CMP 5.4 by Key Media

www.mortgagebrokernews.ca

APril 2010, 5.4

top coming out on

The 2010 CMA Broker of the Year finalists

SPECIAL FOCUS MBABC’s annual broker conference

FEATURE Lenders dish on how to win them over

NEWS ANALYSIS Why it’s tough being self-employed PUBLICATIONS MAIL AGREEMENT #41261516

50 what lenders are looking for Erin Letson talks to CMA-nominated lender BDMs and underwriters to find out what brokers can do to improve their applications and develop better relationships for the future

5. 04 issue

cover story

40 Coming out on top: The 2010 CMA Broker of the Year finalists After a roller-coaster year, these 11 brokers overcame the challenges dealt their way and wound up at the top of the peer-respected pile. CMP gives you an inside look at the finalists for Broker of the Year, both in the national network (over 25) and independent (under 25) categories

contents

NEWS 8

Web comments from mortgagebrokernews.ca: Some of the best stats and comments from CMP’s website.

10 ICICI enters broker channel; Solidifi launches new program; Mortgage Architects’ new owner; Adobe’s closure; Optimum’s B product growth; Canadiana’s uncertain future; CREA rule changes; and more…

NEWS ANALYSIS 34 Restricted access: The CMHC recently tightened the reins on its self-employed borrower program to avoid some of the problems the U.S. is facing. Kit Kadlec checks in with brokers who see both the pros and cons of the changes

FOCUS 64 From the convention floor: MBABC

BUSINESS 66 Branding: Branding and marketing are traditionally the first casualties of a tightened budget – primarily because the return on these investments is notoriously difficult to measure. One of CMP’s sister magazines in Australia, Human Capital, examined the importance of branding

PROFILES 75 Insight: High standards: After almost five years in business, Verico has stuck to its original mandate while expanding its list of services and recruiting top brokers to its network. CMP talks to president Colin Dreyer about the company’s progress and future plans 76 Provider: Balancing the mortgage market: CMP talks to Street Capital Financial president Paul Grewal about non-banks’ place in the Canadian mortgage industry and why service and efficiency levels are becoming increasingly important 78 Favourite things: James Laird, president, Verico True North Ontario, Toronto

mortgagebrokernews.ca

60 new mortgage rules explained In an effort by the Canadian government to prevent an over-heated housing market from turning into a bubble ready to burst, three new rule changes were established, effective April 19. Peter Kinch analyzes what they really mean

regulars 31 International News 32 This time last year 79 CMP Service Directory

We put you front and centre

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When you join most superbrokers, you give up your local personality in favour of a faceless national brand. But at The Mortgage Centre®, we understand that your success is based on your relationship with your local market. Even though we maintain Canada’s longest-established national franchise network, we make sure all our programs and marketing tools spotlight you. To learn more about the exceptional independence we offer, contact sales@mortgagecentre.com 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

A season for changes There have been a lot of changes in the air recently, and I’m not just talking about the abattoir down the road from my place that seems to have stepped up its production considerably. As I’m sure you’re all well aware, recent mortgage rule changes have come into effect and we’re still not entirely sure of the overall impact they will have on the industry, if any. Aside from changing how investors and business for self people borrow money, most of the changes look more like a symbolic teeth gnashing from the government directed at would be “speculators.” But that’s only part of the change I’m talking about. Here at CMP we are going through our own changes and have recently added two new staff members to the editorial team. Gina Monaco, a former broker and seasoned journalist, will be taking over the main editorial responsibilities from me. As such, this will be my last editor’s letter in this magazine, as I am moving to some different publications within the company. That said, I am definitely still around the office and may even have my name pop up in these pages from time to time. Jennifer Zalitack is also joining our team as the new staff writer and resident web expert, so I expect you will be hearing from her soon enough as we continue to look for the best ideas and information to help you build a better business. We’re very excited to have them both here. Before I finish I would like to say a sincere thank you to everyone who has made themselves available to my multiple inquiries or has been kind enough to ring me up to share all the great ideas and trends that are out there in this industry. And lastly, I think it has to be said that if anything I have every written could have been interpreted two ways, one of them offensive to you, one of them not, then I definitely meant the latter. Regards, Jesse Kinos-Goodin Editor Jesse.kinosgoodin@kmimedia.ca

5. 04 issue

April 2010 Publications Mail Agreement #41261516 Postmaster: Return undeliverable addresses to KMI Publishing, 100 Adelaide Street West, Suite 300, Toronto, Ontario M5H 1S3

EDITOR

Jesse Kinos-Goodin

Senior WRITER

Erin Letson

NATIONAL SALES MANAGER

Trevor Biggs

Account Manager

Andrew Davies

OFFICE MANAGER

Marni Parker

SUB-EDITOR

Rachel Naud

DESIGN MANAGER DESIGNER

Jacqui Alexander Vivid Design Solution

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Vice President, Operations & Editorial PRESIDENT CEO

Simon Parker Tim Duce Mike Shipley

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

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News

community

In the community

Bottom Snakes, spiders and hedgehogs were all part of Dominion Lending Centres’ booth at the MBABC conference in Vancouver. To read more about the event, turn to page 64.

mortgagebrokernews.ca

Photo by Kenward Ng

Above If you thought last year’s ’80s-themed CMP Canadian Mortgage Awards was fun, get ready for this year’s event, which travels back a couple of decades to the 1960s. Get to know this year’s broker of the year nominees by turning to page 40.

Phil Larue of The Mortgage Group has been in the business for 25 years. He attributes his longevity to his accessibility and the immediacy of his response to his clients. And we are committed to helping maintain his success, with dedicated relationship managers who have decision-making authority, consistent adjudication and a full suite of mortgage products. scotiamortgageauthority.com

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Readers Write Web comments

Rate hike warranted Sooner or later this exuberance has to be reigned in or the “bubble” will come to light and we will see a much deeper stagnation in the housing market and the economy as a whole. I, for one, welcome this increase and expect more to follow. -John Canadiana Financial whispers I heard they might be making moves to actually pay any outstanding Abode fees, even though it is technically a different company altogether. If they did, that would be a great first step, but either way they are going to have to do some serious PR to win me back. R. Ross I have been in contact with the management team, who assured me that they will be taking care of the agents who supported Abode. We should give them an opportunity to resolve. S. Simon Will this new lender have a product that only lends to those who don’t pay off their debts? That would be most appropriate. Their salaries should go to pay the mortgage brokers who have not been paid by Abode. -Anonymous IRD backlash The banks have changed their calculation of IRD using the posted rather than the contractual rate. This has gone a step further for new home purchasers where the bank offered capped rates at builder sites. For example, say a bank offered one per cent off the posted rate at a builder site for two years and in that two-year period, rates increased. The client who applied for a mortgage at the original one per cent off but closed two years later would now be subject to an IRD penalty based upon the posted rate at closing even though they contracted with the bank at one per cent off. The fact that the banks are charging IRD on posted rates and not actual rates is unfair and it’s a money grab. -PWE

mortgagebrokernews.ca

I think everyone agrees that lenders should be required to give full disclosure of the prepayment fees and penalties, including the calculations used, to the client/borrower (or agent). Standardizing them is the only fair way to achieve this, however, who is going to decide what a fair method of standardization is? Is the government going to be asked to determine this or will it be a consortium of professionals from all aspects of the mortgage industry? I assume that the lenders aren’t going to be satisfied if it adversely affects their margins & profits. Who has more influence with the government, the average consumer or the large institutions? Do without IRD and the complex calculations and implement the simple three-month interest penalty across the board. -LB BFS rule change questions Why is CMHC making it so tough for the self-employed to get financing when they are proving to be one of the largest growing segments of the Canadian employment realm? They could have raised the beacon scores and accomplished a better result. I’m a small business owner who has built a mortgage company from scratch for the past two years. I employ seven people in total. They have a great place to work and they work hard. Just when I know that all my hard work paid off and I have a legitimate business that’s making money, I might not be able to buy a house for the family that’s made all the sacrifices while I worked my tail feathers off. -Elfie I thought that the purpose of tightening up guidelines was to reduce risk. For the life of me, I can’t see how they do that. Is it the government trying to make sure that if you are BFS that they get you to claim more income, spend less developing your business, so that you pay more taxes? -Karen

www.hometrust.ca

News Industry

News bites ICICI Bank enters broker channel via MorWeb ICICI Bank Canada entered the mortgage broker channel at the end of March through a partnership with Marlborough Stirling Canada, makers of MorWeb. The bank’s vice-president, Rajesh Ramakrishnan, retail banking and operations, said implementing MorWeb as an application tool would help it extend its product offerings beyond the branch network. Although the bank is national, the first phase of the launch only extends to mortgage brokers in the GTA. CMP Xceed Mortgage obtains new warehouse credit facility Xceed Mortgage Corporation announced at the end of March that it had established a $50-million warehouse facility with Maple Bank, a Canadian foreign bank branch with headquarters in Germany. “Obtaining this new warehouse facility at a competitive rate provides Xceed with an additional source of funding for our origination of insured mortgages,” said Ivan Wahl, Xceed’s chairman and CEO. “Further, if the regulators approve our pending application to convert to a deposit-taking bank, we will have other costeffective means of raising funds for our mortgage underwriting.” CMP Solidifi launches PerforMax After the success of its Values program, Solidifi launched a new appraisal service for lenders and mortgage brokers called PerforMax. Guy

4% 10

mortgagebrokernews.ca

Growth in residential-insured mortgages among Canada’s big banks in February.

Bantleman, the company’s executive vice-president of appraisal management, said the product is a result of the “strong partnerships” Solidifi has made with more than 3,000 real estate appraisers across Canada. PerforMax manages the appraisal process for a client, be it a lender or broker, and tracks the appraisal and billing process. The company guarantees volume price savings and fast turnaround times with the product. Bridgewater Bank launches new incentive program Bridgewater Bank announced the launch of the Power Compensation Program for brokers on April 1. To qualify for the program, brokers must meet a minimum volume requirement in a six-month period, which varies from location to location. They can then get the “Power Pay Rate” on deals – a finder’s fee of up to 113 basis points on a five-year high-ratio mortgage, for example – as well as a Power Bonus of up to five basis points more if they meet a minimum funding ratio. The lender said the program provides better defined parameters and incentives for brokers who send it business. CMP Mortgage Alliance enters insurance space National network Mortgage Alliance introduced an insurance program through Frontera Financial in March, meaning its members can now offer several types of optional insurance— including home, creditor life, disability and critical illness – to their clients. The network also introduced a new budgeting tool to its members called the Right Budget, a web-based software that can import information from a client’s bank account and report transactions to help them track finances and meet financial goals. CMP

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News Industry

MortgageBrokers.com CEO acquires Mortgage Architects Pacific NA, a financial services company founded and run by MortgageBrokers.com CEO Alex Haditaghi, has acquired Mortgage Architects and its lending arm, myNext Mortgage Company. The move, announced March 30, is part of a larger plan for Haditaghi to transform myNext Mortgage into an online bank. However, Mortgage Architects’ VP of marketing, Kelly Neuber, said the company will stay under the leadership of CEO and founder Bob Ord. “You’re not seeing any changes at Mortgage Architects Bob Ord - our vision and goals and selective recruitment are still all the same,” she said, adding Ord will remain “completely in charge.” Haditaghi did not mention any changes in his role at MortgageBrokers.com, which he started in 2006. “Mortgage Architects is the jewel of the mortgage industry in Canada,” he said. “We plan to deliver unique products and build the technology infrastructure for the company’s mortgage planning mandate, which is to provide niche products and exceptional advice to customers as they move through their life stages.” Ord praised the acquisition – for which specifics were not announced – saying Pacific NA will help Mortgage Architects reach “that next level.” Ord launched the brokerage in September 2006 and it has grown to include 64 lead planners and 300 associate planners. It reportedly processed more than $5 billion in mortgage applications last year. CMP

mortgage brokers appear safe from GST Finance Minister Jim Flaherty said March 29 that there will be no additional GST on financial services following heated discussion about a new proposed tax policy that appeared in the federal budget earlier this month. The debate is over a notice by the Canada Revenue Agency, which said it had plans to broaden the application of GST on financial services professionals like mortgage brokers, insurance agents and financial advisers, who have so far been exempt from the tax. Flaherty denied the changes, blaming the misunderstanding on poor wording in the budget document. “We will have the tools in the first Budget Implementation Act to make sure we get back to the status quo before the court cases, so people can rest assured that the tax treatment of defined financial services will not change,” Flaherty said, adding that businesses still need “clear GST rules” – rules that won’t be clarified until Canada Revenue Agency releases an explanation in the coming weeks. Provincial mortgage associations IMBA, MBABC and AMBA have come together to fight the potential tax rule change, which IMBA said could cut broker commissions by 13 per cent if implemented. CAAMP has also been vocal on the matter, saying it has communicated with auditors and government officials for clarification on the issue. “We’re cautiously optimistic that they will listen to what the negative consequences of such a change would be,” Murphy told CBC News, “ and that they will continue with the current status quo.” CMP

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News

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Banks start interest rate shake-up Many lenders increased their posted rates on fixed mortgages starting on March 29, signaling the start of an upward move on record-low interest rates. Royal Bank, TD Canada Trust and Laurentian all moved their posted rates on five-year fixed mortgages by Donna Ramsay 0.6 per cent on March 29, a move soon followed by the remaining big banks and non-banks. The move prompted a surge in requests from variable-rate clients to lock into fixed rates. “The phones have been ringing off the hook,” said Donna Ramsay, a Mortgage Architects broker based in Orangeville, Ont. “We have several clients that we have committed to calling to see if they want to lock into a fixed. We tell them that we’re not here to tell them what to do – we’ll just give them the facts.” The interest rate increase will also mean higher qualifying criteria for new clients, who must meet

the five-year posted fixed rate when the new mortgage insurance rules kick in on April 19. CIBC economist Benjamin Tal told the Globe and Mail the rise in rates along with other factors means the booming housing market will slow down significantly after spring. “Given where interest rates are now, I still think you’ll see an extremely strong spring. However, after that I think the housing market will stagnate,” Mr. Tal said. “We are in the ninth inning of this booming house market. We are not expecting a crash, but we will stagnate.” CMP

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44%

The percentage of people looking to buy a home in the next two years who plan to take out a combination mortgage (part fixed, part variable), according to RBC’s Homeownership survey.

