The mortgage summit Find out what you missed PROFILED CMA Lifetime Achievement recipient Ron Swift
June 2012 / issue 7.6 / $6.95
MARKETING Generate more leads for your Realtor
CIRCLE Find out who took home the hardware at the Canadian Mortgage Awards page 24
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3877337 Canada Inc. is a subsidiary of CIBC Mortgages Inc. and carries on business as HLC Home Loans Canada (“HLC”) except in Quebec, where it carries 3877337 Canada Inc.Hypothèques is a subsidiary of CIBC Mortgages Inc. and as carries on business as HLC Loans Canada (“HLC”) except Quebec,brokerage where it carries on business as HLC Logis Concept and is licensed a mortgage agency. HLC Home is licensed/registered in Ontario as a in mortgage under on business as HLC Hypothèques Concept andas is alicensed as broker, a mortgage agency. is licensed/registered in New Ontario as a mortgage brokerage Licence #10423, in British ColumbiaLogis and Nova Scotia mortgage in Alberta as aHLC mortgage brokerage and in Brunswick as a credit broker. under TM Licence #10423, British Columbia and Nova Scotia as a mortgage broker, in Alberta as a mortgage brokerage and in New Brunswick as a credit broker. HLC Design is in a trademark of CIBC. TM HLC Design is a trademark of CIBC.
contents / issue 7.6
NEWS & VIEWS 6| Round-up The latest market news from the world of property, economics and mortgages 14 | Product News A round-up of the latest industry product launches
FEATURES 42 | Reaching new heights The inaugural Mortgage Summit drew brokers and industry players from across the country to hear directly from their peers and gather information and connections to help them improve and grow their businesses MARKETING 48 | Realtor Marketing Secrets: The final step in a successful brokerRealtor partnership, Doren Aldana explains, is the use of effective marketing tools to help generate more buyer leads
16 | Viewpoint What MortgageBrokerNews.ca visitors are saying about whether itâ€™s better to be a mortgage specialist or a mortgage broker
18 | Analysis Canadians are putting the brakes on spending 20 | Big Story A compilation of the top quotes from our weekly multimedia broadcasts
Cover Story ÂŽ
22 | This Time Last Year Taking a new look at what made headlines this time last year
24 | 2012 CMAs The best and brightest in the mortgage industry from across the country assembled for the sixth annual Canadian Mortgage Awards to celebrate the accomplishments and successes of their peers
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contents / issue 7.6
profiles 54 | Broker For Canadian Mortgage Award Lifetime Achievement recipient Ron Swift, the advance in technology has been the biggest driver behind the growth of the broker channel during his more than 25 years in the industry 56 | Provider The move by B2B Trust to become Canada’s latest bank looks to strengthen its relationship with brokers
52 | Stats This month’s roundup looks at how national average home prices have changed since last year
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58 | Insight Mortgage Architects has made a bold move – offering brokers 100 per cent of their commissions and more choice about the way they run their business
56 columnS 62 | Guest Toronto broker Nawar Naji questions if the industry’s recent wholesale shift to the four-year term – a defense against the BMO offer – best served their clients
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As Canada’s longest established national broker network, The Mortgage Centre has earned the reputation of being a quality driven organization. We strive to consistently provide our independent mortgage professionals with a stable and reputable environment to grow their careers.
If you’re a driven, born salesperson looking to join an organization geared to helping you succeed, contact our local franchise office nearest you or:
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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.
contents / Editor’s letter
Mortgagepolooza It was a week of firsts. CMP hosted the first Mortgage Summit capped off by the sixth annual Canadian Mortgage Awards, with both events being held at The Carlu in downtown Toronto. The inaugural Mortgage Summit drew more than 500 brokers and industry players from across the country to hear directly from their peers and gather information and connections to help them improve and grow their businesses. Delegates attended 25-plus sessions over the two-day event, presented by Home Trust, focused on bringing brokers together to help each other, but also to map out solutions to some of the challenges facing their industry. The event also made waves outside of Toronto, as attendees sent out tweets about what was happening, with some brokers indicating their intentions to attend next year’s event, to be held again at The Carlu May 23-24, 2013. The best and brightest in the mortgage industry from across the country then assembled for the sixth annual Canadian Mortgage Awards to celebrate the accomplishments and successes of their peers Winners at the 2012 Canadian Mortgage Awards cut a wide swath across the industry, with B.C., Alberta and Saskatchewan mortgage professionals claiming the lion’s share of the 21 awards at the gala event sponsored by Home Trust and attended by more than 500 of the industry’s movers and shakers who were treated to a Roarin’ 20s themed evening that included flappers and live jazz music. Want to tell your clients you’re among Canada’s Top 75 mortgage brokers? Don’t miss out on your opportunity to be recognized as a top performer in your industry. CMP is now calling for submissions for the Top 75 brokers list for the 2011 financial year. Submissions close July 16 and you can enter online at www. mortgagebrokernews.ca. You can also find links in our daily e-newsletter. So, as always, I encourage you to contact us with any news related to the broker and mortgage industry or just to share your opinions on how we’re doing. It is exciting times for our industry and we look forward to helping you and your business navigate them.
COPY & FEATURES Editor John Tenpenny Associate Online Editor Vernon Clement Jones SUB-EDITOR Rachel Naud staff writer Caitlin Nobes contributors Doren Aldana Nawar Naji
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The moRTgage SummIT Find out what you missed pRoFILeD Cma LiFetime aChievement reCipient ron swiFt
June 2012 / issue 7.6 / $6.95
maRKeTINg Generate more Leads For your reaLtor
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4 | mortgagebrokernews.ca
Find out who took home the hardware at the Canadian Mortgage Awards page 24
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News / Round-UP non-banks
Radius Financial launches broker points program
The Radius Financial Points Program offers Radius Reward Points, which can be used to purchase merchandise and travel for brokers, their clients or referral sources and Radius Discount Points, which can be used by mortgage brokers to offer clients cash back and to buy-down interest rates. Both points programs are available to mortgage brokers across Canada who are registered with Radius as of May 1, 2012. “The Radius Financial Points Program gives brokers a competitive advantage in an everchanging marketplace,” said Suzanna Stefanec, VP of national sales & products for Radius Financial. “Our program gives brokers the ability to earn points and rewards or pass along valuable discounts, this is a true value-add.” According to Stefanec, brokers will have online access and be able to manage their point accounts 24/7. “A points program was the next step in providing valuable tools to our broker partners,” she said.
Sears Canada selects Mortgage Alliance
Sears Financial will begin to offer a complete portfolio of home financing products, including mortgages, home equity line of credits, debt consolidation and home renovation loans to its customers in Ontario and has selected Mortgage Alliance Canada as its new mortgage partner.
How are Canadians feeling about debt and retirement?
feel it’s important to be debt-free at retirement
are confident they’ll be debt-free before they retire
of two-adult households review their debt every month
report having less debt than they did 12 months ago
will keep working until they’re debt-free
expect to retire by age 65
Source: Manulife Bank of Canada
6 | mortgagebrokernews.ca
– increase in the new housing price index in March, up 2.6 per cent year-over-year
Source: Statistics Canada
Michael Beckette, Mortgage Alliance President and CEO, said that he was thrilled by the opportunity to work with Sears Financial and help the company build a successful real estate and mortgage services division. “Sears is an iconic Canadian brand and offering their customers a real estate and mortgage service division is a logical evolution for Sears Financial,” he said. “This is a triple win; for Sears, Mortgage Alliance and the
Canadian mortgage broker industry. Sears is one of the most trusted and respected brands in Canada and they chose Mortgage Alliance.” Sears Canada is also shedding light on why it went with MAC at a time when all networks are looking to establish partnerships that elevate their profile and help drive consumer awareness. “The review and competition process was effective in allowing us to determine that Mortgage Alliance would be the most suitable organization with which to build a relationship in the mortgage service arena,” said Vassil Chalashkanov, divisional vicepresident of retail banking & insurance for Sears Financial. “We believe they can bring invaluable insights and equity that will benefit Sears and, more importantly, our customers.”
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News / Round-UP
LUXURY HOMES STILL SELLING: REPORT While home sales and prices continue to moderate and even fall in some parts of the country, a new report finds that demand for high-end housing is ahead of last year’s pace. According to the Upper-End Report released by Re/Max, 81 per cent (13) of the 16 major Canadian centres examined posted an increase in homebuying activity in the first quarter of 2012,
with the vast majority reporting double-digit appreciation. Those centres seeing gains included Greater Montreal, Quebec City, Victoria, Edmonton, Calgary, Regina, Saskatoon, London-St. Thomas, KitchenerWaterloo, HamiltonBurlington, Greater Toronto, Ottawa, and Halifax-Dartmouth. “While the ranks of the rich expand in both population and wealth, their impact on the Canadian residential landscape is undeniable,” said Michael Polzler,
executive VP, Re/Max Ontario-Atlantic Canada. “Their confidence abounds from coast-to-coast, irrespective of price point.” The report also noted that although the top end of the market represents only a small proportion of overall residential sales, when measured in terms of dollar volume, luxury sales are a much larger part of the equation. As such, “the strong momentum out of the gate speaks to the overall confidence in real estate,” the report stated.
Upper-end residential sales (Jan. 1 – Mar. 31, 2012)
Market Price Point % change year-over- year Greater Vancouver $2 million -31% Calgary $1 million +8.5% Regina $500,000 +56% Greater Toronto $1.5 million +49% Greater Montreal $750,000 +32.5% Source: RE/MAX
8 | mortgagebrokernews.ca
$25k PENALTY FOR BROKER RAISES CONCERNS Regulators are sending a caution to brokers prepared to fudge the truth for clients, fining one errant professional more than $30,000 for a lapse jeopardizing lenders but also the industry’s reputation.
In a brief consent order issued in May, B.C.’s Financial Institutions Commission not only orders the broker to pay a $25,000 administrative penalty but some $10,000 to cover the cost of the regulator’s investigation. It also imposes a two-year suspension during which the mortgage professional is restricted from acting “as the designated individual of any mortgage brokerage in British Columbia.” The stiff penalty stems from the submission of several applications on behalf of a client. Those documents fail to disclose that the borrower was also seeking financing to purchase other properties and that he or she also owned other properties, “the existence of which (the broker) ought to have been aware of,” finds FICOM. “The broker also submitted mortgage applications to lenders indicating that the home(s) being financed would be owner-occupied when he ought to have known that they would not be,” continues the consent order. The case also identifies an inadvertent failure to notify a lender about a possible conflict of interest. The broker also waived both his right to a hearing as well as an appeal.
