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CMP salutes 13 of the Canadian mortgage industry’s most dedicated leaders LOOKING AHEAD TO 2022
The trends that are likely to dominate the industry next year
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ISSUE 16.12
CONTENTS HALL OF FAME
19
SPECIAL REPORT
Meet the 13 mortgage industry titans who landed a spot in CMP’s annual Hall of Fame
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CONTENTS
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08
UPFRONT 04 Editorial
A year to be proud of
06 Statistics
Key data that should be on your radar this month
10 Bank update
26 FEATURES
UPFRONT
Industry players weigh in on the Bank of Canada’s likely interest rate moves
NEWS ANALYSIS
12 Legal update
The major trends brokers will want to keep an eye on next year
What’s on the Liberals’ agenda for the housing market?
30
14 Opinion
Why a national code of conduct for brokers is a win-win for both the industry and consumers
FEATURES
MORTGAGE TECH’S PAST, PRESENT AND FUTURE
CMP talks to three leaders in the mortgage tech space to find out how technology for the industry might evolve in the coming years PEOPLE
INDUSTRY ICON
John Bargis’ decades of experience as a broker helped him design an organization that gives brokers the freedom to do things their own way
16 2
34 CMLS readies for further growth
What can brokers expect from the lender in 2022? FEATURES
CLOSING OUT A STELLAR YEAR
M3 opens up about its latest efforts to transform the mortgage industry
40 The solid-gold power of data How a new initiative from FCT will help brokers leverage data to build better deals
38 PEOPLE
THE GROWTH MINDSET
Pineapple co-founder Shubha Dasgupta reveals what prompted his organization’s rebranding and massive expansion in 2021
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Behind every mortgage, there are people. The ones who are consistently there, with the answer when you need them most. Discover Blue Culture Watch the video at MCAPblue.com/discover
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UPFRONT
EDITORIAL
www.mpamag.com/ca ISSUE 16.12
A banner year for brokers
A
s 2021 draws to a close, mortgage professionals across Canada can reflect with satisfaction on triumphing over another year of upheaval. The country’s housing market surged, setting a record pace in the first half of the year and continuing to trend far above pre-pandemic levels, even after cooling noticeably in the late summer months. That meant brokers were faced with the challenge of handling record volumes throughout the year, all while coping with the ongoing work adjustments and economic uncertainty brought about by COVID-19. Homebuyers also grappled with an increasingly complex market as house prices skyrocketed and demand reached unprecedented levels. And in the midst of this, OSFI’s decision to hike the stress test qualifying rate for uninsured mortgages threw another spanner in the works.
Throughout a hectic and often turbulent year, the value of mortgage brokers has perhaps never been clearer Throughout a hectic and often turbulent year, the value of mortgage brokers has perhaps never been clearer. Brokers’ ability to steer clients through the mortgage market during a time of equal challenge and opportunity has proven an indispensable asset for homebuyers across the country. Not only that, but brokers have demonstrated their adaptability by making the transition to digital solutions throughout the pandemic, providing expert service around the clock and managing to adjust to the inability to meet with customers face-to-face. The future looks promising for Canada’s mortgage broker community. Earlier in the year, CMP revealed that the leading 75 brokers in the country funded a collective $10.1 billion in 2020, up from $8.9 billion in 2019 and $7.7 billion in 2018. That soaring volume arrived as a J.D. Power survey found Canadians’ satisfaction with the country’s biggest banks fell during the pandemic, spurred by a perceived lack of convenience and problem resolution. With 2022 just around the corner, the steady hand of a mortgage broker could be more important than ever for clients as they navigate the choppy waters of likely interest rate hikes and a still-hot housing market. With that in mind, brokers can look back with pride on the year that was – and look ahead with confidence to the next one.
EDITORIAL
SALES & MARKETING
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Publisher Chris Anderson
Editor Fergal McAlinden
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gordon_ross@centum.ca | thecentumnetwork.ca ®/™ trademarks owned by Centum Financial Group Inc. (C) 2021 Centum Financial Group Inc. The intent of this communication is for informational purposes only, and is not intended to be a solicitation to anyone under contract with another mortgage brokerage operation.
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UPFRONT
STATISTICS CONSUMER INSOLVENCIES DIMINISH
DEVIATION FROM THE AVERAGE NATIONAL PRICE AS OF MID-2021
-5.86% Winnipeg
OVERVALUED MARKETS COULD SEE PRICE DECELERATION IN 2022
40%
-31.78% Saskatoon
The Canadian housing market is already showing significant signs of moderation, and the latest forecast from Moody’s Analytics predicts that expected higher interest rates will lead to further price deceleration in 2022 in areas where properties are significantly overvalued – namely the country’s largest cities. By contrast, “some of the undervalued housing markets, especially in Alberta and Saskatchewan, will do better despite weaker economic fundamentals precisely because they have retained better affordability,” Moody’s said.
Decline in consumer insolvencies compared to pre-pandemic levels
7.8%
-29.87% Edmonton
-30.92% Calgary
22.95%
Decrease in insolvencies between the second and third quarters of 2021
Vancouver
15.8%
Annual decline in overall consumer insolvencies as of the end of September
CANADIANS FORESEE ONGOING PRICE INCREASES Most Canadians believe house prices will continue to surge in the near term, according to a recent Yahoo/Maru public opinion survey. Nationwide, 68% of respondents said they think house prices will continue to rise over the next couple of years, while 32% think the bubble will burst soon.
PERCENTAGE OF CANADIANS WHO BELIEVE HOUSE PRICES WILL CONTINUE TO RISE 80% 60% 40%
28.3%
Largest provincial decline in insolvencies in Q3 (in Newfoundland and Labrador) Source: Canadian Association of Insolvency and Restructuring Professionals
6
20%
72%
57%
58%
68%
75%
62%
British Columbia
Alberta
Manitoba/ Saskatchewan
Ontario
Quebec
Atlantic Canada
0%
Source: Yahoo/Maru
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INVENTORY DECLINES ACROSS THE COUNTRY
5.41%
-21.06%
Active inventory in Canada’s largest cities fell by as much as 55% annually in October, according to RBC Economics. “We expect extremely tight demand-supply conditions will keep prices under intense upward pressure in the near term,” said RBC senior economist Robert Hogue, “though we see such pressure easing significantly by the second half of 2022 as markets achieve a better balance.”
Halifax
St. John’s
25.16% Prince Edward Island
DECLINE IN ACTIVE INVENTORY, OCTOBER 2021 0%
-9.99%
-10%
Moncton
-20%
24.96%
-30%
Montreal
-40%
39.53%
-50%
Toronto
-60%
Toronto
Fraser Vancouver Montreal Calgary Edmonton Valley
Source: Canada Housing Market: Slower Price Growth, Moody’s Analytics
Source: RBC Economics
OCTOBER BROUGHT HIGHER PRICES FOR NEW HOMES
HOUSING STARTS ON A DOWNWARD SLOPE
Prices for new construction increased in October in 15 of the 27 major census metropolitan areas surveyed by Statistics Canada. On the national level, new home prices ticked up by 0.9% month-over-month in October, outstripping the growth observed over the prior four months.
Nationally, housing starts saw a precipitous decline between September and October, according to CMHC, capping a multi-month trend of decelerating activity. Of the three largest cities, Vancouver was the only market where the seasonally adjusted annual rate of housing starts grew in October, spurred by the multi-family segment.
4%
MONTHLY PRICE INCREASES FOR NEW HOMES, OCTOBER 2021
300,000
3% 200,000
2% 1%
100,000 0%
Kitchener- Victoria CambridgeWaterloo
London
Winnipeg
Regina St. Catharines- Toronto Niagara
Vancouver
Source: Statistics Canada
May 2021
June 2021
July 2021
August 2021 September 2021 October 2021 Source: Monthly Housing Starts, October 2021, CMHC
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UPFRONT
NEWS ANALYSIS
What’s in store for 2022? After one of the most eventful years on record in the mortgage industry, what can brokers expect to dominate the space in the next 12 months?
MORTGAGE PROFESSIONALS have barely been able to catch their breath during 2021 – a roller-coaster year that saw market activity in Canada continue at the relentless pace it’s maintained since the beginning of the pandemic. Already faced with red-hot demand and skyrocketing home prices, mortgage professionals were presented with the added hurdles of a stress test rate change and ongoing COVID-related uncertainty. With 2022 on the horizon, attention is already turning to the challenges and opportunities that lie ahead. One of the biggest questions is whether there’s any chance of the market resuming the frenzied pace it set in the first quarter of this year, when activity surged to a peak that has only begun to moderate somewhat in the last six months.
trend well above pre-pandemic levels. “We’re not expecting sales to get back to where they were in February and March; I have a hard time believing we’re going to see that level of activity anytime soon,” Porter says. “Obviously, I can’t rule it out, but I would be surprised if we got back to those kinds of levels. I would characterize activity as stronger than anything we’ve seen prior to the last couple of years, and I would expect it to stay in that range over the next six months or so.” Top of mind for brokers in the coming months will be the Bank of Canada’s movement on interest rates, as the central bank has said it plans to start hiking rates in the middle quarters of 2022 – meaning that movement could begin as early as April.