Abode announces permanent closure After Abode’s announcement at the end of January that it was close to negotiating a deal with a Toronto-based purchaser, the lender quietly announced the end had come for its mortgage origination business on March 5. “It is with sincere regret that we must permanently close Abode Mortgage Corporation,” said Abode chairman David Nelson. “In the end, pressures from the global credit disruption and corresponding actions taken by our financiers and secured creditors proved too challenging for the company.” The company’s statement also said there was no “definitive agreement” for a sale, adding it “will continue to work towards an orderly winding-down of Abode’s mortgage origination business.” Abode first announced it was shutting down in late November, but the New Year brought rumours that it could be bought. In January, Nelson told CMP that paying outstanding finders’ fees to brokers was “very important to us when negotiating a new purchaser.” He added that talks were going well with supporters and that the company would be back within a few weeks. CMP

Former Abode staff to start new lending operation Just days after Abode Mortgage announced its permanent closure, a few of the lender’s former senior staff members announced they would take the helm at a new mortgage lending operation called Canadiana Financial Corp. Mike Linehan, who served as Abode’s CEO from May 2007 until his resignation in January, has been named president and CEO of Canadiana. The lender said it was launching March 22, however repeated inquiries into the company didn’t yield results. It said it will specialize in residential insured first mortgages with products available in B.C., Alberta, Saskatchewan, Manitoba, Ontario and the Atlantic provinces. Linehan appointed Pamella Mulek as chief operating officer – the same role she held at Abode – and former Abode senior vice-president Joe DiGiambattista to lead team sales. In a news release, Linehan described DiGiambattista as “a proven sales executive in the mortgage industry with a passion for building competitive compensation structures and a competitively priced suite of products for broker partners.” Canadiana Financial is described in the release as “a privately held company with a solid capital structure through its primary investor, Fathom Five Partners.” CMP

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News Industry

Report says one in four Canadians house poor One in four Canadians rely on subsidies or spend over 30 per cent of their pre-tax income on housing costs, including mortgages and rent, according to a report by the Conference Board of Canada. According to the report, a household is unaffordable if more than 30 per cent of its pre-tax income is spent on household costs – a situation that more than three million Canadians find themselves in. The typical household spends 50 per cent more on shelter than on food and over five times more on shelter than on clothing. “The quality and cost of housing are major factors in the health of Canadians,” said Diana Mackay, conference board director of education and health. “However, about one-fifth of Canadian households do not have the resources to afford both good-quality homes and other health-enhancing expenditures, such as nutritious food or access to recreational activities.” The report warned that the high number of Canadians stretched too thin negatively affects their health, productivity, and national competitiveness, and increases the cost of health care and welfare. CMP

Housing market to be tamer over next decade: Scotiabank Despite 2010’s strong start, Scotiabank expects the “2010s” Canadian housing market to pale in comparison to the previous decade. A report titled “Global Real Estate Trends,” released by the bank in March, speculated the volume of home sales transactions will increase by 10 per cent compared to last year while average prices are expected to break $340,000, a record high. Housing starts are also expected to increase. But this hearty activity is expected to drop off later this year when new qualifying criteria for insured mortgages take effect in April and the HST is introduced in July. Scotiabank expects lower sales volumes, lower prices and a decrease in new construction in 2011.

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“It is time for Canadians to reset their housing market expectations. We expect 2010 will mark a transition year as the boom of the “aughts” gives way to a sustained period of more subdued housing activity over the coming decade,” the report said. The millennium decade, in comparison, was, for the most part, consistently booming. Between 2000 and 2009, real home prices increased an average of 5.2 per cent annually, the strongest decade of real price appreciation in at least 50 years. Housing starts during the decade averaged over 200,000 units a year, the highest they’d been since the 1970s. Strong, economic growth, low unemployment, innovative mortgage products and an increase of real per capita disposable income all contributed to the demand seen last decade, Scotiabank said. The bank anticipates much slower growth for the Canadian economy through at least 2015. - Nick Lypaczewski CMP

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Consumer complaints about mortgage penalties pile up

The amount the The National Association of Mortgage Brokers (U.S.) spent in the fourth quarter to lobby the federal government on housing and other issues, according to a disclosure report.

The Bank of Canada’s record-low interest rates have been in place for almost a year and, during that time, consumer complaints about mortgage prepayment penalties have been steadily rising. A story in the Globe and Mail says the ombudsman for Banking Services and Investments (OBSI) has opened 301 new consumer complaints in the quarter that ended in January, which is twice the number seen in the same quarter last year and almost triple the number seen in 2008. In the latest federal budget, Finance Minister Jim Flaherty said he will standardize how prepayment penalties are calculated and disclosed to consumers, but details have not yet been revealed. Douglas Melville, the head of the OBSI, told the Globe in most cases the lender’s disclosure is clear, but there are some instances when the customer’s argument has legs. “At the moment, we have about a dozen case files still open where some form of compensation is likely to result,” Melville said. “We believe compensation is warranted due to a lack of clear disclosure by the firm of the prepayment penalty calculation.” CMP

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News

Housing market

February housing starts beat expectations Matching a growing interest among Canadians to buy property, housing starts surpassed forecasts and were up 6.1 per cent in February. Starts on new houses rose to a seasonally adjusted annualized rate of 196,700 units in February from 185,400 units in January, according to CMHC figures. That’s well above February last year when there were just 115,000 starts. One of the largest jumps reported by the CMHC was in Saskatoon, where the number of starts quadrupled from last February from 25 to 127. Starts were down significantly, however, in Gatineau, where there were 61 per cent less starts in February 2010, dropping to 75 from 190 last year. The Ottawa-Gatineau market is already tight, with one of the lower vacancy rates in the country. CMP

More home purchases likely over the next couple of years: RBC About one in four Canadians plan to buy a home over the next two years, some 27 per cent, according to RBC’s latest homeownership survey. That rate is up four points from 2008, when 23 per cent of those surveyed responded that they planned to buy a home over the following two years. New homebuyers are expected to lead the way in sales this year, as 48 per cent of those surveyed under the age of 35 say they plan to buy, sharply up from 36 per cent last year. Nearly half of all the respondents said it makes sense to buy a home now versus waiting until next year when prices and interest rates might be higher. “The current economic environment does not appear to have dampened Canadians’ overall confidence in the housing market,” said Karen Leggett, head of home equity financing at RBC Royal Bank, adding Canadians have held on to the belief that a home will have long-term value. More than 80 per cent of respondents view homeownership as a good investment, although that’s still down from a high of 90 per cent in 2006. Breaking it down by regions, respondents found B.C. most to be a buyers’ market, some 78 per cent. The lowest percentage was in Saskatchewan/ Manitoba, where just 34 per cent felt they were in a buyers’ market. The region with the most respondents saying they had intentions to buy was in Alberta, at 35 per cent, and the smallest percentage with intentions to buy was in Quebec, at 22 per cent. CMP

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News Economy

Home affordability toughens, especially in top three cities The housing market in Vancouver is “uncomfortably hot,” according to the latest RBC Housing Affordability Measure, while Toronto and Montreal are on pace to set records due to surging demand. The report – which looks at housing costs based on owning a detached bungalow – said national affordability measures eroded slightly in the fourth quarter of 2009 but were mitigated by continued low mortgage rates and gains in household income. “The extent of the deterioration [of affordability] will depend on the speed at which interest rates rise,” the report said, adding the new mortgage rules coming into effect in April could reduce demand. “On that score, the pace of increase should be fairly steady throughout 2010 and 2011, helping to alleviate concerns of an imminent derailing of housing affordability in Canada.” While Vancouver had the most unfavourable conditions with house prices at record-high levels, Calgary saw affordability improve due to a lagging economy and the report said Ottawa had “the best of both worlds” with both strong activity and improving affordability. Atlantic Canada also saw favourable buyer conditions in the fourth quarter of 2009. CMP

mortgagebrokernews.ca

Mortgages help boost banks’ bottom line Canada’s banks have shown better-than-expected results in the first quarter of 2010, with reports pointing to mortgages as a profit-boosting factor. The Financial Times said the “unexpectedly robust” first-quarter earnings – a combined net income of $5 billion among the top five banks – were due to an increase in mortgage lending and other domestic business. An example is Scotiabank, which said it has seen residential mortgages increase by $4 billion since October 2009. The bank saw a total net income of $988 million in the first quarter of 2010. “This quarter’s results benefited from growth in mortgages, lines of credit and personal deposits, in particular our high interest savings and chequing accounts,” said Scotiabank president and CEO Rick Waugh in a statement. “The year-over-year increase also came from higher net interest income as margins improved.” Another bank that saw growth in retail business included Toronto-Dominion, which saw record earnings of $720 million in Q1, up 23 per cent from last year. The bank’s real estate secured lending and personal business deposits also saw particularly strong volumes. CMP

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News Industry

Competition bureau unhappy with CREA rule changes Following the Canadian Real Estate Association announcement of new rules that would allow agents to post a client’s listing on MLS for a flat fee, the federal Competition Bureau hasn’t changed its position that the CREA’s rules are restrictive and deter competition. “There is nothing in these proposals that we haven’t seen before and they do not solve the problem,” Competition Bureau commissioner Melanie Aitken said in a statement. “They are a step in the wrong direction...These amendments amount to a blank cheque allowing CREA and its members to create rules that could have even greater anti-competitive consequences.” Before the changes, anyone who wanted to post their home on MLS had to hire an agent and pay out a commission to that agent upon the sale of the house. But, as the real estate blog Move Smartly put it, this system led the Competition Bureau to believe the CREA is forcing consumers to accept services they may not want to get their house listed on MLS, which is reportedly responsible for 90 per cent of home sales. According to the Toronto Star, the Competition Bureau is concerned the wording of the new rules - which says additional Realtor services will be regulated by CREA and local boards - means the latter could also impose their own anti-competitive rules. The CREA has until March 25 to respond to the Competition Tribunal, and the association has already expressed dismay. “We’ve done everything we can, short of shutting down the MLS system,” CREA outgoing president Dale Ripplinger told the Star before the vote. “We still have to have some rules in place. I don’t think the rules were anti-competitive to begin with, but this is supposed help to make things clearer.” CMP

Optimum sees big growth in alt mortgages Optimum Mortgage, part of Canadian Western Bank, saw a 26 per cent increase in alternative mortgage business over the past year, according to its first quarter financial report. The lender said its portfolio of alternative mortgages has reached $615 million with 10 per cent growth over the last quarter. It also highlighted the success of its new high ratio insured mortgage program. “Optimum’s newly established offering of higher-ratio mortgages insured by either the CMHC or Genworth Financial Canada showed positive results and management expects insured mortgages will continue to become a larger component of this portfolio over time,” the report said, adding the bank remains “well secured” to carry its uninsured mortgages, which represent 73 per cent of its total portfolio. “Management remains committed to grow this business over time as it continues to produce strong returns while maintaining an acceptable risk profile.” Canadian Western Bank saw a record net income of $40 million in the first quarter of 2010, a 56 per cent increase over last year. The company also announced the acquisition of the National Leasing Group on Feb. 1.

