NEW APPROACHES FOR A NEW REALITY
How lenders are responding to a challenging market
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THE BATTLE OVER B-20 RAGES ON
Conservatives’ pushback puts mortgage rules in the spotlight
2018
YOUNG GUNS These 50 young professionals are leading the industry toward a bright new future
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ISSUE 13.07
CONTENTS
YOUNG GUNS 2018
22
SPECIAL REPORT
Meet 50 rising stars – all under 35 – who are poised to become the next leaders of Canada’s mortgage industry
WHEN OTHERS SAY ‘‘NO WAY’’ WE SAY ‘‘HERE’S HOW’’. Romspen Investment Corporation is a non-bank mortgage lender specializing in commercial real estate across Canada and the United States. With over $2.2 billion under administration, we offer customized mortgage solutions for term, bridge and construction financing from $5M to $100M. Blake Cassidy or Pierre Leonard | 800 494 0389 | www.romspen.com
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CONTENTS
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UPFRONT 04 Editorial
Has the Toronto market’s roller-coaster finally come to an end?
40 FEATURES
44 44
TIME TO TRANSFORM
HomeEquity Bank is shaking up its image to build awareness of reverse mortgages in Canada
CMP spoke with Michael Jones, president and CEO of the former Equity Financial Trust, to get the scoop on why the lender decided to reimagine itself as Haventree Bank
PEOPLE
INDUSTRY ICON
When he started Tribecca Finance, Rajan Kaushal knew he was filling a niche in the lending market – but he never imagined how big it would become
18
08 Head to head
Are reverse mortgages a viable way for parents to help their kids buy a home?
10 News analysis
Conservative MPs are leading the charge against the latest B-20 changes
12 Alternative lending update
New data reveals a shrinking market for traditional mortgages Alberta’s commercial segment could be key to its economic recovery
46 FEATURES
A WEALTH OF OPTIONS
Canadian Mortgages Inc.’s Bryan Jaskolka outlines why brokers can’t afford to ignore the private and alternative lending space
16 Opinion
Millennials need to get creative if they want to buy in Canada’s largest cities
FEATURES 48 The benefits of flexibility
A new interest-only mortgage aims to give clients greater financial control
PEOPLE 42 Broker insight
Sherry Corbitt tells CMP why she decided to specialize in helping clients going through a divorce
55 Career path
50 FEATURES
UNFINISHED BUSINESS
Expert advice for getting more commercial submissions to closing
2
Canadians are paying more mortgage interest than ever before
14 Commercial update
FEATURES
INSIDE A LENDER’S REBRAND
06 Statistics
Robert Jennings’ early sales experience proved to be an unshakable foundation for his mortgage career
56 Other life
Celebrate Christmas in July with parade organizer Gunther Kaschuba
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UPFRONT
EDITORIAL
At long last, stability is here
F
or much of the past five years, the question on virtually every Torontonian’s mind has been: When will the market cool down? That question has finally been answered this year. While a slower 2018 market was to be expected, it has been cooler than most observers predicted. The usual spring real estate frenzy came and went, but unlike in years past, it was marked by listlessness as buyers contemplated whether the time was right: Do they buy now and risk value declivity, or do they take the chance of waiting too long in a rising interest rate environment? The latest figures from the Canadian Real Estate Association could provide some clarity. The organization reported that transactions in the country’s largest city rose 1.6% in May – an early, though not entirely premature, indication that Toronto’s housing market is stabilizing. The small spike in transactions could also indicate that consumers are adjusting to climbing interest rates and more stringent stress testing, which CREA explicitly blamed for the languid market.
The usual spring real estate frenzy came and went, but it was marked by listlessness as buyers contemplated whether the time was right CMHC had even better news. In its June Housing Market Insight report, CMHC determined that a serious correction to the housing market is unlikely, citing strong employment and incomes, combined with overvaluation reductions and tempered interest rate growth, as factors that set the 2018 market apart from previous housing busts. Moreover, CMHC found that average weekly wages more than doubled between the third and fourth quarters of last year, which has also helped to put upward pressure on housing prices, even amid slower GDP growth due to tapered consumer spending. Inflation-adjusted home prices in Ontario are expected to remain stable and mirror the tail end of last year – meaning that, over the next year and a half, housing prices should grow with the general rate of inflation. As a result, homebuyers will likely encounter fewer bidding wars and face less pressure to act in haste, while sellers and real estate investors will have no choice but to list for realistic prices. For Torontonians, that’s welcome news. The team at Canadian Mortgage Professional
www.mortgagebrokernews.ca ISSUE 13.07 EDITORIAL Writers Neil Sharma Joe Rosengarten Libby MacDonald Ephraim Vecina Heather Turner Hannah Go Copy Editor Clare Alexander
CONTRIBUTORS Matthew O’Neil Paul McGill
ART & PRODUCTION Designer Marla Morelos Production Manager Alicia Chin Advertising Coordinator Ella Dayandante
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Connect to the right network
The CENTUM broker network spans from coast to coast providing our franchises with technology, support, education, and marketing all for no additional fees! Opportunity@centum.ca | centumcanada.ca/franchises ®/™ Trademarks owned by Centum Financial Group Inc. © 2018 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
A surge of interest
NO SIGN OF SLOWING
Thanks to rising rates and record debt, Canadians are paying more than ever in mortgage interest THE AMOUNT Canadians paid in mortgage interest hit a new high earlier this year. Unprecedented levels of mortgage debt, combined with an uptick in interest rates, led to Canadian homeowners paying around $46 billion in interest on their mortgages in the first three months of 2018 alone – a jump of more than $5 billion in a single year. The low interest rate environment in effect since the financial crisis has led to an increase
$1.6 billion Increase in interest paid between Q4 2017 and Q1 2018
$5.1 billion Increase in interest paid between Q1 2017 and Q1 2018
in lending volume, which in turn has led to the rise in interest payments, currently at their highest level since 2008. Rising rates and tightened lending guidelines don’t appear to be scaring off prospective homeowners yet, either. On a year-over-year basis, the interestpayment growth seen in the first quarter of 2018 equates to an increase of 12.5%, a rate of acceleration not recorded since immediately before the recession.
3.65%
Year-over-year growth in the volume of interest payments in Q1 2018
Over the last two decades, the amount paid to service interest on Canadian mortgages has exhibited an overwhelmingly upward trajectory, rising by nearly $20 billion. And that trend appears to be accelerating – between the first quarter of 2017 and the first quarter of 2018, the amount Canadians paid in interest grew by 12.5%.
8%
Proportion of households that hold 20% of all mortgage debt in Canada Source: Statistics Canada, Better Dwelling
RECENT SURGE
THE UPS AND DOWNS
Over the last year in particular, the amount Canadians are paying in mortgage interest has seen a marked uptick, driven by increasing interest rates and a higher volume of mortgages.
The growth in mortgage interest payments since 2016 mirrors the steep upward trajectory last seen immediately before the financial crisis. From the beginning of 2017 to the beginning of 2018 alone, interest payments saw their highest level of growth in a decade. CANADIAN MORTGAGE INTEREST GROWTH 20%
$40.9 billion
$41.8 billion
$42.8 billion
$44.4 billion
$46 billion 10%
0%
Q1 2017 Q2 2017 Q3 2017 Q4 2017 Q1 2017 Source: Statistics Canada
6
Q1 1991 Q4 1991 Q3 1992 Q2 1993 Q1 1994 Q4 1994 Q3 1995 Q2 1996 Q1 1997 Q4 1997 Q3 1998 Q2 1999 Q1 2000 Q4 2000 Q3 2001 Q2 2002 Q1 2003 Q4 2003 Q3 2004 Q2 2005 Q1 2006 Q4 2006 Q3 2007 Q2 2008 Q1 2009 Q4 2009 Q3 2010 Q2 2011 Q1 2012 Q4 2012 Q3 2013 Q2 2014 Q1 2015 Q4 2015 Q3 2016 Q2 2017 Q1 2018
-10%
Source: Statistics Canada, Better Dwelling
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Q1 1998 Q1 1999 Q1 2000 Q1 2001 Q1 2002 Q1 2003 Q1 2004 Q1 2005 Q1 2006 Q1 2007 Q1 2008 Q1 2009 Q1 2010 Q1 2011 Q1 2012 Q1 2013 Q1 2014 Q1 2015 Q1 2016 Q1 2017 Q1 2018
$27.4 billion $26.2 billion $27.7 billion $29 billion $27.4 billion $28.2 billion $28.5 billion $29.3 billion $32 billion $36.6 billion $41.3 billion $38 billion $37.9 billion $39.5 billion $38.9 billion $38.9 billion $41.1 billion $41.1 billion $39.5 billion $40.9 billion $46 billion Source: Statistics Canada, Better Dwelling
DEBT RATIO ON THE RISE
WHAT STRESS TEST?
Over the last 20 years, the ratio of mortgage interest payments to total income in Canada has been trending steadily downward. Recently, though, the number has started to creep up again. As of the beginning of 2018, Canadians were paying 3.45% of their income toward mortgage interest, a level that is nearly 7% higher year-over-year.
Despite the imposition of the B-20 stress test on uninsured mortgages, their dollar volume continues to climb, even as insured mortgage volumes dip.
CANADIAN MORTGAGE INTEREST SERVICE RATIO 12%
8%
4%
Q1 1990 Q4 1990 Q3 1991 Q2 1992 Q1 1993 Q4 1993 Q3 1994 Q2 1995 Q1 1996 Q4 1996 Q3 1997 Q2 1998 Q1 1999 Q4 1999 Q3 2000 Q2 2001 Q1 2002 Q4 2002 Q3 2003 Q2 2004 Q1 2005 Q4 2005 Q3 2006 Q2 2007 Q1 2008 Q4 2008 Q3 2009 Q2 2010 Q1 2011 Q4 2011 Q3 2012 Q2 2013 Q1 2014 Q4 2014 Q3 2015 Q2 2016 Q1 2017 Q4 2017
0%
Source: Statistics Canada, Better Dwelling; figures represent the amount dedicated to servicing mortgage interest only, excluding principal
December 2017
$492 billion $558 billion
January 2018
$490 billion $562 billion
February 2018
$486 billion $567 billion
March 2018
$483 billion $572 billion
April 2018
$478 billion $578 billion
Insured residential mortgages (total outstanding balance) Uninsured residential mortgages (total outstanding balance) Source: Statistics Canada
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UPFRONT
HEAD TO HEAD
Are reverse mortgages the answer for millennials? Should parents wanting to help their children with a down payment use a reverse mortgage to tap into funds?
