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July 2011, 6.7

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SPECIAL FOCUS Technology: Brokers on the fast track

PROFILED Mortgage Brokers Ottawa: Top of the class PUBLICATIONS MAIL AGREEMENT #41261516

technology transformation Broker channel advances are all about meeting the clients where they live, say industry players, and that, Vernon Clement Jones finds out, is on the technological fast track

6. 07 issue

cover story

52 Top 50 Brokers Now in its fourth year, the CMP Top 50 Brokers survey saw an increase in submissions as well as a surge in funded volumes across the board. CMP explores the results.

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contents

74 Provider: Canadiana set to grow its book with ‘enhanced’ Macquarie deal, which will see its lending capacity bolstered, allowing it to emerge as a more competitive mortgage lender

NEWS & COMMENTS 8 Some of the best stories and comments from MortgageBrokerNews.ca: Broker: ‘Flying solo’ agents eroding industry reputation, Macquarie Financial to leave Canadian broker channel, Brokers: Time to cut commissions to save lenders?, Brokers: banks now eating penalties to retain clients, Alberta broker raises alarm about conservative appraisals, Newbie Vancouver brokers go part-time as purchases slow 16 News Analysis: The Big Story: A compilation of the top quotes from our weekly multimedia broadcasts on MortgageBrokerNews.ca 18 Business Advice: Making mortgages motivating in a media age 24 In The Community: Broker maps way to homeownership for low-income Albertans

PROFILES 70 Broker Profile: Mortgage Brokers Ottawa claims the highest number of mortgage professionals on this year’s Top 50 list. Vernon Clement Jones delves into the reason for that and discovers that there are several

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66 MARKETING

Web 2.0 marketing secrets for mortgage pros In a new series, Doren Aldana explores some of the ways mortgage brokers can harness the power of social media to build referrals. Secret #3: Build a Herd of Realtor Fans

76 Insight: VERICO continues to expand, having welcomed 16 new brokerage firms this year alone, including Ontario’s Service First Mortgages

regulars 23 International News 32 This time last year 78 Favourite Things 79 CMP Service Directory Follow us on Twitter Twitter.com/CMPmagazine

1989 The Mortgage Centre became Canada’s first national mortgage broker organization.

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2011 The Mortgage Centre has earned its good name through years of industry experience. We believe that the key to success lies in our investment in our brokers, franchisees, and employees. By offering competitive compensation and a host of dynamic sales tools, we’ve empowered a new generation of mortgage brokers to grow their business.

Isn’t it time you invested in your good name? For more information on a rewarding career with The Mortgage Centre, or to inquire about franchise opportunities, Contact Eddy Cocciollo at (416) 309-3930.

The Mortgage Centre is a division of CIBC Mortgages Inc., a member of the CIBC group of companies. ® The Mortgage Centre is a registered trademark of CIBC Mortgages Inc.

Editor’s Letter

Everyone’s No. 1 on this list Nothing creates debate like a list. No matter what’ s being ranked or how stringent the guidelines, people will find fault with something. That’s just human nature. And there’s nothing wrong with that. Civil debate is good and healthy for everyone. This year’s CMP Top 50 Broker list is certain to cause a conversation. Some may find fault with the fact that we rank mortgage professionals based on funded volume at all. Others may question who’s not on the list. We don’t deny the list can be arbitrary and that not all brokers submit their information for consideration, but we do think this exercise is useful in highlighting successful brokers and giving readers a snapshot of the past year in terms of the overall health of the industry. This year’s compilation is instructive in that it clearly shows 2010 was a good year for brokers. Across the board, the funded volume numbers for brokers who submitted were up. More brokers crossed the $100-million barrier, including three who topped $200 million. Even the broker at No. 50 brought in $10 million more than the person in the same spot last year. Brokers from major markets such as Vancouver and Toronto are well-represented and, alas, this will always be the case for markets where the price tag on the average deal is higher than in other centres. What we have tried to highlight is that there are very successful brokers from smaller market across the country, including Vernon, B.C., Listowel, Ont. and St. John’s, Nfld. Not everyone may agree with the list, but there is no arguing that each of the 50 mortgage professionals appearing on the list is successful in his or her own right, regardless of ranking. Together, they are all examples of what can be achieved with hard work and dedication to clients, and they should all be applauded for helping raise the status of mortgage brokers in their communities. As always, I encourage you to contact us with any news related to the broker and mortgage industry or just to share your opinion about how we’re doing. It is an exciting time for our industry and we look forward to keeping you informed about the industry and your business. Cheers, John Tenpenny Editor john.tenpenny@kmimedia.ca

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6. 07 issue

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Quotables

“People online are looking at rate, first and foremost. They’re not like referrals from clients. Here the rate has to be the lowest or very near the lowest to get the lead. With the lead generation sites, what we’re getting is fewer leads, but the quality of the lead is better. They’re perspective buyers who are genuinely in the market for a mortgage.” Paul Poirier, a broker with Dominion Lending Centres based in Toronto, speaking about Internet lead generation sites, which some brokers are turning to in an effort to find more business. Page 34

“Our brand is exceptional in our region and with that comes loyalty. We tend to continue to hold onto brokers after they’ve cut their teeth and come into their own. When you’re aiming for $1 billion in sales this year, with only 60 brokers and agents, you tend to attract the crème de la crème. So, it’s a mix of up-and-comers and established brokers, but the numbers that we have in the Top 50 speak for themselves.” Michael Hapke, President and CEO of Mortgage Brokers Ottawa, explaining the brokerage’s success and its accomplishment of placing of seven brokers on this year’s CMP Top 50 Broker list. Page 70

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The past month has seen a lot of broker discussion of articles posted on MortgageBrokerNews.ca. Here we collect some of the most commented on stories and the reaction they garnered from the mortgage broker community. To read the full stories or to make your own comment visit: www.mortgagebrokernews.ca

broker: ‘flying solo’ agents eroding industry reputation A northern Ontario broker is sounding the alarm about what he calls the large number of mortgage agents flying solo in smaller markets, without the benefit of in-house broker guidance. It’s a trend that may chip away at the industry’s bragging rights. “Since the new regulations in Ontario did away with the requirement to have a licensed broker on site, our market has been flooded with inexperienced agents who are working without the direct and necessary training and guidance of their broker,” Nick Tassone, broker-owner of Midtown Mortgage Service in Sault Ste. Marie, told MortgageBrokerNews.ca. “I know that these people will not survive, but it’s the damage they do along the way that matters.” Like brokers in other rural and small markets across Ontario – and, indeed, the country – the 21-year industry veteran has watched in frustration as the local brokering landscape changes from a majority broker-owned-and-operated business to one marked by individual agents representing brokerages headquartered in major urban centres like Toronto and Vancouver. The Ontario trend started in 2008 with amendments made to the Ontario Mortgage Brokerages, Lenders and Administrators Act, effectively replacing rigid on-site broker requirements with mandatory educational training as part of the agent licensing process. CMP

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I don’t like the generalization. I’m ‘flying solo’ and affiliated with a superbroker and have been in the industry for over 35 years. – Christopher Seriously? “...the new regulations in Ontario did away with the requirement to have a licensed broker on site.” Unbelievable! Mr. Tassone, you are right about the damage inexperienced & untrained mortgage brokers will do along the way, and it will affect the reputation of ALL mortgage brokers. What a perfect opportunity for ‘the voice of the Canadian mortgage industry’ (aka CAAMP) to step in and provide some kind of training and guidance to newer mortgage brokers. Unfortunately, CAAMP doesn’t care about any mortgage broker in business less than two years, yet in the span of two years, those brokers can do a lot of damage to our industry. – Julia Krause I have a bigger problem with the bank ‘mortgage specialists.’ The public thinks that because you carry a bank logo, that you are a well-qualified mortgage professional and we all know that’s not the case with many of these road warriors. They are sales reps working on commission with no accountability and no FSCO registration. Let’s work to get these people licensed, regulated and accountable. – Steve I fully agree with Mr. Tassone. I’ve been a mortgage associate for just under four years, and there is no way I would have even considered being on my own during my first two years. You cannot learn this business in a classroom, in a book or online. The only way you can learn it is by watching someone experienced actually doing it, and by having someone experienced directly supervising you and being right there to help. Wow, Ontario really dropped the ball on this one. – Don McKay Agents should be supervised by a broker – period. FSCO needs to make this happen or better yet our industry should to protect the industry. Too many agents running around town with broker networks without proper supervision. – Mike Distefano, DLCBTB Mortgage Solutions If there was an organization that spoke ONLY for mortgage brokers and agents or was a federation of provincial/regional mortgage brokers and agents associations, we might be heard. But CAAMP is not doing it. You can’t have financial institutions paying big bucks and not let them have a say in the organization. What is in the best interest of an FI is not always in the best interest of the mortgage brokerage profession. Education for the industry isn’t everything but it’s a start, but when the bar is so low any snake can crawl under it, why bother with the bar? When are we going to have an organization that speaks just for the brokerage community? – David

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I don’t think cutting commissions is the answer. I am not sure lenders are saying we need to be paid less. I think they are saying they want value for what they are paying us. It is time for us to step up and raise the bar on the level of professionalism. We need to become a more efficient distribution channel. How about a designation that is partially dependent on individual efficiency as well as education, experience and track record? One thing is for certain — it is time for change. Broker-owners need to make sure their brokers are efficient and if they aren’t, stop allowing them to hang a licence. – Michael Cameron I absolutely agree and feel it’s the only way to continue success for both lenders and brokers. Retention is a big issue for lenders and they often compete with brokers at the same time. Paying on renewals would keep the playing field even, pay brokers for doing the right thing, encourage more brokers to keep in touch with clients, which raises awareness and respect for brokers and keeps the lenders happy too. – Taz Rajan Instead of paying everyone less, more lenders should take a look at MCAPs compensation structure which rewards efficiency. Cost-effective brokers can and should be paid more. Lenders could also do themselves a favour by providing more education about their products and having comprehensive broker websites that not only provide product info but underwriting and process information. This makes everyone more efficient and keeps costs down. Trailers are great in theory and reward brokers in it for the long haul. The problem is you get less now and less later (factoring in true inflation and not having the funds available to invest in the business or an investment portfolio). Renewal fees make sense and should help prevent brokers churning their book and placing clients with another lender upon renewal. – Torrington Capital Where in this article and replies does the customer count? Do you really put the deal where it should go, or where you get paid the most? As an agent do I want to feed my broker, or myself? As a broker do you hire me because you like me or for my numbers to line your pocket? Bottom line greed and nothing more is fueling the banks these days. The greed has always been there, but with tighter market and less to go around it is more prominent! Our American neighbours showed us what happens when you get too greedy. So is it time to cut commissions? No. It is time to look after our customers! – Come On

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I think efficiency is the answer. Let’s face it, there is a lot more room for growth in efficiency for both lenders and brokers. Concentra and MacQuarie were not winning any gold stars for customer service and they were obviously having a hard time competing because they didn’t have the products or customer service to attract top level brokers. Could you imagine doing all of your A business with Concentra? I mean, the occasional rural property zoned agricultural or a progress draw, OK, but I couldn’t imagine taking all my business there. It takes more than a few unique products or a different pay structure to compete in Canada’s lending economy. – @kiltedbroker The requirements for a new agent to be able to practice in this business are not nearly enough for them to assist clients with hundreds of thousands of dollars of debt. Let’s get rid of these false professional titles, put into place a candidate system like appraisers so the broker has to sign off on all deals before they are released to the lender and client and ensure that the new agents understand what the word “ethics” means. Maybe this way the lenders will start seeing quality in the work being sent to them and not have so much of their time (equals money) wasted. – Another Broker

brokers: time to cut commissions to save lenders? A supporter of trailer fees is aiming to stem the loss of broker-channel lenders squeezed by commissions and thinning margins, suggesting brokers might be receptive to lower upfront payments in exchange for guaranteed renewal fees. “If the lenders genuinely have to scale back on upfront commissions in order to justify their use of the broker channel – something, of course, we, as brokers, don’t want to see – then that move would have to be accompanied by mandatory renewal commissions,” Ryan Cooper, a senior mortgage consultant with VERICO Paragon Mortgage Group, in B.C. told MortgageBrokerNews.ca. “That would essentially defer a portion of the upfront fee and reward brokers who are prepared to keep a client at an existing lender if the rate and the terms being offered are competitive instead of moving them just to make a commission.” Cooper, a big proponent of trailer fees, is suggesting brokers may be willing to accept as little as 60 basis points upfront on a standard five-year mortgage, with the guarantee of 20- to 25-basis points to follow upon renewal. That differs from both the standard, and generally preferred, upfront model as well as the trailer fee option, which divvies up compensation into annual instalments, both before and after renewal. The suggestion comes as brokers grapple with the loss of Macquarie Financial, and to a much less extent, Concentra Financial. Both recently left the broker channel, with Macquarie officials suggesting its exit was needed to lodge the lender out from between a rock and a hard place. CMP

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Macquarie Financial to leave Canadian broker channel

As far as I’m concerned, they were gone a long time ago. For a while they were so picky as to who they would work with that they had already cut off half the brokers from accessing them. Talk about shooting yourself in the foot. Obviously, if you don’t accept deals from half of the origination market, you’re not gonna make money. – Shawn Dehkhodaei

Brokers have lost another lender, with Macquarie Financial announcing it will outsource servicing of its $8 billion mortgage portfolio to Paradigm Quest, although Canadiana Financial will continue to draw on Macquarie funding for its own mortgage originations. “The Canadian mortgage landscape has been one of, if not, the most challenging environments,” Matt Rady, head of Macquarie Banking and Financial Services Group, North America, told MortgageBrokerNews.ca. “What we’ve seen is a narrowing of margins that have made it a challenging business to operate on a medium-term basis. While it’s profitable for us, it’s difficult to see what opportunities there will be. The treatment of broker commissions, coupled with those tighter margins, have put a strain on returns on regulatory capital.” Canadiana will originate mortgages under its brand through the broker channel. Those mortgages will be originated funded, in part by Macquarie. The move will leave in place existing compensation agreements with Canadian brokers at the same time the deal with Paradigm will ensure their clients continue to access the same service levels they now enjoy. The terms of those loans will not be affected by the change. “We’re very pleased to expand our strong relationship with Paradigm to include our full mortgage portfolio,” said Rady. “This partnership enables us to more efficiently run our retail financial services division, while ensuring our mortgage borrowers continue to receive excellent customer service. Grant MacKenzie, who is currently CEO of Macquarie Financial, will join Canadiana Financial to head up the company on July 1, 2011; and as a result of the expanded partnership agreement Pam Mulek, COO of Canadiana, will assume the role of president and COO. capital Direct ad MAY2011_SYD_HR.pdf 1 5/3/2011 3:07:13 PM “Canadiana values your business and we will continue to deliver the same high level of expertise and service you are accustom to” said Mulek, in a statement to brokers. Canadiana is, in fact, pledging to actively win over those brokers with existing relationships with Macquarie. CMP