What sets us apart? We work for brokers; always have, always will. We offer you SERVICE that saves you time. n A high-service lender suitable for most borrowers. n Always reach us during business hours at 866.441.3775 (no voicemail). n Broker referral fees paid weekly. We offer you PRODUCTS that help you close more deals. n Consumer-friendly mortgages (e.g., early pay-outs permitted, payment increases permitted, portable). n N.I.Q. lending (BFS, stated/salaried income). n “A” lending (high-ratio/conventional, CMHC/Genworth). Optimum Mortgage is the broker-focused arm of the Canadian Western Bank Group (TSX:CWB). CWB Group has a 26-year history, balance sheet assets of $12 billion, and 1,400+ staff.

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Inflation jump causes more interest rate speculation Some experts are predicting Bank of Canada interest rate hikes will be here by summer after Statistics Canada reported core inflation jumped to 2.1 per cent in February. This compares to the central bank’s outlook of a 1.6 per cent average core inflation rate in the first quarter of 2010. Inflation wasn’t predicted to reach the Bank of Canada’s two per cent target until the third quarter of the year and some are saying the effect of the Olympic Games in Vancouver – which drove up costs, particularly in the hotel sector – caused the jump. The inflation numbers also contributed to a surge in the Canadian dollar. “[This] report must be turning heads at the Bank of Canada,” economists Derek Holt and Karen Cordes Woods at Scotia Capital told the Financial Post. “While the details are mixed on the underlying components, it is pretty difficult to argue that emergency rates in Canada [of 0.25 per cent] are still warranted.” In contrast, the Post said economists at TD Securities don’t expect the Bank of Canada to over-react to the new number because “one-off factors” were well-identified. CMP

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Mortgage bond spreads tighten as borrowing costs dip Despite a first-quarter profit of $657 million, BMO’s mortgage market share has been dropping, according to the Globe and Mail, in part because of its decision to drop mortgage brokers in 2007. Canada Housing Trust’s borrowing costs are dipping to levels last seen in late 2007, Business Week recently reported, with the financing arm of CMHC selling almost $6 billion in Canadian mortgage bonds at the lowest relative yields since before the credit markets seized to international investors. During the recession, spreads have ranged from 21 to 65.5 basis points, Business Week said, but the debt is now priced to yield 18 basis points above Canada’s 2.5 per cent bonds maturing in June 2015. This means that it is the lowest spread on a new Canada housing issue since June 2007, when the agency paid a spread of 14 basis points. As the country has seen in the past year, Canada’s mortgage rates are at record lows, prompting a spike in home sales and prices. “The end beneficiary is not necessarily the government but those people taking out mortgages,” Warren Lovely, a strategist at Canadian Imperial Bank of Commerce in Toronto, told Business Week. Canada Housing Trust issued C$46.9 billion in mortgage bonds last year, up about eight per cent from the C$43.5 billion a year earlier, Lovely said, and the trust has about $175 million of debt outstanding. CMP

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Appointments

Financial security top of mind for women homebuyers Cost, neighbourhood, security and proximity are the most important factors impacting Canadian women’s home-buying decisions, according to the third annual TD Canada Trust Women and Home Ownership Poll. The poll, which sampled 1,000 independent, female homebuyers, also reported that almost half of the respondents cited financial security as the best thing about homeownership. “Even though the comforts of home have become increasingly important to women, the financial reasons for home ownership have also increased in importance,” said Chris Wisniewski, TD group product manager. Thirty-five per cent of the sample said having a backyard is the best part of owning a home and

appointments Callum Greig was recently named regional vice-president (Vancouver Island) at Street Capital.

Optimum Mortgage announced Heather Wyntinck as its new business development officer serving brokers in Southern Alberta.

another third said it was having a quiet and private space for themselves. Of the independent homebuyers surveyed, 37 per cent were between the ages of 18 and 29, 30 per cent between 30 and 39 and 33 per cent were over 40. Over a third of the sample said they did not seek advice when purchasing their home. Only 22 per cent reported getting advice from a real estate agent. CMP

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Toronto Suite 1801 130 Adelaide St. West Toronto ON M5H 3P5 Fax: 416-368-3328 Email: toronto@peoplestrust.com CMHC/Conventional Financing Michael Lombard 416-304-2078 Derek Read 416-304-2085

News

International

u.s. People catching up on overdue mortgages outnumbered newly delinquent borrowers for the first time in four years in the United States, according to a report from Mortgage Insurance Companies of America. More than 80,000 borrowers got back on track in February compared to the 68,675 with privately insured mortgages who fell into default. The last time this happened was March 2006. “The government modification programs are starting to have an impact,” Macquarie Group Ltd. analyst Matthew Howlett told Bloomberg News. “[This] signals a turning point. It’s enormous.” Earlier this month, the U.S Treasury Department reported that, in February, almost 170,000 trial plans had been converted into permanent loan revisions. Bloomberg reported MGIC Investment Corp., the biggest mortgage insurer in the U.S., rose 76 cents (7.5 per cent) on March 31. Radian, the second biggest insurer, rose 84 cents (5.8 per cent) and PMI Group Inc., the country’s third biggest, also posted an increase, 44 cents (9.7 per cent). Last year, almost three million American homeowners foreclosed and RealtyTrac Inc. expects 4.5 million more in 2010. Radian Chief Financial Officer C. Robert Quint said in a conference with investors that he expects new defaults to be flat and slightly down throughout this year. CMP

The Labour Party eliminated a first-time homebuyer tax earlier this month in hopes of balancing the market. The tax only affected first-time buyers spending 250,000 pounds or less, and started at one per cent for homes costing more than 125,000 pounds. The elimination of the tax will spare nine out of 10 buyers the extra charge. The U.K.’s current mortgage approval rates are comparable with a low of about 26,600 seen in November 2008. Meanwhile, net consumer credit rose by 528 million pounds in February, more than 100 million above what was expected by economists in various forecasts. CMP

australia Conflicting reports have emerged regarding the effect that government intervention in the Australian financial sector has had on competition between the big banks and other lenders. As the government’s bank guarantee winds down this week, Future Fund chairman and former Commonwealth Bank of Australia chief David Murray told The Australian Financial Review that the policy had caused dangerous concentration in the mortgage market. The big four Australian banks issued over $90 billion in bonds under the guarantee while smaller banks looked on, unable to afford the fees associated with the scheme. On the other hand, the Australian Office of Financial Management announced that its recent investment of almost $8 billion in residential mortgage-backed securities had been a success. Figures showed that private investors were following the government’s lead and flocking back into the market, providing smaller lenders with much-needed funding. This had allowed credit unions and other lenders to keep their interest rates low, providing healthy competition to the big banks. CMP

u.k February mortgage approvals in the U.K. unexpectedly dropped to their lowest level since November 2008 as the government tried to implement new measures to improve the market, Business Week reported. “This reinforces our belief that house prices will be no more than flat this year,” Howard Archer, an economist at London’s IHS Global Insight, told Business Week. “The government’s stamp-duty holiday will probably give the market a boost but the economic fundamentals of the housing market are pretty poor at the moment.”

1 billion pounds Estimated cost of U.K. mortgage fraud every year, according to the National Fraud Authority.

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News subhead

M OR TG SPE AG CIA E AWL 20 AR 09 DS IS SU E

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ISSUE 4.4

BEST

OF THE

BEST

THE NEW PRIVATE LENDING LANDSCAPE

MAKING THE WEB WORK FOR YOU

BROKER PROFILE WHAT MAKES INDUSTRY LEGEND FRANK HICKEY TICK

2009

this time last year Greg Williamson launches coaching program Greg Williamson, the 2009 CMA Broker of the Year (national network), started 180 Degrees Coaching last March, taking enrolments later in the year. The program’s goal: to bring brokers together to build skills, share experiences and convey concerns to lenders. One year later, and Williamson is dedicating most of his time to 180 Degrees Coaching, as well as other speaking engagements through Verico. The coaching program now has four levels of services available and almost 50 brokers have enrolled since last fall. “This is not just about building a coaching company – it’s about building an exclusive community of mortgage professionals who support one another,” said Williamson, adding the program’s peer phone mentoring sessions have garnered the most praise from participants. “They’re in a group with four or five other people who are in the exact same phase of development as them, so the problems and opportunities are similar.” Up next, the company is launching a new product called the Synergy Tax-Deductible Mortgage Strategy – created by the makers of Go/Max Solutions – exclusively to its members. CMP Xceed to apply for bank status Early last year, Xceed Mortgage Corporation was ready to apply to Finance Minister Jim Flaherty for chartered bank status as a means of increasing its lending capacity. One year later, and despite a first quarter net loss in 2010, CEO Ivan Wahl maintains that figures are not indicative of the “progress that Xceed is continuing to make.” The company achieved a 44 per cent increase in the volume of new mortgage originations last quarter, and the lender is still waiting to hear about its application for chartered bank status. “We continue to discuss with the federal regulators our application to become a federally regulated deposit-taking institution,” Wahl said.

mortgagebrokernews.ca

“Although there can be no guarantee that our application will be approved by the federal regulators…we will be able to improve our ability to provide financing options to some of the customers to whom we previously provided uninsurable mortgages and who now, despite having good payment records, are finding it difficult to secure alternative financing when their terms are expiring.” CMP Leaders request government funds for subprime borrowers Alternative mortgage lenders lobbied the federal government for assistance in renewing existing subprime mortgages. An estimated $3 to $5 billion worth of these mortgages are up for renewal in the next three years with no place for refinancing and, as a result, 25,000 subprime borrowers are expected to lose their homes to foreclosure in the next two years despite making their mortgage payments. One year later, and one of the alternative mortgage lenders leading the government lobby, N-B Group, has all but thrown in the towel. According to managing director Paul McGill, the federal government chose not to provide assistance for those renewing their subprime mortgages. He said the 25,000 mark will stay true. “I see no reason why it will change. If anything, the mortgage market has become more restrictive so that would mean all the more reason these people would have less chance of participating in the market,” McGill said. N-B Group wrote direct applications to a few provincial governments but got no assistance from any of them. According to McGill, they said it was a federal issue. “We are doing very limited amounts of work for subprime borrowers. We got to the point where we thought there was really no point in proceeding with the federal government.” CMP -With files from Nick Lypaczewski

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News Analysis

The CMHC recently tightened the reins on its self-employed borrower program to avoid some of the problems the U.S. is facing. Kit Kadlec checks in with brokers who see both the pros and cons of the changes

Restricted access S

elf-employed Canadians have always had a harder time getting approved for a mortgage due to a higher-risk borrower profile. As of April 9, getting a mortgage became even more difficult for business-for-self clients due to new CMHC rules that are receiving mixed reviews from the mortgage broker community. The new rules change a number of things. First off, self-employed borrowers with more than three years in the same business, as well as commissioned-income borrowers, are now required to provide traditional proof of income (or “third-party validation”) to qualify for a loan. Traditional income validation is available through documents like financial statements, contracts and T4s. The CMHC said the rule changes will ensure that self-employed borrowers with third-party validation will benefit from a lower premium. Those who have recently become selfemployed and don’t have third-party validation can still apply for a mortgage, but have to come up with a 10 per cent down payment instead of five per cent. Refinancing will also be cut to 85 per cent loan to value instead of the previous 90 per cent. The decreased likelihood of approval for recent self-employed borrowers is something Vancouver-based Verico broker Mark Fidgett has a problem with. “I don’t think this was a good decision,” said Fidgett, who runs Notapennydown.com. He added that if the new guidelines were actually beneficial, they should have been introduced a long time ago. “It doesn’t make sense now.” The CMHC originally came out with a program for self-employed borrowers in March 2007 when it realized the notice of assessment for business owners and entrepreneurs wasn’t always a true reflection of their real income.

mortgagebrokernews.ca

“When the CMHC came out with this program, they advertised it by saying they understand that small businesses of Canada oil the wheel, that they help float the economy,” said Fidgett. “And now they’re taking it away. They’re saying you can only use [the program] in year three.” Self-employed borrowers often write off a large portion of their income for tax purposes, but the changes make such actions conflicting for those looking for loans, Fidget added. “I’m a business owner as well, and we all pay an accountant to write off as much as possible to make our taxable income as low as possible,” he said. “Our income tax is low, but on this program now, it’s like you need to add everything back.” Private lenders, meanwhile, are out of the scope of the CMHC and could stand to benefit from the new rules. A private lender who wished to remain unnamed confirmed her expectation with CMP that the upcoming changes will bring more potential borrowers pushed away under the new guidelines her way. And while some brokers, such as Fidgett, have openly criticized the move by CMHC, others such as Stephen Gilmour of Dominion Lending Centres Alliances in Oshawa, Ont., were steady in their praise. “The more people who default on loans, the worse the market becomes,” he said, noting he felt a lot of self-employed people have qualified for

2.7 million The approximate number of Canadians who are currently self-employed.