Terry Kilakos
Agency executive officer North East Mortgages “Over the last several years, we have used reverse mortgages as a tool to help parents provide down payments for their grown children. This year in particular, following the tightening of qualifying rules, reverse mortgages have become an invaluable tool for many young families. In the past, parents would have to remortgage their homes and take on large monthly payments; however, as reverse mortgages became more popular and well known, those same parents realized they could use it as a tool to help out without taking on the financial burden of payments while growing the overall net worth of the family.”
Sara Gaggi
Real estate advisor Engel & Völkers Richmond Hill “Millennial buyers are faced with the struggle of saving a down payment while grappling with the added stress of tougher mortgage rules. Parents always want to help; however, reverse mortgages create debt in order to create more debt, which doesn’t add up. Worst-case scenario, the parents’ equity can be eroded via the potential fees, interest and so on that come with reverse mortgages. Perhaps an incentive similar to the first-time homebuyers’ rebate for the land-transfer tax could be put in place to stimulate and encourage homeowner ship without a parent having to put a lifetime of savings at risk.”
Scott Nazareth
Mortgage agent Mortgage Architects Mortgages.ca “Reverse mortgages are an important offering in our industry. They can come in handy for the paid-off homeowner for ongoing expenses that come with aging, such as live-in caregivers, nursing home costs or renovations to make the home more accessible. Reverse mortgages allow clients to stay in their homes. Given rising real estate prices, millennials might seek assistance for their down payment. A reverse mortgage can provide a viable way for parents to provide an early inheritance. It’s always recommended to have independent legal advice, and it’s important to balance long-term and short-term goals.”
THROWING IT IN REVERSE As of the end of March, reverse mortgages accounted for a balance of $2.4 billion of Canada’s mortgage market – an increase of nearly 25% from the same time in 2017. Anne Brill, owner of Centum Metrocapp Wealth Solutions, has been advising clients who plan to bequeath their homes to their offspring but want to help them buy property sooner to consider reverse mortgages. “The parents think, ‘Why don’t we help them out faster so that they can get into a home today rather than 10 – or however many – years down the road?’” Brill says. “They can potentially take out $100,000 on a reverse mortgage, and this way it doesn’t cost them any cash. The reverse mortgage doesn’t have payments, and while the kids get a smaller inheritance, at the end of the day, they get some money upfront to get into a home today.”
8
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UPFRONT
NEWS ANALYSIS
B-20 draws ire of MPs A motion tabled by Conservatives to study B-20’s impact failed for a second time, but it’s an indication that the government is waking up to borrowers’ struggles under the new rules
CANADIANS ARE starting to make their voices heard about the impact of January’s B-20 mortgage rule changes – and it appears that at least one federal political party is listening. Tom Kmiec, the Conservative Party of Canada’s deputy shadow minister for finance, recently tabled two proposals imploring the governing Liberals to create a subcommittee that would study B-20’s impact. Perhaps suspecting what the subcommittee would unearth, the Conservatives’ ultimate goal is to have B-20 overturned. However, given the current Liberal majority, the party probably knew chances were slim to none that its proposals would be greenlit – indeed, both were rejected. Kmiec told CMP he believes the government acted callously by subjecting all Canadians to
them to the unregulated lenders. We know from a CIBC Capital Markets report that 47% of all mortgages need to be refinanced in 2018. In the year they knew there would be so many people refinancing, they still imposed the stress test. That was irresponsible and unfair.” Kmiec first tabled a motion to study the latest OSFI mortgage guidelines on May 30; after it failed, he presented a second motion on June 11, but with a condition. “I will not approve travel of the committee until such time as we approve a study on mortgages,” he says. “I’m being reasonable – I’m willing to make amendments to my motion, I want to be collaborative, and that’s why I’m suggesting we make a subcommittee. I think it’s very reasonable. A home – whether it’s a townhouse, a condo or
“A home ... is the most important financial decision a Canadian will make. Therefore, I’m going to keep pressing” Tom Kmiec, Deputy Shadow Minister for Finance mortgage stress testing. “The new stress test is going to block up to 60,000 Canadians from being able to buy a home,” he says. “About 100,000 Canadians will probably fail the stress test and won’t be approved to borrow from a federally regulated lender, and that will push
10
a detached house – is the most important financial decision a Canadian will make, and likely the biggest financial asset they’ll ever purchase. Therefore, it’s totally reasonable to look at this, and I’m going to keep pressing.” While it might seem Kmiec is playing politics,
he emphasized that his motivation for wanting to overturn B-20 is the impact it has had on his constituency of Calgary Shepard, which he says is replete with homeowners unable to requalify and who are stuck with lenders squeezing them by another 100 basis points. “It’s important for the committee to look at the stress test because a report of theirs from a few years ago said the government should help first-time homebuyers and not introduce a ‘one size fits all’ policy,” Kmiec says. “If the problem is with indebtedness of Canadians, why are they making it more difficult for them to keep the homes they’re in, especially for highratio mortgages, which also face the stress test? Those people put down more than 20% on their homes, but now the government is making it more expensive for them to carry their mort-
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HAS B-20 HELPED AFFORDABILITY? A look at the year-over-year change in average prices in Canada’s six largest cities between May 2017 and May 2018 reveals that the B-20 stress test has had a negligible impact – or none at all – on soaring house prices in most markets. GREATER TORONTO AREA
-5.40% GREATER MONTREAL AREA
+6.66% GREATER VANCOUVER AREA
+11.50% CALGARY
-0.50% EDMONTON
-0.93% OTTAWA
+8.19% Source: Canadian Real Estate Association
gages. That’s not just unjust and unfair – that’s bad policymaking.” But the Liberals’ obstinacy could indicate
“The level of restriction has become common knowledge in the economy, and the government probably wants to keep that from being on the
“Existing lenders don’t have to offer as a good a rate on renewals because they know people can’t shop” Croft Axsen, DLC Jencor Mortgage Corporation their unwillingness to admit a problem does indeed exist. Croft Axsen, owner of Dominion Lending Centres Jencor Mortgage Corporation, believes the government’s refusal to accommodate Kmiec’s motion is rooted in fear of losing face with the Canadian public.
front page of the papers – a report on the subcommittee isn’t what they’re looking for,” Axsen says. “They’re probably looking to keep it quiet.” However, the new changes have effectively put borrowers at lenders’ mercy, and Axsen
believes the government’s short-sightedness is to blame. “They have done something they don’t understand,” he says. “I don’t think they understand the mortgage market and how much competition existed previously – how easily borrowers could get comparative rate offers from other lenders. Existing lenders don’t have to offer as a good a rate on renewals because they know people can’t shop. “The result we’re seeing is a lot of people with refinances that they might have achieved in the last 25 years now need to go to private lenders to retain their homes or face putting them up for sale,” he adds. “So there’s a dramatic impact on people’s lives. I don’t think it’s government policy to force people out of their houses, or to take 12% to 15% private money to solve their financial problem.”
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UPFRONT
ALTERNATIVE LENDING UPDATE NEWS BRIEFS Bank of Canada to take closer look at smaller institutions
In late May, the Bank of Canada announced that it will be expanding its in-house stress testing simulations to cover smaller financial institutions and mortgage insurers in an attempt to allay potential risk factors in the housing market. The BoC has yet to specify which institutions it will include, although it did note that among the important contributors to stability are small banks, credit unions, investment funds and trust companies. “The failure of one or more of these entities could have adverse financial and economic spillover effects,” the BoC said back in 2014.
Growth prospects limited for private lending sector
In a Financial System Review released in early June, the Bank of Canada warned that growth prospects for Toronto’s private mortgage segment are limited. While private lending’s market share has grown to nearly 8% of new mortgages in the GTA, the BoC attributed this increase to the fact that the Big Six banks have slowed down in their lending. “To increase their activity substantially,” the report said, “private lenders would need to further develop their lending channels and operational capabilities, and, most importantly, they would have to materially expand their funding sources.”
Lenders face potential losses in ongoing Fortress saga
According to a report from a courtappointed receiver in late June, lenders connected to syndicated mortgages in the Fortress Real Developments case are at risk for significant losses. The receiver, FAAN Mortgage Administrators, revealed that some of the largest loans in the Fortress fiasco are imperilled by senior
lenders trying to foreclose on properties. One of them is Brookdale, in which negotiations have stalled. Investors owed $14.4 million in a Georgetown project called Halton Hills are also at risk for major losses, as are those linked to the Collier Centre in Barrie, for which lenders provided $53 million.
Will MICs be the next lenders targeted by regulators?
If the Ontario Securities Commission has its way, mortgage investment corporations could become the next object of scrutiny for regulators. At a conference in May, the OSC’s chair sounded the alarm on the growth – and potential perils – of syndicated mortgages and MICs. Given the sweeping regulations of recent years, many industry players have speculated that alternative lenders of all varieties could be next in the government’s crosshairs. “Increasing regulation on private lending and MICs will be ongoing now because it’s taking a bigger piece of the market,” predicted Nick Kyprianou, president and CEO of RiverRock Mortgage Investment Corporation.
Oppono Lending adds new VP of business development
Toronto-based alternative lender Oppono Lending Company has added Steve Futyer to its ranks as vicepresident of business development. Futyer comes to Oppono from Equity Financial Trust. He has more than 20 years of experience in all aspects of alternative mortgage lending, including management, sales and service, marketing, and technology, as well as advertising and customer service. “With Steve joining our team to lead business development in the GTA West region, Oppono now effectively covers the entire GTA,” said Oppono founder and CEO Raj Babber.
Borrowers dumping traditional mortgages Signs abound that private lending is becoming the new normal amid tighter rules and increasing interest rates The popularity of traditional mortgages is waning among would-be homebuyers in the GTA. A study released by real estate information portal Better Dwelling in late June revealed that traditional lenders’ originations in the region dropped by 27% year-over-year in the first quarter of the year. Traditional lenders issued 92.43% of mortgages in the first quarter of 2018, a 0.3% decline from the previous quarter. Overall, the total dollar value of mortgage originations in the GTA was a little over $26 billion in the first quarter of 2018, falling by 0.47% from the previous quarter and by 25.3% compared to the same time last year. These developments reflect the prevailing trend in the national market. Since 2015, private lenders have doubled their share of Canadian mortgages. Private lenders originated more than $2 billion last year and currently represent a nearly 8% share of the national mortgage market. In fact, the private channel has enjoyed six straight quarters of market-share growth, Better Dwelling reported in a separate analysis. Wasah Malik of private lender King Lending Capital told CMP that while tighter lending guidelines and rising interest rates will redirect more borrowers toward the private channel, current uncertainty has limited the channel’s growth for the moment, adding that “2018 is a year where everything is slow. Banks
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won’t originate as much, and private lenders won’t originate over $2 billion like they did last year. Everybody is nervous this year, including lenders and borrowers, and everybody is playing with that fear, but I believe that in 2019, private lenders will originate a lot more money for lending.”