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News / Round-UP banks
Sale of homeQ approved
lenders dangle carrots in drive for efficiency Brokers are increasingly being judged by the efficiency of their work and not just the funded volume of their labour, with two channel players formally updating reward programs to better reflect that metric. With the introduction of a new broker bonus program, National Bank is betting rewards for broker efficiency will bolster both the client experience and broker satisfaction at the same time it slashes originations costs. Monoline Canadiana is making a similar wager in treading out an update to its own compensation plan. The
new-and-improved plan includes an instant reward option -- an upfront lump sum payment in addition to a bonus for meeting efficiency targets. “What efficiency does do is that it allows us to revise and create a compensation plan that rewards brokers at renewal,” said Philip Beer, VP of national sales for Canadiana. Also effective May 1 is the lender’s “Freshly Brewed Renewal” plan, which pays not just upfront, but also at renewal. National Bank used the start of the month as well to officially launch its efficiency bonus program. It pays out bonuses to brokers on a monthly basis. The program also continues use of the tiered system, specifically four levels
based on broker’s approval and approved fund ratios. It will see them earn anywhere from five to 20 basis points. While the top two levels will only be available to brokers who are members of the bank’s Red Carpet program, its new efficiency bonus program will be national, allowing brokers from all provinces to take advantage. In crafting the program, National said it started by creating a baseline for efficiency ratios based on broker scorecards. The efficiency ratios to be used will be based on a six-month rolling average whereby the last 90 days are discounted, meaning, for example, a May efficiency bonus will be based on ratios from September to February.
After some concern that a takeover of Canada’s leading provider of reverse mortgages might fall through, shareholders have given the $138 million deal their approval. HOMEQ Corporation announced that holders of HOMEQ common shares voted in favour of the arrangement under which Birch Hill Equity Partners will indirectly acquire all of the outstanding common shares of HOMEQ for cash at a price of $9.50 per common share. HOMEQ expects that the deal will be completed in the third quarter of 2012. “About 80 per cent of the votes cast were in favour of the transaction. Excluding votes cast by funds managed by Maxam Opportunities, which had opposed the transaction, the vote was 97 per cent in favour of the deal. construction
Bulding permits continue to rise March saw another big month in construction, according to Statistics Canada, as the value of building permits issued rose 4.7 per cent to $6.8 billion. That followed a jump of 7.6 per cent in February, which was revised up from the previously reported 7.5 per cent gain. However, residential building permits were down 1.3 per cent to $3.9 billion. That included a 1.7 per cent decline for single-family homes, and 0.7 per cent drop for multiple-housing structures. Non-residential permits were up 13.9 per cent to a value of $2.9 billion. That was driven by an 88.4 per cent surge in institutional permits, which was largely a result of intentions to build government and medical facilities in Ontario.
OverOver 600 Million 600 Million LentLent sincesince 19971997
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News / Round-UP non-banks
MONOLINES GAIN BROKER MARKET SHARE Monolines have taken back some of the business brokers were prepared to send to the banks, according to the latest quarterly report from D+H. While banks still claimed the single largest share of broker business in the first quarter, that 48.2 per cent cut represents an eight-percentagepoint slide from the year-ago period when they claimed 56.5 per cent of the consolidated volume. For monolines, the story is the reverse, with “mortgage banks” growing their market share to 36.4 per cent from the 26.7 per cent in Q1 2011. The quarter-over-quarter jump was also impressive, representing a gain of nearly four percentage points. Street Capital effectively doubled its percentage share of broker originations in the first quarter compared to a year earlier. In the process, it gained third spot by volume, just after Scotia and, another monoline, First National.
Canadians taking extra steps to tackle debt load
Lender Market Share
Top 5 1. Scotiabank 18.7% 2. First National 14.6% 3. Street Capital 8.1% 4. FirstLine Mortgages 7.8% 5. TD Bank 7.4%
12 | mortgagebrokernews.ca
55 – average age Canadians currently holding a mortgage believe they will be by the time their mortgage is paid off Source:
The majority of Canadians are in debt but nearly half of them are trying to pay off their dues ahead of schedule, according to a survey conducted for a major bank. The study, commissioned by CIBC, found that 72 per cent of respondents said they held some form of debt such as a mortgage, student loan or credit card. However, about 49 per cent of those responding to a phone survey conducted for CIBC said they’ve made an extra lump sum payment in the last year to try and bring down what they owed. Of those making extra payments, 62 per cent directed those funds to credit card balances, followed by 46 per cent for lines of credit and 22 per cent of respondents used that extra money to speed up the pace of mortgage repayment. “Debt management is top of mind for Canadians, and these poll results show that many Canadians are taking steps towards reducing their debt,” said Christina Kramer, CIBC executive vice-president of retail distribution. The bank said the results show that Canadians are focused on reducing their debts amid warnings about rising household debt. The Bank of Canada and some economists have warned that Canadians are piling on too much debt while interest rates are low, and some may no longer be able to afford their homes when interest rates rise.
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News / Product Round-UP
A bite-sized guide to the industry’s newest products as they come out of the box
Who: Invis-Mortgage Intelligence What: Partner Mortgage The facts: Partner Mortgage was developed exclusively for Invis-Mortgage Intelligence and with their involvement; it is not a white-label product. Partner Mortgage was designed to help brokers foster long-term relationships with their clients, with a commission at renewal, and no control issues over ownership of the client. Brokers can also assist clients with inquiries throughout the life of the mortgage. Highlights include: • Platinum rates from the first deal • Automatic commission at renewal • No retention team • Low overhead – great rates • Full featured - 20/20; ability for early payout; up to 30-year am • Full spectrum of credit approvals Partner Mortgage is only available at Invis-Mortgage Intelligence.
What they say: “Team RRP has found Partner Mortgage to be very helpful during recent price wars. Having competitive pricing, responsive underwriting and full pre-payment terms, we found ourselves able to compete and add value beyond pricing through this new partnership. Partner Mortgage lived up to its name, and continues to do so.” – Rob Regan-Pollock, broker, Vancouver, B.C . “We have had great success dealing with Partner Mortgage. They have helped us
14 | mortgagebrokernews.ca
compete in a tough spring market by holding onto the lowest five-year rate being offered in the industry, even with shrinking spreads. Our underwriter Martine is quick to respond to emails and we never wait longer than 24 hours for a commitment; underwriting has been very common sense with no unnecessary conditions.” – Steve Heimbecker, broker, Waterloo Ont.
Who: Optimum Mortgage What: HOMEWORKS HELOC The facts: The Homeworks HELOC is a prime product and is available through brokers who have joined the Optimum Broker Partner Program. Here’s a quick rundown of its features and qualification criteria: Low interest rates • Minimum Beacon Score: 650 • Application Types: Fully-qualifying owner occupied only (highrise condos are case-by-case) • Maximum LTV: 80% (65% for acreages) • Maximum HELOC Size: There is no set maximum for the HELOC or mortgage portions • Maximum Amortization: 25 years on the mortgage portion • Qualified Using: The five-year posted rate with a 25-year amortization
Payment Options: Set fixed payments, 3% of the balance monthly, or interest-only Prepayments: The HELOC portion is open. Mortgage portions allow optional 20% lump-sum prepayments and optional 20% payment increases each year. Convertibility: Yes. HELOC portions can be converted to a fixed- or variable-rate mortgage at any time at Optimum’s discounted broker rates. Lending Areas: Major urban areas within 50 km of 100,000+ populations in AB, BC, MB, ON and SK.
What they say: “The features were developed in close consultation with brokers. Our bread and butter is the BFS stated income borrower, but we’re getting into A-type mortgages to fill requests from our broker partners. We are not looking to change our focus from non-prime lending.” – Bernie Budney, Western Canada sales manager
LAUNCHING A NEW PRODUCT?
Want it to be considered for inclusion on this page, send the details to the editor: firstname.lastname@example.org
News / comment InternatIonaL
inspectors have found problems; appraisals showed a home was worth less than the bid; a buyer lost a job before the closing. U.S. housing market worse than thought More than two years after the recession The number of Americans who bought previously officially ended, many people can’t qualify for occupied homes rose in October. But the National loans or meet higher down payment Association of Realtors says it overstated more than requirements. Even those with excellent credit three million sales during and after the Great Recession, and stable jobs are holding off because they fear showing the housing market was weaker than Percentage of that home prices will keep falling. Sales are also previously thought. homeownership being hurt by a decline in first-time buyers, who The private trade group says sales rose four per costs, including are critical to reviving the housing market. cent in October to a seasonally adjusted annual rate of mortgage payments, Sales have fallen in four of the five years 4.42 million. That’s below the roughly six million homes utilities and property since the housing boom went bust in 2006. a year that economists say are consistent with a healthy taxes that take up a Decliningisn’t prices and record-low mortgage housing market. But it’s ahead of 2008’s revised sales, Mortgage specialist: Grass greener on rates typical household’s haven’t been enough to boost sales. now considered the worst in 13 years. broker side monthly pre-tax At the same time, home construction has The trade group revised its sales from 2007 to 2010 income in Vancouver begun a gradual comeback and should add down 14 per cent, from more than 20.6 million to One nearly of Ontario’sand leading mortgage specialists is setting the record straight forto the Toronto, economy’s growth in 2011 forprovides the first year since 17.7 million. Among the reasons for the lower figures, brokers, laying out his argument for why the bank increasingly the best of respectively (RBC the Great Recession began in 2007. Last month, the Realtors group says: changes in the way the Census both worlds for aggressive entrepreneurs looking to maximize their funded volume. Economics Housing builders broke ground on an annual rate of Bureau collects data, population shifts and some sales Trends and “I have no desire to become a mortgage broker, inthe fact, I routinely have brokers 685,000 homes, government said recently. being counted twice. Affordability Report) phoning me to ask if they can become a member of my team,” said the mortgage That was a 9.3 per cent jump from October and The Realtors consulted with government and specialist, based in southwestern Ontario and apace top performer with one of the the fastest since April 2010. private housing experts, including the Federal Reserve, Most economists say homeon prices will keep the Department of Housing and Urban Development, biggest of the Big Five. He spoke with MortgageBrokerNews.ca condition of falling, by at least five per cent, through 2012. the Mortgage Bankers Association, the National anonymity. Manymillion-plus forecasts don’t foresee rebound in prices Association of Home Builders, mortgage giants Fannie “I brought in a funded volume of $100 last year,”a he said. “The until at least 2013. Mae and Freddie Mac and CoreLogic, a California-based bank’s brand has helped me do that, but the bank is also encouraging self-branding The high rate of foreclosures has made data firm that first raised doubts about the annual for mortgage specialists and greater independence, so I’mthan really resold homes cheaper newworking ones. Thefor myself, numbers earlier this year. but getting leads from the branch network as well.” median price of a new home is roughly 30 per CoreLogic has estimated that the Realtors group The analysis may surprise some mortgage brokers critical the been bankoccupied specialist cent above the price of oneof that’s overstated sales in 2010 by at least 15 per cent. before – twice thehigh normal markup. Investors are The changing numbers could affect how economists model as stifling entrepreneurship. They charge that performers eventually view the trade group’s data. It could also affect companies migrate over to the broker channel. taking advantage of the discounts. The but housing market struggling even has is that use the figures for hiring and expansion plans. “I could definitely have become a broker, I think theisbrand the bank as the broader economy has improved in Sales are measured when buyers close on homes. tremendously powerful in getting deals, and there are no branch specialists that I’m recent months. But many deals are collapsing before that point. competing against,” he said. “Also, I get benefits and agrew pension being a bank The economy at an by annual pace of two One-third of Realtors said they had at least one contract employee, along with rewards for being a high performer. I wouldn’t if I were a per cent in the July-September quarter. Many scuttled in October, up from 18 per cent in September. broker.” economists expect slightly better growth in the Contracts are being cancelled for several reasons: October-December quarter. Banks have declined mortgage applications; home A slowing market and the challenges CMP of chasing leads will undoubtedly send a
Each issue we select a story from MortgageBrokerNews.ca that has got the industry talking and publish the best responses. This month mortgage specialist or mortgage broker?