80%

With such thin margins on MBS products and new capital requirements on regulated lenders this should be the beginning of the end for many lenders in the broker channel. Also makes you think about the reality of doing trailer fees business. Great concept, but low on lender reliability. Also makes you want to laugh in the face of the next BDO who wants all of your total production. Those who last spread the business around. – Another one bites the dust I think it is time for brokers to wake up and really understand what is going on. Traditionally brokers make more money when the property values increase. This has been very good for them over the last decade with huge increases in house prices meaning they could maintain their income by doing fewer transactions. Also, over the same period, finder’s fees went up almost 75 per cent on average. This was not brokers’ fault but it has lead to the tightening in the spreads. If the competition is the banks and the road reps, it may be important to note that they work for about 30 per cent of the fees the broker receives. The banks are now as efficient technology-wise. The consumer is ratedriven and service is expected. – Change Needed Sent a lot of business to Macquarie as I was top 100 with them, but now this news hits after supporting them heavily based on their growth and supposed dedication to growing in the broker channel. Too bad, most of my deals were on trailer. – Kyle Green

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News Analysis Multimedia

Every week, MortgageBrokerNews.ca rounds up influential figures to discuss the major issues in the mortgage industry. You can watch these videos online in the Broker News TV section of our website, but here we bring you the highlights from last month’s clips

the

big story

On the topic of …

keeping pace despite a slowing real estate market

broker dealing with collateral mortgages

Justin Smith: “How do you retain business? I’ve always believed in the concept, “a loan well-closed is halfcollected.” What do I mean by that? I mean listen to the customer’s needs and wants and desires for long-term financial goals. Find out what terms and conditions they’re looking for and not just the rate. Rate is important, but it’s not the only consideration. By doing that you have a better chance of getting that customer back in again. Over 50 per cent of business is going to non monoline lenders, where they’ve got marketing budgets to compete against you and sales people on the street. Why would you compete against that? My way of thinking is, it’s probably best to go to a monoline lender where you’re not going to compete for that same customer. Plugging the hole in the back of the office and preventing the customer from walking out the door is easier to do than to get them to walk in the front door. Maybe it’s easier to be farmers rather than hunters and gatherers. What do I mean by farming? We should employ some type of customer relationship management program, some kind of email program to keep you top of mind with the customer and deal with a monoline lender who is going to be there to support you, not compete against you, when times are slow.

David O’Gorman: “Collateral mortgages are a charge against a Justin Smith mortgage that allows the lender to re-advance money, and in many cases the mortgage is actually registered for more than the value of the property, so someone trying to get a second mortgage down the road will find there is no room to do that. The other issue is that the way a collateral mortgage is registered, the mortgage is not easily transferred at maturity and lenders aren’t willing to transfer between David O’Gorman different institutions, so a consumer is going to be forced to pay off an existing mortgage, pay any discharge costs and then pay any costs to register a new mortgage with a new financial institution. Although consumers are told they are saving money in the beginning by registering a collateral mortgage on their property, in the long run it could be much more expensive. It’s lack of disclosure as well. A borrower is not getting full disclosure from their financial institution. Mortgage brokers on the other hand should also be concerned because they have to make sure they pick the right product for the client and many wouldn’t even know that there would be a collateral charge registered, so you want to make sure that when you’re dealing with a client, yes [a collateral mortgage] it can be a useful too, but is it the right tool for the right job at that point in time.”

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Brokers: banks now eating penalties to retain clients There’s competition and then there’s competition with the big banks, as a handful of Vancouver brokers point to banks and, even, credit unions now willing to eat their own substantial penalties in order to keep clients from going over to the broker channel. “I had heard about this occurring back in the day – in the 80s or 90s – but hadn’t ever encountered this until recently,” Jessi Johnson, president of Verico Jessi Johnson Mortgage Team, told MortgageBrokerNews.ca. “I’ve had about three or four recent cases where the banks were willing to eat the penalty in order to keep a refinancing client.” The scenario is similar to those of a handful of brokers working the increasingly competitive Vancouver market, as banks and large credit unions sharpen their elbows in order to grow and retain clients. That contest has been largely limited to rate wars. The newfound willingness of banks to assume responsibility for penalties attached to premature closing is a relatively new and disturbing addition to the battlefield, said Johnson. Other brokers suggest the tool is being applied at the branch level, and outside of any corporate-wide policy directive. The effects, regardless, are the same. When it comes to a lender eating a penalty that is larger than the commission they’re paying brokers,” said Johnson, “we as brokers can’t compete. Thankfully, we’re seeing it used in a limited number of cases and it represents an unsustainable strategy for the banks.” CMP

Jason Strandlund

Not sure how this is exactly “news.” We have been battling this bank strategy for the last 10 years. It certainly isn’t something “new.” I am completely surprised that the brokers/agents in this piece haven’t come across it before. We constantly battle the banks on retention. Some of the lenders won’t release the discharge statement without speaking directly to the client giving them one last opportunity to steal the deal days before closing. All we can hope for is that this is not sustainable. But with the slower market and the branches needing to get through their budget of dollars for retention, expect this to continue. – Ontario Broker The race to the bottom continues … – Steve Holman We have no one but ourselves to blame. This is nothing new, and it has been going on for years. The banks are also not the only ones who are ‘prostituting’ themselves. There are plenty of brokers who do the same, and we have seen examples of those in this article. In this day and age, there are many who do not take any pride in the work and the service they provide their clients with, and their time is not worth anything to them. Those are the same people who pay their clients’ penalties, legal fees, and appraisal costs, ending up with a couple of hundred dollars to show for hours and hours of work. – Yan

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making mortgages motivating in a media age In the second of a series of articles, Carla Wood assesses how brokers can most effectively integrate various types of social media together to achieve measurable returns

emember when people used to have to wait until they were back at the office to check their voice mail messages or wait weeks for letters to arrive via mail. Remember office memos? Let’s look a bit more recently – remember when you could only check your email from the giant office computer so if you were out of the office, no one expected to hear from you until your return? Perhaps you are still living partially in that world. Most likely you are not. Today, most mortgage professionals have smartphones where they can read and respond to emails in the moment, wherever they are. There is wireless Internet wherever we go, so we can use our laptops on the go. Some use a tablet on a 3G network or by tethering to their smartphone. Are you totally confused? Hang in there and keep reading. We are about to help you make mortgages motivating in a media age. Understanding social media goes far beyond your smartphone, laptop, tablet or Internet connection. However, if you don’t have any of these tools at your disposal, you are already unable to truly leverage this growing trend in communication and business promotion. Arguably, you also “waste” less time surfing meaningless articles, comments

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and links. So what is the middle ground? How do you decide which tools to invest in and then which social media mediums to embrace in your business so that they actually drive a financial return to your business? Much like any marketing decision you make, the first step is understanding the various types of social media. Spend some time asking, researching and reading about these different tools so that you can assess their value critically and accurately. The second step is to assess how they can most effectively integrate together to achieve the following three measures of return: 1. Lead Generation – the number of leads that are driven to you as a result of social media

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2. Lead Conversion – the team’s ability to convert those leads into clients. This speaks in part to the quality of leads being generated through social media, and in part to your sales process. 3. Financial Accountability – considering current cash flow within each decision, and evaluating the impact of future cash flow and profit from the integration of social media.

Tired of searching multiple mediums to get the latest mortgage information for your business?

As some of the mortgage professionals interviewed in last month’s article attested to, the entire value of social media is not direct sales results. For some, there is a true sense of community online that is providing them with added insight, perspective and information that provides them with the opportunity to improve their services and their offerings to their client base. If this is part of the value to your social media strategy, then it also must be

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monetized. How much are you worth an hour? How much time do you spend using social media for learning purposes? How much additional business does that extra knowledge drive or solidify for you? How much time and money are you saving from attending other conferences or courses as a result of these social media relationships? How much has your confidence increased due to your new found knowledge and what change has that driven in your business focus, efficiency and success? Carla Wood

Lead Generation. Know which leads you want to generate before you choose your social media source. Once you know who they are, then find out where they are. If they are seniors, likely Facebook is where you will find them as they log on to see photos of their grandchildren. If they are tech-savvy business professionals who thrive on

“ each investment you make in human resources, in sales team members, in marketing or administration should drive – at a minimum – at least five times the return of what it costs in order to justify the efforts and dollars put in ” networking, LinkedIn may be where they dwell. Twitter is a great place for the information hungry, 20-30 somethings and a few cutting-edge 40-year-olds who are staying current and influencing others in their areas of passion. Once you know who you are after and where to find them, ensure you understand the social media etiquette of the tool on how to connect and relate. I often liken LinkedIn to a business networking event where everyone is dressed in suits and armed with business cards. Twitter is more of a cocktail party where some are there for the company, others are there with business

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hopes, but everyone is looking to meet others, learn new things, share thoughts and have a good time. Facebook is akin to walking down the street in a small town where you see people you know, perhaps unexpectedly and stop to chat. When you stop to chat, you usually focus on small talk, and on the odd occasion offer some sort of professional support or advice – but it is mainly light and relational. In none of these scenarios does the guy walking past shouting out current mortgage rates, then keeps walking, win the relationships or the business. The same applies online. Don’t show up, be self-absorbed and out of context and expect positive results. It won’t work. With social media, to generate leads, you ultimately need to guide people to interact with you by asking about your services, sending an official inquiry through your website or the social media tool you use, or find another way to capture their meaningful information and follow up with them appropriately outside of social media as well to round out the relational experience. Lead Conversion. Create a process for how leads are moved from your inbox to your firm client list. Each channel your business comes from will have a different lead conversion percentage, with your repeat and referral business being the highest and often your social media driven leads being the lowest. Your goal is to increase this year over year. The highest conversion rate I have had the privilege of experiencing is 27 per cent on social media leads. That is when everything is working like a well-oiled, highly integrated machine on the social media side and on the sales conversion end. The goal, even with this particular business was to improve the conversion rate. It can be done. But you need to track in order to see the progress you are (or are not) making. Financial Accountability. Understanding your cash flow means knowing when you will have money in the bank and budgeting your expenditures accordingly. Just as carrying a balance on your credit card is a “no-no” from a personal finance perspective, paying for services with money you do not have is

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“ with social media, to generate leads, you ultimately need to guide people to interact with you by asking about your services, sending an official inquiry through your website or the social media tool you use ” equally problematic in business. Certainly there are exceptions to this rule, but only if you truly understand the lead generation potential and lead conversion capability that will drive future profit and cash flow and can project how far out you will be over-leveraged. If you take your interest and penalties into account for this time period, and the investment in social media still makes sense; that may be your exception. Many are asking how financial accountability can be a factor when everyone tells me that social media’s greatest value is that it is free. Well, the painful truth is that nothing in life is free. If you are not hiring someone to do this work, then you are taking time away from other lead generation and conversion activities that could be leading to business by doing it yourself. There is a price. When you know and understand your hourly value, you can determine what that cost is, and whether the cost is worth the return. If you have the cash flow to pay for your social media plan, how do you know if you are getting a sufficient return? At EDI we use the 500 per cent principal. Each investment you make in human resources, in sales team members, in marketing or administration should drive – at a minimum – at least five times the return of what it costs in order to justify the efforts and dollars put in. That can be your new marker of a good social media plan. Every mortgage professional will choose a different social media strategy, based on their own value proposition or business fingerprint. If you are not familiar with your business fingerprint, read through the Business Advice column of CMP from March, April and May to learn how to discover yours, implement yours and ultimately communicate it. Then be prepared for the August issue of CMP to uncover how you can integrate your value proposition into your social media strategy to drive the returns we have targeted for your business.

Carla Wood, MBA, MSRE – Managing Director, EDI Implementation Engineers (www.edicoaching.com / Twitter: @allstrategy) CMP

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Alberta broker raises alarm about conservative appraisals

MortgageBrokerNews.ca Reader Poll Have home appraisals become more conservative this year? 80 70

I have seen this before. When a market turns, all the appraisers get conservative. – Low Ball Appraisals

$376,817

A seasoned Alberta broker is pointing to increasingly “low valuations” since new mortgage rules were ushered in, concerned appraisers for default insurers have gotten ahead of themselves and any future correction in the housing market. “We had one recent case where an Airdrie property was listed for $920,000, and it took us having to get appraisals from each of the three default insurers in order to get an appraisal of $885,000, which was still $35,000 below,” MaryAnn Guizzo, a broker and general manager for The Only Mortgage Company Inc., based in Calgary, told MortgageBrokerNew.ca. “What was really stunning is that the lowest appraisal was actually $650,000. How do you get that far out in left field? I absolutely think the insurers are telling their appraisers to get even more conservative since the mortgage rule changes.” CMHC, for one, denies making any changes to its appraisal guidelines. Still, an apparent gap between its appraisals and those of their clients is a perennial concern for mortgage professionals. Guizzo and others charge that the gap has widened this spring. While they’re hard-pressed to explain the larger differential – as much as 33 per cent in some cases – they are concerned it reflects a premature move on the part of insurers anticipating a possible market correction. CMP

We have met this many times, most recently a CMHC-appointed appraisal was 15 per cent lower than GE appraisal. It’s confusing and discouraging. – Zoltan Padar of MortgagePRO Ltd.

national average price for homes sold in May, 2011, up 8.6 per cent from the same month last year (CREA)

I agree. I have lost a number of deals or have had to recalculate or refinance LTVs because appraisals have come in way ‘too low’ – in fact ‘much lower than even the City’s assessments (in some cases as much as $35,000 lower). I just saw on TV that in spite of our house prices being a little ‘lower,’ we still had the highest prices for real estate in Alberta. Year-over-year, a single-family home in Calgary is only about five per cent less than a year ago. So I agree that the CMHC appraisers are undervaluing properties by a lot. It would be great if the lenders went back to the brokers being allowed to use “private appraisers” again. It just seemed more realistic appraisals were being done. – Marlene The Calgary and Vancouver markets continue to pose a huge question as to the sustainability of prices overall. If an appraiser does not have a comparable sale in that price range he is required to identify that as well. We are in tough economic times and Alberta is leading the country in defaults. It is not fair to place blame on appraisers as they are protecting the security of the lender and are not here to make our jobs easier. Not everyone needs a million-dollar home and insurers are absolutely correct in being conservative in these times. Clients have to put more funds down to spend $1 million or be prepared to buy a home that is more suitable without mortgage insurance. – 34 years experience

appointments

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ING Direct announced that Rocco Caminiti will be the new regional sales manager for eastern Ontario. He will be reporting to Kim Luxton, Director, Lending Broker Sales.