“Activity [is] stronger than anything we’ve seen prior to the last couple of years, and I would expect it to stay in that range over the next six months or so” Doug Porter, BMO Capital Markets According to BMO Capital Markets chief economist Doug Porter, a repeat of such extreme activity levels is unlikely, but there’s a very real possibility that interest in the housing market in 2022 will continue to
8
When it does, the record low rates that have spurred activity throughout the pandemic will gradually come to an end – and, because variable rates are tied to the bank’s benchmark policy rate, the fixed-versus-variable
mortgage debate will likely rear its head once again next year. There’s also been some speculation over how aggressively the BoC will act to curb inflation and whether that could mean rate movement of more than a quarter-point per hike. Such a situation is unlikely, according to Derek Holt, vice-president and head of capital markets at Scotiabank, who notes that although more significant rate increases have been implemented elsewhere in the world, that idea probably won’t take root in Canada. “We’ve seen some central banks around the world embrace more aggressive rate hikes – some of the Latin American central banks, for example,” Holt says. “But I think it’s a different set of issues across the developed markets. I think there’s a really high bar to seeing, say, 50- or 75-point
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WHAT’S IN THE PROPOSED HOME BUYER’S BILL OF RIGHTS? Ban on blind bidding Legal right to a home inspection Total transparency on recent sale prices Disclosure by real estate agents who are involved on both sides of a potential sale Publicly accessible beneficial ownership registry Mortgage deferrals for up to six months in the event of a job loss or major life event Requirement that lenders act in customers’ best interests
moves at each meeting. I think they’re going to go very cautiously [in] quarter-byquarter steps.” Brokers will also be keeping a close eye
those is a plan to ban blind bidding as part of a Home Buyer’s Bill of Rights – a measure that could help alleviate some of the frustrations buyers face during the purchasing
“I think there’s a really high bar to seeing, say, 50- or 75-point moves at each [Bank of Canada] meeting. I think they’re going to go very cautiously” Derek Holt, Scotiabank on the federal government’s approach to the housing and mortgage markets in 2022, as the re-elected Liberals have unveiled a host of proposals that could impact the daily work of mortgage professionals. Among
process, says Leah Zlatkin, principal broker at Toronto-based Brite Mortgage. “I like the idea of transparent bidding processes where you can see what other bidders are putting down,” she says. “I feel
like sometimes people get to a point where they’ve bid on so many houses that they just give up [and say], ‘We just want this house or nothing. We’re just going to bid on this house until we get it.’ If you could see what other people were bidding, I think that might be eliminated a little bit.” Other government proposals, however, might give brokers some pause, including one that would impose taxes on homeowners who flip their properties within a 12-month period. The government has proposed exemptions for those who have had a change of life circumstance, but Zlatkin says it’s unclear how eligibility for those exemptions would be determined. “How’s the government going to know that somebody honestly had a life issue and had to move, versus somebody [who] is flipping the house?” she says. “It’s very difficult, and it’s going to require so much looking into and validating. I don’t know if it’s reasonable to expect that we could do something like that.”
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UPFRONT
BANK UPDATE NEWS BRIEFS Banks’ mortgage portfolios vulnerable to economic shock
The residential mortgage portfolios of Canada’s Big Six banks and other large lenders are becoming increasingly vulnerable to losses in a stress scenario, particularly after all COVID-19 stimulus winds down, according to a recent report from Moody’s Investors Service. “Our view is that there will be an uptick in residential mortgage delinquency once all support measures are exhausted,” said Jason Mercer, vice-president and senior analyst at Moody’s. However, he added that Canada’s largest lenders are well positioned to deal with future instability due to strong capital levels.
TD Bank announces major shakeup in executive team
TD Bank Group has announced that Teri Currie, group head of Canadian personal banking, will retire at the end of January 2022 after nearly 35 years with the bank. She will be replaced by Michael Rhodes, currently TD’s group head of innovation, technology and shared services. Currie’s retirement was one of several moves announced within TD’s executive team; the bank also made shifts and new appointments within its US retail banking, wealth and insurance, and technology divisions.
Pandemic purchasers most exposed to rate hikes
Approximately half of Canada’s current outstanding debt will be affected by any increases in the Bank of Canada’s overnight rate, according to CIBC deputy chief economist Benjamin Tal – and homeowners who bought during the pandemic are the most at risk. “Given that in the past two years, mortgage
originations rose by more than 60% relative to their pre-crisis level, that might be a significant shock,” Tal said. By contrast, mortgages reset in the last three years or so have “some immunity against rising rates,” he added. “That immunity will cover borrowers that reprice in 2022 through 2024… [but] will fade for borrowers that entered into mortgages during the pandemic.”
Higher-income households saved more during COVID-19
The increase in household savings during the pandemic has been disproportionately concentrated in higher-income households, according to RBC Economics. “Canadian households accumulated a record amount of savings during the pandemic, but the gains have not been evenly distributed,” the bank said in a recent market analysis. “Higher-income households built the biggest savings stockpile and now hold more than 30% of overall pandemic savings, compared to just 10% held by the lowest-income households.”
Interest rate hikes unlikely to slow down price growth
Rate hikes by the Bank of Canada in 2022 won’t help slow down home price appreciation, according to Frances Donald, chief economist and head of macro strategy at Manulife Investment Management. “When you look at what the Bank of Canada is telling us, they’re saying they’re more concerned about inflation and that this is one of the motivations to hike interest rates maybe sooner rather than later,” Donald told BNN Bloomberg. However, Donald argued that this approach is misguided, as the pressures driving inflation involve global problems such as port closures and supply-chain issues.
The path ahead on rates Rate hikes are a near certainty in 2022 after the Bank of Canada’s latest statement – but how soon? After months of speculation on when the days of record low interest rates would come to a close, the answers finally arrived in the Bank of Canada’s statement at the end of October. Buoyed by continuing positive economic news – and with a wary eye on the threat of inflation – the bank readjusted its forecast for when it would begin raising its benchmark policy rate, projecting that the increases would start in the middle quarters of 2022. That could mean the bank will move as early as April or as late as September, although leading mortgage industry figures hastened to point out that much could change between now and then, as the country’s recovery from the COVID-19 pandemic is still highly uncertain. “This all depends on things continuing in a positive manner like they have been in Canada since June,” says James Laird, co-founder of RateHub.ca and president of CanWise Financial. “If we go backwards in the winter, they will change things for sure. If we have to go back to lockdowns, business closures and things like that, they will definitely push this out. I think this is dependent on us being towards the end of this pandemic.” The announcement also
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sparked some debate on how sharp the bank’s rate increases might be in 2022. A report by RBC Economics suggested that three hikes, beginning in April, would be the best option, but that approach was less aggressive than what the market seemed to be anticipating. “Our call for three rate increases in 2022 is still well short of the four to five hikes priced in by markets,” says RBC senior economist Josh Nye. “Canada’s GDP recovery has
“I think this is dependent on us being towards the end of this pandemic” progressed in fits and starts, and that appears to have continued with a ‘flash’ estimate pointing to flat activity in September. If confirmed, that would mean the economy hasn’t strung together consecutive monthly gains since the first quarter.” Meanwhile, Derek Holt, vice-president and head of capital markets at Scotiabank, told BNN Bloomberg that he expects a total of eight rate hikes over the next two years – four in 2022 and another four in 2023. With each increase likely to be 25 basis points, Holt estimated that the bank’s benchmark rate would hit 2.25% by the end of 2023.
Q&A
Jason Provencher Vice-president, national sales BRIDGEWATER BANK
Years in the industry 30 Fast fact In addition to his role with Bridgewater, Provencher serves as a board member for the Alberta Mortgage Brokers Association
Treating clients like family What were the highlights for Bridgewater Bank on the mortgage side in 2021? In 2021, we launched a foundational loyalty program called the Peak Performance Program. It’s a volume bonus program with attainable volume tiers designed to help our loyal brokers maximize their earnings each year. With the pooling option available, our broker partners can reach volume targets sooner. It’s an option that many teams, smaller ones especially, have found very helpful this year. We also have an efficiency bonus for those who maintain a specific commitment-to-fund ratio. The program runs every calendar year, with our brokers receiving quarterly scorecards to help keep them informed. The biggest perk, however, is the program being retroactive. If you reach a tier, you’ll be paid at that level on all deals funded within the year. Brokers can walk away with quite a bit more in their pocket just by funding their alt deals with us.