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28 mortgagebrokernews.ca 16 | mortgagebrokernews.ca
News News / comment aPPoIntments growing number of former mortgage specialists back to the banks and out of the broker industry, brokers told MortgageBrokerNews.ca back in February. “I have no problem with former specialists moving into the broker channel – I made the move myself three-and-a-half years ago after 13 years with CIBC,” said Jeff Trounsell, a sub-broker with Centum Pacific Mortgages in Vancouver. “But I would say that of those entering the market now as many as 50 per cent of them will have gone back to the banks or moved onto something else appointments within a year. That’s different from the 60 per cent of my former colleagues at the banks who’ve come over to the broker channel in the last three years and are still at it.”
Mortgage Intelligence announced that Steve Heimbecker, Marg Green, AB Broker Donna Ramsay and Concierge Where’s the argument? Sounds pretty weak to me. I have no value Mortgage Group are joining proposition, so I need to hide behind the brand. Instead of providing the company. options to my client, I’ll keep them ignorant play off their weakness. Green inand Mississauga, Ramsay in But at the end of the day I have aOrangeville pension, soand working for 30 cents on the Heimbecker in Waterloo, are equal owners dollar is worth it to me. Give me a break! Don’t get me wrong,ineach to their Concierge Mortgage Group. own! If the bank model works for you, great, but it’s not for everyone. Concierge is a new boutique brokerage firm that will focus on Kevin St. Amand elite and experienced brokers, I was a specialist for five years prior to becoming a mortgage agent, I offering exceptional needs-based learned more in three years working for a service. brokerage than customer The goalI ever is fordid working for a Big Five lender. Their model wants to keep their specialists Concierge Mortgage Group to have Ontario. in the dark so that they can onlyoffices preachthroughout one product, how does that help Concierge operate as a a client receive the best deal/service they are will entitled to. Poor network partner with Mortgage misguided soul, he doesn’t know how much commission he is missing out Intelligence, developing its own on and dis-service he is doing for his clients! He is not an independent or brand while taking advantage of working for himself, he is an employee of a (one) bank! Mortgage Intelligence’s key resources like compliance, payroll, Broker exclusive mortgage products, I’m a broker but why trash banksand or marketing. vice versa. We each have a role to “Mortgage Intelligence play in the market. What I laugh about is brokers saying howoffers much I can us competitive compensation make if I was doing $100 million volume. There are other things besides and the support that Concierge your commission income. But if money is all you care about...then I find it needs to be successful,” hard you care about the client just as much. said Heimbecker.
• 100% finder fees & 100% volume bonus paid to you • Virtual office on RmaNet.ca • Centralized Placement Unit gives you access to status & lenders • Dividend-paying share ownership in Real Mortgage Associates Inc. • Annuity paying share ownership in RMA Properties Ltd Own shares in RMA that pay annual dividends and own shares in a commercial real estate portfolio with a target value of $10 million.
The Mortgage Groupbut is moving I get that it is popular to attack TMG the mortgage specialists let’s face three of its regional leaders the facts people: RBC is the No. 1 mortgage sales organization inup this corporate ladder, billing the move as ago country. Period. End of story. They have been since I started 17 years in keeping with its philosophy of and they continue to be No. 1. Their retention of their own book is promoting from within. Effective superb. I don’t want to be a road rep either, I would not survive the first Jan.1, 2012, Bud Jorgenson five minutes of the job interview,assumed but givethe credit whereofcredit is the due. The position VP for consumer must like some mortgage specialists because combined Prairie Region; Gord Appel, VP, they and Gerald Krahn, produce more business than weAlberta brokersRegion; do. Ontario Region. “These three have already made positive changes in their respective regions,” said Mark Kerzner, president of TMG. “Their dedication to TMG agents and Top: Steve Heimbecker brokers is very important Visit mortgagebrokernews.ca to comment for the Middle: Marg Green company’s long-termheadlines success. They in on this making Middle:and Donnaother Ramsay stories Middle: Gord Appel are a great asset to the TMG the industry Bottom: Gerald Krahn family.” CMP
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News / analysis
retr Canadians are putting the brakes on spending with a new report indicating consumer credit is growing at its slowest pace since the early 1990s
Mortgage Arrears By province 0.85 0.80 0.75 0.70
As a % of total portfolio
0.65 0.60 0.55 0.50 0.45 0.40 0.35 0.30 0.25
B M an C /S as k Al ta
Source: CIBC World Markets
18 | mortgagebrokernews.ca
A report on household credit notes that on a year-over-year basis, total household credit (consumer credit plus mortgage outstanding) is now rising by just over five per cent — the slowest pace since 2002. The key is the rapid softening in the pace of consumer credit, according to CIBC World Markets. As of March 2012, overall consumer credit outstanding rose by only 2.3 per cent on a year-over-year basis — the slowest pace since the early 1990s. On a rolling month-over-month basis, consumer credit is now rising by only 0.1 per cent — the slowest pace since 1993. In addition to the slowing growth of consumer debt, the mortgage market is also starting to show some early signs of moderating activity. As of March 2012, mortgage outstanding rose by 6.3 per cent on a year-over-year basis — a rate that is well below the 7.3 per cent average rate of growth seen in the past two years and well below the pace seen during most of the decade. The softening trend is much more evident in a rolling month-over-month growth rate, which at 0.5 per cent is the
slowest since late 2001. The recent modest softening in mortgage activity is coinciding with a reduction in the mortgage arrears rate, which as of January 2012, stood at under 0.4 per cent after reaching close to 0.5 per cent during the recession. This rate is still double that seen before the recession but is significantly below rates seen in previous recessions. The arrears rate in Alberta is by far the highest in the nation. This reflects the fact that, on average, homeowners in Alberta are younger and less established. As well, the pre-recession period in Alberta had seen activity surging rapidly — leading to a higher percentage of consumers overextending themselves. Interest payments on debt accounted for 7.3 per cent of disposable income in the fourth quarter of 2011, roughly the same ratio seen in the previous two quarters. This relative stability, however, masks two diverging trends; interest payments on mortgage debt is falling, whereas interest payments on consumer credit is rising. Mortgage interest payments as a share of disposable income are at the lowest point since late-2004.
News / Appointments
The latest industry appointments and moves from across the country Bob Ord returns to Invis-MI Invis-Mortgage Intelligence announced that industry veteran Bob Ord has been appointed CEO for the company. “Bob Ord was a founder of Mortgage Intelligence; he is also an exceptional leader, and is arguably one of the most influential business builders in the industry,” said Cameron Strong, Bob Ord CFO and Chairman of the Board. “Bob is visionary and has helped shape the mortgage brokerage industry here in Canada.” “I’m looking forward to streamlining the company and focusing on our unique selling propositions,” said Ord. “We believe that our innovative mortgage products will give our brokers the best lending toolbox in Canada. We Pela Nickoletopoulos remain deeply committed to supporting our key lender partners; we will continuously pursue excellent options and the best range of choice.” Mortgage Intelligence also announced that veteran broker Pela Nickoletopoulos and Barb Morgan have joined the company. Nickoletopoulos is based in Laval, Que. while Morgan has joined as Regional Manager, Central and Northern GTA. Nickoletopoulos’s has 20 years of mortgage Barb Morgan experience working initially with a major Canadian bank and the last eight years as an independent mortgage broker. She will be joined by Diane Garneau. “Diane and I are so focused on our clients and building our businesses that we want our brokerage company to stay on top of all marketplace changes and to strategize for the future. We don’t have time for that,” said Nickoletopoulos. Morgan brings over 35 years of financial services experience. Most recently she helped launch a boutique brokerage in Southern Ontario, a Network Partner of Mortgage Intelligence, and previously worked in regional sales for a national monoline lender. “Invis-Mortgage Intelligence has many unique offerings and strong momentum. The industry is changing and we’re poised to take advantage. I look forward to working with my brokers and helping the company implement their bold vision for the future,” said Morgan.
the latest mortgage news and talk?
MortgageBrokerNews.ca Reader Poll Should mortgage payment history be included on credit reports that brokers receive? Yes 80% No 20%
News analysis / MULTIMEDIA
MortgageBrokerNews investigates the burning issues affecting the mortgage industry. Here are the biggest stories highlighted by our weekly newscasts – and uncensored feedback from brokers the topic
Fixed-rate mortgage shift Catherine Evel: “I am absolutely seeing more and more clients choosing the fixed-rate strategy, whether it’s a three-year, a five-year or even a 10-year term, the fixed-rate term is definitely what is being chosen these days. Right now rates are at an all-time low and historically the five-year discounted has been at about five per cent over the years, so choosing a fixed-rate mortgage at these low low rates is an excellent way to go.”