“Everybody is nervous this year … but I believe that in 2019, private lenders will originate a lot more money” Mortgage Architects broker Benjamin Sammut, who is now averaging three private deals a month, believes private origination growth will continue because there’s no sign that lender regulations will ease any time soon. However, he adds that “we try to never use private money to put someone into a situation; we use it to get them out. If they have spousal buyout, a death in their family or they’ve fallen on hard times and lose a job — if anything like that happens and a person needs private financing, then we would offer a one- or two-year solution. But if someone has poor credit, poor income and doesn’t have financial wherewithal and they’re trying to buy their first house, then I wouldn’t even recommend they buy a house. We try to use as much A or Alt-A money as possible.”
Q&A
John Bourassa Vice-president of sales and marketing HAVENTREE BANK
Years in the industry 27+ Fast fact Bourassa made his mark on the industry through major contributions during the meteoric rise of CIBC/ FirstLine in the 1990s
A major lender reinvents itself What was behind the decision to rebrand Equity Financial Trust as Haventree Bank? We’ve been working on this for a little over a year, and we felt that the word ‘bank’ would resonate more with the Canadian consumer, both from an investment standpoint in the purchases of our GICs [and] when a mortgage broker presented our loan offer to their borrowers. We believe the name Haventree Bank will better distinguish us from some of our competitors as well. Over the last 12 months, we’ve invested in research to identify not just how others saw us, but how we saw ourselves. We conducted several focus groups with brokers, borrowers and employees, all of which has led to the rebranding of our company as Haventree Bank.
How have things changed since your overhaul from a trust to a Schedule I bank? Our product and services remain unchanged. We remain committed to the mortgage broker channel as a near- and non-prime lender. Our objective is to continue to innovate new mortgage products to better serve the needs of hard-working Canadians.
What sets Haventree Bank’s alternative mortgage offerings apart from the competition? Our approach is to provide mortgage solutions to Canadian borrowers who may have suffered events in life that have impaired them from credit approval. Our people have distinguished themselves as lenders seeking to help people through these difficult periods. In addition, many Canadians are now self-employed and may require more understanding from mortgage lenders than is the case for salaried employees. Our underwriters are committed to the analysis required to provide business owners an approach to qualification reflective of their individual circumstances.
What industry developments should brokers and borrowers look out for in the next few months? It seems clear that the stress test requirements to mortgage qualification will only further be exacerbated by forecasted increases in mortgage interest rates. Mortgage term selection, both at origination and at maturity, may require that borrowers examine longer terms to protect themselves from the prospect of rising homeownership costs.
What does the future hold for Haventree Bank? We are very proud to have launched Haventree as Canada’s newest bank. Our expansion to the Western provinces was fuelled by the opening of Haventree Bank in Calgary, where we continue to grow not just in our underwriting department, but in several other functions of the bank. The launch of our digital loyalty program has been met with great excitement by our mortgage broker partners. We will continue to collaborate with our Broker Advisory Council to bring new products and programs to serve the needs of near- and non-prime borrowers. The future is very bright indeed for Haventree Bank.
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UPFRONT
COMMERCIAL UPDATE
Commercial sector key to Alberta’s recovery Commercial real estate activity in the province has seen a considerable increase over the past year
are all good signs.” Altus Group credited Edmonton’s retail sub-segment, which accounted for $586 million in investments in 2017, for the capital city’s resurgence. Retail gains helped offset a 14% decline in the industrial sector, as did the office segment, which exhibited the largest year-overyear growth in volume, posting a nearly threefold increase to $425 million in 2017. Altus added that the first quarter of 2018 was the
“Employment numbers [are getting] better, and vacancy is stabilizing. The worst is over”
Alberta’s economy appears to be on the road to better economic health, and experts have pointed to the revitalized commercial property segment as a crucial component of the province’s economic recovery. “We’re seeing employment numbers get better, and vacancy is stabilizing,” says Brian Gettel, president of Network Real Estate Intelligence. “The worst is over.” According to Altus Group, the fourth quarter of 2017 saw 162 commercial real estate
NEWS BRIEFS
transactions in Calgary, totalling $1.1 billion, which represented a 52% increase from the previous quarter. Meanwhile, total investment volumes in the Edmonton commercial real estate segment grew to $2.89 billion in 2017, marking the second consecutive year-overyear increase. “We’ve seen a lot of activity and interest in the last three months,” says Casey Stuart, VP at Barclay Street Real Estate. “We’ve seen situations with multiple offers on properties, which
Commercial segment boosts Toronto budget
Toronto’s land-transfer revenue for the first quarter of 2018 exceeded expert predictions by $30.7 million, a development that acting chief financial officer Joe Farag attributes to “a number of [commercial] transactions.” The Toronto city council has projected more than $800 million in landtransfer revenue by the end of 2018, a sharp departure from previously modest estimates. Gaurav Mathur of JLL Canada predicted that the city will exceed that target, as demand for Toronto’s commercial, industrial, office and retail spaces remains high.
strongest quarter since 2013 for both the retail and industrial sectors. However, RBC has warned that more trying times are ahead for Alberta, as the “easy” stage of the province’s economic recovery is at an end. “We expect key economic sectors, such as energy and capital investment, to reach a more sustainable ‘cruising speed’ after their initial post-recession blast-off in 2017,” the bank said. “The good news is we also expect the recovery to continue to broaden across economic sectors. This means that while the headline growth number is poised to be much smaller in 2018 – our forecast is 2.3% – more Albertans should feel the improvement in the economy.” However, RBC predicted that “it will take until 2019 for Alberta’s economy to recover fully from its severe recession in 2015 and 2016.”
REIT snaps up $45 million worth of properties
PRO Real Estate Investment Trust has entered into final agreements to acquire 12 commercial properties in Manitoba, Quebec and New Brunswick, totalling 368,854 square feet of leasable area and valued at approximately $45.1 million. The deal will expand the REIT’s total assets to around $412 million. To be acquired are six industrial buildings and developable land parcels in Winnipeg, five retail buildings in Quebec and New Brunswick, and a 50% interest in a Drummondville, Quebec, industrial building.
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Q&A
Paul McGill Founder and president THE FINANCING HUB
Years in the industry 25+ Fast fact McGill is an active industry educator and a regular speaker at various industry conferences and events
How tech is streamlining commercial mortgages How have things been at The Financing Hub? The Financing Hub is continuing to grow on a number of fronts. New lenders joining the platform are expanding our aggregate funding capabilities. Also, the growth of our submission volumes in the $1 million to $4 million range shows us that broker-users who weren’t in the commercial space last year are successfully bringing these deals to market.
How has your platform helped the commercial property segment? No question, it has been our industry education and our ability to help compile stronger, more professional applications. We’ve worked hard to find better ways to do this. Some have worked, and some have not, but we continue to build out our placement support services to do what needs to be done to help close transactions. We want to be known as a serious tool for people who are serious about getting their deals done.
What sets you apart from similar platforms? There are three things. First, our direct-to-lender algorithms ensure applications are being exposed to the right lenders with acceptance criteria that match the applications. Neither our submitting nor lending users are wasting time on submissions that aren’t going anywhere. Second, our application grader shows the submitter the strengths and weaknesses of their submissions before they send them out. The grader even provides pointers as to how to improve that application, elevating its chances of closing. And third, our internal placement support remains
Property tax hikes could hurt Edmonton businesses
The Prosperity Edmonton advocacy group has called for the city council to reconsider property tax hikes, arguing that they will push small and medium-sized businesses away from the city. The group noted that from 2006 to 2016, the number of businesses operating in Edmonton increased by 11%, while the overall commercial tax shot up by 124%. It said it is willing “to partner with the city to find ways to manage growth without resorting to property tax hikes that will hurt Edmonton’s job creators.”
a mainstay of our offerings to the broker community – non-competing support that can significantly increase your potential to get paid. Again, these are serious tools for serious people who want to get their deals done.
What are some of the most notable trans actions The Financing Hub has facilitated? We do a wide range of transactions, but there are two we feel were notable for different reasons. The first was a small portfolio of six properties in various stages of development. We utilized The Financing Hub’s tranching and scoring capabilities to find pool funding. We saw this transaction as notable because it showed the value of the hub as a unique underwriting tool for lenders working with multiple property transactions. The second was the purchase of a property by its tenant who, as a stand-alone, did not qualify. The solution was to reorganize the purchase through a new holding company and create a second tenant opportunity to justify the funding. Had our placement support group not had the opportunity to really dig into this transaction, it would have been a failed application from a borrower who simply didn’t qualify.
What new developments can brokers and clients look forward to from The Financing Hub? We’re really excited about our new CMHC placement option. Our users can now go online anywhere in the country and secure CMHC funding for their multiresidential properties at insured rates. With the early success of this new program, you can expect to see more specialized lending programs on The Financing Hub in the next 12 months.
Montreal to benefit from Bitcoin, cannabis
Montreal’s commercial/ industrial real estate segment is getting a boost from an influx of Bitcoin miners and legal marijuana growers. According to Cushman & Wakefield, the sector’s availability rate is down to 3.2% for the first quarter of 2018, considerably lower than the 5.2% seen in the previous quarter. Since 2015, an average of 3 million square feet of vacant commercial and industrial space in Montreal has been leased every year; observers have attributed the demand to the city’s relatively affordable electricity costs.
JLL leans on tech to spur Canadian expansion
In its bid to grow its Canadian commercial real estate services, Jones Lang LaSalle is counting on tech, including innovations such as blockchain leases. The Toronto-based Canadian arm of JLL said it is mounting a challenge to the Canadian units of CBRE and Cushman & Wakefield. The Canadian government has adopted JLL’s smart-building platform, IntelliCommand, and JLL Canada CEO Brett Miller told Bloomberg that the firm is also preparing a service to help landlords run their own co-working operations.