Bridgewater Bank was recently named a Top Mortgage Employer by CMP. What makes it such a good workplace? One of our internal values that we share with the Alberta Motor Association – our parent company, which was voted by Forbes as one of Canada’s Best Employers for 2019 – is TYLF: treat you like family. And we really do operate that way! We’re not a giant corporate entity. We treat our employees with the same warm, genuine approach that we have with our customers, our families. We do that through flexible work options, incentives, development opportunities and recruiting the right people who share our values. In all honesty, though, without the best employees, we couldn’t be the best employer.
What can brokers and their clients look forward to from Bridgewater Bank in 2022? We’re very excited to introduce new technology to the business in 2022. On the mortgage side, the bank will be making one of the most significant investments it has seen in the last decade. Our broker partners are always top of mind, and we want them to have the best experience possible with us. Streamlining alternative deals (which we know are complex), offering personalized customer service and developing the processes to do so seamlessly are all on the list, and we’ll use technology to get there. Technology is exciting, but in this line of work, no amount of innovation can replace the human touch. That human element is how we operate – it’s paramount!
What are the main trends brokers should have on their radar next year? Though pandemic-related volatility is winding down, the alternative lending space will continue to be quite busy. Home prices continue to climb because there is less on the market, and demand continues to grow.
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UPFRONT
LEGAL UPDATE
Tackling the country’s housing crisis The re-elected Liberal government has proposed ambitious new policies for the housing market
not entirely clear how successful these have been at moderating home prices and the escalation of home prices, [or] what the federal government could do at the national level that will really move the needle.” The Liberals also vowed to tweak the much-criticized First-Time Home Buyer Incentive, a plan aimed at providing mortgage assistance to new entrants to the market. The changes would give buyers a choice between the current incentive (a plan that shares equity between the homeowner and the government) or a loan from the government, which would be repayable only at the time of sale.
“We would rather have policymakers do evidence-based policy”
As the dust settled on the federal election, mortgage professionals turned their attention to the extensive set of policies proposed by the Liberals to address what’s routinely been described as a housing crisis. One of the most eye-catching features of the Liberal campaign was Trudeau’s declaration that he would introduce a two-year ban on non-residential buyers in Canada’s housing market, in a bid to curb runaway house prices and clamp down on speculation.
NEWS BRIEFS
Speaking with CMP, RBC economist Robert Hogue questioned the logic of the proposed ban, saying it was unclear how effective similar provincial policies had been. “We would rather have policymakers do evidence-based policy,” he says. “I have not quite seen the evidence of foreign buyers being the culprit here for high housing prices. We’ve already seen some measures taken at the municipal and provincial level in BC and Ontario in the form of a foreign buyer tax. It’s
BC inquiry into money laundering closes
The Cullen Commission, BC’s public inquiry into money laundering, has ended; its final report is expected on December 15. The inquiry, headed by BC Supreme Court Justice Austin Cullen, was announced in 2019 following reports that hundreds of millions of dollars in illegal cash had impacted the province’s real estate, gaming and luxury vehicle sectors. During months of hearings, the commission heard from about 200 witnesses, including former premier Christy Clark, cabinet ministers and financial crime experts.
The Liberals also plan to introduce a Home Buyer’s Bill of Rights to protect buyers in the purchasing process. Features include a ban on blind bidding, a legal right to a home inspection and “total transparency on the history of recent house sale prices on title searches,” as well as a requirement that mortgage lenders act in the best interest of the consumer. Charged with implementing the government’s ambitious housing agenda is Ahmed Hussen, who takes the reins of a new federal housing portfolio as the country’s first minister for housing and diversity and inclusion. Hussen previously served as minister of families, children and social development, a role that gave him oversight of CMHC.
PEI enacts moratorium on ‘renovictions’
Prince Edward Island has passed legislation to prevent landlords from evicting tenants to make renovations or repairs – a practice known as ‘renoviction’ – for two years. The legislation does contain an amendment to allow evictions if the renovations are needed “to protect or preserve the property or to protect the health and safety of persons”; however, it also requires landlords to obtain the permits required by law before completing any renovations that would require tenants to terminate their tenancy.
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Q&A
Joseph Berljawsky
The paperless closing journey continues
Head of real estate division DIAMOND & DIAMOND
Years in the industry 11 Fast fact With 15 real estate lawyers, Diamond & Diamond is the largest residential real estate law firm in Canada
We’ve come to the end of an eventful year in the mortgage industry. How has 2021 been for Diamond & Diamond on the mortgage and real estate side? It has been an amazing year for D&D. A lot of the challenges from the start of COVID have fallen away with the widespread acceptance of virtual signings and electronic files, and it has paved the way for a much better closing experience for clients. We have never been more connected to our clients and referral sources now that we have gotten away from paper, and I think it’s given brokers, agents and clients a view into the lawyer’s office that was historically more of a black hole.
The mortgage process is continually evolving, particularly since the beginning of the pandemic. What are some of the main trends you see coming down the line in 2022? I think 2022 will see a huge investment into technology. APIs and webhooks are being exchanged instead of emails and phone calls. We have four full-time developers on staff, and while this is not so common for lawyers, the big brokerages and CRMs have all increased their investment in technology. I think there will be mixed adoption of technology by lawyers. It will infiltrate every office because it will be the only way to access certain tools, but not all lawyers will leverage the utility of technology to
Mortgage fraud suspect retracts guilty plea
Arnold Breitkreutz, who pleaded guilty in March in connection with a multi-million-dollar mortgage fraud scheme, has been allowed to withdraw his guilty plea and go on trial. However, he was notified that admissions made in connection with his guilty plea could be used as evidence in his trial. The prosecution conceded that Breitkreutz wasn’t aware that his guilty plea would prevent him from appealing his case. “In our opinion, there is no doubt that Mr. Breitkreutz’s plea of guilty was not properly informed,” prosecutor Brian Holtby said.
make their practices better and improve the customer experience. However, I think the ability to automatically push updates out or electronically ingest data can significantly improve precision, avoid mistakes and give clients more information that they want about their deals.
What’s the one thing you wish brokers were more aware of in terms of lawyers’ work in the closing process? I can’t speak for other offices, but I wish people would give us a heads up before we get instructions from the bank. If I get the mortgage approval two days before instructions, then I get a two-day head start to contact the client, do the initial interview and collect preliminary documents. It would help me get deals closed faster, for sure.
Do you have any other advice for mortgage brokers who are looking to close a deal as quickly as possible? The real accelerator for a deal is being organized and sending us all the documents we will need. If we have to collect the same documents from clients that they already sent to the broker, the result is a slowdown and an unhappy client. I want as much information and documentation as early as possible from whoever has it.
BC government introduces cooling-off period
The BC government has announced plans to introduce a cooling-off period for home purchases, allowing buyers to back out of the process without facing severe repercussions. The government said it hoped to implement the policy by spring 2022; it is similar to one already in place for pre-construction condo sales. The measure will help “ensure that British Columbians are protected when buying and selling homes, one of the most important financial transactions of their lives,” said BC Finance Minister Selina Robinson.
MIC founder convicted of fraud in Ontario
David Singh, the founder of two unregistered mortgage investment companies in Ontario, has been convicted of defrauding investors. In November, the Ontario Court of Justice found Singh guilty of fraud for selling millions of dollars worth of shares in mortgage companies that did not invest in mortgages. “Mr. Singh was clearly aware that his business was required to use investors’ money to fund mortgages and that this was not happening,” wrote Justice Mara Greene in her decision.
