateral information control, automatic monthly newsletter distribution, contact management, and an automatic inbound inquiries capture and response system. An extensive library of marketing materials allows TMG brokers to customize flyers, brochures, advertisements and other forms of traditional collateral materials. “TMG The Mortgage Group Canada Inc. is a special company” states Mark Kerzner, President. “So much of our success is based on the relationships that we have developed over the years with our brokers, lenders and industry providers. We are continually looking to the future for ways of enhancing a broker's value with an end consumer. At TMG we are on the right path.”

Celebrating 21 Years of Teamwork National Mortgage Broker Network

For 21 years The Mortgage Group has built a reputation on expertise and integrity through leading-edge tools, innovative training and unparalleled support to our national team of Mortgage Professionals – over 700 strong. Together with our community of lenders and industry specialists, we've helped over a quarter million Canadians “think outside the branch” with our No Sweat approach to mortgage solutions. TM

Awarded the 2011 National Mortgage Broker Network of the Year, we take pride in what we do, where we work and who we work alongside.

20 09 20

Canadian Mortgage Award Winners Mortgage Brokerage of the Year (less than 25 employees): Best Newcomer (Individual): Nick L’Ecuyer Best Lender Underwriter: Barb Starr Best Lender BDM: Cynthia Kramer Lifetime Achievement: Garth Ellis

+ More Canadians refinancing mortgages due to low interest

CMP Archives April 2009

+ FSCO suspends 79 brokerages

Subprime investigative report

A senior mortgage industry player called a newspaper article on subprime mortgages in Canada a “witch hunt,” saying the report overstated the degree to which subprime lenders impacted rising home foreclosures.

“ I think the article was trying to be inflammatory in one way in that it was describing the scale of 85,000 subprime mortgages in Canada. ” “Everyone knows unemployment is up, everyone knows we’re in a recession, everyone knows that real estate has dropped - by definition you’re going to get higher defaults when any of those things happen,” said Ivan Wahl, president and CEO of Xceed Mortgage, a company mentioned in the recent Globe and Mail article on subprime mortgages, which followed up on a report published in December. In the more recent article, the newspaper covered what it dubbed a “burgeoning” subprime problem, stating that more than half the foreclosures in British Columbia and Alberta last year started with loans from subprime lenders. It also partially attributed the subprime trend to “aggressive” US mortgage lenders coming to Canada.


+ CHIP becomes chartered bank   

“My reaction is that [the story] was kind of a witch hunt and not very even-handed,” Wahl said. Nick Kyprianou of Home Trust, who was quoted in the article, called it “relatively fair”. “We looked at a lot of these books of [unregulated subprime] businesses to purchase and there was bad underwriting – it was far too aggressive,” he said, adding that he thinks there is a difference between mortgage arrears in Western provinces and the rest of Canada because the foreclosure process in Alberta and BC takes longer. Peter O’Neill, vice president and COO at Bridgewater Bank, said the article didn’t have an impact on him. “I think the article was trying to be inflammatory in one way in that it was describing the scale of 85,000 subprime mortgages in Canada,” he said, referring to a 2006 CIBC World Markets report quoted in the article. “When I look at the broad landscape, I know 85,000 sounds like a big number, but it’s not that big a number.”

95% Percentage of mortgage defaults that are from homeowners in the first five years of their mortgage

2009 Average Home Price:

$320,364 $320 ,364 ++ Canadian Tire rolls into market




MAY 201

0, 5.5

+ 2006 Seniors Money enters Canada + PMI Mortgage Insurance Company enters Canada Average Home Price:

best simply the

2006 Average Home Price:




The 20 10

Mortgag e Awar d Winn ers





T #412 61516

CMP Archives July 2009




Mortgage brokers gain ground with National Bank acquires first-timers: CMHC Canadian Tire’s CMP Archives November 2009