30 20 10 0 Yes

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australia Senate upholds ban on mortgage pre-payment penalties The Senate has backed a federal government ban on home loan exit fees (pre-payment penalties), rejecting a bid by the opposition to overturn the prohibition, aimed at increasing competition in the home loan market. The Gillard government announced plans to ban mortgage exit fees last December in a bid to boost competition and limit the clout of the Big Four banks that control more three-quarters of Australian bank lending and deposits. But the opposition had sought to disallow the ban before it came into effect, with a Senator proposing the measure be limited to the country’s four major banks. It took effect on July 1, and is part of the government’s package to making the banking sector more competitive. Treasurer Wayne Swan said the Senate’s decision to vote in favour of the ban is a victory for households in getting a better banking deal. ‘‘It removes one of the biggest roadblocks preventing families from getting a better banking deal,’’ Swan said in a statement. ‘‘Lenders will

have to win the loyalty of their customers with good service and competitive lending rates, not by shackling their customers with mortgage exit fees.’’ Speaking with Australian BrokerNews, Mortgage Finance Association of Australia (MFAA) CEO Phil Naylor admitted that “the fat lady has apparently sung” on the issue of the exit fee ban. Naylor said feedback from some Senators with the Australian Green Party (The Greens) indicated that they were sympathetic to the industry’s concerns about lack of competition, but thought that perpetuating exit fees was the wrong policy. However, Naylor said the Greens had been interested in arguments regarding non-bank lender funding, and had told the MFAA they would seek further reforms to improve non-bank access to finance. Naylor has vowed not to give up on the funding issue. “The concerns about lack of competition are still strong, and we will continue to push the funding issue - for example, the Canadian Mortgage Bond system – hopefully with the support of groups like the Greens,” he said. Naylor added that his discussions with nonbank lenders showed that they will continue to “find innovative ways to ensure they remain a competitive force in the industry.” CMP

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Broker maps way to homeownership for low-income Albertans Now what? As financial coordinator of the HOME Program, Axiom’s Mike Cameron is focused on answering that question for thousands of Alberta families that have worked their way out of poverty and are looking to take that next step

Michael Cameron

A modest income won’t necessarily kill the dream of homeownership, but it will challenge it. It’s something Axiom Mortgage Solutions CEO Mike Cameron has learned over the last 10 years, working alongside brokers, real estate agents and social services providers on Alberta’s HOME Program, an initiative, also in its tenth year, and focused on preparing families that have already moved out of poverty and want to take that next step into a home of their own. “We are facilitating that next step in the continuum of housing, and it’s a program I’m really passionate about and have invested in,” said the veteran of Edmonton’s broker community. “We celebrate 10 years of the program this year and in that time have helped 1,541 families purchase homes. There are currently 1,606 others active in the program and together that’s made for $94.5 million in transactions.” The hard, cold numbers don’t really tell the story of participants who access education, the professional advice of real estate brokers and mortgage professionals along with financial aid and down payment support through the HOME Program. What they don’t access is a handout. Ultimately, the program is centred on providing participants the tools to help themselves and their families into homeownership, if, in fact, that is the best fit for them. “The program grew out of a situation where the Capital Region Housing Corporation was looking for a way to help clients who through their own success no longer qualified for public housing assistance,” said Cameron, regional financial coordinator for the program. “It has been extended to anyone who wants to participate, but it was originally seen as a way to bridge that gap. It still is.” The HOME Program starts first with education, hosting free in-class workshops that layout the necessary groundwork – budgeting, credit building and debt management. Counsellors then review participant eligibility based on financial criteria, before a second round of workshops focused on addressing the home-buying process, including what is for many participants the confusing world of mortgages. Low-income buyers who have completed both education sessions can apply for down payment assistance for up to 2.5 per cent of the purchase price. “The down payment assistance is a gift,” said Cameron, a 16-year veteran of the mortgage

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industry. “It’s only repaid if the property is sold for a profit within three years. But the reality is that people don’t cash out on their homes.” That message has resonated with Alberta brokers who’ve supported the HOME Program, which started in Edmonton but has now stretched as far south as Lethbridge. The role of those mortgage professionals have generally been to share in the financial coordination duties Cameron leads as a volunteer. Members of the Alberta Real Estate Association are just as involved, with AREA’s Affordable Housing Initiative, the Canada Mortgage and Housing Corporation, the Alberta Real Estate Foundation and the Capital Regional Housing’s CTD Housing Solutions listed among other key funding partners. The last one on that list foots the bill for the services of the program administrator, who oversees the growing initiative. Poor credit is often identified as the biggest hurdle to helping Canadians into their own homes, but that isn’t necessary true, says Cameron. “Credit is often the easiest hurdle to get over,” he says. “The good news with credit is that it can be improved, it just takes time.” Some clients of the program have taken as long as seven years to steel themselves for the home-buying process. But when they are ready, they’ll go through the same motions as most other A clients. Indeed, the goal is to see them qualify for prime rates, whether directly through a bank or working with a mortgage professional, says Cameron. “We don’t put any restrictions on how and where they obtain a mortgage.” The HOME Program is seen as providing the light at the end of that tunnel, helping families that have stabilized their financial situations, take that next step into homeownership. The benefits, as mortgage brokers know, aren’t limited to value appreciation and mortgage interest deductions. “Homeownership helps create stability for families and a pride of ownership and a greater sense of community connection,” says Cameron. “For the community, it means people are more involved and engaged.” CMP

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Gold-buying broker raises concerns Some brokers fear it may tarnish the industry’s reputation. But a business advertising broker services – at the same it hawks “cash for gold” – is nonetheless focused on customer service, said the jeweller/mortgage professional behind it. “I am a licensed mortgage agent,” Harold Gerstel, otherwise known as “Harold the Jewelery Buyer” to thousands of TV-watchers in the Toronto area, told MortgageBrokerNews.ca. “I had the jewelery business, and for a few months now have offered first and second mortgages and refinances here, too.” “Harold does some of the business, but I do most of the working with clients and arranging the mortgages,” said Joel Kelman, president of The Mortgage Maven Inc. and a licensed broker for more than 10 years. “It’s in one store, and we use the same ad, but we find that they are different clients: People who are purchasing or selling jewelery aren’t necessarily looking for mortgages. There is some crossover, but not enough to explain the success.” Any connection between cash-for-gold services and the mortgage business may, ultimately, damage the industry, said IMBA President Albert Collu. “I applaud Harold for trying to diversify his business and revenue,” he told MortgageBrokerNews.ca, “but in my opinion, there is an inherent danger in the perception this creates about mortgage brokers in the eyes of the consumer. We have worked hard as an industry to elevate our profile and professionalism and a jewelery shop offering mortgages only hurts us as an industry.” Kelman disagreed. “There are a few bad eggs out there in any profession,” he told MortgageBrokerNews.ca. “But reputation has more to do with your business practice than where you practise your business. Where business is conducted is not the determining factor, but how the client is treated.” CMP

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I have a side business intended to generate leads, but it’s income tax preparation, which is a lot closer to the mortgage business. Tax planning for income properties and RRSP holdings is a good skill to have. – Christopher FSCO was all over me about a accountant conducting mortgage business in his office so I wonder how they are going to treat this? – Paul Mangion This guy is a joke. How do you expect people to take the broker industry seriously when you have clowns like Harold Gerstel the jewelery buyer acting as a mortgage agent. He should just refer the business to a broker or say that he is a private lender. As an industry this is the kind of thing we need to eliminate, people who make the broker industry a joke. Watching those ads you would think that any clown could arrange mortgages. Harold stick to what you do best or full time, hawking cash for gold and let the professional full-time mortgage brokers handle the financing. – Didar I have been in the real estate and mortgage brokerage business for over 30 years and find the mortgage brokerage business the last place you will find any integrity. Agents sell not to help the clients but to obtain the highest finder’s fee no matter what the end result to the client. Designations for professionalism are given out with every cup of coffee you have with a lender. I have hired agents from national companies who have no idea what to do with a lender disclosure because they told me it is done after the fact in-house. Shame on all of you for taking this industry to such a low level. As long as a body can breathe they are now considered a professional mortgage agent. This business is now on the same level as used car salesmen. – What Integrity? Well we have seen the grocery stores get into the banking and mortgage industry why not a jewelery buyer? I’m not saying there is anything wrong with this picture. But we are starting to place an image of ourselves that just about anyone can give you a mortgage. What’s next? The convenience store at the end of your street? Someone should be regulating how mortgage brokers get viewed by the general public. – Kris Our industry still has a lot of work to do to educate the mortgage consumer public exactly what a mortgage broker does. We do have an image problem. We don’t need used jewelery salesman selling mortgages. – Bad Idea I take offence to “What Integrity?” wrote. Just because you have met undesirables, please do not paint us all with that brush. In my 20 years of being in this business I have met and worked with many mortgage brokers with high integrity and ethics. – Ken IMHO

of mortgage consumers, who noted using the Internet during their research phase, used an online mortgage calculator (CMHC 2011 Mortgage Consumer Survey)

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It’s nice to know that this broker needs to use the mortgage broker industry to add credibility to his gold brokerage business. – James Shinners

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Newbie Vancouver brokers go part time as purchases slow The number of Vancouver brokers taking a second job outside the mortgage biz is on the upswing, say seasoned professionals, as the competition for a falling number of originations heats up and newbies find themselves without the established portfolios needed to grow referrals and refinances. “A lot of people looked at broking in the last boom as very lucrative and they entered the market thinking that the money was always just going to flow in,” Luisa Hough, owner/broker of Exclusive Mortgage Professionals in Surrey, told MortgageBrokerNews.ca. “The market has now slowed, and it hasn’t worked out for them and they find themselves in a tough situation.” A number of those relatively new entrants are now seeking part-time employment outside of brokering, a survival strategy meant to make up for the falling number of new purchases in the Vancouver area, according to several industry veterans. Some are pegging the attrition rate as high as seven to nine per cent of the more than 100 mortgage professionals who entered the market after 2008, when sales began to claw their way up to 35,669. It means that by Dec. 2008, Vancouver had bettered the recessionbattered performance of the previous year by 44.8 per cent. The change in fortune led to what many brokers are now calling a super-saturated market of mortgage professionals.

Those new agents are largely without the deep client portfolios more experienced brokers are actively drawing on for refinances, second mortgages and other secondary transactions. They’re not prepared to leave the business entirely, pinning hopes on the return to a more-active market as the B.C. economy capitalizes on increased global demand for its natural resources. But any strategy that would see an agent turn to brokering part time may be problematic, said another brokerage head working the Lower Mainland. “It’s very common: working part time,” Trish Pigott, of Verico Primex Mortgages in Coquitlam, told MortgageBrokerNews.ca. “But as a broker in this market, you have to be on the top of your game. If you’re starting to look for work in another area, you’re not spending the time to keep on top of industry trends and the market or investing the time to grow your business. I don’t know that you can adequately serve clients.” Both she and Hough are suggesting new brokers thinking about part-time work outside the field first seek out mentors, a way of gaining the kind of guidance necessary to weather a slower sales market. “There are opportunities out there,” said Hough. “I’ve been in this business for eight years and every day I’m out there looking to see how I can get business. That’s how this business works.” CMP

I think although I am sure this is true, it doesn’t have to happen. I think many newer mortgage professionals are “flying blind” and/or the training and direction available to them is “Get Back to Basics” or traditional sales and marketing strategies, both of which I think are a failing strategy for new brokers and seasoned ones for that matter. The answer is to evolve into “New World” sales and marketing techniques. That is what every other industry is doing and I think it is time the mortgage industry did the same. – Greg Williamson I would have to agree with the above statement with regards to training and direction. There is a “New World” out there and we all need to adapt our skills. I don’t believe that a broker should have a part-time job. This is a career with a great deal of responsibility on the part of all of us to keep this business professional. It has been a long uphill battle to gain the sometimes little respect given to us as an

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industry. Let’s not stand by and allow our young/new brokers to fall into the “guess I’ll go pump gas” syndrome. We, as owners and team leaders must take responsibility to keep our newer brokers interested and committed. If we don’t do that, then we are not committed to the professionalism of our industry. – Ilona Bronson I’m 20 years at this game. I started in a time when it wasn’t cool to be a broker. Now, many newbies who thought life is easy as a broker are now finding themselves in a squeeze with unrealistic projections. The real correction is roosting on our doorstep. The toughest year yet is ahead of us. A part-time broker does the industry no good just as a part-time “any career” does no good to any industry. Good time to toughen the rules and purge the industry. – Gary Snider

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Growing number of brokers reach for ‘last ditch’ lending Lendwise – what some brokers call the lender of last resort – is reporting 70 per cent yearover-year growth in funded volumes for May, as brokers respond to increasingly fierce competition from the banks on rate, rate and more rate. “It’s up 70, yes, but the overall volume is still very small,” company VP Lloyd Pritchard told MortgageBrokerNews.ca. “The fact is we will do less in volume in one year than what (our parent company) Merix will do in a month. We still see our product as a ‘save your deal option;’ that’s how we sell it; that’s how we market it.” Merix virtually built the division up from the ground floor, launching it in January 2010 as a rock-bottom rate provider for brokers fighting to keep clients from going over to the banker side. That tool – specifically access to rates as low as 3.44 per cent on a five-year fixed – comes at a cost, namely, compensation. The finder’s fee on that same five-year fixed, the company’s bestseller, is 55 basis points and there are no volume bonuses. For the client, the mortgage’s terms are largely in line with industry standards on prepayments and other key areas.