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Analysis

mortgages when they shouldn’t have. “This provision for self-employed is going to put the right people in the right structure of home.” Gilmour added that the timing of the changes could be due to the struggles that the U.S. housing market continues to face. “I don’t think they made the decision based on the Canadian market – we’re fine. Sales are up and listings are down, which is great,” said Gilmour. “I just think they’re looking at the housing situation in the U.S. and trying to prevent us from having the same thing here.” But not everyone agrees. Fidgett said he finds fault in this reasoning, questioning if the CMHC is “running scared.” “I think it’s a gut-wrenched reaction to what’s happened in the U.S.,” he said. “I wrote on my Twitter that when the U.S. sneezes, CMHC gets pneumonia.” Fidgett said he has already had a couple clients call him in frustration, expecting that they’ll no longer be able to get approval. When he called CMHC for an explanation of the rule

License #11127

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100,000+

News

Growth in the number of selfemployed Canadians between October 2008 and October 2009, a 4.3 per cent increase according to Statistics Canada.

changes, he said the reason they gave him was that too many people were abusing the system. While some recent changes already passed, such as matching listed salaries for selfemployed with those expected for such a profession in Canada were positive, Fidgett said the latest move was “off the wall” and is hoping that if enough people talk about their displeasure with the changes, the CMHC might alter its decision. But for others like Zoltan Padar, the owner of Mortgage Pro Ltd. in Alberta, the rule changes are barely a blip on the radar. “The CMHC always wanted a certain kind of documentation for self-employed people anyway,” Padar said. “Basically, in my mind, there’s really no change. The rules and regulations haven’t really changed at all.” He also doubts the suggestion that private lenders will get more business due to more self-employed borrowers being shut out. “Private mortgages are much more expensive,” he said. “People aren’t going to go for it.” CMP

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MERIX Financial is leading the way with your continued support Since our inception, MERIX has led the way by providing originators with the tools they need to succeed. With your ongoing input, we have developed innovative lending products, originator support initiatives and a compensation program focusing on the individual originator that builds a book of business with ongoing value.

Here are the highlights from our 2009 originator survey… Compared to last year, more originators said they will be recommending MERIX Financial to colleagues and associates, to which we say thank you! 88% of originators strongly agreed or agreed that MERIX was better overall, or the same as other lenders. You continue to score our DBDs very high and 2009 was our highest overall score ever! The largest improvement year over year was in our overall underwriting score which improved by 8%. This was the highest score ever for our underwriting team! In terms of underwriting feedback, the biggest improvements were in deal turnaround time and condition fulfillment.

During 2009, MERIX Financial... Grew our Assets Under Management (AUM) to over $8 billion,

Re-launched the MERIX HELOC and 3-year ARM. Added an additional insurer with CMHC and began accepting MORWEB applications. Introduced an improved welcome program for all new customers including co-branded letters and phone calls. Reduced the cost of buydowns using XREWARDS by 18% to help originators keep more of their hard-earned commission. Received the CMP Silver Medal Recipient for BDM Support, Interest Rates and Overall Performance. Received the CMP Bronze Medal Recipient for Broker Support, IT and Electronic Technology, and Overall Service Levels. Created and delivered AMP eligible courses to assist originators in growing and improving their knowledge and business. Presentations included Improving Funding Ratios and Understanding Bond Yields and Securitization. Made enhancements to our 2010 Status Program, including:

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from 2005 to 2008. The forecast for trailers paid in 2010 is more than $3 million. Enhanced compensation so that ALL originators are paid on renewals regardless of their compensation structure. Introduced MERIX Concept 2 allowing more originators access to MERIX without the need to “pool” volumes. We believe this helps new and smaller producing originators develop their own

Eligibility for limited time rate specials Thank you again for your positive feedback. As a result of your nominations, and in recognition of the proud achievements we have helped create together, MERIX and our employees have seven finalists in four CMP 2010 Canadian Mortgage Award categories this year. Best Lender Underwriter

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top coming out on

The 2010 CMA Broker of the Year finalists

Cover

Broker of the Year finalists

After a roller-coaster year, these 11 brokers overcame the challenges dealt their way and wound up at the top of the peer-respected pile. CMP gives you an inside look at the finalists for Broker of the Year, both in the national network (over 25) and independent (under 25) categories

BROKER OF THE YEAR (UNDER 25) These nominees represent brokers who are not affiliated with a national network or brokerage.

Lance Cook

Company: CBM Canada’s Best Mortgage Corp. Location: Victoria, B.C. “To be nominated in 2009 is so special to me because it is really an award for my team, my Realtor partners and my lending partners that supported me in my time of need”

To say 2009 was a tough year for Lance Cook would be an understatement. While the recession began to take its toll on his mortgage business in the early part of the year, he was soon faced with a far more difficult challenge – cancer. Cook was diagnosed in early March and less than a month later, he underwent a five-hour operation to remove a rare type of tumour from his spleen. While the doctors pegged recovery time at a minimum of six weeks – fortunately, no chemotherapy was needed – Cook was back to working part time in two weeks and full time within a month, a testament to his hard-working attitude and physical fitness. He is quick to credit his employees for taking on his workload in a time of need. “My team of seven rolled up their sleeves and worked even harder taking on all the responsibilities I used to do – everything from building the business, running the financials, recruiting Realtors on our training program, brokering mortgages and managing the business,” he said. Now that he’s cancer free, Cook is back to running his 10-year-old business, which, aside from mortgages, includes training Realtors to increase their profits and developing custom software to serve clients more effectively.

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Kelly Wardle Company: Bridge Capital (now with Pro Link Mortgages) Location: Calgary, Alta. “Being a people person I love taking applications, I can put people at ease and relate well to most situations, which allows me to pull out all the little details, which allows me to represent a file accurately and structure it properly” This year marks the second time Kelly Wardle is a CMA finalist for Mortgage Broker of the Year – something he attributes to his respect for lenders and the details he puts into his files. “I make sure I understand what kind of business they’re looking for and that way I’m sending them files they want for their portfolio,” says Wardle, who joined Pro Link Mortgages earlier this year. “I recognize the underwriter’s time is valuable and needs to be used in approving deals, not trying to piece them together.” Before entering the mortgage industry five-and-ahalf years ago, Wardle spent a decade working in new home sales, specializing in seniors’ housing, construction management and land development. He says being in the real estate and mortgage industries has helped him develop a knack for solving clients’ problems and matching them with a product that fits their needs. “You have to be available and go the extra mile,” he says. “Customers appreciate that someone cares about them and what they’re trying to achieve, and it makes a huge difference to them when you can explain the pros and cons of mortgage options to them in a non-intimidating way.”

CONGRATULATIONS TO ALL THE NOMINEES! Visit www.canadianmortgageawards.com

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Broker of the Year finalists

Lou Perrotta Company: Domus Financial Location: Oakville, Ont.

“We strive to provide the most practical solutions for the financing requirements of our clients and we retain our clients’ loyalty because of the consistently high level of service that we provide to them” Lou Perrotta started assisting clients with real estate financing in the late 1970s when he worked as a personal finance associate with a consumer credit company. In 1992, he founded the Oakville-based Domus Financial Corporation and now counts almost 100 per cent of his business from previous clients and business partner referrals. “I receive a high repeat business rate by giving each and every file the time it deserves to ensure thorough research, product effectiveness and integrity, plus adequate face time with each client to guarantee full understanding and satisfaction,” he says. He also points to the effectiveness of the Domus website in generating leads and attends several networking events to stay active in the community, including events through the Commercial Executive Organization of Oakville. Perrotta – who is fluent in both English and Italian – received IMBA’s Certified Professional Mortgage Broker designation in January 2007 and says he continues to build on his education. In addition, he has been an active player in the mortgage community, serving as IMBA president from 2003 and 2004 as well as holding various other positions at the association and teaching the mortgage agent licensing course in Ontario.

Vince Gaetano Company: Monster Mortgage Location: Toronto, Ont.

“I have a great team and together we ensure the client is properly educated on the mortgage process, that they feel in control and that they get all the facts their banks won’t tell them” Vince Gaetano is no stranger to the Canadian Mortgage Awards – he took the Independent Broker of the Year trophy home in 2008 and was also nominated last year. Along with being recognized within the mortgage industry, Gaetano is a well-known figure in the media, appearing on the weekly television show Hot Property and providing comment to CTV and CBC on a regular basis. “I believe I have been nominated by my peers because of the time and energy spent trying to elevate the status of the industry,” he says, adding he also works hard to improve efficiency and processes with lenders. Gaetano started in the mortgage industry in 1989, managing mortgage portfolios at two major banks and developing new products before helping form Monster Mortgage in 1998. As an independent broker, he says good customer service is “paramount” to his success. “I believe my strength lies in knowing that if I listen and take care of my clients and distinguish myself in the marketplace, then the business will follow and my reputation as a quality broker will grow,” he says. “Every client, regardless of mortgage size, is introduced to the same service experience and that is the reason we exist.”

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Darryl Swallow

Company: Consumer Choice Mortgages Location: White Rock, B.C. “Offering a product that is win-win to everyone is our motto. We want a fair deal for the consumer, we want our investors to be profitable, and we want our referring brokers to earn a decent fee that is still fair to the borrower” Before entering the mortgage industry in 2001, Darryl Swallow spent 25 years as a healthcare professional, filling various laboratory roles and working his way up to director of materials management for health regions in Saskatchewan and B.C. But he was looking for a change and brokering made sense because he could partner with his wife, Cathy, who had been doing it for 20 years. While he started out doing bank deals, Swallow soon connected with some investors who wanted to put their money into private second mortgages. But because he and Cathy didn’t have enough of their own clients who needed these types of funds, they reached out to other brokers and carved a niche business, which isn’t a mortgage investment corporation but a kind of matchmaking service. “Our investors liked dealing with us so much they started referring their friends and our available funds kept growing,” Swallow says. “We now market regularly to over 1,300 brokers advising what private funds we have available each week.” When not working on their growing business, the Swallows are active in the local Rotary Club and have been foster parents through both Plan Canada and World Vision.

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Broker of the Year finalists

BROKER OF THE YEAR (OVER 25) These nominees represent brokers who are part of a national network or brokerage.

Angela Calla

Company: Dominion Lending Centres Location: Port Coquitlam, B.C. “I always keep in mind that people will remember how I made them feel. I have been proactive and not reactive to the changing marketplace, and my clients feel confident as a result” Angela Calla entered the mortgage industry five years ago at the young age of 22 and hasn’t looked back since. She won the AMP of the Year award from CAAMP in 2009 and was a finalist in this category two years ago. Calla is also consistently on Dominion Lending Centres’ top 20 brokers list for both dollar volume and the number of funded mortgages and is active in the media, hosting a weekly radio show called The Mortgage Report and appearing as a regular guest on Realty TV and Breakfast Television in Vancouver. “I made a decision when I was beginning my career to educate consumers on why they should use a mortgage broker when obtaining home financing as opposed to relying on their banks,” says Calla, adding she sends weekly “rate minders” and monthly e-newsletters with information on what’s happening in the market. “I also offer added value to my clients by helping them set, meet and continually track their real estate goals.” As a real estate investor, Calla says she specializes in helping other investors grow their portfolios. She also sits on several broker advisory panels and stays connected in the industry through MBABC and CAAMP events.

top tips from Best Newcomer Broker finalists These brokers and agents may have only started in the industry in the past three years, but they’ve already made a strong impression on their peers. CMP asked some of these future top performers for their businessbuilding tips: “The best way I’ve found to put clients at ease is to make myself just as vulnerable, part of which includes sharing detailed information about how we as brokers get paid. Once clients see that I’m not holding anything back, they realize that we’re on the same team and it’s smooth sailing from there.” - Tyler Hildebrand, Mortgage Architects, Saskatoon, Sask. continued on page 48

Diana Zitko

Company: Meridian West Coast Mortgages Location: Coquitlam, B.C. “I hope to be an inspiration to young women in finance …my goal is to always be growing and learning and also to help my staff grow and succeed to be the best that they can be” Diana Zitko is no stranger to accolades. In her seven years of being a mortgage broker, Zitko has been named Meridian Financial’s broker of the year four times in a row and receives yearly awards from lenders for mortgage volume. She also won the Business Woman of the Year award from an organization called Women of Worth in 2008 and was on the Tri-City Chamber of Commerce’s shortlist for small business of the year in 2009. Zitko attributes her success to a tightknit team of three employees, her background in real estate and her dedication to client relationships, which includes sending weekly newsletters, throwing annual client and referral appreciation parties and giving gifts to every client after a mortgage closes. “I will fight for my clients’ best interest above all else and I’m sincere in wanting the best for my clients even if it means losing a deal,” says Zitko, who has a storefront location in Coquitlam and a sub-office at Keller Williams Real Estate in Port Coquitlam. To keep involved in her community and the mortgage industry, Zitko is part of several associations including MBABC, CAAMP, Business Network International and the Valley Women’s Network.

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Broker of the Year finalists

Faye Drope

Company: Verico Sand Dollar Mortgage Location: Nanaimo, B.C.