mortgage portfolio

Mortgage brokers’ share of the first-time homebuyers’ market has increased to 44 per cent, up from 35 per cent in 2007, according to CMHC’s 2009 Mortgage Consumer Survey. The survey – which polled 2,507 recent mortgage consumers – showed brokers tend to fare better among purchasers in the 25 to 34 age range (42 per cent share) and female purchasers (43 per cent share). More than half of the survey respondents said getting the best rate or deal were the most important factors driving their satisfaction when obtaining a mortgage, and consumers were equally satisfied whether they used a broker or went directly to a lender. Other findings from the survey saw that 86 per cent of recent purchasers believe their total housing costs and other monthly payments should not exceed 40 per cent of household income, a generally accepted approach, and 20 per cent reported making a lump sum payment to their mortgage. “Our results confirm what we have seen in previous surveys - when it comes to their mortgages, Canadians are informed and manage their debt prudently,” said Francois Blouin, CMHC’s director of insurance products and strategic direction, adding 90 per cent of respondents said they believe homeownership is a good long-term investment.

Canadian Tire is selling its mortgage portfolio worth approximately $167 million – to the National Bank of Canada and focusing on expanding other areas of its retail banking division. “National Bank of Canada is delighted to acquire such a high-quality portfolio of mortgage accounts,” said Réjean Lévesque, the company’s executive vice-president, personal and commercial banking in a statement. “This latest acquisition is a good example of our strategy to expand in select markets in Canada.” Canadian Tire said its mortgage portfolio will be sold at “essentially the book value,” adding it expects to take an estimated $6-million pre-tax charge in the fourth quarter for selling off the business. The sale is expected to close in the fourth quarter of 2009, with the transition of customer accounts to be completed by early 2010. The company’s retail banking business – which includes high-interest savings accounts, tax-free savings accounts, GICs and the Canadian Tire One-and-Only account – had more than $2.1 million in deposits at the end of the second quarter and says it will be expanding into credit card products and related services.  


2010 + AIG United Guaranty sold and becomes Canada Guaranty

Canadian Mortgage Award Winners National Broker Network of the Year: TMG The Mortgage Group Mortgage Brokerage of the Year (more than 25 employees): Verico, The Mortgage Professionals Mortgage Brokerage of the Year (less than 25 employees): True North Mortgage

+ Feds introduce mortgage rule changes

CMP Archives March 2010

Industry not surprised by Flaherty’s mortgage rule changes Federal Finance Minister Jim Flaherty announced three new rule changes connected to government-backed insured mortgages on Feb. 16, saying the government is “taking proactive, prudent and cautious steps” to prevent a housing bubble. The broadest change was the requirement that all borrowers be qualified at a five-year fixed-rate mortgage even if they choose a shorter-term, lower-interest product. The government also lowered the maximum amount Canadians can withdraw in refinancing their mortgages from 95 to 90 per cent, and introduced a minimum down payment of 20 per cent for government-backed mortgage insurance on non-owner occupied properties purchased “for speculation.” George Hugh, vice-president of lending sales at ING Direct, said the rule changes won’t be a big adjustment for ING because it already qualifies borrowers at three-year terms even if they’re taking out a mortgage with a shorter term. “I think it’s proactive behaviour - the changes will have more impact on some lenders compared to others, but I think overall they’re very good for the market,” said Hugh. Don Bayer, president of the Torontobased independent brokerage Monster Mortgage, said he expected the rule changes to be tougher, adding he would have liked to see a more across-the-board rate for mortgage qualifications. “Some banks have posted rates and some don’t, so what they should’ve done is put a prescribed rate out there so that the whole industry had to follow one rate - for example if the variable rate is two per cent they have to qualify borrowers at five per cent,” said Bayer, who also questioned the motive


behind banks requesting the rule changes. “What I find a little ironic is that it’s the banks that wanted the government to intervene, yet it’s the banks that control 90 per cent of the mortgage market - so is this being done to eliminate third parties from originating mortgages in Canada? I don’t know. The majority of the banks are our customers as well, so I don’t know why the banks are suddenly so concerned over this.” The rule changes are set to come into effect on April 19 and clarifications around the five-year qualification are expected to be revealed by the end of March.