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UPFRONT
OPINION
GOT AN OPINION THAT COUNTS? Email mortgagebrokernews@kmimedia.ca
The buddy system Brokers counselling first-time buyers need to consider new alternatives to help them land the home of their dreams, writes Matthew O’Neil PURCHASING A home in Canada is more challenging (and more complicated) today than it has ever been. For first-timers, such considerations as the stress test and changes to mortgage rules are as intimidating as spiralling price appreciation and increasing interest rates. The 30-year-old young professional earning $60,000 a year is simply running out of options to become a homeowner. First-time buyers are often in the position of having to come up with creative means of achieving financing. Asking for help is the new norm; however, firsttime buyers simply aren’t doing this in an effective way. Being in my mid-20s, I can certainly relate to the struggles of this demographic. Growing up just outside of Toronto, moving into the downtown core was always my goal, but when the time came to make the move, I knew I couldn’t do it on my own. What’s an eager millennial to do? Getting a parental co-signer – a commonly proffered workaround – is nowhere near as easy as it sounds. Parents may well have their own debt obligations; many have large unsecured debts and, of course, their own ongoing mortgage payments. A financial gift toward a down payment is a great answer for those with the means, but more often than not, parents’ financial resources are tied up in the equity of their homes. Refinancing could be an option, but the new rule changes make qualifying a less certain prospect. No wonder so many millen-
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nials eyeing homeownership feel that there’s no light at the end of the tunnel. This is where mortgage brokers come in. Our remit is already more diverse than it once was – we now need to be mortgage coaches (and some days even mortgage therapists) for our clients. As part of this process of better addressing client needs, we must
erty taxes and insurance, came with a 50% reduction in price. The benefits of halving line items such as internet, cable, Netflix and hydro – and even joint expenses as small as dish soap – begin to compound. It’s also comforting to know that while my home is sitting vacant for the majority of the day, whatever price tag could be attributed to that notional vacancy is reduced by 50%. However, a smooth tenancy in common demands that co-owners take precautions early on: Buyers should seek out legal advice in order to protect the asset and the relationship that exists between the individuals. A contract between the two parties that stipulates a potential timeframe to hold the asset is also recommended. A ‘shotgun clause’ within this contract sets parameters if one party should need or want to sell off their share of the property. Given that the average condo price is on track to reach $600,000 in Toronto and $700,000 in Vancouver, and thus move
“First-time buyers are often in the position of having to come up with creative means of achieving financing ... however, [they] simply aren’t doing this in an effective way” become more adept at positioning co-signers, financial gifts and tenancy in common. The last concept – tenancy in common, or the purchasing of a home with a friend, partner or relative – will become the new norm in the major urban markets of Toronto and Vancouver. I know whereof I speak: I did it, and I believe more home purchases will soon follow my example. Apart from the obvious advantage of halving the amount I had to come up with for a deposit, the benefits of going into such a major purchase with a partner diminished every fear I once had about entering the housing market. For example, the muchdespised Toronto land-transfer tax and those pesky lawyer fees? Also cut in half. In fact, all housing-related expenses, including condo fees, mortgage payments, prop-
beyond the reach of anyone earning less than $100,000 a year, a flexible approach such as pooling down-payment and income resources in a tenancy in common arrangement is now required. The shift in ideology for this to become more commonplace is underway, and the sooner young people realize this, the sooner they will find themselves able to buy property and – perhaps even better – lower their total expenditures. Young people can either partner up to buy property – or get comfortable at their parents’ house. Matthew O’Neil is a mortgage agent with Mortgage Intelligence. After spending four years in a mortgage specialist role with RBC, he started Connolly Capital, a mortgage administration company.
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PEOPLE
INDUSTRY ICON
DRIVEN BY ENTREPRENEURSHIP Tribecca Finance founder Rajan Kaushal harnessed everything he learned working for the family business and ventured out on his own
LIKE MANY a lender before him, Tribecca Finance president Rajan Kaushal began his career as a mortgage broker but felt he could do more to help people achieve their dreams of homeownership. However, he noticed that, even as a lender, he was constrained by how much he could do. “What drew me to alternative lending was that I felt I was helping people,” Kaushal says. “I realized that many consumers were creditworthy but did not qualify for loans and mortgages under traditional financial institution guidelines. This was my inspiration to establish Tribecca.” In 1999, driven by the desire to offer a multitude of loan and mortgage products backed by a “common-sense approach to lending,” Kaushal launched the alternative lender and quickly began filling a need in the marketplace. “One of the key elements of having a successful business is providing products or services that benefit your customer,” he says. “My vision for Tribecca was to implement several mortgage and loan products to meet different needs, whether it be a first mortgage to help people achieve homeownership, a second mortgage to consolidate debts or provide capital to self-employed customers for their business, or a construction loan for someone to build the house of their dreams.” Beginning his career in the broker channel gave Kaushal the insight needed to service the array of borrowers for whom institutional lenders aren’t an option. His father, the owner
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of Interfinance Mortgage Merchants, also imparted invaluable advice and acumen. “As a broker, I worked with many types of different lenders, banks, trust companies, credit unions and private lenders,” Kaushal says. “I got to understand how different lenders think and the differences in their underwriting criteria. I did both residential and commercial mortgages and had an understanding of different under-
expectations shouldn’t be so stringent. “We look at it in terms of serviceability and the clients being able to service mortgages,” he says. “We look at all aspects – if they’re renting out the basement, we look at the basement. There are many different circumstances, and if we get a sense that the borrower can service the mortgage, then we’re satisfied, instead of being strict like institutions with GDS and TDS
“There are many different circumstances, and if we get a sense that the borrower can service the mortgage, then we’re satisfied ... As long as we feel they can service it, that’s what matters” writing processes and the way different lenders thought, in terms of providing mortgages and why they either would or wouldn’t. It was a very good experience to understand different mindsets and underwriting and approval processes – why they would decline deals and what they were looking for. I learned to identify the weaknesses in files.”
The sixth sense Applying common sense to lending is a sticking point for Kaushal, who believes serviceability
ranges. As long as we feel they can service it, that’s what matters. If someone was planning to renovate the home and sell it but their serviceability was tight, we’d deduct payments for the terms. We want to get a sense of what they can service and the real estate’s quality.” That approach has helped Tribecca grow, as have the recent B-20 changes. The lender has seen an increase in the volume – and quality – of mortgages it originates. Kaushal compares it to the high times just before the financial crisis a decade ago; the only difference is that
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PROFILE Name: Rajan Kaushal Company: Tribecca Finance Title: President Based in: Toronto Years in the industry: 22 Career highlight: “When I was able to implement all the mortgage and loan products that I originally wanted to offer. It required a significant amount of capital and was a milestone I was very happy to achieve.” Career lowlight: “The first time we had to enforce on a mortgage, take possession of the property and sell it. It’s not fun having to take possession of someone’s home. It made me realize that if we are confident a mortgage will go into default, it’s better not to lend in the first place, regardless of the equity position.”
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PEOPLE
INDUSTRY ICON
the alternative space has grown substantially and the competition has become fierce. However, brokers have come to realize that alternative lending offers far more than chartered banks are willing to. “Alternative lending has always been around because there’s always been a need for it,” Kaushal says. “We have a limited amount of institutions in Canada, and they all have certain lending guidelines, so the alternative space has become that much more important. It fills a gap – and has especially in the last couple of years.” Guideline B-20 might have opened a window
alternative lenders, and I only see the alternative space growing.”
Giving back Apart from his work at Tribecca, where Kaushal has poured nearly all of his blood, sweat and tears over the past two decades, there’s another cause close to his heart born of tragedy. His brother passed away after a long battle with cancer, and it inspired Kaushal to start a charity in his name. “My brother, Shayam, passed away at the age of 40 after an eight-year battle with cancer,”
“It’s extremely important for brokers to have relationships with alternative lenders. Even though clients go to brokers for all kinds of reasons, it’s most commonly because they’ve been turned down by an institution and they’re looking for their mortgage broker to provide them options for funding” of opportunity for the alternative space, but it has also created vortex of uncertainty, prompting many who aren’t already precluded from entering the market to take a ‘wait and see’ approach. Kaushal isn’t worried, though, because he believes it won’t be long until people become used to the new normal. And in the meantime, brokers have a key role to play in facilitating alternative options for their clients. “It’s extremely important for brokers to have relationships with alternative lenders,” he says. “Even though clients go to brokers for all kinds of reasons, it’s most commonly because they’ve been turned down by an institution and they’re looking for their mortgage broker to provide them options for funding. I think it’s imperative that brokers have relationships with
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he says. “He was a mortgage broker and was actively involved in the industry. He was one of the original directors of IMBA and helped build the organization. Shayam was passionate about education and was always willing to help people in the industry by sharing what he learned.” To continue that legacy, Kaushal and his family created the Shayam Kaushal Charitable Foundation, which has raised money for several causes, including cancer research at Mount Sinai Hospital, Free the Children, Autism Ontario and The War Amps. “It is the mission of the foundation,” Kaushal says, “to spread the hope, strength and determination with which Shayam lived his life to those in need.”
RAJAN KAUSHAL’S CAREER HIGHLIGHTS 1990
1996 Begins career as a broker, working for his father’s company, Interfinance Mortgage Merchants
1999 Starts Tribecca Finance 2000
2009 Creates the Shayam Kaushal Charitable Foundation in honour of his brother
2011 2010
Tribecca Finance begins sponsoring ultimate fighter Elias “The Spartan” Theodorou
2016 Tribecca wins the North York Mirror ’s Readers’ Choice Award for best lending company in North York
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THE FUTURE IS
#TEAMBLUE Congratulations to all of our 2018 YOUNG GUNS Adam Hawryluk Ben Oakes Cody Sjogren Ravi Gosal Sunny Vig Tyler Wilson Cole Hennig Damon Steele Hillary Slusar
Jeff Ingram Jewels Ferris Kate Brady Kevin Liddiard Lisa Amor Mohammad Derakhshanfar Nathan Lawrence James Li
GET ON THE LIST
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SPECIAL REPORT
YOUNG GUNS 2018
YOUNG GUNS 2018
Millennials are transforming the way borrowers purchase homes. CMP highlights 50 young mortgage pros who are on their way to becoming the new leaders of the industry
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RECRUITING, ENGAGING, training and retaining young talent in the mortgage industry has long been a concern, yet the individuals on the following pages paint a bright picture of the industry’s future. All 35 years of age or younger, these 50 go-getters have already contributed leaps and bounds above what some decades-long veterans have achieved. On the following pages, you’ll be introduced to highly driven brokers who have dedicated their spare time to charitable organizations or to passing on their knowledge through training and education courses, as well as ambitious entrepreneurs and CEOs who are already leading their organizations. Despite their limited time in this industry, these Young Guns have a lot to offer to the Canadian mortgage world.