Still, taking a deal to Lendwise is a bitter pill for mortgage professionals to swallow. May’s increased demand may reflect the kind of tight situation brokers across most markets find themselves in as the banks pull out all the stops in order to woo the dwindling number of homebuyers. Lendwise’s increased demand is evenly distributed across Ontario, Alberta and B.C., said Pritchard. But one successful brokerage head has turned to Lendwise over the last year, if only in exceptional cases and only if “a client was walking out the door on the way to the bank and had a verifiable bank commitment letter in hand,” said Tom Lam, owner of Alberta’s Urban Mortgage. “It’s a last-ditch effort to keep the client, because a client is better than no client, and our business is all about the referral.” Brokers often only turn to Lendwise after they’ve looked at whether it’s feasible to buy down their rate with another lender, something that would allow them to protect a possible volume bonus. Pritchard encourages that kind of research. “Our product is meant to be an option in those rare conditions – a back-pocket option,” he told MortgageBrokerNews.ca. “In an environment where it is increasingly competitive, brokers need as many options as they can get, and there’s a pretty big distinction between using low rates as a primary driver of your business and using it in order to save a deal. We always have to be thinking about keeping the deal with the mortgage broker and keeping the client out of the hands of a non-broker channel lender.” CMP

The industry is more competitive than ever. I don’t use Lendwise. It’s the same as these no frills products they will come back to bite brokers on payout. You are just looking at the single transaction if you are selling these mortgages instead of the long-term sustainability of your business. I would rather network for new clients or call an existing one than get into a rate war with a half dozen other mortgage brokers or banks over the Internet. – Calgary Agent

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JULY 2010, 5.7

Canada’s top

50 brokers P R ES E N T E D BY

SPECIAL FOCUS PACKAGING THE COMMERCIAL DEAL

FEATURE HOW TECHNOLOGY HAS CHANGED THE INDUSTRY

PROFILED MICHAEL BECKETTE DEDICATED TO THE SUCCESS OF HIS BROKERS PUBLICATIONS MAIL AGREEMENT #41261516

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7/7/10 3:19:42 PM

2010

this time last year Canadian household net worth reaches $6 trillion Canadian household net worth increased by 1.3 per cent to hit $6 trillion in the first quarter of 2010. This is the fourth consecutive quarterly improvement in household net worth, marking a 96 per cent recovery of net worth lost during the economic crash, according to David Onyett-Jeffries, economist with RBC Economics. Other numbers from RBC show a strong Canadian housing market. Non-financial assets, where real estate contributes 85.5 per cent, is up 0.8 per cent to $24.9 billion from the previous quarter. Mortgage debt increased by $16.4 billion in the first quarter, signalling continued growth in the real estate market. Over all, household liabilities rose by 1.5 per cent to $1.4 trillion. One year later Household debt has hit a troubling $1.5 trillion, sparking new fears that the heavy burden on Canadian consumers could hurt the economy, particularly as fiscal stimulus fades. The figure, from a recent report by the Certified General Accountants Association of Canada, means that if household debt were distributed evenly across all Canadians, a two-child household would owe an estimated $176,461, including mortgage costs. “The debt of a typical household is rising,” said Rock Lefebvre, CGA-Canada’s vice-president of research and standards and co-author of the report. “And the financial situation of certain groups of households is much worse than average and continues to deteriorate.” The study highlights some disconcerting trends. About 27 per cent of working Canadians aren’t saving, while single-parent families, retirees and households with an income of $50,000 and under are in particularly dire straits. Single parents were the only

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family category listed in the report where debt climbs with age, and one-third of retired households are burdened by an average debt of $60,000. Households with an income of less than $50,000 are “six times more likely to be financially vulnerable in terms of their debt-service ratio,” the study said. The debt-service ratio assesses the ability to honour debt obligations. Several observers have warned that a rise in interest rates, expected later this year, will further squeeze consumers as borrowing costs – from credit cards to lines of credit – go up. “Exhausted consumers will be more sensitive,” said Benjamin Tal, deputy chief economist at CIBC World Markets. “A high level of debt means interest rates will be very powerful in slowing down the economy.” There are, however, signs of change. After five years of serious debt accumulation, TorontoDominion Bank said in a report, Canadian households are “finally tapped out,” and there has been a “notable scaling back in the pace of borrowing over the last six months.” The debt-to-income ratio is now stable at 147 per cent. And the rate of debt accumulation is slowing, too, Mr. Tal added, now the lowest in nine years. TD expects households to continue to work off some of their debt. But the weary consumer is already curbing economic growth. Consumer spending was flat in the first quarter of this year, the weakest showing in two years. Consumers typically account for 60 per cent of the country’s gross domestic product, but rising living costs, along with elevated debt levels and rising interest rates, suggest they won’t be much help this year. CMP

Feature Technology

technology tr 34

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Feature

Technology

ansformation mortgagebrokernews.ca mortgagebrokernews.ca

Feature Technology

Broker channel advances are all about meeting the clients where they live, say industry players, and that, Vernon Clement Jones finds out, is on the technological fast track

Michael Beckette (right) and Scott Ede of Mortgage Alliance-S&R Mortgage Group on MACTV.

s news about tougher mortgage rules began to sink in and broker hands were being wrung raw with worry, Mortgage Alliance President Michael Beckette was preparing to turn that lemon into a 23 per cent jump in pre-approvals. “Michael was on MACTV very soon after the rules were introduced in January and spoke to hundreds of our brokers and agents directly, in real time, about how they could actually use those changes to reach out to clients get them pre-approved before the changes took effect in March,” Louie Bettio, MAC’s Brand Champion, tells CMP. “It grew pre-approvals for our brokers by just under 25 per cent for the first quarter compared to the same period last year. It’s a great example of the power of MACTV to reach out to our brokers from one end of the country to the other and across markets simultaneously.” It’s also an example of the broker channel’s growing reliance on technology,

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cutting edge or otherwise, to advance communication between brokers and super brokers, mortgage agents and mortgagors and, of course, the mortgagees. That interface is rapidly expanding beyond the kind of second-generation web broadcasting that MACTV – a weekly, live simulcast reaching hundreds within the Mortgage Alliance network – relies on. Still, all of those technologies, like Beckette’s fireside chats where he gets pilloried with agent questions and actually answers them, make it easier for brokers to track down leads, conference with clients and close deals. The tools run the gamut from social media and mobile phone apps to advances in customer relationship management to online programs designed to streamline the application process and give instant feedback to appraisers. What’s driving the advances, say broker networks, is the consumers. “We now have to meet our clients where they live, and that’s technology,” says John Kelly, chief operating officer for Verico Financial Group. “It used to be that a lot of brokers were happy with a Rolodex, but smart brokers are now using technology for all its worth and getting more and more tech-savvy, along with their clients, and that’s requiring service providers, super brokers and every other aspect of the business to step up their game.”

“ it used to be that a lot of brokers were happy with a Rolodex, but smart brokers are now using technology for all its worth and getting more and more tech-savvy. ”

Feature Technology

The B.C.-headquartered organization is among several competing networks that have launched upgrades to their CRM and other software programs for brokers, a way of meeting their evolving needs, but also as a retention tool. At its Las Vegas conference just in June, Verico introduced what Kelly terms “four enterprise-class technology systems that will form the foundation of our brokers’ system.” Chief among them was VericoDynamics.com, the network’s next generation “end-to-end” business management system, based on the Microsoft Dynamics platform and tailored to meet the specific needs of Canadian brokers. Essentially, it allows agents to use their iPads and smartphones as travelling offices or dashboards. They can stay connected with client files and keep the clients, themselves, in the loop throughout the application process well before the file matures into a submitted application.

Top: John Kelly Middle: Steve Malone Bottom: Ryan Smith

“ it gives them a much better sense of the stage of process for the application’s approval and funding, but more importantly, it creates greater client stickiness for brokers in that it makes the transaction more concrete in their minds. ” “What’s new here is that the broker can create a customer account for the client to upload documents and track that application on their own,” says Kelly. “It gives them a much better sense of the stage of process for the application’s approval and funding, but, more importantly, it creates greater client stickiness for brokers in that it makes the transaction more concrete in their minds.”

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“ it’s not enough to work harder. In this environment you have to work smarter and we’re committed to continuing education and setting the standard for our industry. ” For broker-owners, it’s being billed as a way to better manage agents and review transactions at each point in the pipeline, all within a secure electronic network. It also ties in another product launched in June, VericoPayroll.com, an update to the super broker’s human resources management system. “Think Ceridian customized for mortgage brokers and agents and connected to Turbo or Quickbooks in the Cloud,” says Kelly. The newly launched VericoFilemaker. com is client-side software that can be customized by the broker for either a Mac or PC platform. But increasingly networks are looking for ways to answer industry concerns about the educational limitations of agents. Calls for tougher licensing standards and testing have challenged super brokers to deliver go-at-your-ownpace training, accessible outside the classroom and anytime of the day. “Verico Academy allows agents to access continuing education tutorials through a combination of video-based and one-on-one personal coaching approaches, covering everything from business development to coaching and accountability,” says Kelly, “It’s not enough to work harder. In this environment you have to work smarter and we’re committed to continuing education and setting the standard for our industry.” More and more, it’s the entire industry’s focus, as service providers for the broker channel try to grab a hold of tracking software and other technological

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Feature Technology

“ part of that has been giving our appraiser partners the tools to grow their own efficiency and to check it against the over 3,000 appraisers in our network through real-time feedback forums. ” advances in order to strengthen their accountability to brokers and themselves. “Solidifi’s technology helps make the lives of appraisers, brokers and ultimately lenders more efficient,” Ryan Smith, chief technology officer for the appraisal management firm tells CMP. “Part of that has been giving our appraiser partners the tools to grow their own efficiency and to check it against the over 3,000 appraisers in our network through real-time feedback forums.” The company will soon roll out appraiser collaboration widgets, which

offer real-time discussion and feedback forums for appraisers. Solidifi has already activated an online survey, which provides appraisers the ability to gain market intelligence and register opinions about Solidifi services. The development of an app allowing appraisers to access those features in the field is also a key part of the technology plan. Perhaps of more direct interest to brokers, this spring Smith launched the Solidifi Appraiser Transparency Report, which, he says, provides appraisers with a real-time performance scorecard comparing their performance against competitors in their market, but without violating privacy. By logging onto “Solidifi Values” portal, appraisers in the network see real-time reports comparing – and, indeed, effectively ranking – their individual performance against the other professionals the company partners with. “That ranking is based on three major areas,” says Smith, “price, speed and quality of work, which includes the revision rate and overall compliance.” Appraisers also access rankings of the unnamed Top 10 and their performance stats, a way of encouraging self-evaluation and helping appraisers better their individual performance on broker files. There is still freedom of choice for appraisers, adds Smith: Solidifi does not force those partners to submit appraisals through online forms or work for set appraisal costs. While mortgage professionals don’t have direct access to the rankings, they can access the company’s database of appraisal partners, using the software to pick and choose.

“ that ranking is based on three major areas: price, speed and quality of work, which includes the revision rate and overall compliance. ”

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Feature Technology

Michael Davies

Greater selection. It’s something Davis + Henderson, another key service provider for brokers, has beefed up this year, with its latest version of Expert, the web-based mortgage origination application most brokers rely on to submit funding requests, arrange appraisals and credit reports, monitor a file’s progress, and, ultimately verify commission. “We want to make it easier for our clients to do business – and we use a combination of regular client input and deep industry expertise to identify the progression opportunities that will be most valuable,” Steve Malone, VP of broker services for D+H, tells CMP. Upgrades to the Expert platform made over the last year run from evolution to a dual credit bureau reporting option, with the addition of TransUnion, to the overhaul of data

“ we want to make it easier for our clients to do business and we use a combination of regular client input and deep industry expertise to identify the progression opportunities that will be most valuable. ” communication between Expert and lenders. That last item has been especially important for brokers. It includes the newly introduced ability to send lenders “Deal Status and Condition Management updates,” says Malone.

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Feature Technology

“ if the time comes that we feel that we are falling behind because we are not as technologically savvy as other brokers, we’ll have to revisit that decision. ” “Brokers and lenders who are now using this new service report being delighted with the upgrade.” Additional features are now handing brokers greater leeway to sync Expert with their own business requirements. One way is the enhanced capability to copy broker data from one firm over to another, “which has been particularly valuable in the face of ongoing industry consolidation and broker firm mergers,” says Malone. Still some brokers aren’t solely swayed by technology. Competing platform MorWEB doesn’t have the lender reach of Expert or all of it bells and whistles, but manages to maintain a following. “I’ve used Expert and am familiar with its technological upgrades,” says Gail Di Stefano, co-owner of BTB Mortgage Solutions in Niagara Falls, “but I’m dedicated to MorWeb because of its own

mortgagebrokernews.ca

user friendliness and its built-in CRM, which I find makes it easier for me to use the system faster without get timed out. As long as we can still do our job effectively, we will continue to use it.” But ultimately, an industry-leading tech-heavy Expert may win out, she concedes: “If the time comes that we feel that we are falling behind because we are not as technologically savvy as other brokers on Expert, we’ll have to revisit that decision.” D+H is actively looking to test that resolve, planning addition tech-laden enhancements meant to help brokers prepare and send applications to channel lenders. On the blotter: The launch of an Expert mobile app that brokers can use

“ late in the year, we will be doing some significant work ‘under the hood’ to upgrade our technology platform to the latest standards, giving us greater flexibility to introduce additional capabilities and improved performance going forward. ”

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Feature Technology

on their smartphones to get real-time updates on a deal’s status. It will also allow for direct email and phone hook-up. D+H is also looking to introduce a number of optional compliance and fraud detection capabilities for both brokers and lenders.

“ the notion that ‘Internet lead generation is only about rates’ may be re-framed to, ‘according to many surveys, well over 80 per cent or more of people start their mortgage search on the Internet.’ ”

Top: Greg Williamson Bottom: Joe Wamboldt

“Late in the year, we will be doing some significant work ‘under the hood’ to upgrade our technology platform to the latest standards, giving us greater flexibility to introduce additional capabilities and improved performance going forward,” says Malone, offering one last nod to technology improvement. With originations slowing across key markets and competition with the banks heating up, brokers are fighting to maintain, if not improve, the size and quality of their portfolios. Internet technologies – specifically online lead generation – are stepping forward to grow, although not without controversy, that client base. “I have recently been leading our community to re-frame our thinking on Internet lead generation,” says Calgary broker Greg Williamson, who also leads industry training firm 180 Degrees Coaching. “The notion that ‘Internet lead generation is only about rates’ may be re-framed to, ‘according to many surveys, well over 80 per cent or more of people start their mortgage search on the Internet.’ The point, I think, is that Internet lead generation may be all about rate because that is all that is out there.”

mortgagebrokernews.ca

There is no maybe: they are all about rate, say brokers, who use those online referral agents to reel in leads. In fact, the bait, itself, is rate – rather, the lowest rate. “At the end of the day, I found that I got the lead if my rate on that product was the lowest on the (referral site) that day,” Paul Poirier, a Top 20 broker with Dominion Lending Centres based in Toronto, tells CMP. “People online are looking at rate, first and foremost. They’re not like referrals from clients. Here the rate has to be the lowest or very near the lowest to get the lead.” He represents a growing number of brokers finding it easier and, indeed, cheaper to turn the expanding number of online referral agents. In many cases, they’re winning as much as a 50 per cent conversion rate for their efforts, and the expense of anywhere from $50 to $80 per lead. There is also the cost, in many cases, of having to buy down your rate. Relying on search optimization methods, firms like RateHub.ca and RateSupermarket.ca are focused on generating “quality leads” for mortgagebroker clients by offering Internet users a daily comparison of their clients’ rates and then linking them to an individual broker’s website. Fees are entirely based on leads and, generally, not just the number of clicks to the client’s landing page. The approach is a little more targeted than Google Adwords, where the mortgage professional tends to get more clicks, although the lead conversion rate is often much lower, say critics. “With the lead generation sites, what we’re getting is fewer leads, but the quality

“ people online are looking at rate, first and foremost. They’re not like referrals from clients. Here the rate has to be the lowest or very near the lowest to get the lead. ”

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Feature Technology

of the lead is better,” Poirier says. “They’re perspective buyers who are genuinely in the market for a mortgage.” Other brokers are reporting similar gains. “It’s a pretty effective tool, if they’re funnelled through a Ratehub.ca or RateSupermarket.ca,” Theresa Shaw, broker of record at Finder Financial Services Ltd. in Vancouver, told CMP. “They’re educating users about the services of the broker channel and that helps us to close a deal. If they’re just going to your site because it is placed high on Google Adwords, then they may not have the knowledge base.” Those online referral sites are increasingly connecting with younger buyers, more inclined say surveys from Genworth Financial, CAAMP and CMHC, to search online for both the home and the mortgage to pay for it. They are, in fact, the courted and pampered demographic driving much of the technology now transforming the broker channel. Those changes are coming rapidly, says Mike Davies, VP of Marketing at Dominion Lending, although his rapidly expanding organization is keeping up with broker demand, and by extension, those of borrowers. “Dominion built its own QR Code generator that makes it easy for members to generate them for marketing purposes,” he tells CMP.

mortgagebrokernews.ca

Those Rorschach-like barcodes are now popping up on mini-billboards and in brochures and other promotional material for DLC brokers and competitors at most other networks. The technology allows smartphone users to download a broker’s URL or other vital statistics and helps warm up a cold lead. “In the first 72 hours of launching the generator on the Dominion Intranet, we had over 336 page views by our users,” says Davies, referencing DLC brokers eager to access information about the tool producing what analysts call “the next-generation business card.” Davies’s generator dovetails with a Google API, enabling Dominion members to generate an unlimited number of unique QR codes. The company, like its competitors, is also busy advancing the utility of its Intranet. That network-internal web platform hosts all of DLC’s expanding library of training videos, each on a high-def content delivery network, which avoids the stop-and-go, sit-and-wait video streaming too often associated with watching video on the web.