2010 Average Home Price:

$339,046 $339 ,046





ER 201

+ Abode closes 2006 Average Home Price: 2006 Average Home Price:

0, 5.11

+ acquires Mortgage Architects









T #412 61516

Stoddart: Mortgage brokers need to improve customer security




CMP Archives July 2010 Several mortgage brokerages need to better secure their customers’ personal information from theft, Privacy Commissioner Jennifer Stoddart said in a report released at the beginning of June. Stoddart audited five brokerages in the Greater Toronto Area to see what privacy protection improvements had been made since incidents in 2008 left hundreds of their clients’ personal financial information vulnerable to theft. “The breaches prompted the brokerages to take some positive

steps to better protect personal information,” said Stoddart. “However, our audit found that those changes did not go far enough.” A lack of access security in a web-based system that allows agents to download the credit reports of hundreds, including people who have never applied for a mortgage, was one of the concerns cited.

“ I think it’s proactive behaviour - the changes will have more impact on some lenders compared to others, but I think overall they’re very good for the market. ”

Other problems included one brokerage storing private information in an unsecured parking garage, inadequate privacy training programs and one agent recycling the blank reverse side of used mortgage applications. Stoddart launched the investigation two years ago after the brokerages reported 14 suspicious breaches within a few months. “In each case, someone impersonating an experienced mortgage agent downloaded credit reports for people who hadn’t even applied for a mortgage,” she said. The brokerages, which were not named due to ongoing criminal investigations, have tightened hiring practices since the incidents.

CMP Top 50 Broker Calum Ross  



Homequity bank

brokers speak up for

reverse mortgages By Heidi Pascucci


oday, seniors are living longer, saving less, spending more and carrying more debt. Seniors are not slowing down, and their income needs are not decreasing after retirement. Since most senior homeowners do not want to move out of their home, unlocking their home equity may be an excellent solution. CHIP Home Income Plan (CHIP), the leading reverse mortgage solution in Canada, is provided by HomEquity Bank. CHIP is designed to help Canadian homeowners over the age of 55 unlock up to 50 per cent of their home equity and maintain their lifestyle throughout retirement. A panel of mortgage professionals share how CHIP enables them to target the senior market segment, and the key strategies that make them successful.

What value does CHIP hold for your clients?

Pierre Martel, President and CEO, Multi-Prêts Hypothèques (PM): It’s important for brokers to have many different tools in their toolbox to help the vast needs of their clientele. CHIP provides our brokers with an additional solution for senior clients that may not qualify for traditional lending products or do not want to sell their home. Robert McLister, Editor, Canadian Mortgage Trends (RM): For many seniors with budgetary and liquidity constraints, CHIP is often the only practical solution. The alternatives—including credit lines, selling, downsizing, finding a renter, asset liquidation, and loans from family or friends—are in many cases risky or unsuitable.

What are the future prospects for CHIP?

RM: CHIP will become even more relevant in time, thanks to a host of trends: a burgeoning seniors population, insufficient retirement planning, a potentially lower return on equities (which impacts retirement savings), higher healthcare costs, and longer life expectancy. PM: As baby boomers retire, they will seek a more active retirement than the generations before them. CHIP is becoming a more mainstream solution as they seek to maintain and enhance their lifestyle in their golden years.

Why do you promote CHIP?

Dave Stevens, Mortgage Agent, TMG The Mortgage Group (DS): CHIP has allowed me to find a niche in an industry where everyone’s product and message are the


same. Reverse mortgages not only create opportunities in a relatively untapped market, but also provide growth potential going forward as our population ages. In the future, I believe reverse mortgages will no longer be a niche solution, but rather a must-have on every brokers’ product shelf.

What value does CHIP provide to your clients?

PM: Because clients do not have to service the debt, CHIP is a very unique and affordable way of accessing funds in retirement. And, with relatively low interest rates, our clients can be confident that their home equity is secure.

What are seniors’ needs when they come to you?

DS: My clients have come to me with many different needs: income, helping kids with the down payment on a house, or just wanting some money to travel. Darlene Vilas, Mortgage Agent, Mortgage One Solutions Ltd. (DV): Seniors are generally looking for a way to free up funds. They may not specifically ask for a reverse mortgage. A reverse mortgage can be a great alternative to a line of credit that can sometimes put seniors in a risky situation with a variable rate, a loan that is call-able and the potential to max-out their LTV with compounding payments. CHIP is unique. It’s the only solution with no payments and the guarantee that clients will never owe more than their home is worth.

What characteristics do you look for in an ideal CHIP client?

Norman Lord, Owner, DLC – Ridgeway Group: CHIP is a viable option for people who have equity in their home and are at a stage in their life where they can not, or would rather not make monthly payments.