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YOUNG GUNS INDEX
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COMPANY
NAME
Bespoke Mortgage Group CanWise Financial CanWise Financial Centum Core Financial Centum Financial Group Centum Financial Group Centum Home Lenders DLC The Mortgage Firm DLC YBM Group DLC Canadian Mortgage Experts DLC Canadian Mortgage Experts DLC Canadian Mortgage Experts DLC Easy Street Mortgages DLC Elite Lending Corp. DLC Home Capital Solutions DLC Mortgage Evolution DLC Mortgage Excellence DLC Mortgage Excellence DLC Mortgage Force DLC Team RRP DLC Team RRP Dominion Lending Centres Dominion Lending Centres East Coast Mortgage Brokers East Coast Mortgage Brokers East Coast Mortgage Brokers Invis McKague Mortgages Invis Mortgage Intelligence/Connolly Capital Invis Mortgage Intelligence Invis West Coast Mortgages Invis The Wilson Team MCAP Merix Financial Merix Financial Monarch Mortgage Group MortgagePal Northwood Mortgage Northwood Mortgage Optimum Mortgage Plan B Mortgage Services Rock Capital Investments/Mortgage Jump The Financing Hub TMG The Mortgage Group TMG The Mortgage Group Verico Advanced Mortgage & Lending Solutions Verico Best Mortgage Loans Verico Nova Financial Services Verico Xeva Mortgage Verico Xeva Mortgage VWR Capital Corp.
Ryan Dennahower Ryan Jejina James Laird Mike Jones Graeme Merrick Joe Muir Clinton Wilkins Mohammad Derakhshanfar Ben Oakes Jeff Ingram Adam Hawryluk Jewels Ferris Kevin Liddiard James Li Ravi Gosal Cody Sjogren Nathan Lawrence Hillary Slusar Sunny Vig Damon Steele Tyler Wilson Lisa Amor Kate Brady Leslie Penney Nikki Carew Robert Jennings Jason McKague Matthew O'Neil Jason Armstrong Aaron Baxandall Kevin Mayer Nicole Cabral Stephen Cheng Nicole Thomson Mauro Poletti D'Arcy Henneberry Scott Robson Grace Reynolds Martina East Cole Hennig James Zantingh David McGill Scott Trainor Candice Light Shane Mouwen Scott Conte Felicity Brempong James DeVuyst Casey Archibald Dimitri Kosturos
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SPECIAL REPORT
YOUNG GUNS 2018 JAMES LAIRD President
CanWise Financial Age: 34
James Laird founded CanWise Financial less than four year ago, and the brokerage is already a multi-award winner firm. CanWise was named Best Newcomer, Mortgage Broker Firm at the 2017 Canadian Mortgage Awards and Mortgage Brokerage of the Year at the 2018 CMAs. Laird is also co-founder of rate comparison platform Ratehub.ca and director of Zoocasa, which he and his group purchased from Rogers Communications in 2015.
MARTINA EAST Manager, business development Optimum Mortgage Age: 35
For the past three years, Martina East has been one of Optimum Mortgage’s top BDMs, developing a reputation among brokers for being reliable, knowledgeable and compassionate toward her clients. In the industry since 2000, East has received multiple awards from different employers. Her diversified experience in the industry provides her brokers a unique perspective from both sides of the desk. This expertise, combined with her friendly personality and empathetic nature, are the key factors behind her continued success.
TYLER WILSON Managing broker DLC Team RRP Age: 34
Currently a managing broker at DLC Team RRP, Tyler Wilson has had the privilege of working alongside top industry leaders during his 10 years as a broker. He’s taken their processes and refined them over and over to ensure his clients are provided with the best experience possible. Despite handling a high number of transactions on an annual basis, Wilson has expanded his knowledge to work with a wide range of clients, from first-time homebuyers and seasoned real estate investors to salaried employees and the newly self-employed. Known for his willingness to assist the clients banks and other brokers have turned down, Wilson loves to help people realize their dreams by removing any fear of financing or the unknown. For him, the initial meeting is only the first step in setting the foundation for a long-term relationship. He provides his clients with a better understanding of the wide array of mortgage options and lays out a long-term plan to ultimately help them grow their wealth through real estate – an approach that has led to many of his clients becoming his friends as well.
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NATHAN LAWRENCE Mortgage broker
DLC Mortgage Excellence Age: 33
Born and raised in Thunder Bay, Nathan Lawrence understands the opportunities and challenges of working in a small market. He has built a strong reputation in Northwestern Ontario by delivering options and clear, independent advice. Lawrence is also an active community member who has been part of the Chamber of Commerce network both locally in Thunder Bay and at the provincial level for more than a decade. “I have always believed in being active in my community,” he says. “Being engaged in different areas has allowed me the opportunity to meet amazing people and the chance to hear and learn from their experiences. It also provides me with amazing insight into my city, which helps me grow my network and business. The Chamber of Commerce network specifically is a passion of mine. I believe that a strong business community helps to foster a strong community overall.” Currently, Lawrence serves as the first vice-chair for the Thunder Bay Chamber of Commerce board of directors and as a vice-chair for the Ontario Chamber of Commerce board of directors, and he previously served for two years as president of the Northwestern Ontario Associated Chambers of Commerce network. In addition, he spent six years serving on the board for SHIFT, Thunder Bay’s young professionals network, and was a founding co-chair of the Ontario Young Professionals Network.
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Brought to you by
JAMES LI
Senior mortgage consultant DLC Elite Lending Corp. Age: 31
Prior to becoming a mortgage broker, James Li served in the Canadian Army, and he continues to use the skills and discipline he acquired there to demonstrate integrity, loyalty and excellence to all of his clients and colleagues. In 2016, Li joined Elite Lending Corp. as a sub-mortgage broker with the goal of becoming a top producer. In his first year as a broker, Li was awarded the Dominion Lending Centres Rookie of the Year Award by outperforming all new brokers in the DLC network across Canada. In the same year, he also earned the DLC Top 50 Monthly Revenue Award and the DLC Executive Award. Li continues to grow his business through his strong work ethic, approach ability and focus on finding creative solutions for clients in this ever-changing market. As of June, he has already surpassed $20 million in volume and is on track to hit his goal of $35 million by the end of the year. Li believes in making a difference in his community and donates a percentage of each commission to Habitat for Humanity. He also volunteers at the local soup kitchen, The Living Room, several times a year.
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SPECIAL REPORT
YOUNG GUNS 2018 JASON MCKAGUE Mortgage agent
Invis McKague Mortgages Age: 32
CODY SJOGREN Mortgage specialist
DLC Mortgage Evolution Age: 32
Cody Sjogren has been helping Vancouverites achieve their dreams of homeownership for the past decade. Growing up with Realtor parents and an aunt who was a mortgage broker, “I was pretty much born with enthusiasm for the mortgage industry entrenched in my mindset,” Sjogren says. In 2017, he reached Gold Club status, putting him in the top 15% of DLC brokers nationwide. Sjogren is also the creator of NOA Today, which helps brokers obtain CRA documents within 24 hours to help them fund mortgages in a timely manner. NOA partnered with Dominion Lending Centres to launch nationally, allowing hundreds of brokers to use the service monthly to help fund their deals. NOA also contributes to DLC’s Bikes for Kids initiative by donating money for every order placed on NOA Today during the month of September. “Donating to charity is a passion of mine,” Sjogren says, “and I also contribute personally to Bikes for Kids as one of my yearly contribution focal points.”
FUN FACT A die-hard soccer fan, Sjogren has been to every Euro Cup and World Cup in the past eight years. In June, he travelled to Russia to cheer on his home country, Australia, at the 2018 World Cup.
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As a student in the University of Waterloo’s co-op program, Jason McKague was introduced to Manulife, where he worked for eight years and eventually became the number-one producing banking consultant in Canada for mortgage volume and transactions in 2014 and 2015. In 2016, McKague decided to venture out on his own, starting McKague Mortgages to address the financing needs of the Barrie community and to help other people achieve financial freedom. Outside of his mortgage work, McKague supports community organizations such as the Easter Seals and Big Brothers Big Sisters.
HILLARY SLUSAR Operations manager/underwriter DLC Mortgage Excellence Age: 27
Hillary Slusar believes that the fundamentals of a good business – having amazing people and exceptional processes – are the same, regardless of industry. This principle has held true as Slusar has transitioned from managing a local restaurant to overseeing the operations of a mortgage business. She and her team work hard to ensure that no matter where their clients are based, the service they receive is consistent and excellent. To achieve this, they’ve worked tirelessly to perfect their internal underwriting system to efficiently move each mortgage from offer to closing. They’ve also been able to build excellent relationships with clients, referral partners and lenders, as well as their own agents, who are spared from excessive administrative work and thus empowered to add more value to the business.
ROBERT JENNINGS Broker/co-owner
East Coast Mortgage Brokers Age: 35
With more than 12 years of experience in financial services, Robert Jennings is the longest-tenured advisor at East Coast Mortgage Brokers [ECMB], of which he is also part owner. Jennings was the firm’s top producer from 2012 to 2017, and has been recognized by CMP as a Young Gun, Top Alternative Broker and Top 20 Small Market Broker. He was also a finalist for Alternative Mortgage Broker of the Year at the 2018 Canadian Mortgage Awards. Aside from being highly regarded in the industry, Jennings is active in his community, leading ECMB to receive the Community Impact Award from the St. John’s Board of Trade in 2016. He also volunteers for and contributes to a number of charities and fundraisers, including the Ronald McDonald House and Make-A-Wish Foundation.
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Brought to you by
LISA AMOR
Creative director and brand manager Dominion Lending Centres Age: 28
As the creative director for Dominion Lending Centres, Lisa Amor is the creative force behind one of the most recognizable brands in the industry. At age 17, Amor moved to Vancouver to pursue her design career. She attended the Art Institute of Vancouver, graduating at the top of her class, and worked at various creative agencies across the city, specializing in branding real estate developments, before joining DLC in 2015. At DLC, Amor is responsible for designing all national marketing campaigns, corporate marketing initiatives, conferences, events and products. Her keen eye for design has been behind some of DLC’s most successful marketing campaigns, which have elevated the brand to new heights. Her notable successes include the award-winning Our House campaign, the Change of Space document that gained industry buzz following the new mortgage rules, and the development of brands like Newton Connectivity Systems. Her true passion project, however, is DLC’s Our House magazine, the home and lifestyle publication distributed to 50,000 Canadians each quarter. Outside of the office, Amor has lent her creativity to local initiatives like Young Women in Business, A Little More Good, the Passion Foundation, Project Change Film Festival and the Mission Possible Gala.