“ you want them to remember you, but in as many dimensions as possible. ” As at D+H, apps are also at the technological forefront of DLC’s plans. “Corporately, we provide a web app that allows potential customers to view the latest mortgage rates, calculate mortgage payments, and subsequently find a Dominion Lending Centres mortgage professional in their local area,” says Davies. Eager brokers like Joe Wamboldt from Dominion Lending Centres Cornerstone have taken that step into the future themselves, building apps that provide users with not only the latest rates available to them, but, in the case of Wamboldt’s application, a mortgage quiz meant to educate and entertain prospective leads. “You want them to remember you,” laughs Alberta-based Wamboldt, “but in as many dimensions as possible.” CMP

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Cover Top 50

Now in its fourth year, the CMP Top 50 Brokers survey saw an increase in submissions as well as a surge in funded volumes across the board. CMP explores the results.

010 was a good year for Canadian mortgage professionals. Just check the numbers. The results of our fourth annual CMP Top 50 Brokers list, a ranking of mortgage professionals from across Canada in 2010 shows funded volumes increased from the previous year. Last year, four brokers topped the $100-million mark. This year, nine brokers surpassed that barrier, including three who funded more than $200 million. The trend continues throughout the list, with this year’s 50th broker funding $10 million more than the same position a year ago. The rules for submitting were straightforward: you must be employed as a mortgage professional able to write loans and the deals must have been personally originated by you (back-office support in processing the loans is acceptable, but no other parties have been paid commissions on the deals). We went to confirmed figures submitted by everyone with brokerage head offices and lender underwriters. We recognize that although numbers are paramount, when it comes to ranked lists there are complexities to any survey and reasons behind every ranking. A high volume and a large number of deals can indicate that you are doing something right to stand out from the crowd, be it launching a clever marketing campaign, tapping into new referral sources, building a list of “niche” clients or simply providing top-notch customer service. It also, in many cases, speaks to a mortgage professional’s hard work over his or her years in the industry. In addition to profiling the top five mortgage brokers from the Top 50 Brokers, we also take a

mortgagebrokernews.ca

PRE

look at some brokers who made the list from some smaller population centres as well as Atlantic Canada’s only member of the Top 50. Another interesting result this year was the placing of seven brokers on the list from one brokerage (read the profile of Mortgage Brokers Ottawa on page 70). CMP congratulates all the mortgage professionals who took part in this year’s list and would like to thank FirstLine Mortgages for being the official partner to the CMP Top 50 Brokers list.

FirstLine Mortgages is proud to support the CMP Top 50 Brokers As exclusive sponsor of the 2011 CMP Top 50 Brokers, FirstLine Mortgages would like to extend our sincere congratulations to this year’s top performing brokers. As leaders in the industry, you have proven that dedication to your clients and exceptional service, are keys to success. FirstLine Mortgages is committed to providing our brokers with tools to help them succeed. We take pride in our commitment to service and strive to provide you with the best possible experience. Our competitive reward programs and events help you grow your business and provide valuable industry insight and networking opportunities. From all of us at FirstLine Mortgages, congratulations, and thank you.

Cover Top 50

Funded Volume

Funded Deals

Support Staff Who Don’t Write Loans

Support Staff Who Do Write Loans

Years as Broker

VERICO Real Mortgage Services

$263,461,354

602

Calgary, AB

True North Mortgage

$254,687,571

915

Jim Tourloukis

Unionville, ON

Advent Mortgage Services

$212,927,433

548

Calum Ross

Toronto, ON

Mortgage Professionals Inc. – The Mortgage Centre

$170,327,966

518

Collin Bruce

Edmonton, AB

Dominion Lending Centres Mortgage Mentors

$137,281,939

457

Paul Gazzola

Guelph, ON

Mortgage Architects

$130,570,000

636

Dave Butler

Mississauga, ON

Mortgage Intelligence

$122,183,347

509

Scott Travelbea

Victoria, BC

Dominion Lending Centres Travelbea & Associates

$110,547,834

317

Richard Kitts

Kitchener, ON

Tristar Funding – The Mortgage Centre

$100,180,000

465

Nicole Drummond

Ottawa, ON

Dominion Lending Centres The Mortgage Source

$98,392,750

453

Christopher Bisson

Guelph, ON

Complementary Real Estate Services – The Mortgage Centre

$94,588,848

410

Bill Macklem

Surrey, BC

Dominion Lending Centres Macklem Mortgages

$91,588,000

300

Greg Martel

Victoria, BC

Dominion Lending Centres Harbour View Mortgages

$89,000,000

227

York Polk

Ottawa, ON

Mortgage Brokers Ottawa – The Mortgage Centre

$83,718,905

337

Frank Napolitano

Ottawa, ON

Mortgage Brokers Ottawa – The Mortgage Centre

$77,431,983

298

Dustan Woodhouse

Anmore, BC

Dominion Lending Centres Canadian Mortgage Experts

$75,316,351

177

Angela Calla

Port Coquitlam, BC

Dominion Lending Centres Angela Calla

$74,717,701

236

Sarah Makhomet

Mississauga, ON

Dominion Lending Centres Mortgage Village

$71,999,097

252

Morris Briglio

North Vancouver, BC

The Mortgage Advantage

$69,075,202

156

Debbie Belair

Ottawa, ON

Mortgage Architects

$68,396,610

262

Lisa Theriault

Ottawa, ON

Mortgage Brokers Ottawa – The Mortgage Centre

$66,730,925

252

Cindy Faulkner

Surrey, BC

VERICO Coastal Mortgages

$65,301,144

187

Mark Goode

Orillia, ON

Mortgage Architects

$64,520,356

362

$63,854,185

193

$63,526,822

228

Rank

2010 Rank

Name

City/Province

Company

Gord Pipkey

Richmond, BC

Dan Eisner

Sharnjit Gill

Surrey, BC

VERICO Superior Mortgage Inc.

Jordi Browne

Chilliwack, BC

VERICO Preferred Financing Inc.

mortgagebrokernews.ca

Cover Top 50

Funded Volume

Funded Deals

Support Staff Who Don’t Write Loans

Support Staff Who Do Write Loans

Years as Broker

VERICO The Mortgage Wellness Group

$62,837,276

278

Edmonton, AB

First Foundation Residential Mortgages

$62,294,794

237

Justin Blacklock

Vancouver, BC

TMG Averbach Mortgages Ltd.

$60,306,000

131

Murray Groen

Ottawa, ON

Mortgage Brokers Ottawa –The Mortgage Centre

$60,207,792

246

Luisah Hough

Surrey, BC

Exclusive Mortgage Professionals

$59,000,000

140

Harold Tagg

Stony Plain, AB

Centum MortgageFlex Ltd.

$59,000,000

218

Jeff Cody

Ottawa, ON

Mortgage Brokers Ottawa – The Mortgage Centre

$57,322,837

223

Lisa Manwaring

Delta, BC

Mortgage Alliance Meridian Southwest Mortgage

$55,000,000

185

Jason Singh

Toronto, ON

VERICO COD Financial Services

$55,000,000

145

Deb White

Vernon, BC

Dominion Lending Centres White House Mortgages

$54,071,234

216

Lance Cook

Victoria, BC

CBM Canada's Best Mortgage

$52,541,244

169

Bruce Gilkinson

Listowel, ON

Gilkinson Financial – The Mortgage Centre

$48,687,195

274

Robert Floris

Hamilton, ON

Mortgage Architects

$48,362,000

221

Jeff Attwooll

Cambridge, ON

Dominion Lending Centres Your Mortgage Partner

$47,930,360

210

Sabeena Bubber

North Vancouver, BC

VERICO Integre Mortgage Partners

$47,017,100

111

Maria Kyle

Duncan, BC

Dominion Lending Centres Vintage Financial

$46,830,907

167

Lisa Yun

Coquitlam, BC

Elder Mortgage - The Mortgage Centre

$46,178,201

121

Terry Short

St. John's, NL

The Mortgage Centre

$45,221,762

222

Aman Khatkar

Surrey, BC

VERICO Aman Khatkar Mortgage Group

$42,660,210

130

Darren Keck

Ottawa, ON

Mortgage Brokers Ottawa –The Mortgage Centre

$42,287,735

140

Darick Battaglia

Barrie, ON

Dominion Lending Centres YBM Group

$42,219,695

166

Paul Stapley

Campbell River, BC

Dominion Lending Centres Coastal Mortgages

$42,000,000

186

Tonia Jacobsen

South Surrey, BC

Dominion Lending Centres Canadian Mortgage Experts

$41,861,544

144

Reed Harris

Vancouver, BC

VERICO Manifest Mortgage Corp.

$41,564,458

126

Michael Hapke

Ottawa, ON

Mortgage Brokers Ottawa – The Mortgage Centre

$41,508,353

164

Rank

2010 Rank

Name

City/Province

Company

Nick Lecuyer

Barrie, ON

Gordon McCallum

mortgagebrokernews.ca

Cover Top 50

While the Top 50 Brokers list may be populated with big-city brokers, there are some mortgage professionals from smaller urban areas that have made the grade and CMP spoke to three of them to learn the secrets of their success

Small-town success Bruce Gilkinson #37 ++ Principal Broker ++ Gilkinson Financial – The Mortgage Centre ++ Listowel, Ont. Most mortgage brokers probably haven’t had an issue with trying to prove to a bank that their client’s place of employment really does exist. “I’ve had banks turn down clients because when they searched for the company, it’s not on the Internet or in the Yellow Pages and the pay stub is handwritten. They think I’m trying to defraud them,” recounts Bruce Gilkinson, principal broker at Gilkinson Financial – The Mortgage Centre in Listowel, Ont., a town of 8,000 an hour outside of London. “And we’ve learned to live with things like that and work with that.” Gilkinson began his career in 1993 as a tax planner before entering the mortgage business in 2001 and later forming Gilkinson Financial, which specializes in mortgages, income tax preparation, bookkeeping, financial planning and credit counselling. Recently Gilkinson also became licensed as a mutual fund representative. Being based in a smaller community is definitely different than working in a larger urban setting, says Gilkinson. “We need to be creative and do everything we possibly can,” he says. “Our average deal is smaller, but I’m sure some of these little deals are harder to put together than some larger ones, because of some of the different variables we deal with such as location and property type.” He says there are few B lenders willing to do business in the area. “If it’s not CMHC-insured, they aren’t going to lend and I have to turn to private lenders,” says Gilkinson. He also deals with a lot of people, despite the smaller population of his location. “I did 800 applications last year. Half my day is spent helping people fix their credit or consolidate debt in order to get these mortgages approved. I can’t be like these

big-city brokers and turn them down and go on to the next one. “Of those 500 I didn’t get, I’m still working with them, hoping I can get them a mortgage this year.” One advantage Gilkinson points to as an advantage is the lack of competition. “My business is built on referrals and repeat customers,” he says. “I don’t have to do a lot of advertising. “A few years ago I branded myself on our one local radio station by providing mortgage information without soliciting business directly.” It seems to have worked, although Gilkinson says 2010 was not his best year. “Our local economy was hurt last year by the closing of some auto industry-related factories and that’s one the downfalls of being in a small community sometimes - if you only have one or two major employers and one of them goes under.” But because of the many hours spent with people helping to rehabilitate their credit or simply advising them about what steps to take to improve their chances of qualifying for a mortgage, Gilkinson believes his business will bounce back. “Many clients weren’t able to take advantage of the low interest rates last year because they had too much revolving debt. I helped a lot of these people for free and they tell me that when they’re ready to buy they will get their mortgage from me.” And once they do, referrals will come as well, because Gilkinson believes it’s about the service they receive, not the rate they get. “Rate is secondary. Clients aren’t going to talk about rate if the deal didn’t close on time or they had a bad experience. “I make sure the process is simple and as easy as possible and I think it’s worked because so many of my clients say, ‘It doesn’t matter, you know this guy is going to get you a great rate, but boy he’s great to work with and you need to call him.’” It’s taken him 10 years to get to that point and Gilkinson says he will continue to grow in a market that others might dismiss as not lucrative enough. “My goal is $100 million in the next couple of years.”

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Mark Goode #23

Deb White # 35

++ Owner/Mortgage Planner

++ Owner

++ Mortgage Architects ++ Orillia, Ont.

++ Dominion Lending Centres White House Mortgages ++ Vernon, B.C.

The grocery store is not where most mortgage professionals run into clients, but when you work in a smaller community, such as Orillia, Ontario, it does happen. Just ask Mark Goode. “We’re part of the community,” says the mortgage planner/ broker of Mortgage Architects. “We work and live here.” This means the interaction with clients and past clients occurs more regularly. “We really have to do what’s best for the client, so we can hold our heads up high as a part of this community,” says Goode. He says this leads to differences in how we approach this business. “We do a lot more marketing. “It’s a constant 24-hour a day marketing effort.” And it’s more than ads in the newspaper. “We’re very involved in the community,” says Goode. “We sponsor sports teams, support our local schools and also do quite a bit of community service.” Referrals are the lifeblood of Goode’s business and he says that’s just how it is in a small town. “Everyone knows someone here in town that has a trade or is a professional. If I’m putting up a fence, I would have two or three people recommend someone to me. It’s all word of mouth. “Once we do get a customer in and do a great job with them, then obviously we ask for referrals and that’s where most of our business comes from. “I think people prefer to deal with somebody that their family or friends will recommend.” Goode says a lot of his customers have specialized fields and in turn, “We have a lot more people who are self-employed,” he says. “A lot of our clients need that expertise and extra help we provide to get that mortgage.” That extra help includes an application process that is very hands-on, according to Goode. “I meet with every single client. I sit down and go through the commitment with them face-to-face and have them sign in my office.” “When you’re in a smaller town, sometimes modern technology and communication by way of e-mail simply doesn’t cut it.”