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UPFRONT
OPINION
GOT AN OPINION THAT COUNTS? Email mortgagebrokernews@kmimedia.ca
Staying up to code A national code of conduct for brokers is a key step in better serving consumers, writes FSRA’s Antionette Leung A COMPETITIVE real estate market and changing life circumstances are prompting consumers to expect more from their mortgage brokers and agents. While many consumers are still looking for mortgage rate deals, they ultimately want expertise on financing options that suit their needs in a particular phase of their lives. The launch of a national Code of Conduct for the Mortgage Brokering Sector by the Mortgage Broker Regulators’ Council of Canada makes it easier for consumers to know the type of service brokers and agents should provide. Economic challenges like escalating home prices and an elevated cost of living are making it harder for Canadians to save for a down payment. Statistics Canada data indicates that Ontario’s inflation rate rose 4.4% on a 12-month basis in September, and recent CMHC data shows that home prices continued to rise nationally in the third quarter. The pandemic also drove many Canadians to pursue gig work or entrepreneurship. Gig workers now represent 13% of Canadian adults, while 21% of Canadian entrepreneurs started their business within the past year. These Canadians typically bring home irregular pay cheques, making it more difficult for them to qualify for a mortgage at a bank. In this environment, consumers’ expectations of mortgage brokers are evolving. A 2021 CMHC consumer survey found that 84% of respondents want to use a mortgage broker who provides advice and recommendations. An example is when brokers identify financing options and guide their clients through each choice by explaining the poten-
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tial consequences of different features, such as repayment terms and penalties for breaking the mortgage. In August, the Financial Services Regulatory Authority of Ontario (FSRA) adopted the Code of Conduct for the Mortgage Brokering Sector into its regulatory framework. The Code explains existing regulatory requirements in an easy-to-understand manner. Adopting the Code helps mortgage professionals meet regulatory obligations. But it supports much more than compliance. The national Code publicly signals the mortgage brokering sector’s commitment to raising
return to full-time employment in the near future. The lack of steady income means this individual is unlikely to qualify for a bank mortgage and needs an alternative loan. A broker following the suitability principle would consider the specific situation of the client, such as anticipated income, continuity of the income, risk of missing a payment and timeline for returning to full-time employment. The broker would then present financing options that meet this client’s needs, such as mortgages with lower penalties for missing payments or repaying early. The disclosure principle requires brokers and agents to provide important and relevant information about the mortgage in an honest and timely manner. It involves more than providing information on interest rates. Consumers should understand the financial impact and consequences of their future actions or intentions, such as the risks of not meeting specific terms of a mortgage or what will happen if they want to switch to another option down the road. Brokers and agents need to share this information in a way that consumers can easily digest. Brokers and agents can also build stronger relationships and better fulfill consumers’ needs by ensuring they provide service that
“The national Code publicly signals the mortgage brokering sector’s commitment to raising professionalism in the industry” professionalism in the industry. It informs consumers that mortgage professionals must meet specific competency and ethical standards in order to help them make one of the biggest purchases of their lives. Brokers and agents who serve consumers according to the Code stand to achieve greater satisfaction with clients. Some of the most common consumer complaints FSRA receives involve a failure to adhere to two principles in the Code: suitability and disclosure. The suitability principle requires brokers and agents to provide their clients with suitable mortgage options. For instance, let’s say a broker’s client is a gig worker looking to
aligns with their clients’ expectations. Sharing the Code with them is one way to ensure everyone involved in the mortgage process understands what to expect. Getting a mortgage is a stressful process. While finding the best rate is attractive, the true value of a mortgage broker lies in the expertise, guidance and advice they provide to help consumers finance the house of their dreams while keeping their interests top of mind. Antoinette Leung is head of financial institutions and mortgage brokerage conduct at the Financial Services Regulatory Authority of Ontario.
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PEOPLE
INDUSTRY ICON
LEADING THE COALITION CIMBC founder John Bargis tells CMP how his lengthy career as one of Canada’s leading mortgage brokers inspired him to form an organization designed to support independent brokers
IT MAY seem surprising now, but industry veteran John Bargis says he never imagined that he would one day have a long and successful career in the broker channel. The catalyst for his move into the space arrived when he was working at TD Bank and met Tina, the woman who would become his life and business partner. This pivotal event encouraged him to explore the industry – and, he says, had a huge bearing on the success he’s achieved since. It was soon clear that Bargis and the mortgage industry were a good match; during the first third of his career as an agent, he funded more than $150 million in mortgage volume. He was instrumental in the formation of Invis as a founder and managing partner, a role that arose from the time he spent criss-crossing the country as chair of the association now known as Mortgage Professionals Canada. Upon the sale of Invis, Bargis decided to return to his roots as an independent broker, starting the Mortgage Edge brokerage with Tina – with a clear vision in mind for what he wanted the company to represent. “Our main focus while building the company was to stay the course on a
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number of key initiatives: direct access to lenders based on performance, education on the importance of increased productivity, addressing lender sensitivities under a true partnership model, teaching the importance of a strong process and structure and how to
Independent spirit Bargis’ extensive experience as a leader and entrepreneur in the mortgage industry eventually led him to form the Coalition of Independent Mortgage Brokers of Canada (CIMBC). The organization’s genesis, Bargis
“I explored the idea of creating a national collective of independents that, while maintaining the integrity of a true independent broker model, would also offer the benefits and strength of a cooperative structure on a national scale” properly mine business, to name a few – and all this with no compromise to compensation,” he says. It was an approach that was geared around the idea of running the business rather than letting the business run its agents, Bargis adds. “After all, time is money regardless of what business one is in.”
says, was the result of considerable time spent closely watching the evolution of the mortgage space. “I explored the idea of creating a national collective of independents that, while maintaining the integrity of a true independent broker model, would also offer the benefits and strength of a cooperative structure
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PROFILE Name: John Bargis Title: Founder and CEO Organization: Coalition of Independent Mortgage Brokers of Canada (CIMBC) Based in: Richmond Hill, Ontario Years in the industry: 25+ Fast fact: Outside of the office, Bargis enjoys spending time with his family (including his two Cairn terriers, Macchiato and Stella), gardening, taking long walks, relaxing by the pool, engaging in charitable work and reading
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PEOPLE
INDUSTRY ICON
on a national scale,” he says. “I didn’t really have to look far beyond what we had already successfully built under our own brokerage to find the answers.” CIMBC’s initial objectives were clear, Bargis says: Each member broker had to maintain their true independence and lone brand recognition, with no interference in any way on each member’s operations. Not charging monthly network or franchise fees was also a critical point for Bargis, who wanted to prioritize “direct, unfettered access to lender partners” and a focus on increasing the productivity and profitability of broker partners and agents. It’s an approach that has served the organization well.
selves going through a transformation in a good way as our industry continues to grow,” he says, “and I applaud their efforts and approach of embracing industry stakeholders for their input and feedback.” Of course, underlying those positive changes has been a market infused with an unprecedented level of unpredictability and volatility. While Bargis believes there may be some bumps in the road ahead, he sounds an optimistic note on any economic repercussions that Canadians might face. “The one cautionary point I’ll make is that there may well be a market correction to an unknown extent as a result of the imminent rate hikes in an effort to curb the
“If there’s any concern about the resilience of the broker industry, rest assured it’s here to stay for the foreseeable future” “We’re very pleased with our growth and progress since our formation,” he says. “Although CIMBC has grown to north of 90 member broker partners nationally with over $12 billion in originations, we have a great five-year plan in place that continues to evolve for the benefit of the feet on the street, first and foremost.”
The future of brokering Coming down the line, Bargis foresees an increase in new lenders entering the market, as well as the continued growth of technology “in a positive way as it relates to the origination process and quality.” On the regulatory front, Bargis points to positive changes that have taken place, describing them as “welcome and encouraging” developments in helping push the industry forward and continuing to professionalize the broker channel. “The jurisdictional governments are them-
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not-so-transitory inflationary pressures,” he says. “The good news is that record savings resulted from the pandemic, which may well serve as a support mechanism to shore up any unforeseen financial challenges for many Canadians.” It’s little surprise that Bargis is so bullish on the future of the mortgage market and the broker channel, given that he’s had the opportunity to witness the profound transformation of the industry throughout his lengthy career. The changes he’s seen since starting his journey in the mortgage industry have been “nothing short of positive,” Bargis says. The share of mortgages orchestrated by brokers has risen significantly in recent years – particularly since the onset of the COVID-19 pandemic – and that growth appears likely to continue in the coming years. “If there’s any concern about the resilience of the broker industry,” he says, “rest assured it’s here to stay for the foreseeable future.”
JOHN BARGIS’ CAREER HIGHLIGHTS
2000
Helps establish Invis
2002
Starts independent brokerage Mortgage Edge
2014
Founds the Coalition of Independent Mortgage Brokers of Canada
2019
Is named to CMP ’s Mortgage Global 100 list for the first time
2020
Is inducted into the CMP Hall of Fame
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SPECIAL REPORT
CMP honours 13 individuals whose sterling careers have elevated them to the pinnacle of the Canadian mortgage industry
CONTENTS PAGE Feature article .......................................... 20 Methodology ........................................... 21 Hall of Fame 2021 .................................... 24 Profile ....................................................... 24
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SPECIAL REPORT BUSINESS STRATEGY
HALL OF FAME 2021
LEAVING A LASTING LEGACY WHAT DOES it take to build a mortgage career that truly leaves a mark? While a record of business success is obviously key, that’s just one of the components that goes into putting together an abiding legacy. Despite being a major sector spread from coast to coast, the Canadian mortgage industry is at its heart a close-knit community, and an individual’s ability to leave a positive imprint depends on how well they can impact that community in a
number of different ways – from innovation to philanthropy to advocacy. CMP’s prestigious annual Hall of Fame list recognizes those members of the industry who have achieved success in their own distinguished careers while also making the broker channel a better place through their significant contributions. This year’s 13 Hall of Fame inductees each boast more than two decades of transformative experience in the Canadian mortgage
THE 2021 HALL OF FAME BY INDUSTRY TENURE
20
20 to 30 years
4
31 to 40 years
6
41 to 50 years
2
50+ years
1
“It’s one thing to be successful in business, and entirely another to be a meaningful contributor to the growth and genuine progress of an industry” John Bargis, Coalition of Independent Mortgage Brokers of Canada industry – and they’ve all been at the forefront of the profound change the industry has experienced. These bona fide legends join the other esteemed members who have been inducted into the CMP Hall of Fame since 2017 – an ever-growing list that pays tribute to the veterans who have led the way and set a shining example for other mortgage professionals to aspire to.