Julia Parkin: “I’m seeing most clients go with fixed-rate mortgages and the longer-term fixedrate mortgages, between 20 | mortgagebrokernews.ca
seven- and 10-year terms. And I think it’s great because people who are businessfor-self or have fluctuating income want to know what their payments are going to be in the future. So, what we do is place them in 10-year term rate mortgages and then increase their payments with inflation so that they are right in line with where rates are today and where they will be in a few years.”
OSFI guidelines Ron Swift: “I think the OSFI B-20 guidelines are overkill for the Canadian marketplace. I like to base my views on numbers, not on government sentiment around debt levels and a possible housing bubble. Let’s look at the numbers. And the numbers suggest that Canadian lenders are prudent today. I think some of
the pieces of the proposed legislation are not necessary here in Canada. An example of that would be renewals. The suggestion is that we would have to re-qualify consumers at renewal. Think about that. Someone qualifies upfront, they make their payments for five years without missing a beat and then we have to re-qualify them and potentially they might not meet the new standards, then what do we do? Say to them, ‘Sorry, you no longer qualify to have a mortgage, get out.’ If we’re really trying to manage the real estate market, implementing overreaching policies will not give us a soft landing, but potentially a hard landing.”
From the forum
I applaud that OSFI is taking proactive approach to HELOCs as this is revolving credit. HELOCs secured or unsecured are indeed the culprit of our high debt issues.
News analysis / MULTIMEDIA
For maintaining your existing clients, you should use a mix of emails, direct mail and phone calls as well as supplementing that with other things to personalize your marketing
Look no further than your free daily online news source for mortgage professionals
Visit Daily To Get The Inside Scoop
Marketing for brokers Ingrid Menninga: “Some of the most important things for a broker to keep in mind is No. 1, who their target market is. So which type of client they want to appeal to, they’re highly profitable clients who are the best match for them. And the really important thing in understanding that is No. 1, you can build a highly profitable business that way and No. 2, you know exactly what to do to make them happy and exceed service level expectations and your marketing questions that you would have become really clear because you know exactly what to do to appeal to them. Brokers need to figure out the magic marketing mix for their clients. For maintaining your existing clients, and we know from the Maritz report that people like to hear from you, you should use a mix of emails, direct mail and phone calls as well as supplementing that with other things to personalize your marketing. Then you need to figure out what you can do to attract new clients, keeping mind your target market, because you really want to attract those people that are highly profitable clients. Then track the return on your investment for those marketing tactics you use so you get a positive return on your investment for your marketing time.”
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News / this time last year
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Brokers biking across country in fight against cancer Brokers going for broke on the back of bikes. It’s a tongue-twister, but precisely what Mortgage Alliance President and CEO Michael Beckette, a team of industry professionals and more than 150 bikers from across the country will do in July in an effort to fight a disease set to claim 5,100 Canadian lives this year. “The 2011 MAC Rally of Hope is great fun for us and will depart from Vancouver, B.C., and make its way across Canada and arrive in St. John’s, Nfld. On Friday, July 29,” Beckette told CMP, as he readied for the 7,500 km trek, crossing six time zones and hundreds of communities. “It’s not a leisurely ride – it’s quite gruelling” Louie Bettio, brand champion for Mortgage Alliance, told CMP. “But, no matter how tired you get, you’ll pull in somewhere and meet a cancer survivor and be inspired all over again. Their stories fuel your heart as much as gas fuels our bikes. “We are connected in this country not just by a flag, but unfortunately, we are also all connected by cancer,” said Bettio, now cancer-free. “It’s why the MAC Rally of Hope connects with people all across our country.”
22 | mortgagebrokernews.ca
Last year ONE YEAR LATER Mortgage Alliance met and surpassed its $100,000 goal, and its setting even higher goals for the year to come. The MAC Rally of Hope saw more than $110,000 donated to the Canadian Breast Cancer Foundation, earning them an award from the organization as one of the top community fundraisers. For 2012 they’re looking to almost double that amount, across a range of events. “It’s a nice chunk of change. I think you always want to surpass last year’s results,” says Louie Bettio, national marketing director for Mortgage Alliance. “As [CEO] Michael Beckette says, we’re not the surgeons, we can’t operate on people, we can’t administer chemotherapy, what we can do is raise awareness and funds to make a difference.” Bettio couldn’t ride himself last year because he was himself recovering from cancer, but he’s looking forward to taking part this year, despite describing the ride as “gruelling.” “This isn’t a leisurely road trip, but what I realized was that across the country we’re linked by this disease. Everywhere we stop we hear people’s stories, and they’re a lot more positive than you expect.” The cause has taken off with their network as well, with many people holding events within their communities – including a “shredding party” held last year to help people get rid of sensitive documents while supporting breast cancer research. As well as the 7,500 km trip from Port Moody, B.C., to St John’s, Nfld. in July, the company already has 75 walkers signed up
for the Weekend to End Women’s Cancers. With each walker committed to raising $1,250, and those signed up for both days expected to make $2,000, that’s more than $90,000 committed to their final target. As long as the Rally of Hope makes the same, or more, than last year, Mortgage Alliance will easily pass its goal. Bettio hopes the company’s example inspires other corporations to get involved in causes beyond just writing cheques. “I think corporations sometimes feel obligated to do something from a charitable point of view, and whenever you feel obligated to do something it’s not the same,” he says. “If you’re passionate about what your vocation is, that comes out in what you do from nine to five, if you’re fuelled by the same genuine motivation to help others, you’re going to succeed.” - Caitlin Nobes
What I realized was that across the country we’re linked by this disease. Everywhere we stop we hear people’s stories, and they’re a lot more positive than you expect
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The best and brightest in the mortgage industry from across the country assembled for the sixth annual Canadian Mortgage Awards to celebrate the accomplishments and successes of their peers
COVER / 2012 Canadian Mortgage Awards
esterners challenged Ontario dominance at the 2012 Canadian Mortgage Awards, the industry celebrating that excellence in Roarin’ 20s style at Toronto’s historic Carlu. Winners at the 2012 Canadian Mortgage Awards cut a wide swath across the industry, with B.C., Alberta and Saskatchewan mortgage professionals claiming the lion’s share of the 21 awards at the gala event sponsored by Home Trust Company and attended by more than 500 of the industry’s mover and shakers. “While the night of awards focused on acknowledging excellence, it also served to provide a pat on the back to the industry as a whole,” said KMI Publishing and Events President Tim Duce. “This is our sixth annual event, and it continues to attract the brokers, the lenders and the insurers that are driving this industry and setting the course for its growth.” Ron Swift, CEO of Pacific Mortgage Group, accepted the Lifetime Achievement award, pointing to the growth of the industry yet to come. “I got this award, but I’m hoping this doesn’t mean it’s over,” he said. “I’m as excited about the industry as I’ve ever been. I think that there are going to be lots of changes coming our way.” The Roarin’ 20s theme brought flappers and guests dressed in period costume to the opening cocktail reception sponsored by Radius Financial. One highlight of the evening was the videos of finalists from across the country who got into the 20s theme, eliciting plenty of cheers and laughs from the audience. After bringing down the house in 2010, Jessica Holmes, one of Canada’s top comedic talents, returned to host the 2012 Canadian Mortgage Awards, while Meet The Sugar Shakers, an all-girl 1920’s Charleston Flapper dance group mingled and performed throughout the evening. This year the CMAs presented two musical acts; smooth & sultry jazz duo, iSPY who played the Radius Financial cocktail party; and The Jade Monkeys, one of Toronto’s best classic rock, soul, and R&B bands, boasting a lineup of some of Toronto’s best studio musicians who helped guests dance the night away at the Merix Financial After Party. Home Trust President Martin Reid addressed the
crowd on the occasion of the company’s 25th anniversary. “Home Trust is proud to be this year’s presenting sponsor,” he said. “For those of you here tonight who have done business with Home Trust, I want to personally thank you for your business. And for those of you who have not, I would like to welcome you to the next 25 years with Home.” Duce was thrilled with the turnout as once again mortgage industry professionals help set an attendance record for the event. “I’m particularly pleased that the industry responded in such great numbers this year, as both the number of nominations and popular votes we received set all-time highs for the Canadian Mortgage Awards. “Congratulations to the winners and nominees and a big thank you to Home Trust and all the other sponsors for their support this year. I would also like to thank my team here at KMI for doing such a brilliant job.” On the following pages are all the winners, who are sure to continue to have a bright future in the mortgage industry in Canada. They were more than happy to tell us what they thought contributed to their big win of the night.
mortgagebrokernews.ca | 25
COVER / 2012 Canadian Mortgage Awards
The Search Engine People Award for Best Internet Presence David Ross and Robert McLister Canadian Mortgage Trends, Vancouver, B.C.
“I really hoped I would win, but you never know. It’s incredible affirmation of what we are doing. It’s a tremendous industry and there’s a lot of misinformation out there and we do our best to clear the air on those topics.”
The FNF Award for Best Branding Lori Smith, Gary Mauris and Reta Coburn Dominion Lending Centres, Vancouver, B.C.
“This is an important award for us because we put a lot of time and effort into our branding. I think it shows the credibility Don Cherry has with Canadians.”
The CHIP Home Income Plan Award for Employer of Choice Jeff Spencer and Kathy Gregory Paradigm Quest, Toronto, Ont.
“The Paradigm family is very close knit. It’s the commitment to performance. It’s all the individuals striving to do the best each and every day – there are over 200 of us working now and we have a tremendous amount of fun.”
26 | mortgagebrokernews.ca
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COVER / 2012 Canadian Mortgage Awards
The Genworth Financial Award for Best Newcomer (Individual) Debbie McPherson and Ron Lefebvre Ron Lefebvre, Invis-Mortgage Intelligence, Edmonton, Alta.
“What I’m doing right is looking after my clients and giving them the best possible service, honesty and integrity.”
The First Canadian Title Award for Best Newcomer, Mortgage Brokerage Firm Emine Ziya and Todd Fralic Quantus Mortgage Solutions, Calgary, Alta.
“We started Quantus Mortgage Solutions a couple years ago with a very specific vision of what we wanted the company to represent, what values we share, and the type of team we’d like to create. Because of the strong culture and team feeling we have, this win has created a great deal of excitement within the company as well as with all our industry partners.”