KEVIN MAYER Mortgage agent
Invis The Wilson Team Age: 28
Kevin Mayer takes an educational approach to his role as a mortgage agent, working closely with families and individuals looking to make the biggest investment of their lives and developing customized strategies to meet their unique goals. Starting in the industry at the age of 23, Mayer has worked tirelessly to grow his network and to put systems in place to make his clients’ mortgage experience simple and stress-free. In 2016, Mayer was named Rookie of the Year at his brokerage; the following year, he was a finalist for Best Newcomer, Individual Agent or Broker at the Canadian Mortgage Awards and was named top associate within a team at his Ottawa brokerage. “The sky is the limit, and 2018 is shaping out to be the best year yet,” Mayer says.
www.mortgagebrokernews.ca
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SPECIAL REPORT
YOUNG GUNS 2018 MATTHEW O’NEIL Mortgage agent/president
Invis Mortgage Intelligence/Connolly Capital Age: 27
Matthew O’Neil has been a business owner since age 12, when he started a landscaping business in Port Credit that grew into a saleable company that lasted for more than 10 years. After graduating from university, O’Neil joined RBC and spent the next four years as a mortgage specialist, becoming one of the top five in mortgage volume within his team. Earlier this year, O’Neil transitioned into the mortgage broker community under Mortgage Intelligence, and he has his sights set on becoming the network’s number-one agent in terms of mortgage volume. He also started his own mortgage administration company, Connolly Capital, where he’s responsible for overseeing all new mortgage originations, as well as day-to-day operations.
DAMON STEELE Broker
DLC Team RRP Age: 33
An experienced financial planner, lender and now mortgage broker, Damon Steele prides himself on applying a holistic approach to financing, drawing on the insights he has gained about the industry and his clients’ needs. Whether for clients looking to purchase their first home, planning for a new family or eyeing a sabbatical years down the road, Steele has repeatedly demonstrated a knack for understanding unique personal situations, seeing the big picture and engaging in careful problem-solving. His commitment to customer service is backed by his values of communication, transparency and education. Outside of his mortgage work, Steele is a real estate investor and also serves as a board member for a Vancouver-based non-profit focused on music and the arts.
NIKKI CAREW Mortgage broker
East Coast Mortgage Brokers Age: 35
Nikki Carew has worked in financial services for more than a decade, but it wasn’t until she became a mortgage broker that she found the perfect fit. Since joining the industry, Carew has gone on to receive multiple Veris awards from Verico and has been recognized on CMP’s Top 20 Small Market Brokers and Women of Influence lists. Already in 2018, Carew has managed to achieve an 80% increase in her business and is continuously looking for ways to grow her book while maintaining a strong level of commitment. Outside of her daily responsibilities, Carew serves as the Newfoundland director for CMBA Atlantic and also chairs Brokering Wishes NL, which has raised $38,000 so far this year for Make-AWish Atlantic.
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COLE HENNIG President
Plan B Mortgage Services Age: 27
Not many people can add ‘president of a successful company’ to their resume before the age of 30, but Cole Hennig can. Under his guidance, Plan B has quickly become one of the leading mortgage originators in the alternative lending space, funding more than 125 units per year, and was named a Top Alternative Broker by CMP. “If Cole believes in a file and in the consumer’s situation, he will work it through countless lender contacts, put in his best efforts to fulfil the application goal,” a peer says. “Files that have been declined by other brokers and lenders regularly land on Cole’s desk, where he and his team will find approvals.” While he has a knack for business, it’s giving back to the community that makes Hennig most proud. Born and raised in the Tri-Cities, he has helped several local charities, including SHARE Family & Community Services Society and Canadian Blood Services.
www.mortgagebrokernews.ca
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Brought to you by
RAVI GOSAL Mortgage agent
DLC Home Capital Solutions Age: 32
Wanting to pursue a career that would give him more control over his future and allow him to fully use his skill set, Ravi Gosal became a mortgage agent in 2010 after working with TD Canada Trust for several years. From the start, Gosal decided that his guiding principle would be to educate his clients by equipping them with as much information as possible in order to make informed decisions. Today, this principle remains his core focus and has allowed him to build a successful and flourishing book of business. In 2014 and 2015, Gosal received Dominion Lending Centres’
Sales Achievement Award for reaching minimum gross revenue of $50,000. He followed that up in 2016 and 2017 with the Executive Award for minimum revenue of $100,000, and he’s on pace to have an even more successful year in 2018 – and he has achieved all of these goals while being a stay-at-home dad for the past four years. “My family and my work are my passion,” he says. “It has been a challenge to juggle everything the past few years, to say the least, but I figure once my child starts school this fall, I will get a big part of my days back. This should allow me to be a more productive agent.” When he does have the opportunity for downtime, Gosal and his family love to travel, usually opting for hikes on trails around Ontario. Gosal also gives back to the broker community by helping to recruit and mentor new agents.
www.mortgagebrokernews.ca
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SPECIAL REPORT
YOUNG GUNS 2018 JOE MUIR Marketing manager
Centum Financial Group Age: 26
SCOTT ROBSON Mortgage broker
Northwood Mortgage Age: 34
Scott Robson is perhaps best known for his TV and print work – including Match Game, Panic Button and, most recently, Food Network Canada’s Chef in Your Ear, but his time in the mortgage industry has been equally successful. In 2011, he obtained his broker licence after four years as a mortgage agent. At Northwood Mortgage, Robson has been named to the Top Brokers Club in 2014, 2016 and 2017, and he also earned Verico’s President’s Club Award in 2016 and 2017.
FUN FACT Robson has been featured in print campaigns for Cadillac Fairview, the Toronto Maple Leafs and GoodLife Fitness.
MAURO POLETTI Mortgage broker/partner
Monarch Mortgage Group Age: 35
Moving from the restaurant industry to the mortgage world has been an exciting and fulfilling journey for Mauro Poletti. A broker with Mortgage Intelligence since 2011, Poletti became a partner last year at Monarch Mortgage Group, which operates under the mission of “taking the butterflies out of homeownership.”
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Armed with a solid background in entrepreneurship, finance and project management, Joe Muir has transitioned successfully into the mortgage industry by keeping in mind what will benefit brokers and the community. This has led Muir and his team to develop various initiatives, ranging from an online university to a scaling down of a 25-storey building for charity. Muir believes any accomplishment boils down to honesty and hard work, and this has proven true for him as both a business owner and a mortgage professional.
CLINTON WILKINS Mortgage broker
Centum Home Lenders Age: 35
A published author and a regular TV commentator on mortgages, Clinton Wilkins has been helping clients achieve their financial goals for more than 11 years. His diverse background includes everything from managing small businesses to handling human resources. Wilkins focuses on meeting the financial needs of his clients by providing them with strong options so they can leave his office with the satisfaction of knowing they received great customer service. His dedication to his clients led him to win the 2018 Canadian Mortgage Award for Mortgage Broker of the Year (Fewer Than 25 Employees).
NICOLE THOMSON Director of business development Merix Financial Age: 34
A dedicated business development manager, Nicole Thomson helps brokers find solutions for their clients. Her hard work landed her a spot as a finalist for Lender BDM of the Year at the 2018 Canadian Mortgage Awards. “Nicole is amazing, intelligent and makes mortgages fun,” a peer says. “She is a true partner and industry expert.”
www.mortgagebrokernews.ca
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Brought to you by
RYAN JEJINA Mortgage agent
CanWise Financial Age: 28
After working at RBC for a number of years, Ryan Jejina joined CanWise Financial in 2015 at the firm’s newly opened Calgary office. Last year, Jejina successfully closed 95 mortgages totalling $30.5 million in volume; as of June, he has already surpassed his 2017 targets, closing 125 mortgages worth $38.4 million. He attributes his success to his straightforward delivery of mortgage information. “My focus each day is finding the best mortgage options for my clients and making sure my clients know what to expect in the initial mortgage discussions so there are no surprises later on,” he says. “A lot of my success has come from keeping my clients up-to-date, whether it’s sending them emails throughout the process or giving them a call when you hear back from a lender. If you’re accessible and you answer your phone, you will find clients appreciate your service and will continue to use your services in the future.”
MOHAMMAD DERAKHSHANFAR Mortgage associate
DLC The Mortgage Firm Age: 32
In his three years as a mortgage associate, Mohammad Derakhshanfar has built his business on his dedication and commitment to his clients and the marketplace. His approach has resulted in incredible growth, including his being named to the top 20 brokers by individual volume within the national DLC community.
BEN OAKES Mortgage agent
ADAM HAWRYLUK Mortgage expert
DLC Canadian Mortgage Experts Age: 35
The leader of a growing team based in Nanaimo, British Columbia, Adam Hawryluk is the driving force behind ‘Flawless Financing,’ his team’s unique process for increasing efficiencies to enhance the client experience. The system has been a major factor in the team’s consistent annual volume growth of 40% year-over-year since 2015. Nominated to the Times Colonist newspaper’s Top 20 Under 40 for the last six years, Hawryluk is an active leader in his community. He previously served as president of the Young Professionals of Nanaimo and is a long-time member of the board of directors for Community Futures Central Island, where he was awarded Volunteer of the Year in 2017.
DLC YBM Group Age: 33
Ben Oakes understands that the experience of purchasing or refinancing a home can be one of the most stressful situations clients will ever face, and he prides himself on alleviating that stress with educated insight and by helping clients through each transaction in a professional and knowledgeable manner. This approach has earned Oakes DLC’s Diamond Award, which recognizes the top 5% of DLC agents nationwide, every year since 2015. He was also named Rookie of the Year in 2015 and has already been recognized in 2018 with the company’s Sales Achievement Award and Executive Award for volume.