Chad Wilson

Company: Mortgage Logic (Axiom) Location: Winnipeg, Man. “Top notch client service has saved me advertising dollars by generating ‘happy client referrals’ and has been the fundamental success of my business”

After graduating from business school in 2000, Chad Wilson took a job in the mortgage division of a large mutual fund company. Three years in, he started looking at becoming a mortgage broker – a move that made sense, he says, because there weren’t a lot of mortgage professionals working in Winnipeg at the time. Wilson took what he calls “the leap to entrepreneurship” in 2004 and says his focus has been building referrals from existing clients, financial advisers, Realtors and other influential people in the local business community. “My entire advertising budget to date has been focused on my existing referral sources – I’ve found this to be the most cost- and time-effective way to generate new leads that close,” he says. Wilson also attributes his “rock solid value system,” ethics and respect toward lenders as helping him build a solid business in a relatively short period of time. He is quick to point out that taking care of his clients is the most important aspect of his role as a broker. “I love my job and I believe dearly in the services I provide to my clients,” he says. “Rate is one thing, service is everything.”

“I feel the challenges the industry is facing right now and just like a chess board, you have to play or admit defeat. I am here and I mean business” Before becoming a mortgage broker in 1999, Faye Drope worked at a credit union for almost nine years, moving into roles in branch management and business development. But it was her experience in collections that foreshadowed her new career direction. “I got such a rush out of commissioned sales,” says Drope, who was also nominated in this category last year. “I always believe that if you help someone they will participate and reward you.” While Drope – a self-proclaimed Sudoku addict – says she has been chastised for taking too long with clients in the past, her belief is that people won’t be loyal if there is no relationship built with them. She points out that she always makes time to help or listen to a client and also likens brokering to chess because “you always need to know what the obstacles are and who the opponents are.” The past year was also important to Drope due to the hardships she faced, most notably losing a close friend to cancer. She says she is grateful for the life lessons she learned while taking time off to deal with the loss, and is now back to dedicating time to her career.

continued from page 47

top tips from Best Newcomer Broker finalists “Once I have done a couple of mortgages for clients from any one company, I contact their human resources director and offer to buy their employees lunch and deliver a presentation on mortgages. Topics are very open-ended depending on what people want to learn about, but examples include credit ratings, variable versus fixed-rate mortgages and rate trends.” - James Laird, Verico True North Mortgage, Toronto, Ont. “I constantly network in my community, whether at local chamber events, charity events or golf tournaments. I hand out tons of pens everywhere I can, short of tossing them out of my truck window! Developing strong community and business relationships has been key to getting business in the door.” - Julie Stamp, Dominion Lending Centres Alliance, Brooklin, Ont.

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“The best way to generate business is to get out there and meet people. That’s the advice I give any new agent that works for our company.” - Robert Hooper , Verico Fair Mortgage Solutions Inc., Oakville, Ont. “I openly ask for referrals as much as possible and I consistently send out thank you cards and gift cards to clients for providing referrals.” - Michael Sjerven, Dominion Lending Centres Smartymortgage, Vancouver, B.C.

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Broker of the Year finalists

Gary Meger

Kevin Boucher

“I believe in constantly evolving to ensure my business continues to thrive in an everchanging industry”

“I shoot straight and I’m always honest and straightforward. I like to think I see the big picture and would rather talk a client out of a deal that is wrong for them than sell them on something”

Company: Neighbourhood Dominion Lending Centres Location: Barrie, Ont.

With more than 20 years as a broker under his belt – and 10 years prior to that working on the lending side of the industry – Gary Meger knows the ins and outs of the mortgage business. But that doesn’t stop him from trying to learn more whenever he gets the chance. “The past 13 years have seen me invest countless hours attending seminars and doing coaching with several of the top resources in the world,” says Meger. “I have then taken those ideas and applied them to our Canadian mortgage market.” Meger’s education prompted him to create a Mortgage Process flowchart, which he says helps him continuously build his business on referral and repeat business and ensure all customers receive consistently high level service. He has also expanded his brokerage to include 40 agents across Ontario and helps them build their business through training and mentoring. “Teamwork is important in this business, and I have been fortunate to forge a partnership with the best this industry has to offer,” says Meger, adding his ongoing education in the industry has kept him excited about what he does. “I still have a wonderful passion for this business.”

how finalists are chosen Nominees for the CMP Canadian Mortgage Awards are selected through an open call to industry members, promoted through a phone, e-mail and online campaign. All nominees are contacted and need to fill out a package (which is sent to the CMA judges) before becoming a finalist. Those nominees who do not fill out packages are not on our final list for the awards show. For more information on the 2010 CMP Canadian Mortgage Awards, visit www.canadianmortgageawards.com. Harbour_Mortgage_CMP_Quarter_ad_Feb2010:Layout 1

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Company: Invis Location: Newmarket, Ont.

When Kevin Boucher left his big bank mortgage job to become a broker with Invis in 2006, he instantly knew it was the right career choice. “I should have made the move sooner, but here I am – mortgage brokering is the thing I will do for the rest of my days,” he says. “I’m proud to be a mortgage professional and I want our industry to serve the public well.” As a big believer in the client database, Boucher focuses on keeping past clients up-to-date on mortgage news and isn’t afraid to ask for referrals, especially since most of his clients fall into the ‘A’ category and, as he puts it, “great clients know great clients.” Boucher – whose slogan is “Your Mortgage Guy” – also focuses on maintaining 85 to 90 per cent efficiency ratios with lenders and keeping on top of new product offerings. “I get a tremendous sense of satisfaction from knowing that I’ve taken the time to get to know my client so that I can recommend a mortgage that fits them,” he says. “It’s not just about putting people into houses, it’s about making sure that they can reach their longterm financial goals.” CMP

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Erin Letson talks to CMA-nominated lender BDMs and underwriters to find out what brokers can do to improve their applications and develop better relationships for the future

hen we talked to lender BDMs and underwriters nominated for CMP Canadian Mortgage Awards last year, they were happy to share what brokers could improve on application-wise and what their predictions were for the year ahead. This year, with a fresh batch of finalists – including those from the newly added lender newcomer categories – and a host of new issues facing the industry, we asked similar questions to the people who put through deals and work with mortgage brokers and agents on a daily basis. Their feedback is particularly relevant and interesting with the advent of the new mortgage insurance rules, the harmonized sales tax in Ontario and B.C., and rising interest rates.

While the lender employees interviewed seemed relatively calm about the upcoming changes, David Neville, a BDM with Home Trust, neatly summed up the situation and how it will affect brokers. “I think brokers have to expect the unexpected,” said Neville, who is based in Halifax. “Insurers are going through uncharted territory and what was approved yesterday might not be approved today – not everything is a slam dunk as it has been in years past.” With that in mind, here are some insider views on how brokers can develop closer relationships with lender partners and get a greater number of deals approved.

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Common mistakes Because lender BDMs and underwriters see hundreds upon hundreds of mortgage applications in a year, it’s no surprise they can name off common errors and suggestions for improvement without hesitation. “One of the big frustrations is having an application that isn’t complete,” said Christine Siddiqui, an underwriter with ING Direct in Toronto. She adds that brokers can improve on this by having better relationships with clients and completing applications with full disclosure in mind. Along the same lines, Barb Morgan, a BDM at Merix Financial in Toronto, says the biggest thing she sees is brokers rushing applications after they get a rate

“ I can’t stress enough that it’s not a race – it’s the biggest financial transaction most people are going to go through, so it’s important for originators to coach their clients to do things correctly and not rush just to get a rate ”

Barb Morgan

quoted from the lender and then missing important information to get the deal done. “I can’t stress enough that it’s not a race – it’s the biggest financial transaction most

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people are going to go through, so it’s important for originators to coach their clients to do things correctly and not rush just to get a rate,” says Morgan, who encourages face-toface meetings with clients when possible. “We waste so much time going back and forth on tiny pieces of information and that delays everything.” The most common type of information she sees missing on applications is related to property taxes, employment and income. She says it’s important to get clients to differentiate their base salary and extras like bonuses, overtime and commission. Chris Hoeppner a BDM for Street Capital in Chilliwack, B.C., also stresses the importance of brokers clarifying to lenders how a client’s income is derived. “The best brokers are the ones that ask clients for income documents upfront and then ask them to break down how they are paid as opposed to just putting down salary,” he says. “The majority of delays

“ because a lot of clients see ads showing the lowest mortgage rate, they think they’re going to automatically get that rate, so a big part of the broker’s job is pre-selling a deal to a client and making sure they have realistic expectations, especially in this environment ” generally have to do with the fact that questions weren’t asked at the beginning of the process.” For alt-A and B deals, brokers have to pay more attention when filling out an application so they can go into more detail with lenders about why a credit score is a certain way or why income is irregular. This is especially important as guidelines tighten and formerly ‘A-minus deals’ may need to be turned over to an alternative lender. “When insurers had easier guidelines, it was enough for brokers to say ‘here are the

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facts’ and that was that,” says Home Trust’s Neville. “Now telling the story really does help and allowing for some more time for the deal to be done because there is an appraisal involved.” Like last year, the BDMs and underwriters interviewed emphasized the importance of good notes in getting an application processed. Neville says this is especially important for pieces of information like additional income or original purchase price, which don’t always carry over to underwriting systems.

Top: Chris Hoeppner Middle: David Neville Bottom: Ambrose Wong

Good habits Beyond a thorough application, there are other ways brokers can ensure smoother relationships with both clients and lenders. These habits go beyond simply knowing what numbers fit where and how to shape an application to work with a certain lender or product. For Ambrose Wong, an underwriter at Bridgewater Bank in Calgary, a key component he looks for in applications is a client’s financial maturity. It’s something he thinks brokers need to pay attention to as well. “If I see a client that makes $200,000 a year in Fort McMurray but he has almost no savings, I’ll certainly ask questions and see if the broker is missing any information,” Wong says. “Brokers are sometimes too focused on policies where they make sure a deal is with the right ratios and meets the five Cs of credit, but they don’t look at things like financial maturity or unsupported marketability of a property.” Related to that, Wong often advises brokers to recommend amortizations under 35 years, especially for clients who are putting the minimum five per cent down. And if a client clearly isn’t ready to take on a mortgage or will be stretched thin if they make such a big financial decision, he says it shouldn’t be pushed. “Don’t force a deal because that can create massive credit hits and then the Beacon score will be driven down,” he says. Another aspect of responsible brokering is managing client expectations so that, for example, alt-A clients know they might not be able to get the best rate on offer.

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“Because a lot of clients see ads showing the lowest mortgage rate, they think they’re going to automatically get that rate, so a big part of the broker’s job is pre-selling a deal to a client and making sure they have realistic expectations, especially in this environment,” says Neville. For better client relationships, Hoeppner recommends brokers take the initiative to explain new rules or changing guidelines to clients. “It’s a real value-add if brokers can call their database and explain the new rules and how they could affect them like, for example, if they’re thinking of refinancing,” he says. “It’s a personal touch and it allows clients to prepare accordingly.” Future predictions Last year, lender BDMs and underwriters predicted a few changes that would affect the mortgage industry over the remainder of 2009 and at the beginning of 2010. (This was, of course, before signs of the housing market picking up at an explosive pace.) A lot of these predictions remained this year, including a much bigger focus on responsible lending practices and brokers choosing fewer lenders to work with. “Lenders are asking for higher volumes and more of a volume commitment, so I think there’s a trend toward brokers sending deals to three or four main lenders that cover off every type of deal they need to

“ the best brokers are the ones that ask clients for income documents upfront and then ask them to break down how they are paid as opposed to just putting down salary. The majority of delays generally have to do with the fact that questions weren’t asked at the beginning of the process ”

Christine Siddiqui

get done and building those relationships as opposed to scattering deals around,” says Hoeppner. Siddiqui from ING agrees. She says brokers are becoming more selective and realizing the benefits of having a “strategic relationship” with the lender. But while many lenders and brokers see this as a positive development, there can be some drawbacks, particularly for originators in smaller locales. “Especially here in Atlantic Canada, individual brokers don’t do huge volumes, so picking one or two lenders to deal with has been a tough road for them to travel,”

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five lender predictions for the year ahead 1. Due to lender volume requirements and efficiency ratios, brokers will choose fewer lenders to work with to maintain good status. 2. Volume pooling between brokers will become more common, particularly in smaller markets. 3. There will be more demand for alt-A and B lending as insurance criteria tightens and certain sectors of borrowers (e.g. self-employed) face more restrictions. 4. The housing market will slow down in the second half of 2010 from the frenetic pace seen over the last year. 5. More brokers will have to diversify their business instead of focusing on one type of client.