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What makes a Hall of Famer? For the members of the judging panel for this year’s Hall of Fame, it’s clear that while a track record of success was one of the factors that determined their selections, each nominee’s achievements beyond the bottom line were even more important. “The common theme of a Hall of Famer in general is their overall contribution to the mortgage broker industry as a whole throughout their tenure,” says John Bargis, founder and CEO of the Coalition of Independent Mortgage Brokers of Canada (CIMBC) and a judge of this year’s Hall of Fame. “It’s one thing to be successful in business, and entirely another to be a meaningful contributor to the growth and genuine progress of an industry.” After all, Bargis points out, leadership comes in many forms and is defined by
mortgage broker industry has contributed to the success of the collective,” Bargis says. “That’s what defines leadership.” Fellow judge Tracy Valko, principal mortgage broker at Valko Financial, confirms that the judging panel was focused on each nominee’s values and overall impact on the mortgage sector. “Some of the key initiatives that I looked at were industry initiatives, changes for the betterment and the overall integrity of what their beliefs are – not only acknowledgements of what they’ve done, but the ways that they’ve been able to impact people,” she says. Those qualities are exemplified in inductees such as Ron Swift, CEO of Radius Financial, who started his career in 1983 as a mortgage broker and enacted change in the industry through a range of advocacy and committee positions.
“Persistence and focus on the objective seems a common theme [among the Hall of Famers]. Although the strategies may change as the goal is sought, it’s the determination to achieve the objective that wins” Phil McDowell, DLC Mortgages Are Marvellous
much more than funded volume and financial success. It also comes down to how an individual has driven lasting change in the mortgage industry, for the benefit of both its current and future members. “If mortgage professionals take the time to dig deep into the accomplishments of a Hall of Famer, they’ll quickly realize that their involvement in the evolution of the
The same applies to Dawn Stephanishin, a mortgage broker with Invis who was hailed as an “exceptional role model” within the industry. Not only has Stephanishin’s career spanned 40-plus years, but she has donated more than $100,000 of her own money to local homeless shelters and helmed a local chapter of the Angels in the Night homeless shelter project.
METHODOLOGY Starting in September, CMP invited mortgage professionals from across the country to nominate standout industry veterans for the Hall of Fame. This year’s Hall of Fame class was selected by an independent advisory panel of industry leaders and previous Hall of Fame honourees, including: • John Bargis, Coalition of Independent Mortgage Brokers of Canada • Tracy Valko, Valko Financial • Phil McDowell, DLC Mortgages Are Marvellous Nominees had to have been in the industry for at least 20 years. The panel considered each nominee’s history of service to the profession, the leadership and inspiration they’ve provided to others, their role in guiding future generations, their contributions to the leadership and direction of industry associations, and any visionary strategies and innovations that have made an outstanding contribution to the industry as a whole. To avoid any conflicts of interest, votes for family members or a judge’s own organization were voided.
4th Year of CMP’s Hall of Fame
66 Total inductees to the Hall of Fame so far
418+ Combined years of experience of the 2021 Hall of Fame class
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SPECIAL REPORT BUSINESS STRATEGY
HALL OF FAME 2021
“Generosity is a common factor – either giving through training others entering the industry or giving time, money, or ingenuity towards the community at large,” says 2021 Hall of Fame judge Phil McDowell, principal broker and co-owner of DLC Mortgages Are Marvellous.
THE 2021 HALL OF FAME BY PROVINCE
The importance of innovation
2 1
British Columbia
Manitoba
9
1 Quebec
Ontario
“The integrity of the individual and how everybody else in the industry perceives them is very important. It’s important that we continue to strive for that excellence” Tracy Valko, Valko Financial
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Being able to improve processes and spur innovation in the mortgage industry also emerged as a prominent quality among this year’s Hall of Fame inductees. Gary Mooney, president and CEO of law firm Anderson Sinclair, was described as a pioneer of title insurance and legal processing outsourcing for financial institutions, having established a reputation as a “creative visionary” among lawyers, notaries, bank executives and mortgage origination professionals. RMG Mortgages’ Bruno Valko, meanwhile, was lauded for his “inventiveness and expertise” in introducing a number of products that are now considered staples of the industry. McDowell says the entrepreneurial spirit of many Hall of Famers spoke for itself, and their ability to enact positive change through innovation is something mortgage professionals of all stripes can learn from. “Persistence and focus on the objective seems a common theme,” he says. “Although the strategies may change as the goal is sought, it’s the determination to achieve the objective that wins. An entrepreneur is more than one who organizes, manages and assumes the risks of a business or enterprise. He or she also innovates to get the most from limited resources – in the case of the mortgage industry, training people and applying or creating new technology.” Tracy Valko also points to the lengthy careers of each Hall of Famer as a shining example of their contributions to mortgage industry, given the fact that a job in the
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broker channel can be notoriously gruelling and challenging. “The longevity of people being in this industry – because it is very fast-paced, high-changing, ever-fluid – tells you they’re resilient,” she says. “Making that impact, and continuously striving to improve, is really paramount.”
Leading through education Ultimately, one of the most powerful qualities that the 2021 Hall of Fame inductees have in common is their ability to leave a
lasting impact on colleagues and counterparts through mentorship and training. Marty Coubrough, the recently retired broker/owner at VERICO One Link Mortgage & Financial, was described as an inspirational figure who built his mortgage brokerage through the pillars of education, service and professionalism, while also contributing to the creation of the Accredited Mortgage Professional designation. Meanwhile, Mortgage Alliance regional vice-president David Gyurits was praised as a leading light in the education of new
agents, with a firm focus on ensuring they’re equipped with the knowledge and professionalism to assist Canadians with their financial needs. For Valko, those qualities reflect the integrity of each of the names on the list – a key factor in a long and rewarding career in the mortgage industry. “The integrity of the individual and how everybody else in the industry perceives them is very important,” she says. “It’s important that we continue to strive for that excellence.”
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SPECIAL REPORT BUSINESS STRATEGY
HALL OF FAME 2021
Gary Mooney Executive Chairman Anderson Sinclair
Gord Wintrup President/Director and Portfolio Manager Bayfield Mortgage Professionals/ Bayfield Mortgage Investment Corp.
Lyne Deslippe Vice-President, Corporate Services Multi-Prêts
Phone: 604-533-4478 Email: gord@bayfield.ca Website: bayfield.ca
Mark Kerzner President and CEO TMG The Mortgage Group
Anna Gomes Senior Director, Underwriting MCAP Bruno Valko Vice-President, National Sales RMG Mortgages
Marty Coubrough Broker/Owner (Retired) VERICO One Link Mortgage & Financial
David Gyurits Regional Vice-President Mortgage Alliance
Michael Jones President and CEO Haventree Bank
Dawn Stephanishin Mortgage Broker Invis
Ron Swift CEO Radius Financial
Gary Meger Mortgage Broker/President Neighbourhood Dominion Lending Centres/Bedrock MIC
Scott McKenzie Senior Vice-President, Residential Mortgages First National Financial
GORD WINTRUP President/Director and Portfolio Manager Bayfield Mortgage Professionals/Bayfield Mortgage Investment Corp.
W
hen asked what has been the most personally fulfilling part of his 55-year career, Gord Wintrup doesn’t hesitate: “Helping others. One way is helping people not just pay off their debts, consolidate their debts, buy their first or second home, or renovate their home, but giving them guidance on how best to do it.” Wintrup founded Bayfield Mortgage Professionals with two brokers in 1982 in Langley, BC; the company now has 82 brokers serving BC, Alberta and Manitoba. He started the first mortgage investment corporation (MIC) in the Fraser Valley and was also a board member for the first mortgage brokers’ association in BC in 1973. He was selected to chair the association’s Ethics Committee and, in 2013, earned a Pioneer Award for Lifetime Achievement from the Mortgage Brokers Association of BC. Throughout his career, Wintrup has given back not only to the industry, but also to his community through charities like Big Brothers Big Sisters. It’s a theme that runs through his entire life. “Give back,” he advises, “and when I say give back, it’s giving to your clients, to your investors, but most of all, giving to fellow brokers – reaching out, mentoring them, helping them. There are some brokers out there that I have mentored over the years that have gone on to be very successful, and I feel proud that I had a small part in that.”