Describe your experience with your CHIP BDM and the referral process for a CHIP deal.

DS: My BDM and I have a really good understanding of each others’ processes, which helps make both our lives easier. Before sending in a referral I call and pre-qualify each client and prepare them for my BDM’s call. Once my client is in his hands he gives me regular updates and lets me know when the deal has closed. The process works; it allows me to focus on generating new business while my BDM handles the paperwork and closes the deal. NL: The referral process is smooth and simple. We e-mail or fax in the client’s information and our CHIP BDM takes it from there. Our BDM is local and makes a great effort to accommodate our clients. The process works very well. Plus, we receive a referral fee for each funding. For more information on CHIP Home Income Plan, visit

Think reverse mortgages are expensive? Think again! With the CHIP Home Income Plan provided by HomEquity Bank™, homeowners 60+ can access up to 40% of their home equity at a rate that’s comparable to other home equity lending products. Why not tap into the potential of the growing seniors market and recommend CHIP? You’ll receive a referral fee, and we’ll look after all the paperwork for you.

To find out more or to partner with CHIP, contact us:

Congratulations on your 5-year anniversary, CMP Magazine! We would like to take this opportunity to congratulate Canada’s leading independent magazine for mortgage brokers and professionals and say thanks for delivering outstanding service to the brokerage community.


CHIP Home Income Plan is provided by HomEquity Bank, a Schedule I Canadian Bank. HomEquity Bank is a wholly-owned subsidiary of HOMEQ Corporation, a TSX-listed company. TM Trademark of HomEquity Bank.

20 10 20

Canadian Mortgage Award Winners Mortgage Broker of the Year (more than 25 employees): Tom Lam Mortgage Broker of the Year (less than 25 employees): Diana Zitko Best Newcomer (Individual): Bev English Best Lender Underwriter: Chris Fontana Best Lender BDM: Nina Labate Lifetime Achievement: Gord Dahlen

+ BMO files mortgage fraud lawsuit in Alberta

+ Mortgage market surpasses $1 trillion

+ Wells Fargo closes Canadian outlets

Canadian mortgage broker industry strong for the future CMP Archives December 2010

Brokers on Lenders Survey– Overall Ranking 1. First National Financial 2. Merix Financial 3. MCAP 4. Scotia Mortgage Authority 5. Home Trust

The Canadian mortgage broker industry is poised to remain strong, according to a new report by Deloitte. The report entitled “Winning strategies in the brokered mortgage marketplace” found that mortgage brokers have evolved from “lenders of last resort” to a legitimate option, and is shaping a more positive mortgage landscape for Canadian homebuyers. “In the face of significant industry developments, such as the recent credit crisis, industry consolidation and price competition, many banks and non-bank lenders are starting to seriously evaluate the economics involved in pursuing the mortgage broker channel,” said Todd Roberts, consulting partner at the Corporate Strategy Practice. “As more of these lenders enter this business, Canadian mortgage consumers will ultimately benefit in the form of increased choice of products, value-added advice and more convenient services.” It is unlikely mortgage brokers will dominate market share as suggested five years ago, but the broker channel will continue to stabilize. In 2009, brokers represented 38 per cent of total origination transactions in 2009, up from 26 per cent in 2003, according to the Canada Mortgage and Housing Corporation’s 2009 Mortgage Consumer Survey. Also, mortgage agents sourced half of their 2009 volume from the three big national banks still actively participating in the broker channel. A few notable trends the Deloitte report predicted: • Mortgage brokers will evolve from “rate shoppers” to “advisers.” • Major banks will continue to compete against broker business.


• Superbroker networks will continue to consolidate. In 2005, almost 70 per cent of Canadian mortgage agents were employed by one of five broker houses. Since mid-tier networks have emerged, the figure tops out at 85 per cent. • Niche lenders with specialized product offering will emerge through the broker channel, increasing options for new immigrants, the self-employed and individuals with credit challenges.


Percentage of Canadians who think interest rates are going up in the next six months

Celebrating five years

Celebrating five years

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Congratulations to CMP for five years of outstanding publishing!

Š 2011 Genworth Financial, Inc.

CMP 6.6 - Special Edition  

The magazine for Canadian mortgage professionals