The Vanguard Law Group Award for Best Community Service Effort Sanjay Soni and Deb White Deb White, Dominion Lending Centres, White House Mortgages, Vernon, B.C.
“The community service fills my heart – the reward from the community is really enough for me, so this is amazing. The community was really there for me when my daughter needed help so I wanted to give back.” 28 | mortgagebrokernews.ca
CMHCâ€™s 2012 MORTGAGE CONSUMER SURVEY
Released annually for over 10 years, the Mortgage Consumer Survey is a reliable source of insight into consumer behaviours, attitudes and expectations when acquiring, renewing or refinancing a mortgage. CMHC provides you with support, expertise, and the tools you need to effectively meet the needs of an evolving industry, helping you focus your time on serving your clients and managing your business.
Visit cmhc.ca/2012survey today to get the details of the 2012 survey results.
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COVER / 2012 Canadian Mortgage Awards
The Vector Financial Services Ltd. Award for Best Commercial Mortgage Broker Mickey Baratz and Sandy Harrington Sandy Harrington, IC Funding, London, Ont.
“It’s nice to be nominated but it’s great to win. Work with the people that have got the education and the experience who can guide and teach you.”
The Invis-Mortgage Intelligence Award for Best Industry Service Provider Doren Aldana and Stan Falkowski Superstar Mortgage Broker/Power of Choice Coaching Inc., North Vancouver, B.C.
“What I’m doing right is looking after my clients and giving them the best possible service, honesty and integrity.”
The Merix Financial Award for Best Customer Service from an Individual Office Jill Paish and Diana Zitko Dominion Lending Centres West Coast Mortgages, Coquitlam, B.C.
“The No. 1 concern for me is customer service. As a customer I knew what I wanted to feel from other vendors, and that’s what I wanted to give my customers. This is such a validation of what I have done – I’ve worked so hard to build and maintain this – this award is the icing on the cake.” 32 | mortgagebrokernews.ca
COVER / 2012 Canadian Mortgage Awards LENDERS ON BROKERS
“ we strive to hire dedicated and service excellenceoriented senior underwriters that understand our broker partner’s business ” our value proposition for our broker partners which clearly states underwriting and business development service standards. In addition, we introduced Express 4.3 in January 2011, in partnership with D+H that enables brokers to have real time access to deal and condition statuses through Expert. Turnaround times Street understands that our broker partners have a client waiting for an approval and that we directly impact their ability to look professional to their clients. We strive to hire dedicated and service Categories (in order of 2011 2010 excellence-oriented senior importance) underwriters that understand our broker partner’s Turnaround times 3.96 3.56 Rob Leeming andwe’ve Michelle Wise business. We believe Michelle Wise,team Paradigm Quest, Toronto, Ont. built the right to provide Underwriter support 3.93 3.55 a fast and personalized underwriting experience for “It’s incredible to be acknowledged in your industry. I couldn’t Street havebroker asked partners. for a better honour.Overall You have to listen serviceto be willing 3.99 3.75
INGTechnology Direct Award The Strategic Information for Best Newcomer, Lender Underwriter
and understand the whole story because at the end of the day Interest rates it’sunderstand a customer we want to make it work for them.” We theand competitive pressures our broker partners are facing. We’ve strived to offer the best rates to our broker partners balancing that with service excellence. We believe that by offering brokers rate specials on terms that may be more suitable for a client’s needs that we enable broker partners to grow their business.
Kim Luxton, Director, ING DIRECT Broker Sales 2011 has turned out to be another dynamic year in the mortgage industry. Canadian
+0.40 +0.38 +0.24
Satisfaction with credit policy
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COVER / 2012 Canadian Mortgage Awards
The National Bank of Canada Award for Lifetime Achievement in the Mortgage Industry Sebastien Kuperhause and Ron Swift Ron Swift, Pacific Mortgage Group, Toronto, Ont.
“I never set out to win an award like this. It’s been a terrific ride and for me to be recognized for it is fantastic. I got the call to say I got this award and I’m hoping this doesn’t mean it’s over. I’m as excited about the industry as I’ve ever been. I think there are going to be lots of changes coming our way. I just love the challenge of trying to figure out how to shape it how to get advance of it and maybe there’s a way to make this industry that much better again.”
The MCAP Eclipse Award for Best Alternative Lending Mortgage Broker Fred Testa and Megan McDonald Fred Testa, Invis-Mortgage Intelligence, Toronto, Ont.
“It feels great to win. Over the last 38 years I’ve been in the industry I’ve won different awards, but this is extra special for me because it was from people in the industry, people that are your peers. I really feel overwhelmed by it.”
The Award for Best Advertising Gary Mauris Dominion Lending Centres, Vancouver, B.C.
“I love it – this is a great award for us because we’re all about branding and advertising and I think it shows. Branding is about recognition and awareness of our brand and colours and advertising is looking for responses from customers to seek out our services.”
34 | mortgagebrokernews.ca
2012 will be the best year of your career
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COVER / 2012 Canadian Mortgage Awards
The CMHC Award for Best Lender Underwriter Harold Cowling and Jason Galea Jason Galea, AGF, Toronto, Ont.
“I’m truly honoured to have won this award. It makes my working hard every day worth it. To become a good underwriter is not just about the deal. You have to connect on a personal level – it’s really a relationship industry.”
The Radius Financial Award for Best Newcomer, Lender BDM Cathy Godin, Home Trust Company, Calgary, Alta.
“I’m extremely honoured. I think you earn your value in this industry. It’s about the relationships you have, the product knowledge. I think that’s how it happens.
The Mortgage Centre Award for Best Lender BDM Boris Bozic (accepting on behalf of Rachelle) and Eddy Cocciollo Rachelle Gregory-Marshall, Merix Financial, Toronto, Ont.
“What a lovely surprise to win this award after already having one of the most rewarding weeks of my life as I had my son Owen on Monday! I couldn’t be successful without the amazing credit team I have behind me. Thanks to the originators I work with every day that make my job so enjoyable.” 36 | mortgagebrokernews.ca
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COVER / 2012 Canadian Mortgage Awards
The Syndicate Mortgages Award for Mortgage Broker of the Year (fewer than 25 employees) Karen Gibbard, VERICO Gibbard Hoffart Financial Group, North Vancouver, B.C.
“The people that are nominated are such big names – I had nothing ready because I thought someone else was going to get it. I work hard and don’t focus on the money. If you work hard, the money will come. The minute you start focusing on the money is when you will do the wrong thing.”
38 | mortgagebrokernews.ca
COVER / 2012 Canadian Mortgage Awards
The Bridgewater Bank Award for Mortgage Broker of the Year (25 employees or more) Collin Bruce, Dominion Lending Centres Mortgage Mentors, Edmonton, Alta.
“This is the biggest award that a mortgage broker could win and when I look at all the other nominees, I am very lucky. You treat people how you would want to be treated and the universe has a way of making sure everything works out for the best. I think that is why I won this award.”
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mortgagebrokernews.ca | 39
COVER / 2012 Canadian Mortgage Awards
The ING Direct Award for Mortgage Brokerage of the Year (fewer than 25 employees) Kim Luxton and Daryn Young Mortgage Intelligence TMF: The Mortgage Firm, Regina, Sask.
“[Winning this award] is one of the ways we can tell we’ve been able to get to the same stage as brokers out of larger centres. It’s a refreshing change. I think being in Regina you know just about everybody in Saskatchewan so we get a lot of referrals and a lot of people that know us. I think in the smaller centres you have that advantage of closeness in business.”
The Home Trust Award for Mortgage Brokerage of the Year (25 employees or more) Anthony Contento and Martin Reid Mortgage Architects Sherwood Mortgage Group, Toronto, Ont.
“I’m certainly proud of our accomplishment – we definitely weren’t expecting it. For us, honesty plays a big part. There’s a lot of trust required to be a good brokerage. We have a brokerage that’s a family brokerage, built up from friends. We have been together for 15 years and the trust built up within our family has allowed us to excel and become a great brokerage.”
The D + H Award for National Broker Network of the Year Chris Pornaras and Gary Mauris Dominion Lending Centres, Vancouver, B.C.
“This is a great night for Dominion Lending. Everyone works incredibly hard and we saw the prize for that. I’m incredibly proud of the industry because I’m seeing the industry finally catch up as well and start to do a better job communicating directly with their messaging to the consumers.” 40 | mortgagebrokernews.ca
su b Ju miss
ly ions 16, clo 20 sE 12
WanT To Tell your ClienTs you're aMong
CanaDa's top 75 mortgage brokers?
Submit & you may even find out what itâ€™S like to be no. 1! CMP magazine is now calling for submissions for the Top 75 brokers list for the 2011 financial year. Donâ€™t miss out on your opportunity to be recognized as a top performer in your industry.
EntEr onlinE at: www.mortgagEbrokErnEws.ca
Reaching new heights themortgagesummit.com
Feature / 2012 mortgage Summit
The inaugural Mortgage Summit drew brokers and industry players from across the country to hear directly from their peers and gather information and connections to help them improve and grow their businesses It’s a message that reverberated from one end of The Mortgage Summit to the other, with speaker after speaker calling on brokers to choose sides – are you focused on service or rates? “You can’t be a rates person and a service person,” Top 50 broker Calum Ross told delegates on the first day of the Toronto event at the downtown Carlu, drawing 500 brokers and industry players from across the country. “Doing both probably isn’t going to work.” The comments came during one of 25-plus sessions over the two-day event, presented by Home Trust and hosted by CMP, focused on bringing brokers together to help each other, but also to map out solutions to some of the challenges facing their industry. Brokers gathered information and made connections that will help them provide even better service to their customers and in turn, grow their business. “We’re proud to be the title sponsor of The Mortgage Summit,” said Tom Trenouth, assistant VP, Business Development, Home Trust. “Since we deal exclusively with brokers across Canada, this is a great venue for us to showcase our products and services and support the broker community in Canada.” Over the two days, brokers heard directly from top industry executives, such as Ron Swift of Pacific Mortgage Group, Michael Beckette from Mortgage Alliance Canada and Paul Therien from Centum
Tweeting @ The Mortgage Summit The Twittersphere was abuzz with thousands of Tweets being sent throughout The Mortgage Summit, with delegates extolling the benefits of attendance as well as letting those who were unable to attend know what they were missing.