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FEATURES
SECTOR FOCUS: TECHNOLOGY
JERRY LO Vice president, Filogix Finastra
Mortgage tech’s past, present and future CMP checked in with three of the biggest names in mortgage technology to find out how 2021 has been for the sector – and what’s coming down the road 26
At Finastra, incorporating an entrepreneurial mindset was top of mind in 2021. Jerry Lo, vice-president of Filogix, tells CMP that this approach was vital in demonstrating to customers that product investment and innovation are front and centre for the company. “We began by improving our product development and delivery protocols toward being agile,” Lo explains. “This gave us the speed we need to lead the market in terms of features, functionality and value. With our ability to scale and invest, deliver, and execute, I think the market is again excited about the technology we’re delivering and the roadmaps we have planned.” Lo says Finastra has also focused on building working sessions to better engage with customers, investing more time with people in the market to truly understand their needs and the problems the company can help solve. Throughout this process, understanding and correcting the market’s perceptions of Filogix was also a key priority. “We found that in some cases, the narrative around Filogix was being driven by the competition, which was neither ideal nor accurate,” Lo says. “Despite market
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rumours, we have no intention of retiring the original Filogix Expert solution this year. We remain committed to serving our customers and acknowledge the challenges that technology changes can bring.” In 2022 and beyond, Lo says he expects the mortgage industry to benefit from a number of technological advances, including a deeper adoption of artificial intelligence for adjudication, which will drastically reduce response time; KYC technologies to eliminate current document processes; open banking adoption across the big banks; and
“It’s easy to get caught up in the bells and whistles that technology can offer. But any mortgage professional should prioritize a tool that will help them do their job in the most efficient way” metaverse-type experiences to transform how industries, including the real estate and mortgage sectors, do business. As for the number-one priority for mortgage professionals in their use of technology in their daily work? Lo says the answer depends on each individual and what’s important to them. “It’s easy to get caught up in the bells and whistles that technology can offer,” he says. “But any mortgage professional should think honestly about their business needs and prioritize a tool that will help them do their job in the most efficient way. Having said that, mortgage professionals will be well served by a flexible and scalable technology that can bring strategic value to their business.”
GEOFF WILLIS President and CEO Newton Connectivity Systems
With mortgage brokers required to service their clients from a distance in 2021, learning how to use client document portals, e-signature solutions and digital bank account connections was a top priority for the profession. Newton president and CEO Geoff Willis says his company focused on making those tools easier to learn and work with, which has allowed many brokers to develop
ments that support each application for mortgage credit will evolve and improve.” With that in mind, Willis says Newton is working with its lender partners to ensure brokers who use Velocity can transfer their clients’ supporting documents directly as they upload new application content with one click of the ‘submit’ button. As advancements in mortgage and financial technology continue to gather pace, the question of whether more can be done on the government or regulatory side to spur that growth has emerged as a hot topic. “I think that more readily available access to CRA income tax documents for key mortgage industry players, granted by our federal government as recognition that tax documents are a business imperative to the credit-granting process, would be a real process improvement,” Willis says. “I do believe that our association, MPC, is leading this charge now.” He also cautions that after an unprecedented year for the mortgage industry, brokers should plan for 2022 to not be as robust. “That means it’ll be imperative to stay more connected than ever to previous clients, prospects and referral partners,” he says. “Invest now in an omnichannel communications system to stay top of mind. Newton’s Velocity active and passive CRM solutions
“In 2022 and beyond, we will see more advances in the initial client experience online as both brokers and lenders try to find new mortgage customers online” a better application and approval process, giving them an edge over other mortgage channels as things get back to normal. Coming down the road for mortgage technology, Willis anticipates further evolution. “In 2022 and beyond, we will see more advances in the initial client experience online as both brokers and lenders try to find new mortgage customers online,” he predicts. “I also believe that more efficient means of collecting and transferring docu-
help you stay connected with email, text, phone, social and print.” For mortgage professionals, the top priority when using technology should be recognizing that it can help support both client and lender interactions, Willis says – and that it will get easier to use with each passing day. “Stay connected to what advances are being made,” he advises, “and be open to including them in your process in order to serve your clients better.”
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FEATURES
SECTOR FOCUS: TECHNOLOGY THE GROWING APPEAL OF DIGITAL SOLUTIONS
71%
of Canadians managed more of their finances online in 2020 than in 2019
58%
of Canadians found their lender through an online search
69%
of Canadians have either shopped for a mortgage online before or would be open to doing so in the future Source: State of Fintech Lending in Canada, Smarter Loans
CARTER ZIMMERMAN President Lendesk
Lendesk witnessed “monumental” growth in 2021, according to president Carter Zimmerman, ignited by its acquisition of mortgage origination platform Finmo, which came onboard at the end of 2020. The company focused on connecting that platform to its network of more than 260 lenders, another step toward its mission to deliver “a mortgage in minutes.”
“I believe it’ll become commonplace for an agent to talk about the technology stack that they use to run their business” Other features launched by Lendesk this year included mortgage scenario calculators, automated bank statement retrieval, automated NOA retrieval and Manulife Protection Plan integration. Lendesk also released an API for leading brokerages and enterprise solutions to build a custom solution on top of Finmo. “To summarize, the pace we’re building true value for originators and borrowers in Finmo is staggering,” Zimmerman says. Speed, transparency and accessibility
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are likely to remain top priorities for brokers – and therefore a functionality that mortgage technology should deliver, according to Zimmerman. He says Lendesk will consider how to provide value to the borrower on behalf of the broker, working to optimize the experience brokers provide to support customer acquisition and retention. Rather than looking to the government or regulators to find ways to spur progress in the mortgage tech space, Zimmerman believes the mortgage industry itself should be constantly working to drive progress. “Networks are looking to capture the revenue that independent technology companies currently capture by passing data to lenders,” he says. “Some of these networkowned technologies are trying to win with the best product, which helps the industry through competition, and some are looking to mandate their own technology, which hurts the industry. Lendesk’s mission has been to make mortgages easy, accessible and transparent; this means fighting for the choice and the competition.” For mortgage professionals choosing a technology, Zimmerman says the most important thing to look for is the freedom to integrate with any partner and move their data anywhere as their business matures. “Look for solutions that say, ‘Let me help
you integrate to streamline lead intake to payroll’ – not ones that are hampered by technical limitations,” he advises. “When a platform passes on fees to users for their own technological shortcomings, that’s the old way. I believe it’ll become commonplace for an agent to talk about the technology stack that they use to run their business. By using a foundational technology that’s eager and willing to integrate with others, you’re essentially choosing the most powerful stack possible.”
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SPECIAL PROMOTIONAL FEATURE
BROKER NETWORKS
Closing out a stellar year M3’s deal with investing giant CDPQ and launch of an Equifax certification program are the latest steps in a landmark 2021 FOR A company whose mantra is “Broker First – Always,” M3 Group’s recent moves have been especially significant for its network of brokers. Shortly after announcing an industry-first certification program for brokers with Equifax, the company revealed a significant new investment by Caisse de dépôt et placement du Québec (CDPQ), a
“rocket fuel” for M3’s technology roadmap. The deal will accelerate M3’s expansion through acquisitions and organic growth, as well as provide it with access to CDPQ’s vast knowledge of international markets – a significant step in M3’s bid to surpass $100 billion in total mortgages funded within the next 24 to 36 months.
“We’re going to switch gears, doubling the size of the organization and drastically changing the way brokers interact with customers and lenders through big improvement in terms of innovative technology” Luc Bernard, M3 Group development that chairman and CEO Luc Bernard described as a “game-changer” for its future plans. The news capped off a year in which the broker network has lived up to its reputation as a leading digital innovator in the mortgage space. Dino Di Pancrazio, chief strategy officer and head of M3’s mortgage division, says the partnership with CDPQ will be
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“The timing couldn’t be more perfect for us,” Bernard says. “We’re very proud of what we’ve achieved over the past five or six years. But now we’re going to switch gears, doubling the size of the organization and drastically changing the way brokers interact with customers and lenders through big improvement in terms of innovative technology.” Bernard and private investors will
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retain a majority stake in the organization following the investment, which CDPQ said reflects M3’s reputation as a driving force of digital change in the mortgage industry. “A good point for any investment is companies that are at the forefront of the technology side in their respective markets, and we think M3 is one of those companies,” says Julien Dirand, CDPQ’s senior director for Quebec. “We like that the company places innovation at the centre of its business plan, [and] we recognize the quality of the management here. They’re on a growth path in terms of growing organically, adding market share and growing by acquisition.”