JASON ARMSTRONG Mortgage broker
Invis Mortgage Intelligence Age: 33
With 10 years of experience in the mortgage industry under his belt, Jason Armstrong currently leads a team of six located in London, Ontario. Since joining Invis Mortgage Intelligence a year ago, Armstrong has successfully recruited new agents to his team while also promoting the benefits of using a broker.
www.mortgagebrokernews.ca
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SPECIAL REPORT
YOUNG GUNS 2018 SCOTT TRAINOR Mortgage associate
TMG The Mortgage Group Age: 29
Since his start in the mortgage industry at age 21, Scott Trainor has evolved into an integral force in helping to grow the TMG brand in Saskatoon. Two years ago, Trainor and two other young brokers opened their office in Saskatoon, re-establishing TMG’s foothold in the area and bringing the location into the 21st century with their use of technology. “I pride myself on my use of a CRM that allows me to become my clients’ friend and mortgage broker for life rather than just doing one transaction and constantly searching for new business,” Trainor says. “By implementing technology into everyday life, it has taken away hectic work and created a predictable business.” In addition to his technology initiatives, Trainor has been in the top 20% of TMG brokers nationwide since 2012. He is also a strong supporter of his local children’s hospital, inspired by his oldest son, who was born with a complex heart condition.
DIMITRI KOSTUROS
SHANE MOUWEN
VWR Capital Corp. Age: 34
Verico Advanced Mortgage & Lending Solutions Age: 32
Chief operating officer
As VWR Capital Corp.’s COO, Dimitri Kosturos is responsible for the company’s day-to-day operations within business development, marketing, IT and underwriting. He also works closely with other senior managers to set VWR’s strategic direction. Since Kosturos joined VWR, its mortgage portfolio has grown from $95 million to more than $320 million, and the company has expanded from British Columbia and Alberta to Saskatchewan, Manitoba and Ontario. Active within the industry, Kosturos is a past director/president of the BC MIC Managers Association and currently sits on the association’s regulatory committee. In 2017, he joined the Merchant Advance Capital board of directors, and he also sits on the boards for the Shewan Foundation and the Langley Community Services Society.
JEWELS FERRIS Mortgage expert
DLC Canadian Mortgage Experts Age: 28
In just four years as a full-time mortgage broker, Jewels Ferris has parlayed her people skills and attention to detail into some pretty impressive numbers. A top-producing broker at DLC Canadian Mortgage Experts, Ferris received the DLC Diamond Award in 2017 for being among the top 5% of DLC agents in the country, and she also received Canadian Mortgage Experts’ Titan Award in 2017 for being a top 10 broker for number of units funded. Ferris is currently filming a video series, The 100 Million Dollar Journey, in which she applies the most useful tips and tricks shared by the industry’s best on the “I Love Mortgage Brokering” podcast.
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Mortgage associate
Prior to joining the mortgage industry, Shane Mouwen was involved in the construction of new homes. He eventually completed his construction management course at SAIT and began doing site supervision with a custom home builder, but Mouwen quickly realized that he was more passionate about working directly with customers. He transitioned into new home sales, where he spent about seven years before ultimately deciding the mortgage industry was a better fit for his personal life. “I really feel like I’ve found my calling as a mortgage professional,” Mouwen says. “I love the idea that everyone around me is, could be or eventually will be a potential customer. I love helping people, so I try to help as many people as I can. I’m never too busy or too good for anyone’s business.” In his first year as a mortgage associate, Mouwen funded $9 million; now in his third year, he’s on pace to close about $30 million by the end of 2018. A strong believer in giving back, Mouwen is also actively involved with the Ronald McDonald House.
www.mortgagebrokernews.ca
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Brought to you by
KATE BRADY
Director of marketing, events and sponsorship Dominion Lending Centres Age: 32
With a degree in hospitality and tourism business management, Kate Brady set her sights on a marketing career. Her first role was as an account coordinator with Maritz Canada, where she assisted in the planning of national sales conferences for large pharmaceutical companies. She then moved to Endo Network, a small technology marketing company, where she climbed the ranks to become project manager for the Scotiabank account. She made the jump into mortgages as a marketing specialist for the residential lending solutions division at FCT. Now with Dominion Lending Centres, Brady has successfully led major company and industry events, including DLC University conferences in Toronto and Vancouver, and IGNITE conferences for Mortgage Architects and Mortgage Centre Canada. Brady also steers DLC’s successful marketing team and initiatives, including DLC’s Our House marketing campaign, as well as Our House magazine and a set of soon-to-air TV ads.
FUN FACT Brady has recorded a rap beat under her rap handle, L’il Braidz.
www.mortgagebrokernews.ca
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SPECIAL REPORT
YOUNG GUNS 2018 CANDICE LIGHT Broker
TMG The Mortgage Group Age: 32
Candice Light began her career in the mortgage industry almost 12 years ago. Over the years, her hard work and focus on the client experience have earned her various accolades, including being named TMG’s Rising Star in 2014 and being among TMG’s top performers for the last four years. Light’s passion for the industry is evident
in the way she puts clients first. She also enjoys building relationships, whether it’s with clients, lenders or referral partners. “I like connecting with past clients to see how they’ve been doing and how their situations have changed,” she says. “I like that each day is different and each deal unique.” Outside of the mortgage industry, Light is an avid hockey player who played at a high level as a forward – she even played with several of the women from the Vancouver 2010 Olympic gold-medal-winning hockey team.
SUNNY VIG
Principal mortgage broker/owner DLC Mortgage Force Age: 28
JAMES DEVUYST Mortgage professional
Verico Xeva Mortgage Age: 33
In 2015, James DeVuyst made the decision to step into the broker world and joined Xeva Mortgage, and he hasn’t looked back since. In just over three years, he has grown his business from $13 million to more than $51 million. “My focus for 2018 is a new client care system, which I will be rolling out in the coming months, and I’m excited for the milestones ahead,” he says. “James’ expertise in private lending and having the contacts to close complex applications, paired with his drive and determination, lands him amongst the top Young Guns in the country,” a peer says. Outside of Xeva, DeVuyst is involved with 100 Men That Give a Damn, which puts on events for three selected charities in Vancouver.
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Both of his parents were in the mortgage industry, so Sunny Vig always knew that mortgage brokering was in his future. Licensed at 19 years old, Vig went to work at one of the Big Five banks as a mortgage specialist after completing his business degree. He now leads a growing team of 15 mortgage associates at DLC Mortgage Force in Edmonton and has won Executive and Gold awards from DLC for being within the top 15% of all DLC agents in Canada. Devoted to educating his clients and establishing a genuine rapport, Vig is committed to honesty, integrity and providing a great mortgage experience for his clients and top-notch support for his team. Vig attributes his success to the support and influence he receives from his parents, who are currently part of his team.
NICOLE CABRAL Broker relationship manager MCAP Age: 31
Having been in the mortgage industry for more than a decade, Nicole Cabral has proven herself to be a top performer, consistently surpassing previous years’ results. In her 11 years at MCAP, Cabral has taken on various roles, each challenging her to develop new skills. As a broker relationship manager, Cabral fulfils three important services for brokers: underwriter, fulfilment specialist and sales. She was the first BRM to pilot the role at MCAP; due to her exceptional service and knowledge, and based on positive feedback from brokers, her success provided the benchmark for the position to be expanded nationally. Cabral was a finalist for Best Newcomer, Lender Underwriter at the Canadian Mortgage Awards in 2014 and 2015, and was named to CMP’s Women of Influence list in 2017.
www.mortgagebrokernews.ca
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Brought to you by
AARON BAXANDALL Mortgage broker
Invis West Coast Mortgages Age: 34
After graduating from university, Aaron Baxandall started in the banking industry and soon became a business owner, juggling multiple roles, from purchasing to accounting to general management. Five years into the business, Baxandall was able to grow sales to close to $2.5 million a year and eventually transitioned ownership to a UK multinational company. Shortly thereafter, he decided to take a mortgage broker course and passed his exam in early 2017, at which point he joined Invis West Coast Mortgages. Earlier this year, Baxandall was named
Young Entrepreneur of the Year by the Comox Valley Chamber of Commerce. In June, he became part of the ownership of West Coast Mortgages, which has allowed him to witness and contribute to one of the best years in the history of the West Coast team. Following a solid first half of 2018, Baxandall is hopeful that his team can consistently grow as they work together to strengthen internal relationships and customer service.
FUN FACT In 2005, Baxandall’s boat sunk during a squall, forcing him to swim for three hours to reach the shore. “Although this may not seem ‘fun,’ it certainly puts things in perspective,” he says.
Email lender notes, application, and credit bureaus to:
deals@vwrcapital.com D IMITRI K OSTUROS
Chief Operating Officer dimitri@vwrcapital.com
P AULA H UTTON
BDM - Prairies paula@vwrcapital.com
www.mortgagebrokernews.ca
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SPECIAL REPORT
YOUNG GUNS 2018 GRAEME MERRICK Franchise services advisor Centum Financial Group Age: 29
“Graeme Merrick has only one setting: above and beyond,” a colleague says. As a franchise services advisor for Centum, Merrick coaches and trains mortgage agents and assists owners with day-to-day business operations. Merrick joined the mortgage industry at age 20, following in the footsteps of multiple family members. Finding
it hard to break into the industry at such a young age, he spent some time as a restaurant manager before deciding to return to mortgages as an underwriter on a high-level broker team, where he assisted in the funding of $100 million annually. At Centum, Merrick created an in-depth, dealspecific Filogix training for Centum University, a key access point for all agents’ initial training. He hasn’t neglected his own development, either – he is licensed in BC and Alberta, and is in the process of obtaining his Ontario licence.
LESLIE PENNEY
Owner/broker
East Coast Mortgage Brokers Age: 33
Energetic, hard-working and dedicated, Leslie Penney always seeks to connect with people and his community. Having spent a decade in the industry, Penney is now an accomplished career mortgage broker and part owner of Newfoundland-based East Coast Mortgage Brokers, which was named a CMP Top Brokerage in 2017 and won the Community Impact Award from the St. John’s Board of Trade in 2016. A top-producing broker, Penney has received the Consumer Protection Award from Manulife, and he was previously recognized as one of CMP’s Top 20 Small Market Brokers. He is also an active member of the board for Habitat for Humanity NL and a member of the local Brokering Wishes committee in support of the Make-A-Wish Foundation.
D’ARCY HENNEBERRY President
MortgagePal Age: 33
Since starting out as an administrative assistant six years ago, D’Arcy Henneberry has risen to become the president of MortgagePal, an online brokerage with more than 20 agents nationwide. Playing a vital role in the growth of the organization, Henneberry oversees lead management and sales processes that have resulted in more than $1 billion in online mortgage sales. Under Henneberry’s leadership, MortgagePal has been nominated twice for Best Customer Service at the Canadian Mortgage Awards. More recently, Henneberry has taken to mentoring the newer mortgage agents who are looking to learn how to attract and convert online mortgage clients. He has developed a unique mentorship model that supports new agents with lead generation and coaching on live files over a period of 12 months with the goal of helping the agent process more than $10 million in sales within their first year.