says Neville, adding he has seen a lot of brokers talking about pooling deals and looking at ways to stay within funding ratios of certain lenders. Neville also says that with the changing market, brokers will have to take on more of a “jack-of-all-trades” attitude compared to when the market was booming and relatively stable. “Six years ago, brokers were taking every type of business they could get and then you saw people starting to specialize in A deals or B deals or rental property deals. Now I think you’re going to see the broker population decrease slightly and brokers diversifying deals instead of focusing on just one thing.” Like last year, there are also predictions that there will be a greater interest in alt-A and B lending, particularly with slightly higher qualifying standards and tightened insurance guidelines for self-employed clients. Home Trust, for example, has put a reemphasis on its B lending products and other lenders may follow suit. As for the housing market, which is still seeing near-record numbers, there is a general consensus that sales will dampen in the not-too-distant future. “We’re predicting the last half of 2010 is probably going to be much slower with the combination of changes coming in,” says Morgan, although she adds the new mortgage rules probably won’t have too much of an effect. “I think most good originators already qualify clients on a higher rate – it’s a smart thing to do

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because if you have any surprises, there’s some wiggle room.” Brokers and lenders may have survived the recession, but the lessons of the financial crisis have left the mortgage lending and insurance realms more cautious than when times were good, meaning more challenges for brokers and clients. Fortunately, there is still a lot to be said for good relationships between brokers and their lender BDMs and underwriters. With regular communication, brokers can keep their efficiency ratios high – something that is becoming increasingly important – and keep on top of new products and guidelines. And brokers shouldn’t forget the importance of teamwork. “To me, we both chip in – they send the deal and I’ll make sure it doesn’t turn around in two years and that will help them do better,” says Ambrose. “Together, our ultimate goal is to secure financing for a client that truly deserves to be a homeowner.” CMP

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The banks are increasing their sales forces and competing with mortgage brokerages at increasing levels, keeping mortgage brokers’ market penetration at approximately 25%. Negative press in the U.S. has seeped into Canada and has affected Canadian consumers’ opinions of mortgage brokers. Lending guidelines are tightening, affecting products mortgage brokers can provide to their clients. Some troubling news. So why are some brokers not concerned? One mortgage professional, Paul says that he’s used the Real Estate and Mortgage Institute of Canada Inc. (REMIC) to develop a business plan that addresses those concerns head on. “It was a fantastic process. I completed a one on one interview that evaluated my business and together we created several strategies to actually grow my business in this market. The Success Plan works.” As Sue, another mortgage professional says, “The Success Plan uses the tools and resources that REMIC members already have access to. There’s no need to go looking elsewhere for solutions to growing your business; those solutions are all on REMIC’s website” Founded by Joseph White, a 20 year industry professional and author of two textbooks used for mortgage agent and mortgage broker licensing in Ontario, REMIC is designed to meet the sales and marketing needs, among others, of its members. “Our focus is simple, which is what makes it so powerful. We’re here to provide the latest tools and

Real Estate and Mortgage Institute of Canada Inc. Website: www.remic.ca Tel: 1-877-44-REMIC

resources to help mortgage professionals increase their market share. Period.” Joe says. “Our site reflects our belief that every consumer should be using a qualified mortgage broker”, a belief that Joe says has shaped his vision of REMIC. “Because we firmly believe that consumers are best served by qualified brokers, all of our materials reflect that belief. To grow our industry requires dedicated, passionate brokers Joseph White who act as ambassadors for our Founder/President industry, who act ethically and professionally and always in the best interests of their clients – both their borrowers and their lenders.”

‘every consumer should be using a qualified mortgage broker’ And as the market evolves, so does REMIC. Our goal is twofold, says Steve Fabian of REMIC. “We’re here to lead with cutting edge resources, but also to respond to the needs of our members. We’re constantly adding resources we feel will help mortgage professionals grow their business as well as actively encouraging input from members as to what they feel they need to be successful, however they define success.” Kevin Rallings, another industry veteran, sums it up nicely. “The industry is changing. REMIC has the tools and resources to not only meet those changes but to excel in this market. That’s why I’m part of REMIC.”

Joseph White: joe.white@remic.ca Steve Fabian: steve.fabian@remic.ca Membership inquiries: membership@remic.ca mortgagebrokernews.ca

April 23, 2010 • The Liberty Grand • Toronto, Ontario

The 2010 CMP Canadian Mortgage Awards promise to build on last year’s awards with more categories and a glamourous 1960s theme inspired by Mad Men. Approximate Running Time 6 p.m. to 7:30 p.m.: Cocktail party sponsored by FirstLine Mortgages 7:30 p.m. to 10:30 p.m.: Awards ceremony and dinner sponsored by ING Direct Broker Team 10:30 p.m. to 1 a.m.: After party sponsored by Merix

2010 Awards Host Jessica Holmes, a favourite on CBC’s Royal Canadian Air Farce, has brought the house down opening for such comedians as Jerry Seinfeld and Leslie Nielsen. She is Canada’s fastest rising comedy star and always leaves audiences in stitches with her interactive humour and vivacious energy. She recently performed in two televised comedy specials at Just for Laughs and the Winnipeg Comedy Festival. Her one-hour comedy special, Holmes Alone, won a 2001 Platinum Award at the Worldfest International Film Festival and was nominated for a Gemini Award. Her work on the Second City production The Best of the Very Last earned her a nomination for the prestigious Tim Sims Scholarship. Holmes is also known for her work on The Comedy Network and CTV’s hilarious, edgy, Carol Burnett-style sketch comedy, The Holmes Show. She has appeared in such films as Welcome to Mooseport and Citizen Duane. Additionally, Holmes is working on her first comedic/motivational book, I Love Your Laugh, due out in 2010. Holmes’s comedic highjinks and crazy antics, her knack for skewering celebrities such as Céline Dion, Liza Minelli and Britney Spears, along with her original creations, amuse even the most straight-faced audiences. Her grace, bilingualism and ability to react on the fly make her a natural choice for MC. Whether hosting or performing her hilarious characters, Holmes always leaves the audience in stitches.

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Feature

Mortgage rules

New mortgage rules explained In an effort by the Canadian government to prevent an over-heated housing market from turning into a bubble ready to burst, three new rule changes were established, effective April 19. Peter Kinch analyzes what they really mean

ny borrower who chooses a short-term mortgage (one to three years on a variablerate mortgage) must now qualify at the five-year rate in order to get a CMHC insured mortgage. Impact: Negligible. The fact is that most lenders already require that anyone taking a variable rate mortgage must qualify at the ‘threeyear posted rate.’ What’s of interest is that the government announcement did not distinguish whether the five-year rate was a ‘posted rate’ or ‘discounted rate.’ The difference is about 1.5 per cent. The irony is that the current three-year posted rate is higher than the five-year discounted rate, so if the government rule requires that borrowers qualify at the five year discounted rate, this could actually serve to ‘relax’ the rule, not strengthen it. In addition to that, recent surveys indicate that as much as 70 per cent of Canadians already choose fixed-rate long-term mortgages. Bottom Line: Great move regardless of the type of borrower. It is practical and imperative that anyone taking a variable-rate mortgage today factor in a three per cent increase in rates over the next two to three years. I still believe there are huge savings to be had with a variable today, but only if the payments are increased to match the current discounted five-year rate. In doing so, two things will be accomplished. It will accelerate the rate at which the mortgage is paid off, thus reducing the principal mortgage balance at the time of renewal. This will help to negate the impact of an increase in rates at that time, and it will adjust family budgets today to the inevitable higher rates in the future – thus avoiding payment shock. Smart and prudent, but will it achieve the effect of helping to

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cool off the housing market and slow things down? Not at all – this one is purely optics. The maximum amount to refinance has been lowered from 95 per cent to 90 per cent. Impact: Negligible. Smart move by the government to make mandatory what should be common sense. The only reason anyone would leverage their residence up to 95 per cent would be to pay off high interest credit card debt with the extremely low interest mortgage debt. Others may want to simply access as much money as they can at these historically low rates in hopes of generating a greater return in the market. Either way, it is extremely imprudent for anyone to over-leverage their principal residence. Whether there is a bubble or not, it certainly doesn’t take much of a market correction to eliminate five per cent in the value of any home. For the average Canadian, their home represents

Feature

Mortgage rules

their greatest investment and with that, their largest source of net worth. It also represents a major component of the average Canadian’s retirement plan. It should be a source of equity development, not as an ATM to subsidize a current lifestyle. Bottom Line: Smart and prudent move. Will it have the desired effect of slowing down the housing market? Not at all. The truth is that the percentage of Canadians refinancing to that extent is an extremely small percentage of the population so this will have a very small impact. The minimum down payment on non-owner occupied properties purchased for speculation will now be 20 per cent. Impact: Negligible. This is by far the most significant of the new rule changes – especially if you are a real estate investor. Although the announcement specifically stated that they were targeting the “speculator,” not the “investor,” the net effect is that all investors will be impacted. However – and this is very important – the impact will not be the fact that investors must now put 20 per cent down. Any investor should look to put 20 per cent down for cash flow reasons if nothing else. But the real reason this is a major rule change is the sub-text to this rule change that was not included in the original announcement and not reported in the press. In addition to no longer allowing high-ratio mortgages, CMHC has also changed their underwriting policy. Whereas they previously allowed for an 80 per cent offset of an investor’s existing portfolio when underwriting a mortgage, they will now revert to a 50 per cent addback. Now, to the average Canadian this is a meaningless change, but again for the real estate investor, the change is significant in three ways. A 50 per cent addback is significantly less favourable to an investor than an 80 per cent offset. For example, for someone who currently owns more than three rental properties, they will never be able to qualify for a mortgage using only 50 per cent of the rental income from their portfolio. The secondary issue here concerns borrowers who wish to bypass this by simply putting 20 per cent down. The thing is though that the noninstitutional lenders that are mortgage-backed security lenders will require that all the mortgages in their portfolio be insured – even if they are conventional (20 per cent down). That means they need to follow the CMHC guidelines,

which means those lenders are no longer an option for your clients with three or more properties, even with a 20 per cent down payment. This will shift more of this business to the chartered banks, all of which are tightening their guidelines on rental properties, meaning the next issue for these borrowers will be cap space (Banks will have a cap on how many mortgages borrowers can get). Bottom Line: Significant impact, mainly for investors. As for cooling down the overall market? Again negligible, simply because real estate investors as a whole represent less than five per cent of the overall market so their impact on the housing market in Canada is muted.

Peter Kinch

Key lessons If you are a broker who has a significant portion of his/her portfolio coming from real estate investors, what does all of this mean to you? Well, first and foremost, it’s important to clarify that the new rule changes only apply to residential mortgages insured by CMHC. So to effectively answer this question we need to separate the investment market into four camps: One - Those who focus mainly on commercial or multi-family purchases. Two - Those who are new to investing and are either buying their first rental property or have less than three rentals. Three - Those whose current rental portfolios are between three and 10 properties and have relied mainly on one lender/ bank for mortgages. Four - Mature investors with over 10 properties and have used multiple lenders/banks to date. For those who are purchasing commercial properties or multi-family buildings, none of the above rule changes affect them. CMHC has not made any changes to their insurance program for multifamily units to date, so apartment buildings can still be purchased withas little as 15 per cent down as long as the cash flow warrants it. For category No. 2 borrowers, these rules will not have a major impact other than the fact that they will have to come up with a 20 per cent down payment, but as I mentioned earlier, this is a prudent thing to advise your clients to do regardless since they are likely buying real estate for a combination of net worth and cash flow.

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Feature

Mortgage rules

Keep in mind that the new rules only impact CMHC policy, so putting 20 per cent down with a chartered bank will still afford many non-CMHC options as well. Depending on how much income can be verified, you will still be able to access the maximum amount of lenders for these clients, but it is critical to use your lenders in the right order. From 3 to 10 properties For those who have purchased more than three rental properties but less than 10 are an interesting case. These new rule changes will have an impact depending on what their future plans are. If they plan to continue buying more real estate for investment purposes then the issue moving forward will be cap space (three and 10 properties being a rough guideline, as the number will vary between lenders). Any lender using a 50 per cent rental addback policy will not be an option for them, even with 20 per cent down. These clients will be forced to work with deposit-taking chartered banks that have a rental program which does not require CMHC insurance. Properly structured, the only limitations will be hitting the cap space at each bank, not the CMHC guidelines. Cap space The last category will be those investors who have already experienced cap space issues at their chartered banks. The strategy up until now for those individuals was to spread out their mortgages over as many lenders as possible and maximize the cap space at each lender. A key component of this strategy was to use the non-chartered banks, applying an 80 per cent rental offset. CMHC’s previous guideline, which many of these lenders used, would allow them to use an 80 per cent offset on the entire portfolio, the catch being that they could typically only have a maximum aggregate total of $1.5 million worth of CMHC mortgages with these lenders. For those with more than 10 properties who have not already taken advantage of these non-chartered bank lenders, they will need to rely solely on the chartered banks moving forward, which again, will result in cap space issues. Those who have been strategic however and utilized the $1.5 million worth of cap space with the non-chartered CMHC-insured lenders, will now have that much more room

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the difference between an 80 per cent offset and a 50 per cent addback is critical An 80 per cent rental offset works like this: (Total amount of rental income in portfolio x 80 per cent) – Total amount of mortgage payments. The result will be either a surplus or a shortfall. With a large portfolio of between three and 15 properties that have positive cash flow, they will more than likely generate a small surplus using this calculation. Using this form of underwriting makes having more properties an asset. A rental addback works like this: The lender will take only 50 per cent of the total rental income in the portfolio and add it back to the verifiable income. The new total verifiable income will then be multiplied by 40 per cent (the TDSR) to determine the total verifiable income. Meanwhile, 100 per cent of the expenses from all of your client’s rental properties will be added to their debt. The only way to qualify for a mortgage is if 40 per cent of their verifiable income is sufficient to service 100 per cent of their debt. This form of underwriting will work for individuals with a large verifiable income and less than three rental properties, but once they have three or more rentals it is virtually impossible to qualify for a mortgage using the addback policy. The biggest challenge borrowers will face moving forward is from mono-line lenders that require all of their mortgages be insured regardless of the loan to value. These lenders are now no longer an option for anyone with three or more rental properties in their portfolio regardless of how much money they have to put down.

to work with chartered banks and will find that the new rule changes will have no impact. The key here is to be strategic and learn about cap space options. At the end of the day, the finance minister walked a thin line between addressing concerns about an overheated real estate market in Canada and not over-correcting the problem at the risk of causing damage to the overall economy. For the broker whose main source of business is the average Canadian, these new rules will have a negligible effect. But for those of us who deal greatly with real estate investors, there has never been a more important time to stress acting strategically.