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Feature / 2012 mortgage Summit Financial who appeared on the opening keynote panel to discuss such issues as impending OSFI guidelines and how the industry can better market itself to consumers. “This event is a huge opportunity for mortgage brokers, especially those who are starting out in the industry,” said Equitable Trust’s Harry Singh. “It gives them the opportunity to meet people and get a comprehensive view of what the industry is all about, learn about trends affecting brokers and it’s a tremendous educational opportunity for new as well as seasoned brokers.” Jacquie Carstensen, a broker with Mortgage Architects, commented on the advantage of having so many brokers and industry people in one place. “It’s a great event for keeping up with what’s going on in our workplace and environment and the lending world and the mortgage industry in particular. And of course seeing some old friends and getting to collaborate in one place, since we don’t often get to connect in person.” For Paul Grewal, president of Street Capital Financial, The Mortgage Summit was a win-win for brokers and lenders. “For brokers, the advantage of coming here is that you get to learn from other brokers. A lot of the panel sessions have been brokers assisting other brokers to become better at running their businesses and helping customers. For lenders, I think the value is that we’ve got a lot of brokers here, these are our customers and for
For brokers, the advantage of coming here is that you get to learn from other brokers. A lot of the panel sessions have been brokers assisting other brokers to become better at running their businesses and helping customers
May 23-24 – The Mortgage Summit 2013
Michael Mullis @MT_MikeMullis
Safe Money Mortgages @SafeMortgages
@pasain: Just heard someone say
People are defined in their moment
“this is the best panel I’ve heard in
of weakness not their moments
far too long” #CMPMortgageSummit
of strengths. - Calum Ross
Lisa Theriault @ottawamortgage
Great discussion about the viability of the
Just learned of another lender out there
that does 80% LTV on stated income
cost, relationships and compensation on
for self-employed clients! Good day at
44 | mortgagebrokernews.ca
Sometimes, the best Award looks like this
The review and competition process was effective in allowing us to determine that Mortgage Alliance would be the most suitable organization with which to build a relationship in the mortgage service arena. We believe they can bring invaluable insights and equity that will bene�it Sears and, more importantly, our customers.
Divisional Vice-President, Retail Banking & Insurance, Sears Financial
Raising the credibility of our industry
Feature / 2012 mortgage Summit
us it’s important to advise them of new products and services that we have.” Other sessions at The Mortgage Summit included discussions about brokers differentiating themselves on something more than rate, led by broker Peter Kinch, strategies for winning over consumers in the face of online competition, led by Robert McLister, a review of ongoing regulation issues, featuring CAAMP President Jim Murphy and the event’s final session which featured a spirited discussion of the relationship between brokers, underwriters and BDMs. More topics covered, such as collateral charges, stewardship of young agents and Internet sales kicked off active debate between panelists and delegates, but the challenge of fighting and winning the rate wars, said one broker “was always the elephant in the room.” A model almost entirely focused on rate and the buy-downs often used to win high volumes is a viable one, said Ross, and other brokers taking to two stages. But professionals centering their offerings on high-level service are less susceptible to the vagaries of today’s interest rates. “If all you have is the ability to get rates done,” said Ross, you’re no different from the other guy who can do the same.” stats
22, 50+ – number of sessions and speakers at the 2012 Mortgage Summit
This event is a huge opportunity for mortgage brokers, especially those who are starting out in the industry
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June 1 Karim Talib @KTALIB Had a great time on the panel discussing regulations at#CMPMortgageSummit Gord McCallum @gordmccallum “If you’re in an industry pay attention to your industry.” - Nick K. Changes coming Brokers! Heads up. #CMPmortgagesummit Nat Ng @FindMeAMortgage Exciting panel of underwriters & underwriting team of major lenders talking on credit decision #Cmpmortgagesummithttp://pic. twitter.com/66g3lklw
Wouldn’t Wouldn’t it be be nice? nice? PARTNER ZERO monthly MORTGAGE! marketing fees Wouldn’t it be nice to have a say in your own product; to always be paid at renewal; to not fight with a retention team for ownership of your client; to have platinum rates from your first deal; to have had an answer for 2.99? (Partner had the rate AND the frills!)
Wouldn’t it be nice to have Partner Mortgage?
Business / marketing
marketing secrets The final step in a successful broker-Realtor partnership, Doren Aldana explains, is the use of effective marketing tools to help generate more buyer leads
48 | mortgagebrokernews.ca
Business / Marketing
In last month’s article, I gave you a step-by-step game plan for taking Realtors who don’t know you from a hole in the wall, and turning them into highly committed, loyal, high-level referral partners. Once you have a new Realtor partner, your job isn’t done – it’s just begun. In fact, if you really want to maximize the amount of buyer leads you generate from each one of your Realtor partners, you’ll need a marketing system designed to generate more buyer leads for your Realtors. Why? Because each buyer lead you generate is also a new potential mortgage client for you. This is all about win-win marketing. With that in mind, here are the top seven most effective marketing tools for generating more buyer leads for your Realtors’ listings.
#2: Just Listed Cards
#1: Fusion Ads
A rider sign is a sign designed to piggyback or “ride” along with the Realtor’s normal For Sale Sign. It’s designed to give a call to action that generates leads. There are two different types of lead capture rider signs: Call Capture and Text Capture. Implicit in its name, the Call Capture version invites people to call a 24-hour hotline to receive “FREE Recorded Info & Price.” When someone calls, they can hear all the details in audio format. The Text Capture version, on the other hand, invites people to send a text using their cellphone to request this information. At the end of the day, they both accomplish the same thing – attracting leads. However, Text Capture
This involves placing a text capture ad in the local Real Estate Weekly newspaper. For best results, withhold the asking price and invite buyers to text the listing code in order to receive more information, including price and financing options, on their cellphone. Each time someone requests more info, you and your Realtor will be instantly notified via email. Then, as an added-value service, you can followup by phone on behalf of your Realtor to see if the buyers would like to view the property, get pre-approved or hire a buyer’s agent.
What better way to announce a new listing to the neighbourhood than to mail out a Just Listed Card to the entire postal code surrounding the new listing. The postcard should have an attentiongrabbing headline like, “Just Listed In Your Neighbourhood,” and should also highlight any unique financing options available, perhaps with a starburst that says, “95 per cent Financing Available!” Of course, it would also include typical features such as the property description, photos, logo, contact info, etc. However, where this card gets unique is in the withholding of the price and integrating text capture, as explained above.
#3: Lead Capture Rider Signs
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About the Author:
tends to be an easier sell with Realtors because it’s still considered relatively new and “cutting edge.”
#4: Open House Feedback Forms Believe it or not, a lot of Realtors don’t even use a guest registry at their open houses, let alone feedback forms. Implementing this powerful tool will allow you and your Realtors to collect valuable feedback about the property so you can see how buyers and their agents perceive it. Not only that, it can also help you identify and qualify hot mortgage prospects. Here are a few critical components to consider including in your feedback forms: a) Chance to win a prize. Let’s face it, most people are hesitant to give away their contact info unless there’s a sufficiently compelling reason to do so. That’s why I recommend offering a chance to win a prize. For example, you could place a headline at the top of the feedback form that says, “Thank you for coming to our Open House. Please give us your FEEDBACK and ENTER to WIN a $100 Home Depot Gift Certificate!” b) Feedback. Get the prospect to rate various aspects of the property, including its overall condition, landscaping, neighbourhood, price, etc.
Doren Aldana is considered by many to be Canada’s leading Mortgage Marketing Coach. Since 2005, he has been dedicated to helping mortgage professionals attract more clients with less effort, regardless of market conditions. For a free online workshop on “How to Turn Your Realtors’ Listings into a Flood of Red-Hot Mortgage Leads,” visit: www.UltimateRealtorMarketingSystem.com.
You can also ask what the prospect liked most and what they liked least. This critical feedback will help your Realtor make quick adjustments to help sell the property faster at top dollar. c) Qualifying questions. At the end of the feedback form, be sure to include the following qualifying questions: 1) Do you have a buyer’s agent to help you find your dream home? 2) Are you pre-approved for a mortgage yet? These questions will flag hot prospects for you and your Realtor.
#5: Email Marketing I’m on several Realtors’ email lists and it’s amazing how few of them notify me via email when they get a new listing. In fact, now that I think of it, I can’t even recall one time when I’ve received a “Just Listed” email notification. Not even once. That means there is a lot of untapped opportunity here. All the Realtor has to do is blast out an email to their database announcing the new listing with a link to their website for people to get more information. This ain’t rocket science.