Vernon, B.C. is a town where everyone knows your name – if your name happens to be Deb White. The owner of Dominion Lending Centres White House Mortgages doesn’t boast about being well-known in this interior city of 35,000, she’s worked hard becoming the face of mortgages in town where the lifeblood of her business is referrals. “I’m at a point now where people know me. I can’t go anywhere in town without people knowing me,” laughs White, who has owned White House Mortgages for six years. “I’ve done a massive amount of marketing. Getting my name out there and staying consistent is the key. A lot of brokers will stop advertising when it gets slower or will stop advertising when it gets busy. I’m consistent [with my advertising]. I never stop.” Name recognition is important because despite its small size, Vernon provides White with plenty of competition from brokers and of course the banks. But she’s finding that her advertising efforts and hard work are paying off when it comes to competing with the banks in town. “The one thing I’m finding is people are coming back because they know we’re still going to be here, where they’re not confident that the people at the bank are still going to be there. “We’re kind of a staple in town now and people know where we are.” They are also appreciative, as the seemingly endless trail of testimonials on White’s website can attest to. White is certainly not going anywhere, as her tireless involvement in the community proves. During the conversation she mentions board meetings over the following few days involving the Vernon Winter Carnival, the Run For the Cure supporting breast cancer research and the Mortgage Brokers Association of British Columbia. Earlier this year, White was recognized for her volunteer work with a nomination for Best Community Service Effort at the Canadian Mortgage Awards. White says word of mouth about her brokerage is continuing to increase business as volume is up 10 per cent already this year after 2010 saw a $4 million improvement in volume funded. “Last year was definitely a mixture, with more refinances and this year I’ve seen more purchases,” she says while checking the whiteboard in her office for confirmation. Of the 54 deals listed, White says 21 are for purchases, or approximately 40 per cent. Last year I would say it would have been 20 percent.” CMP

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like a

rock

During his 25 years as a broker in St. John’s, Terry Short has seen the broker industry in Newfoundland expand rapidly and his experience has allowed him to capitalize on a booming economy and become the only broker from Atlantic Canada on this year’s Top 50

Terry Short

ne might envy the position Terry Short found himself back in 1986 when the mortgage broker community in St. John’s, Nfld. consisted of himself and one other broker in town. Since then, the number of brokers has increased, as has Short’s business, which last year totalled more than $45 million in funded residential volume and landed him in 43rd place on this year’s Top 50 Broker list. “We’re fairly well known in St. John’s because we’ve been around for so long,” says Short, stating the obvious. “We do a lot of advertising, including TV, and most of my business – 90 per cent of it – comes from referrals from previous clients, we do a lot of contacting our clients with regards to staying in touch.” Short doesn’t partake in the usual broker custom of using real estate agents to generate referrals. “You can’t rely on real estate agents for business, although we all have our own Realtors,” he says. “I’m not knocking the real estate community, I’m just saying it’s the flavour of the day. ‘Yesterday you couldn’t do this deal for me after you did 10 before, but this chap down the road who is a broker, albeit new, can do it. How come? I’m going to start dealing with him.’” The increase in funded volume over the past few years has been mainly due to an improved economy, low interest rates and the effects of the “havoc down below” as Short refers to continued economic troubles south of the border. Specifically, massive scale offshore projects such as Hibernia, Terra Nova and White Rose have created more than 3,500 jobs and injected more than $1 billion into the local economy since 2007, according to labour market statistics. The workers associated with those offshore drilling

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++ Total Volume Funded: $3,940,728,675 ++ Average Volume Funded: $78,814,573.50 ++ Median Volume Funded: $63,182,049 ++ Total No. of Deals: 13,867 ++ Average No. of Deals: 277 ++ Median No. of Deals: 228 ++ Average Funded Deal: $287,375.26 ++ Total No. of Years as a Broker: 546 ++ Average No. of Years as a Broker: 11

Provincial Breakdown: ++ Ontario 23 ++ British Columbia 22 ++ Alberta 4 ++ Newfoundland & Labrador 1

Brokerage Breakdown: ++ Dominion Lending Centres 14 ++ Mortgage Centre Canada 13 ++ VERICO 9 ++ Independent 6 ++ Mortgage Architects 4 ++ Mortgage Alliance Canada 1 ++ Mortgage Intelligence 1 ++ TMG The Mortgage Group 1 ++ Centum 1

Number of brokers from 2010 on this year’s Top 50 list

PR ES ENT ED BY

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projects have also driven a residential construction boom, starting in 2004, with home prices on Newfoundland’s Avalon Peninsula expected to climb another four per cent this year even as those across most of the rest of the Atlantic region fall well below the growth rates of 2009 and 2010. “We’ve kind of had the best of both worlds the past few years,” says Short. “A decent economy and decent interest rates.” In 2010, Short estimates his mortgage business was split 60/40 between purchases and refinances, something that has remained constant for the past few years, according to Short. In 2011, business has slowed down, but has started to pick up recently. Short attributes the slow start to mortgage rule changes that lower amortizations to 30 years and lowered the loan-to-value ratio for borrowers to 85 per cent. “We’re probably on a 2009 pace instead of a 2010 pace right now.” The pace of growth in Short’s competition has certainly increased since 1986.

“I’ll go to an industry event and I say ‘Who are all these people and where did they come from?’” says Short. “They seem to pop up overnight and the problem with that is, of course, is that here in Newfoundland, if you have $300, go get a licence and you’re a broker, that’s it. “For years now we’ve been trying to get something legislated in regards to the education of brokers. It’s dangerous. When you have someone out there trying to put together a mortgage and they don’t know what they’re doing, and they screw up, that’s not just reflected on them, it’s reflected on the broker community in general. All it takes is a bit of bad news to bring the broker industry down a bit. I’m a broker and that’s frustrating.” Short’s secret to success? It’s not really a secret at all. “We try to treat people as they would want to be treated themselves, because that’s important to us and client referral is very important to us. We pride ourselves on customer service. “It’s a smaller market, so word travels fast.” CMP

License #11127

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When times are tough, as they were in the real estate market a few years ago, the strategy of cutting back expenses, such as advertising, can be tempting for businesses, but for Collin Bruce, it was never a consideration. “When the market was down in 2009, we took advantage of signing some long-term advertising contracts, knowing the market was going to improve,” says Bruce, owner/broker with Dominion Lending Centres Mortgage Mentors in Edmonton. “We’re at about 40 per cent repeat and referral customers, with the rest coming from new advertising, and our plan is to eventually slow down the advertising as our referral business keeps growing.” Referral clients are the best because, “they’re not shopping you,” says Bruce. This year should see an increasing number of house shoppers, says Bruce, as the local economy is predicted to grow because of things such as the oil sands project. “As the economy improves and everyone feels better about it, more people are going to be buying houses and our purchases are going to increase significantly.” That will move away from the makeup of Bruce’s business in 2010, when it was an even split between new purchases and refinances. “While some people were still a little bit gun-shy because of the recession, many were taking advantage of low interest rates,” says Bruce. “Early in the year there was an artificial rush to get

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STATS ++ Company: Dominion Lending Centres Mortgage Mentors ++ City/Province: Edmonton, Alta. ++ 2010 ranking: NR ++ Support staff who write loans: 2 ++ Support staff who don’t write loans: 2 ++ Years as a broker: 6

into the market created by the first wave of mortgage rule changes from the federal government. I see purchases increasing this year, driven by continued population growth as people move to the area for employment opportunities.” Taking advantage of every opportunity also helps explains Bruce’s success. He recently became involved with REIN (Real Estate Investment Network), speaking at some of their local events and meeting prospective clients. He also lauds the support his brokerage receives from Dominion Lending Centre’s head office, particularly branding, which he says has been important to the growth of his business over the past year. When it comes to his work, Bruce says it’s always about putting the client first. “Matching their unique needs to a specific lender offering a specific product is the priority,” he says. “I spend time on an ongoing basis ensuring I know what’s happening in the market, as well as what rates and products are available.” He will, for example, advise clients not to refinance their home if it’s not the right thing to do.

05 Collin Bruce

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04 Calum ross

Boston may seem like a strange destination for a Canadian mortgage broker looking to grow his business, but not if you’re Calum Ross. Ross, who ranked No. 1 on the Top 50 Broker list in 2010, is speaking from a dorm room at Harvard University, where he has spent the last eight months completing the Leadership Program at Harvard Business School. It’s all part of his philosophy of building the best team at Mortgage Professionals Inc. – The Mortgage Centre. For Ross, that means investing money in your professional development. “You are an extension of your brand. You are the team leader and you have to lead by example. The best leadership example you can provide is a continuous commitment to improvement.” That commitment also extends to that team, as Ross recounts team retreats his office staff attended last year as an example of the, “substantial investment we make in improving the skill set of everyone on the team. “A team is only as strong as its weakest link,” he says. “I think when people invest in the quality of their individual team members it pays dividends.” Despite the advantages of operating in the Toronto market, with higher than average home prices, Ross contends it’s about improving productivity.

“No question that anyone who competes in a market with a higher price is going to have a strategic competitive advantage,” he says. “The amount of volume you can do in the broker market is a function of how many transactions you do and the size of the transactions. And if you’re not improving your productivity, it’s going to have a huge impact on your overall production.” Interest rate rises in early 2010 definitely impacted business, says Ross. “A short-term rise in interest rates does create a temporary false loyalty to the brokerage community because it costs [buyers] so much to leave. “We saw a lot of pre-approvals and when interest rates went up, the cost of not finding a home went up.” But that doesn’t always translate into an easy decision on the part of homebuyer, says Ross. “People are not always rational when it comes to purchasing a home,” he says. “They will pay $50,000 more for a house because of the threat that it might cost them an extra $10,000 in interest rate costs.” In 2011, Ross sees a couple of trends. “For brokers who are focused on first-time buyers I think there is a huge opportunity. For people who are working with more sophisticated real estate investors and the luxury home market, I think they will need to make considerable adjustments to their plans.” Ten years after opening his own mortgage brokerage, Ross says he’s more committed than ever to helping his clients. “I think the mortgage industry is a great industry. We earn a great living, we have a fantastic opportunity to make a difference in people’s lives and I enjoy going to work every single day.”

STATS ++ Company: Mortgage Professionals Inc. – The Mortgage Centre ++ City/Province: Toronto, Ont. ++ 2010 ranking: 1 ++ Support staff who write loans: 2 ++ Support staff who don’t write loans: 2 ++ Years as a broker: 12

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When it comes to being successful as a mortgage broker in Canada, Jim Tourloukis says it boils down to four simple reasons: the people you work with; referral partners; lender partners and family. Tourloukis, who reached No. 2 last year, appears in the top five for the third consecutive time, despite the fact that this is only his fifth year as a mortgage broker. In discussing the reasons for success, Tourloukis, who opened Advent Mortgage Services in Unionville, Ont. in 2006, says it all begins with the people you work with. “I have two people whose only job is to service my deals,” he says. “And they not only know how to make a deal work, but they know how to find deals within deals.” Next up is what Tourloukis calls “good deal flow.” “I’ve had great referral partners and those relationships continue to grow and get deeper,” he explains, adding that he recently signed another deal with a financial planning firm. “We’re fortunate in the sense that we have these partnerships and deals kind of fall into our laps, without having to chase them down.” With deals on hand, it’s time for the lenders to enter the picture and Tourloukis is adamant that lenders and brokers work together as equals. “Eighty per cent of my deals go to ING and National Bank, both lenders I consider to have the best products in the marketplace,” he says. “They treat us very well.” Most importantly, Tourloukis credits his family – and his wife in particular – for the success he has been able to achieve in such a short time. “They’re very supportive of how hard I work in order to be successful. “My wife is my strategic partner in the sense that any ideas that I have I run through her first. And she’s able to give me a third-party overview of what I’m trying to do and there have been many cases where I’ve had some dumb ideas and she’s brought that to my attention.” Tourloukis credits his 70 per cent year-overyear growth in 2010 to a spike in repeat client business, which he says is now around 40 per cent. “We’re five years into the business now and we’re starting to see some traction from our past

STATS ++ Company: Advent Mortgage Services ++ City/Province: Unionville, Ont. ++ 2010 ranking: 2 ++ Support staff who write loans: 0 ++ Support staff who don’t write loans: 2 ++ Years as a broker: 5

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clients,” he says. “It comes back to what we’ve always done, which is put the client first, which most people say, but we actually do. “Treat your clients like they’re family and they will take care of you.” Continued growth is on the horizon, as Tourloukis says he plans to expand outside of Ontario and open offices in B.C. and Alberta in the near future. “I’m actively looking to hire a partner in each of those provinces,” he says. No matter what the future holds, Tourloukis counts himself lucky to be a part of a profession where hard work pays off. “In this industry, we are truly the masters of our own destiny,” he says. “There is no end to the success that one can have - the opportunities are endless. You just have to be willing to work hard and go get it.”

Jim Tourloukis

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STATS ++ Company: True North Mortgage ++ City/Province: Calgary, Alta. ++ 2010 ranking: NR (Ranked 6th in 2009) ++ Support staff who write loans: 9 ++ Support staff who don’t write loans: 0 ++ Years as a broker: 8

Dan Eisner, founder and CEO of True North Mortgage in Calgary thinks he has one explanation for the increases seen across the board on this year’s Top 50 Broker list. He chalks some of it up to a shift in power moving from the brokerages to the agents, which he contends is the result of the decision a few years ago by one of the big banks to change their compensation model around volume bonuses, paying them for agent, not brokerage volumes. “They decided that it was time that they actually pay the volume bonus to the people that actually deserve the volume bonus. And the people that deserve the volume bonus are the people that know the lender’s products really well,” says Eisner. “It was a big mentality shift in the industry. And a lot of lenders have followed that path to some extent.” Eisner says this brings economies of scale to the broker industry, making it tougher for new agents to achieve these bonuses. Not the answer you were expecting? Not a surprise coming from someone who based his business model on being different from everyone else’s.

02 Dan Eisner

“We’ve been successful because we think differently and act differently than the vast majority of brokers. “We like to describe ourselves as halfway between a bank and a broker; we have locations, toll-free phone numbers and salaried employees like a bank, but we have the rates that only a broker can provide,” he says. Competing on rate is what True North does and Eisner uses his volume bonuses to further strengthen his competitive advantage. “Some brokers such as myself, we take those volume bonuses and funnel them back into lower rates. That’s how we choose to compete.” True North also deals with a select number of lenders, so as to offer better service to clients says Eisner. “We know everything about our top lenders and are able to answer the client’s mortgage question regarding lender policies and lender documentation requirements without hesitation. This is the primary reason we have only four top lenders. If we had anymore, we would not be able to train our staff to the levels needed.” It’s a different model and for Eisner that’s the advice he would give any other broker. “You’ve got to do things differently, whatever it is. Just make sure it’s not what everyone else is doing.”