An industry-leading program M3’s reputation as a trailblazer in the industry was furthered with the announcement that it has launched a new certification program for brokers, aimed at helping them gain an all-encompassing understanding of credit and its significance in the mortgage process. The course consists of eight comprehensive modules – credit bureau, credit report, credit ecosystem, credit scores, fraud, legal and regulatory, fintech trends, and broker support – and brokers receive an Equifax certification upon completion. Éric Chamelot, executive vice-president of operational effectiveness and lender relations at M3, says the program came about as a result of the company’s focus on future trends for brokers and its aim to equip mortgage professionals with the tools they need to establish themselves as experts. “It fits really well into our mission and our objectives for brokers,” he says. “We work a lot on the technology side, but also in preparing our brokers for the changes that are coming in the industry. We want to gear everyone towards being the best mortgage advisors they can be. In the future, with technology changing the landscape and consumers being able to get access to mortgage information a lot easier online, the shift for brokers will be
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SPECIAL PROMOTIONAL FEATURE
BROKER NETWORKS
from servicing the best rates with the best lender to advising clients on what the best mortgage solution is for them.” Eric Poblete, Equifax Canada’s director of solutions for mortgage and housing, says the collaboration represents the first time Equifax has launched its own brand certification for brokers, and it’s set to benefit both mortgage professionals and their clients. “Equifax has never allowed a certified brand to be attached to individuals, so this is actually the first time we’re going to allow brokers to put their signatures on websites with ‘I am an Equifax-certified broker,’” Poblete says. “I think it’ll be inevitable that consumers will see the value of that as well. If they’re going between A and B, and A is certified with Equifax, that’s an industry advantage.” Five of the leading Canadian brokers operating under the M3 banner were intensively involved in putting together the program, using their expertise to help craft content that’s as relevant and informative as possible. Poblete, who has done more than 100 presentations to around 10,000 brokers during COVID-19, says the course will allow brokers to capitalize on the experience of these industry veterans. “We took many of the 20-year-plus brokers, the key players at M3, and tried to digest and include their knowledge in the program,” he says. “Rather than waiting five, 10 or 15 years for brokers to get that level of knowledge, we’re going to provide it to them in an e-course module.” Chamelot says the program’s benefits for brokers are clear, allowing them to distinguish themselves from competitors and display the type of knowledge that will set them apart as a mortgage expert. “We feel that the brokers that’ll be going through this program will be set up to be some of the best advisors a consumer can get, because not only do they know the mortgage product side of things, but now they’ll
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“A good point for any investment is companies that are at the forefront of the technology side in their respective markets, and we think M3 is one of those companies” Julien Dirand, CDPQ be able to better advise their client on the best strategies to optimize their credit situation,” he says. “The only way of doing that is to really understand what Equifax does in the background – and this program accomplishes that.”
The road ahead These bold new moves are just the latest steps M3 has taken towards its ambitious growth plan in 2021. Earlier in the year, the company announced the acquisition of leading fintech Pinch Financial; that purchase was aimed at helping brokers get ahead of the curve and kickstart qualified applications immediately – another boost to the company’s goal of helping brokers control the customer journey from beginning to end. And in June, M3 announced the expan-
sion of its partnership with National Bank into Ontario – a significant step for brokers in Canada’s largest province. In 2022, the company’s focus will remain squarely on driving innovation and technological advancement in the broker space. “The pace of change we will see in technology will be phenomenal,” Bernard says. “You need to have access to the capital and the brainpower to develop the technology, and the most important thing is to make sure the technology is easy to adopt at the broker level. It’s one thing to adopt the technology, but it’s another thing making sure that the brokers are well positioned to use the technology and all the benefits that come from that. You’ll see many changes that will be announced very early next year on that topic.”
www.mpamag.com/ca
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Powerhouse Mortgage Group partners with Caisse de Dépôt to accelerate expansion Investment to set brokers up for success! www.m3-grp.com
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30/11/2021 1:37:07 am
SPECIAL PROMOTIONAL FEATURE
LENDING
CMLS readies for further growth The company has announced two landmark executive changes to spur its expansion in 2022 and beyond
CMLS FINANCIAL is entering into a new era with two high-profile executive changes: Dan Putnam, who’s been named senior vice-president and head of residential mortgages, and Andrew Gilmour, who’s taken the reins as vice-president of residential operations and capital markets. According to Putnam, the moves reflect the company’s focus on placing the right people in their best positions. “The changes are geared toward getting the best performance from each division at CMLS by utilizing the experience and knowledge of our members,” he says. They’ll also aim to improve efficiency on the origination side, coinciding with a review of lending and policy guidelines that will move CMLS in line with the other lenders mortgage brokers traditionally deal with. Putnam, a mortgage broker by trade, knows and understands the profession innately, and that background is one of the main reasons CMLS is constantly working to improve its overall service level by reducing turnaround time and increasing its staff count by around 30%. As any broker knows, the importance of technology in the space has skyrocketed over
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the past year and a half – one of the main reasons that CMLS is prioritizing continued growth and advancements in its technology offerings through AMI (Advancing Mortgage Innovation). That platform allows both real deals and pre-approvals to be qualified almost instantly, with commitments issued quickly and efficiently. “Our technology saves time and allows all parties in the mortgage process to stay
solutions and can make changes to offer an approval, before advising the broker what it has done.” Ultimately, that’s a win-win for brokers, who can get straightforward deals back instantly and can also ensure quicker overall approvals for more complex files. CMLS is currently working on a broker portal, set to debut at some point in 2022. In the meantime, brokers can conveniently email askami@cmls.ca to receive deal status and conditions updates within seconds, just by sending an email with the CMLS deal number in the subject line. The company will soon debut AMI push notifications, which will automatically send reminders at important milestones, keeping mortgage professionals informed of deal progression and sending a weekly summary of deals on the go. CMLS’ commitment to forming a strong ongoing relationship with its brokers, Gilmour says, is demonstrated by its development of a new partner program that rewards brokers for volume and efficiency on both prime and near-prime products. The program combines CMLS Prime, Aveo and Adapt volume to make it easier to achieve higher levels of partnership, with an annual lookback in place to make up on any previous quarters when brokers might have missed their target. Based on the level achieved, brokers can also avail of
“Our technology saves time and allows all parties in the mortgage process to stay informed of what’s happening at each stage” Dan Putnam, CMLS informed of what’s happening at each stage,” Putnam says. “Through AMI, approvals and real commitments can be issued within minutes, and if applications are declined, users will promptly receive notifications that give them the opportunity to immediately fix and resubmit those files. The program uses logic, which means that it will look for
appraisal reimbursement on prime deals. A new loyalty refinance and early renewal program, meanwhile, allows existing clients to refinance and have penalties reduced or waived, with a fair compensation still paid out to the broker. It’s no secret that the last 18 months have been some of the busiest on record for mort-
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CMLS Partnership Refinance Promotion
2021 has been a record year for CMLS Financial. Our success is directly connected to the support of our Partnership Program brokers. As a thank you, we are pleased to offer the following legal fee rebate promotion.
$30,000,000 Partner Brokers - $350 Legal Fee Rebate $20,000,000 Partner Brokers - $250 Legal Fee Rebate $10,000,000 Partner Brokers - $150 Legal Fee Rebate
These rebates are in addition to our current partnership benefits of appraisal rebates and extra compensation for both volume and efficiency. CMLS Financial also has preferred refinance pricing from FNF for all approved CMLS originators.
For more information, visit cmls.ca/brokers today!
cmls.ca
Ontario Mortgage Brokerage License - FSRA License #11749 Mortgage Administrator FSRA License #11689
1.866.426.2657 | info@cmls.ca
Please contact your Regional Manager for full program details and eligibility. Terms and Conditions: Rebates are only applicable when refinance transactions closed with FNF. Offer can be discontinued without notice. FNF pricing excludes variable registration in Alberta, Newfoundland, and PEI. Additional title insurance premiums applicable for mortgages over $750,000. Transactions www.mpamag.com/ca 35 must close after January 1, 2022. Prime CMLS Financial applications only.
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30/11/2021 2:31:05 am
SPECIAL PROMOTIONAL FEATURE
LENDING
“We’ve invested to have a direct link to multiple systems very shortly. This allows us to increase the efficiency for the user by going direct” Andrew Gilmour, CMLS gage brokers as many borrowers have turned to brokers to find solutions that can’t be provided by banks and institutional lenders. “We’ve responded to that by increasing and improving the investor base of our Aveo near-prime program and expanding the product,” Putnam says. “We’ve grown our dedicated sales and underwriting teams, with two new non-prime products to be introduced before the end of Q2 2022.” With 2021 CMP Woman of Influence Ut Yue heading up Aveo as AVP, that program has witnessed staggering 400% growth yearover-year, Putnam says.