#6: Facebook Marketing Once the email has been sent out, the Realtor can simply cut and paste the exact same message as a
Doren Aldana CMA Winner for Best Service Provider
50 | mortgagebrokernews.ca
Business / Marketing Industry Your trusted news source
status update on their personal profile and/or fan page in Facebook. This allows the Realtor’s friends and fans to receive the announcement in their newsfeed. If the Realtor is smart, they’ll ask the have expanded unsecured lending reader to “Share”their the announcement withproducts. their What ournetwork, government fails to realize that Facebook which increases theischances unsecured lending has a larger impact on cash that the announcement will go viral. And here’s the flow than mortgage lending. Particularly when best part: like email, it won’t cost youproven or the Realtor home ownership has already been to be amore singleaffordable penny to do this. than renting in most areas (Vancouver is currently a rare exception). What theyFacebook (government)Marketing do see is the most powerful #7: lobby group in the country saying “it’sads mortgage You can help your Realtors post listing in the lending that is theofissue.” real estate section Craigslist and other classified – Paul Therien ad websites. To make things easier, I provide my clients with a powerful automation tool that 101, allows They just don’t get it, do they? Economics says you to post these ads instantly – just three clicks ofto a cool off a hot market by making it more difficult mouse and you’re good to go. It also allows you to borrow, heat up a cooling economy by loosening up lending. are cooling in many markets, track all yourWe hits and uniqueoff visitors. Since many that were hot as Toronto Vancouver. people go tonever theseas classified websitesand to look for Canadian institutional (read mortgage properties for sale, this is greatbank) way to build lending has been on a 10-year roll, like drunks on a exposure. bender, abetted by their “drinking buddy” CMHC. I Another feature included with thislong a agree that cool a 30-year amortization is too automation tool is the ability to instantly time in general, but maybe it should be create allowed for single property websites and then publish them to
14 of the most travelled property search engines on the planet with a click of a button. So it’s got a huge syndication effect, allowing you to get your Realtors’ listings in front of more eyeballs, more often. first-time buyers, or mortgages that start under a So there you have it, I’ve just given you the ninth specific (remember restrictions in 1992 when and finalprice secret for attracting Realtor referrals like the first-time buyer program was implemented? crazy. In fact, over the past nine articles I’ve walked Should we look at something similar?) When “Red you Clark through my was entire Ultimate for Realtor Ed” at TD screaming moreMarketing System. Admittedly, if you’re like most of my what clients, government controls on mortgage lending, you might find this a little overwhelming at first. he was really saying was that lenders can’t police themselves. If as bank A willasdoyou themight deal why can’t Relax. It’s not difficult think, bank B? If ifJohnny jumps the bridge, wouldtools you especially you utilize myoff turnkey templates, jump off a bridge? Whatsimply kind oftake people do wetohave and technology. If you’ll the time running our banking system? The real culprit in learn and implement the steps I’ve laid out for you, I this whole mess is the least regulated and that is guarantee marked, dramatic credit cardyou’ll debt.see Putasome sense back in the improvement in your ability to attract topsystem, put the boots to the credit card lenders, producing Realtor partners who actually send you understanding that it will impact the economy significantly, especially retail goods. Gradually consistent business. tighten the mortgage underwriting “standards” I’ve given you everything you need to know to get that have been over the last years. started. Now it’sperverted time to take action. Take10massive Will there be pain? No doubt about it. But an action and get you’ll get massive results. I’m looking uncomfortable pain now, beats an agonizing pain forward to hearing your success stories as you go later. forth and make it happen. – GTA Broker
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mortgagebrokernews.ca | 51 mortgagebrokernews.ca
STATISTICs / AVERAGE HOME PRICES
This month’s roundup looks at how national average home prices have changed since last year and what’s noticeable is the regions in which changes have taken place The average price of a home in Canada is now $375,810, slightly higher than year-ago levels. But behind the aggregate numbers are wide variations in what’s happening with housing. Figures from the Canadian Real Estate Association show average prices are 0.9 per cent more than a year ago. Prices are higher, on a year-over-year basis, in 80 per cent of all local markets in the country. The annual climb in prices doesn’t sound like much. But back in 2000, average residential prices were less than half where they are today – at about $150,000. The report comes as a growing number of economists and policy-makers are concerned about a correction in the housing market, and in particular, Toronto’s condo market, where construction continues at a blistering pace. Meantime, Bank of Canada Governor Mark Carney has repeatedly warned Canadians that rising household debt is the No. 1 domestic risk to the economy. Opposing trends in Canada’s two largest cities are skewing the national numbers, says Gregory Klump, CREA’s chief economist. For one, the high-end market in Vancouver is rapidly cooling, putting downward pressure on prices there. Take Vancouver out of the national average price calculation, and home prices are 4.9 per cent higher than last year, he calculates. At the same time, Toronto is galloping ahead. “Higher-priced sales activity there is on the rise and buoying average prices,” he said. As the most active housing market in Canada, “Toronto is the biggest factor supporting national average price.” Strip Toronto out, and prices are actually down, 2.2 per cent, on an annual basis. Netting out both Vancouver and Toronto shows a 3.1 per cent increase in average price. Toronto is by no means the only hot market in Canada.
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April 2012 vs. April 2011 Residential average price* (year-over-year percentage change) Source: CREA
Canada BC AB SK MB ON PQ NB NS PE NF
+0.9% -10.9% +1.9% +11.8% +6.8% +7.8% +3.4% -2.9% +10.2% -8.6% +12.8%
STATISTICs / AVERAGE HOME PRICES
CANADA’S HOTTEST MARKETS
+12% Newfoundland & Labrador +9.6% Toronto, ON +9.4% Regina, SK 9% Saguenay, QC 8.5% Thunder Bay, ON
Newfoundland & Labrador
Thunder Bay, ON
+8% +7% +6% +5% +4% +3% +2% +1%
CANADA’S COOLEST MARKETS:
-3.6% Victoria, BC -3.2% Saint John, NB -1.9% Vancouver, BC -1.4% Fraser Valley, BC +0.2% Sherbrooke, QC
Fraser Valley, BC
Saint John, NB
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Profile / CMA LIFETIME ACHIEVEMENT
For Canadian Mortgage Award Lifetime Achievement recipient Ron Swift, the advance in technology has been the biggest driver behind the growth of the broker channel during his more than 25 years in the industry When Ron Swift graduated in 1983 from the British Columbia Institute of Technology, he wasn’t exactly sent off into the workplace with a lot of fanfare. “It was the recession,” recalls the CEO Pacific Mortgage Group and the 2012 recipient of the Canadian Mortgage Award for Lifetime Achievement. “The Dean of the business program said, ‘the [job] market’s changed so hopefully you have other contacts, family, friends and you can take advantage and you should take whatever job you can get.’” No family members came to Swift’s rescue, however he did see a newspaper ad asking, “do you have a real estate licence, are you good with numbers and do you want to make lots of money?” Luckily, Swift did possess a real estate licence, something he had acquired as an elective at BCIT. What he didn’t possess was any real knowledge of what a brokerage doing private lending did. It didn’t take him long to get his bearings and in 1986, along with some partners, he opened his own brokerage, which continued to do mostly private lending.
Anyone dealing with consumers should be a professional
54 | mortgagebrokernews.ca
After a quick detour at the Insurance Bureau of B.C., “it was not for me,” he says, Swift found himself answering another ad for someone to run the residential mortgage division for the province at Mutual Life. “There were big in commercial lending, but wanted to expand into residential lending as an asset class,” says Swift. “They knew they were going to have to deal with brokers, but didn’t really know brokers, so wanted someone who knew the broker industry.” Eighteen months later, a call from Bob Ord then had Swift running FirstLine in B.C. for five years, before he was lured back to Mutual Life with a promise of big plans. “Five months later, discounting began to increase, Mutual said ‘forget it,’” says Swift. “They no longer wanted residential mortgage assets so they immediately starting looking for an exit strategy.” The strategy took a while. After relocating to Toronto in 1997, Mutual’s mortgage division became MCAP in 1998, where Swift rose to become president, until moving to Pacific Mortgage Group last year. While at MCAP, Swift became involved with CAAMP, serving as its chair in 2006, as well as serving on various committees, such as ethics and best practices. He also became the first Canadian to successfully achieve the Certified Mortgage Banker
profile / CMA LIFETIME ACHIEVEMENT designation from the U.S. Mortgage Bankers Association. “At the time [MCAP was] looking to become a sub-servicer, not just an originator and servicer of our own business,” he says. “We were working with a couple of American companies that were coming up to Canada and we found ourselves in meetings talking about mortgages, and not everything was the same, so we thought it would be helpful for our company to understand more about what the Americans were doing and how their programs worked.” Did he sense the impending doom that was just around the corner? Swift says no. “Back then everything was positive. Looking back you start to understand what happened. Everyone was looking to make a fast buck, consumers, originators, wall street, investors and the rating agencies. No one had skin in the game and everything just got passed through. We got lucky. In Canada we were starting to head down the same path with 100% lending, stated income, extended amortizations, ARMs with low introductory rates that reset after a period of time. Fortunately we had the advantage of seeing what happened to our neighbours down south and were able to pull back in time.” The time spent south of the border also influenced Swift’s views about needing to raise the bar of professionalism in the industry and the need for further educational requirements. “Anyone who is dealing with consumers should to be a qualified mortgage professional,” he says. “That is why I believe we needed to start with an industry designation and it wasn’t going to happen overnight.” Swift says the AMP designation was a 15-year strategy. “It wasn’t going to be mandatory,” “We knew it was going to be a long road.” “You can’t measure that progress year-by-year, but, if you go back to when we started with the vision to where we are now, I think the industry has moved a long way.” He also points to the strides CAAMP and provincial associations have made to raise the profile of the industry through education and ethics. They have also made their voices heard where it matters – Ottawa. “The conversations we can have with the Minister of Finance, we couldn’t have done that 10 years ago,” says Swift. “They’re now calling us as an association and soliciting our views. And that’s a testament to not just what the associations have done, but what everyone as members have done to raise their level of professionalism. “I’m of the belief that 10 years from now we will
If you go back to when we started with the vision to where we are now, I think the industry has moved a long way
have an industry that will have adopted a designation that will be not an option, but a requirement.” Asked about the biggest change he’s seen in the industry over this time and Swift doesn’t hesitate before saying “technology.” “When I started we didn’t have cellphones or fax machines. You met with all your customers and filed out paperwork and collected all the information and sent a package into the lender and waited for a response and hopefully you heard something in a few days.” Once technology took hold, it started to fundamentally change the business, says Swift. “We could process more loans per underwriter and could respond faster. However, there have been unintended consequences and costs of the technology.” “As the technology evolved it has sped up how we could internally process loan applications. But, when you start going faster it is easier to miss something on a deal.” ‘I don’t think underwriters today have been trained like they were back in the early days, when you would have to understand how to read an appraisal or truly had to know how to read a credit bureau report because there was no Beacon score.” Technology has also invited more fraud into the mortgage industry. It is easier to fabricate documentation. So now we have to have more technology to detect it. Sending deals to lenders is now very fast and easy but unfortunately that has created some bad behaviour with deals being “shopped to lenders versus sent to lenders”. “It’s an evolution,” says Swift, “but it’s getting better. We have a lot more information now and we can make better decisions. After having spent more than a quarter century in the industry, Swift says it’s at a crossroads. “We are going through another transition and it has changed how lenders value a mortgage. It’s not just about the mortgage, it’s about the customer,” he says. Going forward, the only way for brokers to grow is to create partnerships with lenders, he says. “If we’re going to continue to fight over the customer then the only way for it to make economic sense to the lender is to pay brokers less or rely on other means to get customers.” Swift is also concerned about the loss of some broker channel lenders and isn’t sure we’ve seen the end of it. “I’m worried about what other major lenders are thinking. I know they love brokers. It’s not a matter of they don’t love brokers, it’s just a matter of them loving their shareholders more,” he says.
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Profile / provider
What’s in a Name? The move by B2B Trust to become Canada’s latest bank looks to strengthen the relationship with brokers the company has built up nationally over the past three years
he move by B2B Trust to becoming Canada’s latest bank in July is more than just a name change. It will also mean giving more options to brokers, something that is very important to the fully owned subsidiary of Laurentian Bank of Canada. “We felt it was important to clearly distinguish ourselves and have all of our products – including mortgages – sold under the “B2B” name,” says Francois Desjardins, president & CEO of B2B Trust. “While we are already a recognized leader in the financial advisory community, our intention is to build recognition of the B2B Bank brand (and attain leadership status) in the mortgage broker space as well.” It also means it can be more transparent so that it can serve the broker community efficiently under one entity and one brand, where previously its mortgages were under the Laurentian Bank banner. According to Desjardins, B2B began contemplating this move about three or four years back.