Peter Kinch is a bestselling author and owner with Dominion Lending Centres. Peter’s next book, The Canadian Real Estate Action Plan, is being released this month. CMP

From the convention floor MBABC

It required a lot of overtime locking those rates in. I was out of here as soon as Resmor drew for the Nintendo Wii. Bonnie Deck, Mortgage Consultant, Peter Kinch Mortgage Team, DLC

mbabc

On the morning of day one of the MBABC trade show, three big banks announced a 60 bps rate increase. CMP caught up with everyone on day two and asked: How did yesterday’s rate announcement affect your day at the trade show?

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They always seem to raise rates when you have a conference. I didn’t leave the show early though – it was just a 1 a.m. night instead. Susan Zanders, Mortgage Broker, Verico

More liquor (laughs). It’s a conspiracy I think. They wait for all the brokers to get in one room so they can’t get out for those rate holds. All the guys from the interior couldn’t get back soon enough so they were in the hotels and on the BlackBerrys all day. Tony Kreutzer, Regional Manager, Interior B.C., Invis

I got my clients the rate holds just last night. I was up until 3 a.m. and did about 20 apps. I was able to do it pretty easily with ING’s online rate hold though.

I am going to take the opposite approach and say it was a positive move. A lot of people sitting on the fence woke up so now the pressure is on to get the deals in by 4 p.m. today.

Atish Thakur, Mortgage Expert, DLC

Gord Ross, Axiom Mortgage Partners

It’s good because now we are able to proceed with our model, which is mortgage planning. As for yesterday, there was no way I could have left the office, and I was up until 11 p.m. locking in rates. Gale Tracey, The Dream Home Maker, Mortgage Architects

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Business Branding

why

branding still matters

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Business

Branding

Branding and marketing are traditionally the first casualties of a tightened budget – primarily because the return on these investments is notoriously difficult to measure. One of CMP’s sister magazines in Australia, Human Capital, examined the importance of branding

o the uninformed, employer branding may seem like marketing lingo - raising further doubts about its usefulness. The words attributed to U.S. department store merchant John Wanamaker still linger for many: “Half the money I spend on advertising is wasted; the trouble is I don’t know which half.” Furthermore, if an organization has scaled back recruitment activities, why is a focus on the employer brand necessary at all?

experiences truly reflect their brand. In other words, they deliver on their communicated promises to employees,” says David Kent, managing director of The Right Group, a brand management company based in Australia. A common trap for many organizations is to equate employer branding to recruitment marketing. They also fail to link their external employer brand messages with internal experiences. “Our philosophy is that an employer brand is the package of functional, economic and Defining the brand psychological benefits provided by employment It has been almost 20 years since Simon Barrow, with the company - these benefits need to focus on chairman of U.K.-based People in Business, the most compelling reasons a candidate would began selling the concept of employer branding. both choose the organization and also why they But only in the last five years has the concept would choose to stay,” Kent adds. gained traction. Successful organizations align their employer Employer branding, at its simplest, is about brand promise with their customer brand to how an employer sells itself to current and future optimize their organizational performance and employees. The brand showcases the company’s customer experience. They clearly state the personality and values and says: ‘this is who we benefits employees can expect from the are and this is why you should work for us’. Note organization in return for their contribution that this definition specifically mentions current towards the customer brand experience. Kent uses employees - a fact that is frequently forgotten in Microsoft as an example. Microsoft promises to analyses of the employer brand. The employer help employees “realize their potential” and in brand is undeniably at its most powerful when return expects employees to “take on big utilized in recruitment but it is equally useful as a challenges and see them through”. retention tool. Indeed, it should mirror an “Once defined, the employer brand needs to be organization’s talent management strategies, managed throughout the organization. This is not which for most organizations in this market are just about managing communication channels but focused on retaining top performers and increasing improving internal people processes and uptheir engagement and productivity. skilling line managers and corporate leaders to All employees are exposed to the employer provide the right experience for employees,” brand through daily interactions with the Kent says. organization through ‘touch points’ - HR procedures, their manager, executive leadership Branding in a downturn communication, general internal communication, Brett Minchington, CEO, Employer Brand career mobility or development opportunities. Institute, says that employer branding will always “Each touchpoint is a brand experience for the exist, regardless of the external environment. An employee, and for the best companies these employer brand - much like a corporate culture

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OF THE HERD

ONTARIO’S With Ontario’s new mortgage brokering legislation now in effect, not even two thirds of the province’s mortgage professionals were registered with the Financial Services Commission of Ontario (FSCO) by the July 1 deadline

s of the Canada Day deadline, almost 3,300 mortgage agents from across Ontario found themselves in contravention of the new provincial act, putting themselves at risk for reprimand by the provincial regulator. With an estimated 9,000+ agents in Ontario, this translates into approximately 37% who failed to hold approved licences by the deadline. Ontario’s mortgage agents were bombarded with stern notifications CAAMP, IMBA and FSCO in June, enforcing the fact that, after July 1, mortgage agents not registered under the new Mortgage Brokerages, Lenders and Administrators Act 2006 are forbidden to practice in Ontario. The low number was a surprise to some. After all, the act was designed to improve the mortgage brokering profession by implementing educational requirements, mandatory errors and omissions insurance, and introduce a whole slew of other factors to ensure the safety of consumers and, consequently, improve customer confidence.

www.canadianmortgageprofessional.com

The fact that such a low number of agents took the steps to proactively stand behind it led some to believe that a large percentage of Ontario’s mortgage agent population didn’t care about the best interests of the industry. Others said there were a number of factors at play.

Agents being agents Up until a week before the deadline, Jeff Atlin, vice president and chair of government relations for IMBA, had only received a handful of queries regarding the new act. That number escalated in the week leading up to the mandatory changes – signifying that many mortgage agents weren’t apathetic, they were merely disorganized. “It seems mortgage professionals tend to do things last minute – so, in many ways, it doesn’t surprise me,” he said. “On the other hand, I am surprised that there isn’t a stronger sense of urgency.” While the lack of urgency might be disturbing, Phil McDowell, president of AMBA, said it’s not uncommon. Alberta

Business

Branding

- will develop with or without direct guidance from stakeholders. But organizations that strategically manage it will be at the mercy of two factors: the current financial position of the organization and their competitor’s position. “The game doesn’t change and neither does the process. Organizations still need to determine what they want to stand for, and determine which values and activities align with that,” he says. June Parker, general manager, LINK HR Consulting, firmly believes that employer branding remains relevant in a downturn - mainly because some skills sets are always in high demand and good employees with those skills are hard to find. “Employer branding acts as both a retention tool and an attraction tool, to retain top talent and entice employees out of other organizations who may be nervous about job stability,” she explains. In industries less affected by the downturn, employer branding can be used as an internal communications tool to reassure existing staff that the organization is doing well and still recruiting. Bakers Delight, for example, has advertisements for new bakers that position the organization as a great place to work, emphasising both internally and externally the good performance and health of the organization. Joanne Rigby, APAC marketing director for business communication experts Premier Global Services, notes that while recruitment levels may drop off, some positions simply have to be filled and good branding can lure passive candidates. She also stresses the importance of continuing to engage existing employees. “Regardless of whether we’re in a downturn or not, your employees are the best brand champions you’ve got, so you need to be

actively engaging with them, getting their input, consulting with them,” she says. What to say - and how to say it Whatever the economic conditions, good brands should essentially stay the same but may need to be communicated more strongly in a downturn. They should continue to communicate what the organization offers employees in terms of learning and development, career paths, organizational stability, opportunities (immediate and long term), profitability and market positioning. A strong, well-articulated employer brand will help to retain top talent. The brand and the communication channels in which it is disseminated can also be used as a valuable tool for leaders to connect with employees and also provide the vision and progress updates that are so desperately needed in times of uncertainty. Rigby cites a recent Harvard Business Review article that stated, ‘when the flight gets bumpy, you want to hear from the captain’. “There’s no such thing as over-communicating to employees,” she adds. Communication and the EVP It is far simpler to ensure effective and consistent business to employer (B2E) communication when a recognized Employee Value Proposition (EVP) is in place and also when a unique employer brand can be leveraged. Now, more than ever, this is ‘business critical’ if an organization is to lead the recovery in its market. Communication of the EVP and employer brand and - more importantly - a strategy to ensure the activation of this at every touchpoint of the employee life cycle, is just as important as

the essentials To stay ahead of the competition, smart employers need to ask the following questions: • Do we know what our unique EVP is and do we have an employer brand that reflects this? • How do we use this? For recruitment purposes only or at every key stage of the employment life cycle? • How are we bringing our brand to life in terms of engaging and retaining the right talent in our business to get us through the current economic crisis? • Do we leverage our marketing budget as well as our HR dollar? • How do we measure and show ROI at board and shareholder level for investment in this?

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Business Branding

communication of the corporate and product brand, notes Alison Maidment, managing director of B2E specialists Daemon Within. “At a time when business strategy and priorities need to be realigned this is especially necessary. Add to that the fact that many business leaders may never have led a business through a downturn, and it becomes even more critical to have clear and consistent messages for them to deliver,” she says. Maidment adds that even bad news, communicated the right way, can contribute to enhanced employee engagement. “If you have invested heavily in attracting the right talent to your organization in the past, the last thing you want to do is see that investment migrate to the competition the minute the market picks up and the grass seems greener on the other side of the fence,” she says. Brands in turbulent times Companies facing layoffs risk long-term damage to their employer brand, but the damage can be minimized depending on how the situation is

“ regardless of whether we’re in a downturn or not, your employees are the best brand champions you’ve got, so you need to be actively engaging with them, getting their input, consulting with them ”

handled. Kent urges organizations to consider what they will be known for as a result of the layoffs - that is, the way people were treated and the approach taken. Is it aligned with a strategy to retain performers within core functions or non discriminatory? How will it affect remaining staff? How will it affect the organization’s ability to re-hire when the economy recovers? “Providing timely and accurate information to employees is critically important to manage rumour mills and misinformation that could have a long-term impact on brand reputation,” he adds. To cite one recent example, employees of Pacific Brands wanted an opportunity to work with their employer to find a way to keep their jobs. Could the outcome have been more positive if management were open about the organization’s financial position internally and then sought support and ideas from employees? Rigby believes so. “Even if the outcome meant job losses, it would have been a collaborative and potentially rewarding process for employees irrespective of the outcome,” she says.

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Business Branding

Internally, the challenge is to communicate that retrenchment is a last resort to maintain the company’s viability and protect the jobs of remaining employees. “Organizations that have made large-scale retrenchments but are still hiring externally for certain roles needed to frame these opportunities carefully. They need to communicate clearly why these key roles need to be filled and why they can’t be filled internally,” says Parker. Times of crisis can help shape an organization’s reputation as an employer of choice, but they can also destroy a company’s reputation. Maidment cites the unforgivable crime of announcing redundancies via SMS as just one example of poor practice. “How you handle a divestment, restructure, change in reward strategy, employee relations generally will be critical to your reputation now and during the recovery. Your top talent - and let’s acknowledge that that they are most likely the ones to bring you through the tough times - need your attention as much as the talent you might be reluctantly losing. A well-managed alumni program or digital employer footprint, for example, could significantly enhance your employer brand and, in turn, your product brand and shareholder value,” she says. HR and marketing The consensus from the experts Human Capital contacted for this article was that HR needs to work closely with marketing on the employer brand. It’s also apparent that while HR has vast knowledge of the elements of the brand to be presented, both internally and externally, they generally need assistance with the tools to present that information.