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On the prime side, the company has also been busy with lower rates for higher-quality clients and higher compensation guaranteed for brokers. It has also launched more products with enhanced transfers, more noninsured offers and larger uninsured loans of up to $2 million. With those new developments in mind, Gilmour says there’s never been a better time for brokers to get involved with CMLS and avail of its products and programs. The company’s broker resource centre is available 24/7 with no password – meaning that brokers can access its programs, policies and
rates from a laptop, smartphone or tablet. That resource also features the company’s appraiser list, forms and calculators, and contact information. Gilmour also highlights CMLS’ compatibility with all the major direct connect platforms, noting that by the end of 2021, it’s expecting to also be connected with all POS systems, offering even greater convenience and ease of use for mortgage brokers. The company’s focus on technology, he says, demonstrates the importance it places on continually evolving its product range and offerings to ensure as strong a value proposition as possible for the broker community. “We value and appreciate the industry’s commitment to technology and the tools it provides the network,” he says. “We’ve invested to have a direct link to multiple systems very shortly. This allows us to increase the efficiency for the user by going direct. It reflects the importance we place on evolution and innovation at the company.”
www.mpamag.com/ca
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30/11/2021 3:33:14 am
CMA2
EVENT PARTNER
APRIL 28, 2022 • LIBERTY GRAND, TORONTO
2022 NOMINATIONS NOW OPEN After two years of virtual gatherings, the Canadian Mortgage Awards are back with a bang and ready to raise a glass to the mortgage industry’s best and brightest. Returning to the Liberty Grand in Toronto as an in-person black-tie gala, this year’s awards event will give mortgage professionals and businesses the chance to be showcased on a national stage, while celebrating with all the glitz and glamour that they deserve. Be a part of this iconic industry event by nominating for our prestigious awards. We look forward to receiving your nominations before the deadline of January 14, 2022, and rolling out the red carpet for you on April 28, 2022, in Toronto. To learn more or submit an online nomination, visit
www.canadianmortgageawards.com
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30/11/2021 3:33:20 amAM 25/11/2021 1:00:06
PEOPLE
BROKER INSIGHT
The growth mindset From fresh funding to a rebranding and expansion across Canada, Pineapple co-founder and CEO Shubha Dasgupta catches CMP up on what’s been a stellar 12 months for the company
WHEN IT comes to transformative years, few companies can rival the journey Pineapple has been on in 2021. The brokerage started out the year as an Ontario-only organization with an entirely different name, Capital Lending Centre Network. In July, it launched a rebrand that co-founder and CEO Shubha Dasgupta describes as a reflection of its “warm and inclusive” culture – and a mark of its continuing growth. Pineapple, a tech-driven organization that now empowers 13 independent brokerages across the country through proprietary technology, underwriting training and infrastructure support systems, began the year with a bang. Its Series A financing round strongly exceeded the company’s initial fundraising target – it eventually raked in well over $9 million, a success that Dasgupta says has allowed it to focus on a key priority: the broker community. “This financing was mostly dedicated to propelling the growth of our network and the success of our brokers,” he says. “We wanted to ensure that we’re amplifying the support for our existing team and strategically growing the brand and business for our brokers and brokerages.” The rebrand was another step in that direction. Dasgupta says the move has allowed the company to position itself strongly in the market, all while driving sustainable growth and expansion.
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Central to Pineapple’s success this year has been the strength of its technology platform and a corporate infrastructure it’s been carefully building over the last several years. Dasgupta proudly describes Pineapple as the “first data-driven mortgage company in Canada,” and that focus has been crucial in helping it streamline the mortgage process for brokers and homebuyers. “If the pandemic taught us anything, it was how quickly markets can shift and how important it is to stay technology-enabled to make sure that we’re staying at the forefront of what the future holds for us and our industry,” he says. However, its attention to technological advancements hasn’t turned Pineapple away from the value that mortgage brokers and agents bring to the table for their clients. Dasgupta emphasizes that he views technology as a means of expanding the potential and efficiency of brokers, rather than taking
their place. “We always say that we don’t build technology to replace people – we build technology to empower people,” he says. “That’s what we want mortgage brokers and the mortgage industry to view technology as: a way for them to empower their businesses, strengthen the relationships they have with partners and clients, and really ensure that customers are receiving a seamless experience from them.” The importance of people reflects itself in different ways at Pineapple. When the company was setting its philosophy at the beginning of this year, it settled on growth – not just company growth, but also the personal advancement and development of its staff and mortgage brokers. Dasgupta says Pineapple is people-focused at its heart, taking great pride in the “people success” it’s had alongside its notable business growth in recent years. Throughout the
THE VALUE OF EMPATHY Considering Pineapple’s people-focused approach, it’s no surprise that Shubha Dasgupta identifies “relationship over transaction” as one of the most important mantras in the mortgage industry over the past year. After a trying 12 months for homebuyers, Dasgupta says all mortgage professionals need to keep an empathetic approach top of mind. “If I was to give one message to the broker community right now on what they should be focused on: patience and empathy,” he says. “I think it’s a trait that can make a very big difference in this profession, especially right now.”
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FAST FACTS: PINEAPPLE
YEAR FOUNDED 2016
CO-FOUNDERS Shubha Dasgupta, CEO and director; Kendall Marin, COO, president and director
HEADQUARTERS North York, Ontario
NUMBER OF BROKERS IN THE PINEAPPLE NETWORK 400+
“We always say that we don’t build technology to replace people – we build technology to empower people” testing times of the pandemic, Pineapple prioritized mental health in the organization, rolling out new initiatives such as children’s mental health webinars and seminars, and giving staff Fridays off throughout August to ensure that they could spend some extra
personal time with their friends and families. Dasgupta, who has also emphasized the importance of mental health and well-being through his role as 2021 president of the Canadian Mortgage Brokers Association – Ontario, says it will continue to be a top
ACCOLADES Named a Top Brokerage by CMP in 2021
concern for Pineapple heading into 2022. “I think it’s important for all of us as an industry to put people first right now,” he says, “and harness the strengths of the people around us and allow them an opportunity to succeed in all areas of life.”
www.mpamag.com/ca
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SPECIAL PROMOTIONAL FEATURE
DATA
The solidgold power of data CMP catches up with FCT’s Jon Castellano to find out more about the Golden Record, the organization’s fascinating new data solution WHAT EXACTLY is a ‘golden record’? It’s the famous name, of course, given to the gold-plated LP fixed to the Voyager space probe – and it’s also the title of FCT’s far more terrestrial new prospect. Yet when it comes to streamlining convenience for brokers, FCT is certainly intent on reaching for the stars. “The Golden Record is a visual tool that enables our customers to view and leverage property data on 100% of Canadian properties,” explains Jon Castellano, director of data strategy at FCT. “We have successfully aggregated a multitude of property data by connecting to multiple sources across all regions of Canada to ensure we have the full
narrative on every single property. “We want to help brokers expedite the application intake process by giving them direct access to property-level data that includes assessment data, taxation, sales, structural information, land data and valuations. Brokers can then effectively validate
the application, reduce manual efforts and support the adjudication process by offering their lenders data with integrity.” Data, obviously, is key to the functionality of the Golden Record. But of particular interest is FCT’s commitment to becoming a ‘single source of truth.’ What does this notion mean, data-wise? “FCT defines a ‘single source of truth’ as a single trustworthy repository of information gathered from multiple data sources across Canada,” Castellano says. “By ingesting data from multiple sources, specifically authoritative and non-authoritative, it gives us a glimpse into changes to specific properties in a given time period. This allows us to define the truth behind a property due to the depth of insight provided across these sources. “This promotes consistency across the mortgage transaction. The participants of the mortgage transaction can leverage the same data used at all stages of the transaction to ensure consistency and transparency.” The Golden Record is setting itself up as a gold-standard solution for brokers and buyers alike. Yet can this hotbed of powerful data be deployed for other means – say, giving a
“We have successfully aggregated a multitude of property data … to ensure we have the full narrative on every single property” Jon Castellano, FCT vital boost to lead generation and retention? Yes, Castellano says – and the Golden Record encompasses more than just that. “Having the insight on changes to properties like new permits or changes in valuation, and potentially new development in a well-developed area, can provide brokers with data and tools to create reach-out programs to generate leads,” he explains. “FCT has also brought all of these unique influences into one system to offer a portfolio monitoring tool. This monitoring tool will notify the broker of positive and adverse influences that may prompt the broker to connect with their borrower well before the time of their renewal.”
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www.mpamag.com/ca
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Are you ready for the future? As breakthroughs in technology continue to shape the real estate industry, we’re at the forefront of what’s possible. We’re focused on developing the most advanced property intelligence tools and data-driven solutions to improve the experience across the real estate lifecycle. We’ve always operated at the cutting edge of change and continue to search for new and innovative ways to serve you. Want to learn how we can take you and your customers into the future? Contact us today.
fct.ca | 1.800.307.0370
Insurance by FCT Insurance Company Ltd. Services by First Canadian Title Company Limited. The services company does not provide insurance products. This material is intended to provide general information only. For specific coverage and exclusions, refer to the applicable policy. Copies are available upon request. Some products/services may vary by province. Prices and products/services offered are subject to change without notice. ®Registered Trademark of First American Financial Corporation.
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The road to better living starts with one bold word. Together with our broker partners, we believe that everyone who calls Canada home should have the opportunity to dream big. Whether it’s buying their first home or making room in the one they have, when you help your clients see what’s possible, you’re empowering them to say yes to bringing their dreams to life.
See what’s possible when you say yes. Let’s work together to start your clients on their journey. Go to hometrust.ca/partners #HomeHappensHere
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