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01 Gord Pipkey

Most people would expect that a broker who does more than $260 million in volume in one year wouldn’t have much of a social life and perhaps would be in danger of burning out, but that’s surprisingly not the case for Gord Pipkey, this year’s No. 1 on the Top 50 Broker list. Pipkey, owner/broker of VERICO Real Mortgage Services in Richmond, B.C., is very honest and sincere about the reality of his profession and how he has managed to survive. “The sad part is that to do that kind of volume, I’ve never taken much time off. I found myself on a treadmill and just kept running. I was sort of an eight-to-10 guy, six-and-a-half days a week and I was surprised that I didn’t exhaust myself at any point, but I kept my energy up and that energy came from looking after my clients. “I never focused on the commission. I never dreamed of this. I just did the deals and it kind of happened. Pipkey got his start as a Realtor as an owner/ broker with Realty World in 1984. He also did some in-house mortgage brokering as well. In 1989, he sold the business and moved to Washington State and set up shop as a real estate and mortgage broker, which in those days was much more lucrative than it was in Canada, since at that time in the U.S. 80 per cent of mortgages were done through the broker channel. “No one paid brokers here in those days,” says Pipkey. “Only if you did a B deal did you charge fees and get paid something.” He returned in 1994 and worked as a real estate manager and mortgage broker until becoming a full-time mortgage broker in 1997. It made sense as brokers were finally starting to be able to make a living doing it full time. “It started with Laurentian Bank,” recalls Pipkey. “They were the first to offer me any kind of compensation. I was allowed to keep the application fee as a finder’s fee.” Then Household Trust and Confederation Trust began paying referral fees to brokers and quite quickly other lenders began dealing with the broker channel.

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Real Mortgage Services remained independent and grew from $70 million in funded volume in 2000 to over $300 million in 2009, until joining the VERICO network last year. Pipkey says over the years he resisted numerous offers to join national broker networks. “I didn’t need to own a franchise to be successful.” What changed his mind? Pipkey says it came about through a client of his, Sean Widdess, who just happened to be VERICO’s national sales manager. “There was no pressure, but it finally just made sense to me to join VERICO.” According to Pipkey, his volume really started to grow in 2006 as a result of client referrals from his first years in the business, but real growth has occurred since he took the advice of his son, Steve, who works alongside him at Real Mortgage Services. “We didn’t even start using our client database until a few years ago, when Steve took the initiative and said to me, ‘I’d like for you to be in a position to maintain our client base as a source of new business.’” “Before that clients only came back because they remembered me,” he says. “I’m old fashioned. If I did a good job, I always said, ‘Someone will come back to me.’ Advertising isn’t a must for Pipkey either. “If I do a good job, that’s my advertising.” Although nearly half his business comes from Realtor referrals and agents he trained during his days in the business, Pipkey agrees with his son that to cultivate and service our existing client base is another great source of business. Deals in 2011 are facing challenges, according to Pipkey, including a softening housing market. But the biggest threat in his mind is the aggressiveness of banks and credit unions going after broker business business and the tightening up and new restrictions on mortgage lending policies. “I can feel it because their pricing is such that, despite my volume, I can’t get the same rate many times as a lot of my business is now being siphoned off by the deep discounting of the banks and credit unions not using the broker channel.” CMP

STATS ++ Company: VERICO Real Mortgage Services Inc. ++ City/Province: Richmond, B.C. ++ 2010 ranking: NR ++ Support staff who write loans: 2 ++ Support staff who don’t write loans: 1 ++ Years as a broker: 25

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Gord Pipkey receives his Top 50 award from FirstLine Mortgages Business Development Manager Candace Wood.

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Business Marketing

web 2.0 marketing secrets for mortgage pros In a new series, Doren Aldana explores some of the ways mortgage brokers can harness the power of social media to build referrals

d of r e h a build or fans t Real

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n last month’s article, we discussed the best types of content to put on your “Realtor Tips” Facebook fan page so you can get more Realtors sending you more referrals more often. The idea was to focus on giving valuable tips that can help Realtors attract more quality listings and sell them fast, for top dollar. So, at this point I’m going to assume that you’ve got your Realtor Tips fan page set up and you’ve loaded some cool content on the page. Now you’re ready to start building a herd of Realtor fans who will send you loads of quality referrals. Here’s how.

Business

Marketing

Seven Tips for Getting More Realtors to “Like” Your fan page Tip #1: Email your Realtor list and ask them to “Like” the page. Compile a list with their names, company names, phone numbers and email addresses. If they don’t know you from a hole in the wall, be sure to call them to ask if they’d be open to receiving your free video tips that show them how to get more quality listings and sell them fast for top dollar. Who the heck would say no to that? Once you’ve got their approval to send them emails, you can send them an email once per week inviting them to watch your weekly video tip. Remember, the sole purpose of the email is to get the Realtor to click the link and watch your video – so don’t over-complicate this. Here’s an example of a simple teaser email:

Subject: The No. 1 question every sm wants to art home know... seller Hi [first n ame], What’s th e sin home seller gle, most importan t question wants you every sma to answer presentati rt at their list on? HINT : ing it ’s probably the shock ing truth.. n ot w h at you thin . [Video L k. Here’s ink] Your part ner

in success,

Bob Broker 123-123-1 234 www.bobb roker.com PS. If you haven’t don e so yet, p you can co lease “Lik ntinue rece e” my fan iving thes page so e cool video PPS. After tips. Than you watch ks! th comments . I love feed is video, please sub mit your back! [Video L ink]

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Business Marketing

Pretty simple, huh? Now let’s take a moment to break down the six critical elements of this email so you understand exactly what I’m doing and why I’m doing it.

curiosity. A surefire way to create curiosity is to simply ask a relevant, compelling question and then invite them to click the link to discover the answer.

1. A curiosity-evoking subject line. You want to craft a subject line that makes it almost impossible for your Realtors to ignore, let alone delete. It needs to pique their curiosity so they can’t help but click on the email to learn more. If your Realtor received an email from you with a subject line like “The No. 1 question every smart home seller wants to know …” chances are they’d click on it just to find out what the heck that question is. Curiosity is extremely powerful.

5. Include a benefit-laden closing salutation. Rather than finishing your message with the plain-jane-vanilla “sincerely yours” or “regards,” why not inject a few words that actually communicate how you want them to see you. For example, you could use something like “Your Partner in Success.” It might seem like a small thing, but it can make a BIG difference.

2. Use their first name. In most cases, the more you customize your email to make it look homespun – like you wrote it yourself, just for them – the more likely they are to open it and respond to it. That’s why I always add the recipient’s first name in the salutation of my emails. Fortunately, most email marketing software allows you to automatically data-merge their first name into your email so you don’t have to bother doing all of this manually. 3. Communicate with a friendly, conversational tone. Most business owners, mortgage professionals included, have a tendency to over-polish their business communications with the positive intent of creating a “professional image.” While professionalism is always a good thing, doing it at the expense of your own authentic personality is not. You see, your clients and referral partners want to connect with you as a real person, not just a business. That’s why I recommend being professional and personable – communicating in such a way that adds your own personal flare with a down-to-earth, friendly, conversational tone. 4. Use the first paragraph to drive “Clicks”. If they don’t click on the link, they’ll never get to your fan page to watch your videos. As I mentioned before, one of the most effective psychological triggers for motivating people to take action is

“ rather than finishing your message with the plain-janevanilla “sincerely yours” or “regards,” why not inject a few words that actually communicate how you want them to see you. ”

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6. Include a P.S. According to numerous marketing studies, the P.S. is the third most read element of a letter, surpassed only by the headline and photo captions. In this example, we use the P.S. and the P.P.S. to remind people to “Like” and give “Comments” after they watch the video. Ok, let’s continue... Tip #2: Suggest your page to your Realtor friends in Facebook. This, of course, presupposes you already have some Facebook friends who are real estate agents. Once you’ve done that prerequisite step, simply go to your fan page and click the link on the upper right that says “Suggest to Friends” and it will allow you to promote your page to individuals, groups or all your friends. Tip #3: Hijack other fan pages. For example, use the Facebook search tool to find Realtor associations and Realtor trainers in your area. In this case, if someone signs up as a fan for a Realtor association or a Realtor training company, they’re probably a Realtor – your ideal referral partner. So once you get to the fan page, simply pull a list of all of the page’s fans and start sending friend requests. Of course, not everyone’s going to accept your request but a lot will, and those new friends can now be invited to “Like” your fan page. Tip #4: Remind your Realtor fans to “Like” and “Share.” When you upload your video, always include some “teaser text” along with it that motivates people to watch it. At the end of your teaser text, you can add on this little special request: “Kindly share it with your FB network if you find it useful. Thanks!” Tip #5: Offer fan-only protected content. For example, you can add a special tab on your page with an image that says “Click ‘Like’ to download a 27-Point Marketing Checklist for Selling Your Listings Faster and for Top Dollar.” You just need to come up with a resource that you can offer as fan-only protected content and when you do, you’ll be able to get more people to “Like” your page. You

Business

Marketing

can even make this the main default landing page when people land on your page. Tip #6: Buy Facebook advertising. You can do this in two different ways: Pay-Per-Click (PPC) or Cost-per-Impression (CPI). In most cases, PPC provides the best results but you may want to test both. Once you set up your advertising you can target brokerages by name, like Re/Max and have everyone whose employed by Re/Max see your ad on their Facebook pages. You can also target specific areas so only people in Re/Max in a specific area like Hamilton, Ont. see your ad. And then you can send them to your Fan-Only Content Page, so they are given a special offer that compels them to “Like” the page. Tip #7: Buy fans. You can actually delegate the promotion of your page and there are plenty of companies out there who will do this for you for a modest fee. All the grunt work and heavy lifting is done for you. So there you have it, I’ve just given you seven proven strategies for building a herd of Realtor fans

“ you can actually delegate the promotion of your page and there are plenty of companies out there who will do this for you for a modest fee. ” on Facebook. Next month, I’ll teach you how to convert your fans into cash in the bank. Stay tuned … About the Author: 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. Among Aldana’s latest innovations, is a completely done-for-you video marketing solution that allows you to instantly deploy powerful videos through social media that attract mortgage clients like crazy. To see a free demo, visit: www.Done4UVideoMarketing.com.CMP

We think outside the branch. The Mortgage Group Canada Inc.

For over 20 years, The Mortgage Group has built a reputation on expertise and integrity with over 670 Mortgage Professionals across Canada. In fact, our No Sweat approach to mortgage solutions has helped over a quarter million Canadians. From our vast lender network and leadingedge tools to innovative training and unparalleled support, we take pride in what we do, where we work and who we work alongside.

www.mortgagegroup.com

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Profile Brokers

team triu 70

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Profile Brokers

Mortgage Brokers Ottawa claims the highest number of mortgage professionals on this year’s Top 50 list. Vernon Clement Jones delves into the reason for that and discovers that there are several

(L to R): York Polk, Michael Hapke, Frank Napolitano and Jeff Cody.

mph

isa Theriault drives a two-and-a-half-ton GMC Yukon. Actually, given that it’s “fully-wrapped” with black, white and red logos – all sporting the Mortgage Brokers Ottawa brand – it may weigh closer to three. “It’s my daily drive, and I don’t feel at all self-conscious about it,” laughs the broker, a regional partner with one of the country’s largest firms. “In case they miss the badging, my 27-inch chrome rims should help get your attention. I’m very proud of our brand and am always out there as a representative of the business.” As far as marketing statements go, there may be more subtle ones, but probably few as effective. Theriault brought in $67 million in funded volume last year, earning her 21st spot on CMP‘s coveted 2010 Top 50 Brokers list. She’s not alone. The 38-year-old was one of an astounding seven mortgage professionals at Mortgage Brokers Ottawa to make the cut. Mortgage Brokers Ottawa President and CEO Mike Hapke came 50th on the list, with managing partner York Polk, making it all the way to 14th, given his own $84 million in funded volume. That’s only one ahead of another of the firm’s managing partners, Frank Napolitano, who attracted $77 million last year to earn 15th place, while the group’s fourth partner, Jeff Cody, brought in $57M in funded volume, earning him 32nd spot in the national ranking. Regional Partner Murray Groen, with a funded volume of $60 million came in 29th. And mortgage agent Darren Keck made the list at 45, with $42 million. The collective performance represents the single-best showing of any brokerage, not only this year, but of any since the inaugural listing in 2008. While the group accomplishment is both a nod to the demographics of the Ottawa market and the widespread acceptance of mortgage brokers as an alternative to the banks, concedes Hapke, it also speaks to the strength of the organization’s individual brokers. They are, nonetheless, focused on moving forward as a team. “With our model we don`t lose top producers,” a pleased, if not entirely surprised Hapke tells CMP after receiving the standings. ”Our brand is exceptional in our region and with that comes loyalty. We tend to continue to hold onto brokers after they`ve cut their teeth and come into their own. When you`re aiming for a billion in sales this year, with only 60 brokers and agents, you tend to attract the crème de la crème. So, it`s a mix of up-and-comers and established brokers, but the numbers that we have in the Top 50 speak for themselves.” Hapke and Napolitano launched the company in 2005, bringing their combined 40 years-plus of banking experience in tow. They would later move their Elite Mortgage Team of 20 mortgage professionals under the MortgageBroker.com banner in 2006, two years later merging with Polk and Cody’s firm. It’s one Hapke had, in fact, left to start up his own business three years earlier. Together the four successfully led the company to independence in 2010 before agreeing to partner with The Mortgage Centre Canada last fall. That strategic move has