“ providing timely and accurate information to employees is critically important to manage rumour mills and misinformation that could have a longterm impact on brand reputation ”

“Traditionally, marketing and HR functions do not talk about strategic issues but this is essential. Consistency of internal and external messages is of critical importance in branding and building brand equity. A truly collaborative partnership between HR and marketing can actually create a company culture more effective at delivering on-strategy and greater bottom line results for the business,” says Kent. Minchington adds that if branding efforts are not a ‘key strategic pillar’ it just remains an HR activity. “If it’s seen as a strategic pillar it gets support and investment, and it gets the HR department out there mixing with other teams. Two years ago, 75 per cent of global branding efforts were managed by HR. This has dropped to 43 per cent so we know that marketing and communciations are starting to get involved in it. The message for HR is to go and knock on the door of marketing and communciations if you want to do this properly. HR leaders cannot be expected to have all these skills sets,” he says. Rigby takes this a step further by suggesting that ‘brand ownership’ should extend to the whole organization. “Every employee has a responsibility to their brand whether they only deal with internal employees as their customers or are directly working with external suppliers or customers. Having pride in where you work makes you the best kind of brand champion and employees must feel content and empowered to do that.” Kent notes that managers generally underestimate the impact their daily interactions (including communication and behaviour) can have on an employee’s employment experience. This is not their fault, he says. “Buy-in of the employer

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Business Branding

brand concept at senior leadership level first is most critical if middle/line managers are going to impact on brand equity.” When to change The employer brand will need adjustments to stay relevant and appealing. This is important for retention of talent in core functions necessary to survive recessionary times and to position the organization for recovery. Also, employer brands need to be competitive to attract highly skilled talent that will boost recovery. Parker suggests the employer brand should be pushed when a company has good news and a need to hire, such as a construction business winning a major, long-term infrastructure project. “It need not be an expensive exercise, but the brand message needs to be clear and consistent,” she says. nexus-cmyk-halfpgCMPad-march10(2Page 1

Kent adds that there is endless research that supports how marketing investment can improve an organization’s strategic position and ability to develop a competitive advantage. “Organizations that are stripped to the bone during recessionary times not only harm their brand reputation but also have no capacity to respond to an economic upturn,” he says. It is not an expensive exercise to reinvigorate or live and breathe the employer brand - leaders still need to engage and communicate with employees to motivate them to perform. “This isn’t just all about pretty pictures and a snappy strapline in your recruitment ads either. Despite the seemingly larger pool of talent in the market, the top talent is still the same finite pool whether it’s employed by your competitor or not. It’s about having reliable data about what makes your business unique in what is still a highly competitive landscape,” Maidment concludes. CMP

09/03/2010

5:20:14 PM

We supply mortgages throughout Western Canada, Northwest Territories and the Atlantic Provinces, for a wide range of commercial properties that includes:

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Insight

standards After almost five years in business, Verico has stuck to its original mandate while expanding its list of services and recruiting top brokers to its network. CMP talks to president Colin Dreyer about the company’s progress and future plans.

Colin Dreyer

Quick stats Verico

n the eve of Verico’s fifth anniversary – it’s coming up in June – president Colin Dreyer is keeping busy expanding the national network’s business-building services to brokers. It’s another way he hopes to keep growing the network while sticking to the same model that has made the company a success. “The basic premise of Verico is a network that provides tools and services to help brokers build their businesses and that has stayed the same since the beginning,” says Dreyer, who is based in Vancouver. “We haven’t tried to redefine ourselves – our model still stands and we’ve had that ability to also deliver what’s needed to our members as changes in the industry happen.”

Focus on quality Since Verico was established in 2005 by Dreyer + Company started: 2005 and his business partner, John Kelly, the network has recruited 165 business owners across the + Number of business country. Dreyer says members have to go through owners: 165 an intense selection process, including a six-page + Number of locations: application form, and are selected based on their 225 + Number of agents: 1850 professionalism, which includes experience and production levels. “We have always felt that our demographic was the top companies across Canada and we always wanted to differentiate ourselves from our competitors in terms of quality,” he says, adding that the network has taken an industry-focused promotional approach as opposed to targeting consumers. “We’re all about being the best for the industry and we’ll let the industry people be the best for the consumer.” That focus on quality also links directly to lender relationships, which Dreyer says are top-of-mind at Verico. The company has a dedicated employee who works on lender partnerships and the network aims to keep efficiency levels high among its members. “We realize the lenders want to be profitable, the brokers want to be profitable and the

consumer needs to be serviced, so it’s finding compatibility between those components and making sure we do a good job of that,” he says. New services Over the past year, Verico has added a number of new services and initiatives for its brokers. Last year, the company introduced a new proprietary CRM system that works through Filogix and re-launched its creditor life insurance program. More recently, a free website tool called VeriSite was introduced, which allows members to customize their websites with different designs and colour schemes as well as blogs and social media links. There are also new consumer videos that brokers can put their own individual branding on, and, at the end of last year, Verico Coach was launched to provide monthly TV coaching sessions to licensees led by top broker Greg Williamson. “We want to make sure people are very understanding of what it takes to build a business – it’s a very committed endeavour and these services show that we’re here to help,” Dreyer says. Education has also remained a key component of the network, Dreyer adds, which is why Verico started “regional days” this year, which encourage networking among brokers and lending partners in the same area. In the coming months, Dreyer also says there are plans to launch a program that will better connect consumers and referrals and an “internal information communications system” for Verico licensees. And in celebration of the company’s five-year anniversary, Dreyer says there will be licensee retreat in Las Vegas in the spring. “We always want businesses to be built in the collaborative sense,” he says. “We don’t force programs on people who don’t want them or don’t want to pay for them – everything we do is in harmony with our members.” CMP

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CMP talks to Street Capital Financial president Paul Grewal about non-banks’ place in the Canadian mortgage industry and why service and efficiency levels are becoming increasingly important.

Balancing the mortgage

Q: The spring market is always busy, and this year there are other factors contributing to the rush. What is Street Capital doing to prepare?

market

Q: What differentiates Street Capital as a non-bank lender in comparison to the big banks? I think one of the things is that we’re very much a flat-board structure – the buck stops with the executive team and there are not a lot of layers. I also think we’re more flexible and faster to respond to the market. Beyond brokers having a relationship with management and the team at Street Capital, our whole focus is to provide them with an exceptional level of service so they look fantastic in front of their clients. And because rates and products are comparable among lenders, there isn’t much unique competitive advantage in that, so a service level promise is important to us. Q: As a broker-focused lender, why is it becoming increasingly important to look at efficiency ratios? We have a scorecard, which all of our brokers receive, that looks at efficiency – the industry as a whole is actually moving in that direction and I think it’s the right direction. We look for at least a 65 per cent commitment-to-fund ratio from originators, but we don’t have a minimum volume requirement because we know some of the newer agents might not be able to meet that but could end up becoming more successful later on. The reason efficiency is so important for us is that our business model is based on being a monoline lender – we don’t have other product lines where we cross-sell, so it’s important for us to be efficient and to see deals close. Also, spreads are at historic lows so now, more than ever, it’s important for us to have a quality portfolio.

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We’ve been expanding our BDM team and our underwriting and operations team in anticipation of a very active spring market. Paul Grewal We’re a growing company and we want to ensure we have a service level promise and we deliver upon it. Right now, we have 14 BDMs across Canada and we’re going through another phase of expansion in a couple of weeks. Q: How many brokers are involved in Street Capital’s status program and how has it benefited the company? We have approximately 150 brokers involved in our status program and it has proven to be extremely successful because we’ve been able to establish a strong relationship with Canada’s top mortgage brokers. Q: What do you see in the future for Canadian non-bank lenders? In order for the mortgage market to be healthy and vibrant, particularly for mortgage brokers, they need choice and there has to be competition, which enables them to provide more to their customers and grow their market share. The non-banks are facing some unique challenges right now because banks’ mortgage share in the broker channel is continuing to grow. But I think we will start gaining back share because brokers are always looking for choice and the non-bank lenders collectively are quite strong – I think you’re going to see much more aggressive business development practices in terms of getting brokers to support the non-bank lenders. Banks still serve a product and brand purpose, but they need competition for there to be a healthy diversified marketplace. CMP

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Favourite Things

James Laird + President (and finalist for Best Newcomer at the 2010 Canadian Mortgage Awards) + Verico True North Mortgage Ontario + Toronto

Favourite Things Sport Waterskiing.

Vacation spot Whistler, B.C. I ski a lot and it’s a great place to get some physical activity in, but it’s also a fantastic place to kick back and party a little bit.

Celebrity George St-Pierre. He’s a Canadian athlete [a mixed martial artist], a very determined guy, very poised, very focused and he’s the best at what he does. BOOK The Da Vinci Code. It spins facts with fiction in a very entertaining way. Food Steak, medium rare.

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Movie The Shawshank Redemption – it’s Morgan Freeman at his finest.

Drink Gin and tonic – it takes the edge off after a long day of doing mortgages.

service directory

Banks

Bridgewater Bank www.bridgewaterbank.ca Ph: 1 888 837 2326 Page 27

HomEquity Bank www.homequitybank.ca Ph: 1 866 522 2447 Page 17 & 45

Home Trust www.hometrust.ca Ph: 1 877 903 2133 Page 9

TD www.tdfinancingservices.com Ph: 866 694 4392 Page 33

Macquarie Financial www.macquariefinancial.com Ph: 1 877 462 3788 Page 65

The Money Source www.mymoneysource.ca Ph: 416 699 2274 Page 36 Insurance

National Bank www.nbc.ca Ph: 1 888 483 5628 Page 73

Scotia Mortgage Authority www.scotiamortgageauthority.com Page 7

Merix Financial www.merixfinancial.com Ph: 1 877 637 4911 Pages 38-39

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

Moskowitz Capital www.moskowitzcapital.com Ph: 416 781 6500 Page 55

Non-Bank Lenders

Mortgage Protection Plan www.mppbroker.com Ph:1 866 677 4677 Page 46

Broker Networks

Capital Direct www.capitaldirect.ca Ph: (780) 868-0550 Page 18

Concentra Financial www.concentrafinancial.ca Ph: 1 800 788 6311 Page 21

Equitable Trust Company www.equitabletrust.com Ph: 1 866 407 0004 Page 35

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

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

New Horizon Mortgage Investment Corporation www.newhorizonmic.com Ph: 905 889 0867 Page 24

Optimum Mortgage A Division of Canadian Western Trust www.OptimumMortgage.ca Ph: 866 441 3775 Page 28

Peoples Trust www.peoplestrust.com Ph: 1 800 663 0324 Page 30

Resmor Trust Company www.resmor.com Ph: 866 809 5800 Page 14

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

Centum Financial Group Inc. www.centum.ca Ph: 1 604 257 3940 Page 19

Dominion Lending Centres www.DominionLending.ca Ph: 1 888 806 8080 Page 20

Home n Work Mortgages www.homenwork.com Ph: 1 866 658 0492 x 100 Page 53 & Classified

INVIS www.invis.ca Ph: 1 866 854 6847 Page 59

Mortgage Intelligence www.mortgageintelligence.ca Ph: 1 877 667 5483 Page 11

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Real Estate

Commercial Lenders

OMJ Mortgage Capital Inc. www.omj.ca Ph: 905 482 9393 Page 15

Real Estate Institute of Canada www.reic.ca Ph: 1 800 542 7342 Page 70

Harbour Mortgage Corp. www.harbourmortgage.ca Ph: 416 361 3315 ext. 221 Page 49

RMAI Financial Group www.rmaifinancial.com Ph: 1 866 955 7624 Page 29

Nexus Investment Corp www.nexusinvestment.ca Ph: 1 604 664 7079 Page 74

Canadian National Association of Real Estate Appraisers www.cnarea.ca Ph: 1 888 399 3366 Page 72

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

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

Real Estate and Mortgage Institute of Canada www.remic.ca Ph: 1 877 44 REMIC Pages 52, 57 & 63

Technology/Software

Services

Applied Business Software www.absnetwork.com Ph: 1 800 833 3343 Page 2

The Mortgage Group www.mortgagegrp.com Ph: 877 899 1024 Page 25

GoMax Solutions www.gomaxsolutions.com Ph: 1 877 492 5164 Page 16

VERICO www.verico.ca Ph: 1 866 983 7426 Page 13

Best Points Travel www.bestpointstravel.com Ph: 1 800 551 8786 Page 26

Eprintagent.com info@eprintAgent.com Ph: 1 888 907 5550 Page 37

Tax-Deductible Mortgages

Verico The Mortgage Practice Inc careers@vtmp.ca Ph: 905 458 4222 Page 12

TDMP.com www.tdmp.com Ph: 1 866 500 8886 Pages 22 & 23

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