Our intention is to build recognition of the B2B Bank brand in the mortgage broker space 56 | mortgagebrokernews.ca
Originally, B2B was more on the trustee side of the business, handling self-directed accounts 15 years ago and was very small in terms of its loan and deposit books. That has shifted over the last decade and it now has a significant book in terms of mortgages through brokers, which was started three years ago. “So we decided to take a look at our legal structure and make sure it aligned with what we were actually doing as a company now. “Being a national organization, it made a lot more sense to be a bank than to continue to be a trust.” A new entity, B2B Trustco, will continue to do trustee services. The move to being a bank will also allow B2B to continue to build on its success, says Desjardins. “In the mortgage broker world Laurentian Bank didn’t really have a strong brand outside of Quebec and B2B Trust and now B2B Bank has a better brand recognition among advisers and brokers and we’ll be also able to sell and offer more products through brokers to the end customer so the customer will be able to get not just a home for their mortgage, but more products under the B2B Bank brand. “So customers that came to us before just for the mortgage will be able to have a mortgage, GICs, loans and have access to those online and have a more holistic relationship with the bank than they did in the past.” Since focusing on brokers outside of Quebec over
profile / provider the past three years, B2B has tripled that business, despite not being able to offer more than mortgages. The broker business was a little bit orphaned,” says Desjardins, “but one of the main reasons we picked that business up was that we believe in the channel. It’s our model and we believe in it. Desjardins says Laurentian will still work with brokers in Quebec, but outside of that province everything will be sent to B2B Bank. “And we’re expecting to get some traction being present with the brokers in the field every day.” While B2B will be a bank, it won’t be competing with itself like some of its competitors in the broker channel. “While brokers are out there every day pounding the pavement trying to give good service to their customers, they need a place to send their business to that will be there every day,” says Desjardins. “We see that as an opportunity. We’re not fighting with ourselves. We’re not competing with our own sales force, because we don’t have one. We work directly with mortgage brokers and don’t compete with
We’re not fighting with ourselves. We’re not competing with our own sales force, because we don’t have one
them by going direct to their clients. We value the relationship they have with their clients and we are here to exclusively serve brokers. “Our sales force is really the thousands of brokers that are out there getting the business.”
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Profile / insight
100 per cent Mortgage Architects has made a bold move – offering brokers 100 per cent of their commissions and more choice about the way they run their business
Mortgage Architects has introduced both franchise and non-franchise models that allow brokers the ability to select what level of service they want from a brokerage and reward them with cost savings. The models give brokers the opportunity to earn in excess of 100 per cent of their commissions with no commitments – they chose from no term or three-year term commitments. “The foundation of our new business model is to provide choice for today’s mortgage professional without having to commit to a long-term contract,” says Ron Swift, CEO of Pacific Mortgage Group. “You choose the support and services you need while having the opportunity to make the industry’s best commission split.” “We are excited to have launched four unique, value-rich, industry-leading business models, which not only provide brokers with competitive advantage, but just as importantly, an opportunity to select options that are tailored to their specific needs and circumstances. It is truly a ‘no strings attached’ win-win situation for all concerned,” adds Meini Ickert, Mortgage Architects’ VP, national sales.
How do I earn 100 per cent? Mortgage Architects is owned and operated by the Pacific Mortgage Group Inc. Pacific also owns Radius Financial. Through access to its own in-house lender, Radius Financial, Mortgage Architects is able to offer incentives to MA Brokers that are unmatched by external lenders, says Ickert. Through the Radius 3 and Partner for Life incentive programs, brokers can earn up to 100 per cent or more of their commissions.
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What about ownership opportunities? By supporting Radius Financial, brokers can gain ownership in the Pacific Mortgage Group, with MA brokers earning up to 33 per cent ownership in the form of Pacific Trust Units. Pacific “We are the only brokerage and lender that gives its lead planners the unique opportunity of ownership,” says Ickert.
How are your models different than others in the industry? The brokerage has a MA licensee or a MA franchise model that starts at 90/10-95/5 splits. Through its Radius 3 Incentive Program, brokers have the ability to earn additional compensation in excess of 100 per cent of their commission. “Being the only mortgage brokerage with an in-house lender is huge,” says Ickert.
Is it that easy, what`s the catch? MA says these models are truly transparent – there are no special deals or incentives. When brokers join MA, they have the ability to earn their way to an excess of 100 per cent commission. There are no obligation terms. “We are confident in our offering,” says Ickert. “We want brokers who perform and stand out in the industry.”
And what about services? MA offers a variety of full-serve or self-serve models. The broker decides how to run their business, with MA to support them with the right tools to grow. “Whether it’s compliance, commissions, technology or marketing, MA has full and self-serve models that are leading-edge,” says Ickert.
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Profile / favourite things
Max Afzalimehr Syndicate Mortgages, Markham, Ont.
Food: Sushi Sport: Soccer
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Drink: Vodka, soda and lime
Book: The Da Vinci Code
Hobby: Working out at the gym Music: Mozart
Place: A villa on the beach
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Crunching the numbers Nawar Naji
Toronto broker Nawar Naji questions if the industry’s wholesale shift to the four-year term earlier this year – a defence against BMO’s 2.99 – best served clients
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During the rate wars earlier this year some in the industry focused on selling four-year mortgages at 2.99 per cent in order to compete with the BMO product. Broker channel lenders and brokers responded by shaving one year off the term while maintaining the standard features BMO sacrificed in favour of rate. The fact that the industry moved back to the five-year fixed-rate mortgage less than a month later, suggests to me that brokers need to look at why they are in the business in the first place. For me, it goes back to ensuring that we tailor our mortgage solutions to what truly makes sense for the client and is in their best interest. I did not sell any of those four-year mortgages, because they just didn’t jive with the best interests of my clients. During that time, I heard another reason put forward as to why some mortgage brokers were promoting the four-year fixed rates to their clients: it coincides with the U.S. presidential cycle based on the argument that in U.S. re-election years, mortgage rates remain low for the incumbent president to be re-elected. As a mortgage broker who is driven by data and facts, I had to do some research to see if these statements hold water. Before we dive into the data, let’s
understand what drives mortgage rates. Fixed rates are driven by the bond market, which moves up and down based on economic news. Good news drives the bond yields higher, therefore increasing rates and vice versa; bad economic news drives the bond yields lower, therefore reducing fixed mortgage rates. Variable mortgages are driven by the prime rate, which is set by the Bank of Canada and the discounts on prime are driven by liquidity and credit risk factors. In good times, variable mortgages were at prime -0.8 per cent, while during the financial meltdown of late 2008, variable mortgages were at prime +1 per cent. Accordingly, I don’t see how U.S. elections can drive the bond market or influence the decisions of the Bank of Canada. The only connecting factor is the Bank of Canada benchmark rate has to remain relatively close to the U.S. Federal Reserve benchmark rate. If Canada’s benchmark rate was much higher, the Canadian dollar would rise in value, negatively affecting exports and, in turn, dampen the economy. According to the data, over the last 25 years, fixed rates on U.S. re-election years (2004, 1996 and 1992), the fixed rates did not show a dip in these specific years. In fact, interest rates have been decreasing over the last 25 years. When someone makes a statement, always ask to see the numbers. It’s easy to make generic statements.
service / directory
Bridgewater Bank www.bridgewaterbank.ca Ph: 1 888 837 2326 Page 9
Canadian Mortgage and Housing Corporation www.cmhc.ca Ph: 1 888 463 6454 Page 29
ING Direct www.ingdirectbrokerteam.ca Ph: 1 800 574 5629 Page 33
HomEquity Bank www.homequitybank.ca Ph: 1 866 522 2447 Page 37
Peoples Trust www.peoplestrust.com Ph: 1 800 663 0324 Page 51
Genworth Financial Canada www.genworth.ca Ph: 1 800 511 8888 Outside Back Cover
National Bank www.nbc.ca Ph: 1 888 483 5628 Page 39
Centum Financial Group Inc. www.centum.ca Ph: 1 604 257 3940 Page 11
Radius Financial www.radiusfinancial.ca Ph: 1 877 369 6398 Page 31
Capital Direct www.capitaldirect.ca Ph: 780 868-0550 Page 10
Dominion Lending Centres www.DominionLending.ca Ph: 1 888 806 8080 Page 15
Street Capital www.streetcapital.ca Ph: 877 416 7873 Page 5
Equitable Trust Company www.equitabletrust.com Ph: 1 866 407 0004 Page 23
Tribecca Finance Corporation www.tribecca.ca Ph: 416 225 6900 Page 57
INVIS Mortgage Intelligence www.invis.ca • Ph: 1 866 854 6847 Pages 47
ROMSPEN Investment Corporation www.romspen.com Ph: 1 800 494 0389 Page 1
FirstLine Mortgages www.firstline.com Ph: 1 877 658 3660 Inside Back Cover
Home Loans Canada www.hlcmortgages.com Ph: 1 866 452 1821 Inside Front Cover
Home Trust www.hometrust.ca Ph: 1 877 903 2133 Page 7
Canada Guaranty Mortgage Insurance Company www.canadaguaranty.ca Ph: 1 866 414 9109 Page 27
Mortgage Alliance Company of Canada www.mortgagealliance.com Ph: 1 877 366 3487 Page 45
mortgagebrokernews.ca | 63
service / directory
Teranet www.teranet.ca Ph: 1 866 237 5937 Page 38
The Mortgage Centre www.mortgagecentre.com Ph: 1 800 423 0107 Page 3 Real Estate
Canadian National Association of Real Estate Appraisers www.cnarea.ca Ph: 1 888 399 3366 Page 16
RMAI Financial Group www.rmaifinancial.com Ph: 1 866 955 7624 Page 17 Services
The Lions Share Group www.lionssharegroup.com Ph: 1 866 726 5159 Page 12
VERICO www.verico.ca Ph: 1 866 983 7426 Page 13 Technology & Software
Real Estate and Mortgage Institute of Canada www.remic.ca Ph: 1 877 44 REMIC Page 35
D+H Limited Partnership www.dhltd.com Ph: 1 866 345 6449 Page 2
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