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Profile Brokers

already begun to add heft to the company’s presence in the Ottawa market, says Napolitano, pointing to its exclusive broker channel access in eastern Ontario to President’s Choice and CIBC product lineups. Those offerings such as a cash-back switch and a one-year construction rate hold have better positioned Mortgage Brokers Ottawa as a direct competitor to the banks. “Being connected into a bank is not a bad thing, yet we have maintained our freedom in terms of offering clients access to all the other lenders we can access,” Napolitano says. “We make it very clear that we built our business based on what’s best for our clients. Everything else is secondary.” The partners are candid about the tricks of the banking trade they’ve picked up from their years inside those financial institutions. In fact, all but one of the seven Mortgage Brokers Ottawa brokers to make the Top 50 has an extensive banking background. “We’re trying to do exactly what the banks do in terms of branding, but with a local focus,” says Napolitano, the former TD mortgage specialist, who like most of the executive team drives a “fully wrapped” pickup no more and, certainly, no less promotional than Theriault’s. “Through our advertising, our jingle and our community involvement we’ve become a recognized brand in Ottawa and that has helped us to compete with the banks.” Increasingly that brand acts as a calling card for Mortgage Brokers Ottawa agents and brokers, says Groen, but ultimately it’s the brokers themselves who are extending the company’s reach in a market where average incomes are some of the highest in Canada, buoyed by federal government jobs and a burgeoning high-tech sector. “If it’s a question of which came first – the brand or the brokers – it is the brokers,” Groen says. “Because the people behind the brand have made the brand what it is. Those of us on the list were in the industry before the brand was a brand, but now the brand has value that we have sort of imparted to it, and I’m sure it does help me now with referrals.” A bank-style public relations approach has also gone a long way in terms of keeping Mortgage Brokers Ottawa top of mind with existing and potential clients. Still, brokers in the capital city enjoy a higher market share than much of the rest of the country. “In Ottawa, it’s not predetermined that homebuyers are going to take their business directly

mortgagebrokernews.ca

“ we make it very clear that we built our business based on what’s best for our clients. Everything else is secondary ”

to the banks and that they’ll just accept what their banks offer,” says Groen. “The economy in Ottawa is a lot more stable than a lot of the rest of the country, and they are very well-educated and understand how a broker can help them. But we don’t have 90 per cent market share yet, so there is an awful lot of room for growth.” Actively seeking new business remains the focus of all the company’s mortgage professionals, says Cody, even as the company’s strong Internet presence increasingly attracts younger clients more inclined to begin their search for a mortgage online. “It’s really still about building personal relationships,” says Cody, who obtained his broker’s licence more than 30 years ago, later leading a top Invis brokerage with then-partner Polk before teaming up with Hapke and Napolitano. “You can’t just sit on the web and expect business to flow in.” Both individual and company success have come from building a team approach to brokering even as brokers increasingly face competition from within their own ranks. “We grew exponentially very quickly and a large part of that was cementing brand recognition,” Theriault tells CMP. “But also key was that we support one another. If something works well, we share it. Through training and marketing, and regular meetings with the entire company, we keep things in the open. We like to see each other do well.” Part of that is knowing what individual strengths his brokers bring to the game and supporting them in areas where they need help, says Hapke. Of the 60 agents and brokers, 70 per cent have now agreed to lower commission splits in order to transfer administrative duties like storing documents, preparing closing documents, submitting deals for underwriting and collecting conditions to Hapke’s support team. “We see it as having helped to create the kind of sales environment you need to help agents generate business,” says Hapke, who spends most of his time on corporate direction and strategic planning, but still managed to bring in $41 million in funded volume last year, most of it generated from referrals through past clients. He’s not alone. “All of the Mortgage Brokers Ottawa people on the Top 50 list are veterans of the industry, no question,” he says.” They`re passionate and as driven as they were the first day I met them. It’s what you need to be.” CMP

CANADIAN REAL ESTATE IS PROUD TO ANNOUNCE PRESENTED BY:

The REAL estate investing event of the year is coming to the west! Two days of industry networking and learning will take place at the

Vancouver Convention Centre, November 12-13 Also Introducing

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your investment

PLUS all new Mortgage Broker Workshop!

• Get sound advice on legal, tax and accounting strategies from the pros • Network with other industry professionals • Educate yourself on up-and-coming products in the industry

For full agenda details please visit www.theinvestorforum.ca

Who should attend? Open to seasoned investors, first-timers and anyone who is seriously interested in making (more) money through real estate including: • Realtors & flippers • Property managers • Mortgage brokers

! W O N K O O B ICING

3 primary sessions to look forward to: • The Canadian financial market – Forecast 2012 • The Canadian hotspots for 2012 • The Regional Economic Forecast

Diamond Sponsor

EARLY BIRD PRM $129! STARTING FRO For more information about sponsorship opportunities or tickets for this event please contact sarah.habib@kmimedia.ca

Gold Sponsor

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Another event organized by

profile PROVIDER

Canadiana set to grow its book with

‘enhanced’ Macquarie deal Will see its lending capacity bolstered, making it more competitive in the marketplace

anadiana Financial is billing an expanded partnership agreement with Macquarie as beneficial for both parties, but, more importantly, for brokers. “Canadiana values (broker) business and we will continue to deliver the same high level of expertise and service you are accustomed to,” said Pam Mulek, Canadiana COO and now company president. The new deal, announced recently, will build on a relationship between Canadiana and Macquarie established in 2010 and effectively bolsters the lending capacity for Canadiana, allowing it to emerge as a more competitive mortgage lender in the Canadian marketplace. While brokers effectively lost Macquarie Financial as a direct lender – the company announcing it would outsource servicing of its $8 billion mortgage portfolio to Paradigm Quest – it also pledged to maintain its key role as a funder for Canadiana, which continues to focus on growing its own orginations through the broker channel. Macquarie will also transfer key corporate personnel to help Canadiana meet that goal. The close relationship is being billed as a win-win in that it enables Canadiana to make further inroads with the broker channel and helps Macquarie fulfill funding obligations under the CMHC’s Canada Mortgage Bonds (CMB) Program. “Joining Canadiana provides an exciting opportunity for me to add to the high standards of a well-recognized mortgage provider and continue a culture of industry innovation,” said Grant MacKenzie, who currently serves as CEO of Macquarie Financial but joined Canadiana as CEO on July 1, 2011. “In addition to fostering new

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Grant MacKenzie

“ in addition to fostering new mortgage-broker relationships, there will be additional scope to expand Canadiana’s partnership with Macquarie. ”

mortgage-broker relationships, there will be additional scope to expand Canadiana’s partnership with Macquarie. I look forward to my new role as we focus on providing even better service to a larger group of brokers.” Joe Digiambattista, VP of sales, and his business development team will remain key broker contacts at the lender, which entered the market early last year. “With the addition of our newest potential team members, who have proven sales experience and success, I am very excited about what we can deliver to our preferred broker partners, this is a perfect fit for us,” Digiambattista told CMP. Canadiana is pledging to build on the relationships Macquarie has already established with its brokers, said Mulek. The move also ups the profile of Paradigm, which currently manages about $1.5 billion in mortgages for Macquarie. “We’re very pleased to expand our strong relationship with Paradigm to include our full mortgage portfolio,” said Matt Rady, head of Macquarie Banking and Financial Services Group, North America. “This partnership enables us to more efficiently run our retail financial services division, while ensuring our mortgage borrowers continue to receive excellent customer service.” “Paradigm has had a strong relationship with Macquarie for years,” said Kathy Gregory, CEO of Paradigm. “It is a testament to our good working history and Paradigm’s award-winning capabilities that we were able to expand our servicing mandate to include Macquarie’s complete mortgage portfolio.” CMP

Don’t leave your marketing plan to the last minute! New products

Announcements

Get your message in these special issues of CMP: • 6.9 Brokers on Lenders • 6.11 Superbrokers • 6.12 Year in Review / CMP 2012 Wallplanner CONTACT Trevor Biggs PHONE 416-644-8740 x236 EMAIL trevor.biggs@kmimedia.ca

Extra branding

Profile Insight

VERICO continues to expand, having welcomed 16 new brokerage firms this year alone, including Ontario’s Service First Mortgages

First choice K

evin Boucher, Jason McKittrick and Heather Paterson, the three owners of Service First Mortgages, had a tough but necessary decision to make at the end of 2010. After working for a nationally branded mortgage company that underwent 18 months of organizational changes, Boucher and his partners decided it was time to take their business to the next level. “After exhaustive research and asking a ton of questions to members in the mortgage community, the VERICO Network seemed not only the logical choice but also the only real choice for us,” says Boucher. “Jason, Heather and myself are entrepreneurial spirited people. We wanted control of our individual direction; and VERICO was clearly the only national network that supported our individualism and our brand,” says Boucher, who has over 12 years of experience in the mortgage industry. Paterson agrees. “Branching out on our own provided us with control over the path of our company and the direction we wanted to take corporately. It was the logical next step up in my career.” “The franchise models were restrictive in terms of marketing territories and availability of service. We’ve been down the national brokerage road before and that gave us no decision-making power whatsoever. VERICO gives us the option of running our own business and being provided with the best tools and technology support in the industry,” says Boucher. “Colin Dreyer has a well-known reputation for being honest and forthright with tons of integrity and we feel that he is the type of person we want to be associated with and the VERICO Network is where we belong.” “We are proud to have relationships and top-tier status levels with all the major broker lenders, including Platinum at Firstline, secondtier Wizard at First National, top level at

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Scotiabank and CEO Status with Street Capital. Our team consists of commercial specialists and access to a vast pool of private funds,” adds Paterson. “Kevin, Jason and Heather are outstanding members of the mortgage industry and exemplify the qualities of the VERICO Network. VERICO Canada looks forward to working with Service First Mortgages to ensure their continued success,” says Colin Dreyer, president of VERICO Canada. “I’m very pleased to welcome them aboard.” VERICO Service First Mortgages will serve homebuyers in central and south-central Ontario, North Bay, Tri-Towns and all of the GTA with a location in Newmarket and a second office in Toronto. “One of our core beliefs is to create a network of quality over quantity. For over six years, VERICO has not only set the standard in the industry but has cultivated an enviable reputation for being the best network for higher performing mortgage brokers,” says Dreyer. “With our broker firm application process, we ensure that VERICO maintains the integrity and strength of our network while continuing to attracted like-minded professionals,” adds Dreyer. McKittrick, AMP, has over 13 years of experience in the mortgage industry. Jason rose through the ranks from a mortgage specialist at a major bank to a BDM for a national lender and later became the vice-president and Broker of Record of a national brokerage where he was instrumental in recruiting over 100 agents. Paterson, AMP, quickly grew to become a top producing agent since joining the industry in 2003. Heather is a mentor and an inspirational leader to the entire team at VERICO Service First Mortgages. Boucher, AMP, has been in the mortgage industry since 1999. His first six years was with a major bank and the next five years was with a major national brokerage. CMP

Jason McKittrick

Profile

Favourite Things

Julia Parkin + Mortgage Agent, Dominion Lending Centres Homestead Financial + Waterdown, Ont.

Hobby Baking and decorating cakes and cupcakes. I love designing them for special occasions.

Favourite Things Celebrity I just love the Kardashian sisters. They are fabulous, successful and beautiful. I have three sisters, so I can totally relate to the dynamics between them.

Place to be Place to be: At home entertaining family and friends as well as spending time with our new addition Titan, our 16-month-old Great Dane.

Sport I’ll play pool volleyball any day of the week.

Food Macaroni and Cheese. It’s a guilty pleasure. I don’t eat it often and in the grocery store I literally have to avoid that aisle or I’m in trouble.

Drink Baileys on the rocks.

Movie Pretty Woman. I watched every morning at breakfast when I was younger and literally have Julia’s lines down pat.

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Book Last book I read was The Unfair Advantage, by Robert Kiosaki. It was a light read with tons of interesting financial information.

Music I like a variety of music, but lately I haven’t been able to stop listening to Lady Antebellum.

Vacation spot Sandals Whitehouse in Jamaica. I honeymooned there last year and the resort is just indescribable...it is pure paradise.

service directory

Insurance

Banks

Bridgewater Bank www.bridgewaterbank.ca Ph: 1 888 837 2326 Page 9

Canada Mortgage and Housing Corporation www.cmhc.ca Ph: 1 888 463 6454 Page 15

Home Trust www.hometrust.ca Ph: 1 877 903 2133 Page 37

Canada Guaranty Mortgage Insurance Company www.canadaguaranty.ca Ph: 1 866 414 9109 Page 25

ING Direct www.ingdirectbrokerteam.ca Ph: 1-800-574-5629 Page 47

HomEquity Bank www.homequitybank.ca Ph: 1 866 522 2447 Page 41

ICICI Bank Canada www.icicibank.ca Ph: 1 800 ICICI CA or (1 888 424 2422) Page 7

Peoples Trust www.peoplestrust.com Ph: 1 800 663 0324 Page 42

Genworth Financial Canada www.genworth.ca Ph: 1 800 511 8888 Outside Back Cover

Broker Networks

Centum Financial Group Inc. www.centum.ca Ph: 1 604 257 3940 Page 11

Resmor Trust Company www.resmor.com Ph: 866 809 5800 Page 45

National Bank www.nbc.ca Ph: 1 888 483 5628 Page 29

Non-Bank Lenders

Capital Direct www.capitaldirect.ca Ph: 780 868-0550 Page 14

Equitable Trust Company www.equitabletrust.com Ph: 1 866 407 0004 Page 33

FirstLine Mortgages www.firstline.com Ph: 1 800 387 2020 ext. 6044 Inside Back Cover

Dominion Lending Centres www.DominionLending.ca Ph: 1 888 806 8080 Page 31

Street Capital www.streetcapital.ca Ph: 877 416 7873 Page 5

www.tdfinancingservices.com Ph: 866 694 4392 Page 39

The Money Source www.mymoneysource.ca Ph: 416 699 2274 Page 59

Home Loans Canada®

Home Loans Canada www.hlcmortgages.ca Ph: 1 866 452 1821 Inside Front Cover

Mortgage Architects www.mortgagearchitects.ca • Ph: 1 877 802 9100 Page 57

Commercial Lenders

Fisgard Capital Corporation www.fisgardmortgage.com Ph: 1 866 382 9255 Page 17

ROMSPEN investment corporation www.romspen.com Ph: 1 800 494 0389 Page 1

MortgageBrokers.com www.mortgagebrokers.com Ph: 647 680 9384 Page 43

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service directory

Services

Best Points Travel www.bestpointstravel.com Ph: 1 800 551 8786 Page 23

VERICO www.verico.ca Ph: 1 866 983 7426 Pages 12, 13 & 49

The Mortgage Centre Canada www.mortgagecentre.com Ph: 1 800 423 0107 Page 3

Technology/Software

The Mortgage Group www.mortgagegrp.com Ph: 877 899 1024 Page 69

180 Degree Coaching www.doa180.ca Ph: 403 250 2150 Page 27

D+H Limited Partnership www.dhltd.com Ph: 1 866 345 6449 Page 2 Real Estate

Verico The Mortgage Practice Inc careers@vtmp.ca Ph: 905 458 4222 Pages 50 & 51

Canadian National Association of Real Estate Appraisers www.cnarea.ca Ph: 1 888 399 3366 Page 77

Reach your target market with affordable advertising solutions

For service directory listing please contact Trevor Biggs: trevor.biggs@kmimedia.ca

Please contact Trevor Biggs at 416-644-8740 x236 trevor.biggs@kmimedia.ca

Got news? Y Your

news n ews is our news!

Do you hav have a e news to share? r Hav Have ave you you heldd a recent event v or made d a new w appointment? pp If so,, CMP W WANTS ANTS to hear ffr from om you. Send us your newsworthy submissions and photos, and you may find your story printed in a future issue of CMP. Send your news to: vernon.jones@kmimedia.ca

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