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STEPHEN CHENG Personal account manager Merix Financial Age: 32
After working for a bank and then a B lender, Stephen Cheng joined Merix Financial in 2009 as a senior underwriter and has spent the past five years working as a personal account manager. Cheng’s role was developed to bridge the gap between the director of business development, underwriter and credit administrator. Cheng prides himself on working efficiently with mortgage brokers to grow their business and foster existing relationships with clients, Realtors, referral sources, lawyers and other business partners. Cheng’s dedication, attention, knowledge and dependability have not gone unnoticed by his broker clients and colleagues. “Every day Stephen Cheng shapes the mortgage industry by providing top-notch service to his broker partners,” a peer says. “Not only is he an underwriter, but he is also the BDM for his accounts [and] offers support, sales and underwriting for his brokers.”
www.mortgagebrokernews.ca
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Brought to you by
FELICITY BREMPONG Sub-mortgage broker
Verico Nova Financial Services Age: 34
At 34, Felicity Brempong has already been in the industry for 12 years, after following in the footsteps of her parents. “I am thankful my parents, who are in the industry, suggested I try it out after I graduated from university,” she says. “Maybe my kids will join me in the business one day!”
As a broker with Verico Nova Financial Services, Brempong enjoys working with young people to help them achieve the goal of homeownership. “When you get the phone call after from your happy clients, it’s pretty awesome,” she says. In 2016 and 2017, Brempong was a member of Verico’s President’s Club, honouring brokers with an annual volume of $25 million or more. “Felicity has been an integral part of our company for over 10 years,” a colleague says. “She provides her clients with the absolute best service possible with the utmost compassion and integrity.”
www.mortgagebrokernews.ca
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SPECIAL REPORT
YOUNG GUNS 2018 RYAN DENNAHOWER Vice-president and mortgage broker Bespoke Mortgage Group Age: 28
Ryan Dennahower has more than 140 fivestar reviews across Google and Facebook – a testament to his dedication to exceed his clients’ expectations throughout the mortgage process. Dennahower has established a large social media presence, which enables him to engage with his audience by delivering exceptional content, advice and updates regarding the mortgage
and real estate market. Though he’s been in the industry for just three and a half years, Dennahower has accomplished much in that short time, including being named a finalist for Best Newcomer, Individual Agent/Broker at the 2015 Canadian Mortgage Awards and co-founding Bespoke Mortgage Group in 2017.
FUN FACT Dennahower grew up racing dirt bikes and go-karts for more than a decade.
GRACE REYNOLDS Mortgage agent
Northwood Mortgage Age: 35
SCOTT CONTE Mortgage broker
Verico Best Mortgage Loans Age: 29
Scott Conte was introduced to the mortgage industry by his father, a longtime banker and mortgage agent. Conte and his father opened a brokerage in 2015, and he hasn’t looked back since. Armed with a wealth of mortgage knowledge and attention to customer service, Conte has grown the brokerage by recruiting a mix of new and experienced agents, all while nearly doubling his own book of business year-over-year. Conte remains focused on expanding the business to help more clients achieve their mortgage goals and on giving back to his hometown of Hamilton by donating a portion of his commission from each mortgage to two local non-profit organizations.
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Grace Reynolds had a whirlwind year in 2017 as she faced the challenges of adjusting to a new career in a new city while also being a new mom. Determined to succeed, she dedicated herself to cultivating relationships. Within her first 15 months as a broker, she was up for Best Newcomer awards at the Canadian Mortgage Awards and the Mortgage Awards of Excellence, where she took home the trophy for Best Newcomer Agent. Reynolds is a member of two networking groups, Business Network International and Women’s Business Network, serving as vice-president of BNI and secretary of the board for WBN. She also volunteers her time with the Mombassadors, which supports the labour and delivery unit at the Peterborough Regional Health Centre Foundation.
JEFF INGRAM Mortgage expert
DLC Canadian Mortgage Experts Age: 32
With many years of mortgage experience under his belt, Jeff Ingram is already an industry veteran at age 32. As part of the Ingram Mortgage Team, he has the benefit of working under a very experienced partner and mentor in the business: his father. Ingram also belongs to a mastermind group that shares best practices, which has led to a steady increase in his annual volume year-over-year. “I’m passionate about helping people achieve their dreams and meeting new people,” he says, “and making many lifelong friends along the way is extremely rewarding – it makes it all worth it.” Ingram recently received DLC’s Diamond Award for being among the top 5% of DLC agents across Canada. Outside of the office, he organizes an annual charity hockey tournament with one of his Realtor partners that has raised more than $30,000 for the Langley Food Bank and has donated hundreds of pounds of non-perishable food items.
www.mortgagebrokernews.ca
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Brought to you by
JAMES ZANTINGH
DAVID MCGILL
Northwood Mortgage Age: 34
The Financing Hub Age: 34
Mortgage broker
James Zantingh began his mortgage career in 2014, closing 28 deals and more than $4.7 million in volume in his first year, which earned him the Rookie of the Year Award from Rock Capital Investments. He followed up that incredible start by almost tripling his business the following year, which led him to receive another award as the Most Improved Agent. In 2016, Zantingh started building his own team and brand, Mortgage Jump. His upward trajectory has continued ever since; in 2018, he added three new agents to his team and is on track to become the top broker/broker of record in the company. “It’s important to note that James has never had an assistant or help with any of his deals,” a colleague says. “He is the application taker, appraisal orderer, compliance officer and go-to for many other agents within our brokerage.”
Vice-president
At age 34, David McGill is already a veteran within the Canadian financial technologies sector. He began his career in the mortgage industry in 2004 as an account manager but quickly transitioned into tech-focused roles. Over the course of his career, McGill has completed system designs for a number of innovative loan origination portals and risk grading tools, and has led The Financing Hub’s participation in fintech projects alongside top industry players, including D+H/Finastra, Home Capital Group and Paradigm Quest. Recognized as an effective translator between technology and banking professionals, McGill is now responsible for all design and system architecture for The Financing Hub’s commercial real estate finance portal.
CASEY ARCHIBALD Partner
Verico Xeva Mortgage Age: 34
As a partner at Verico Xeva Mortgage, Casey Archibald is dedicated to co-leading one of the top 10 mortgage firms in the country and the winner of CMBA-BC’s Individual Partnership Award in 2017. Archibald has a reputation for giving back to the industry – he is a founding member of K.A.R.E.S, an industry organization that helps fund scholarships for at-risk youth. He has also served in a number of roles for Mortgage Professionals Canada, including as a member of the National Conference committee and as a champion of the BC chapter.
KEVIN LIDDIARD Mortgage agent
DLC Easy Street Mortgages Age: 34
Before entering the mortgage industry, Kevin Liddiard worked at a law office for five years, where he gained valuable experience in real estate law and customer service, which proved to be an ideal foundation for his mortgage career. Last year alone, Liddiard funded an impressive $52.5 million across 187 deals. His hard work has landed him among DLC’s top producers nationally, and he has already been inducted into DLC’s Elite Hall of Fame. “Kevin genuinely cares for his clients and always does his best to find just the right mortgage and lender for them,” a colleague says. “He is very good at what he does, which shows with all of his achievements.” Outside of mortgages, Liddiard is an active lacrosse player and sponsor of the local Junior B Spartan lacrosse team and Falcons AAA hockey team.
MIKE JONES
Owner and broker Centum Core Financial Age: 35
A dedicated entrepreneur, Mike Jones has moved up the ranks at Centum Core Financial, from agent to manager to partial owner and ultimately sole owner of the office. Backed by a dedicated team, Jones continues to increase his volume year-over-year, and is currently fourth in units funded and fifth in mortgage volume for the entire Centum network. “Mike is driven and ensures he is staying on top of all the industry changes, social media and anything else that can make him and his team more successful,” a peer says. “He is a great franchisee in the sense that he always gives feedback and makes suggestions if he thinks something could be tweaked. It is a pleasure having him in our network.”
www.mortgagebrokernews.ca
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SPECIAL PROMOTIONAL FEATURE
REVERSE MORTGAGES
Time to transform
After 32 years in the business, HomeEquity Bank is shaking up its image to get the word out about the benefits of a reverse mortgage. CMP spoke to Yvonne Ziomecki to find out the impetus behind the bank’s rebrand
ALTHOUGH IT’S enjoying a period of strong and sustained growth, HomeEquity Bank decided it was time to make a change. In operation for 32 years, the Canadian bank – the only lender in the market to solely offer a reverse mortgage – decided to rebrand itself and launch a new marketing campaign with the help of a leading Toronto-based creative agency. Since its inception in 1986, HomeEquity’s primary marketing focus has been product advertising: building awareness around the reverse mortgage product, explaining its mechanics, and dispelling some of the myths and misunderstandings that still exist. It’s a strategy that has worked well. The company has been exceeding sales expectations for the past five years, and originations are growing at a solid rate in 2018. Even with its recent success, HomeEquity Bank decided it was time to move forward and solidify its place in the Canadian marketplace. “For a long time, our advertising strategy was to send out a single, precise message, which helped to educate people on a reverse mortgage and how it works,” explains Yvonne Ziomecki, Chief Marketing Officer and EVP of Marketing and Sales. “However, that strategy does not build an emotional connec-
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tion for the end consumer or create conversations. That’s why we decided it was time to rebrand.” Another driver behind the bank’s new image was to put the reverse mortgage product firmly in the mainstream. Reverse
gage, there’s really no easy way to release its value other than borrowing money against the equity of the home, which isn’t a great option.” HomeEquity was keen to change the conversation around reverse mortgages. For years, the product has been viewed by some as a loan of last resort, which is inaccurate. As Ziomecki explains, a reverse mortgage is not simply a tool for paying down debt – many clients use the money they receive to buy more property, do major renovations, travel or to remain in their home rather than downsizing. “With our new ad spots and rebrand, we are trying to open up the product to all Canadians,” Ziomecki says. “We attempted to show how older people are living in Canada, day in day out, and create some funny and insightful stories – humour is very important. We had some focus groups with people in the older age range, and everyone is saying we’ve hit the nail on the head. Older people don’t want to be patronized. They are not weak or stupid – they just want to enjoy their retirement with dignity and on their own terms.”
“A house is the biggest asset most people have heading into retirement, and other than a reverse mortgage, there’s really no easy way to release its value” Yvonne Ziomecki, HomeEquity Bank mortgages have many benefits – there are no payments, it cannot be called, and at no point will the client ever have to requalify for the product – and Ziomecki and her team thought more people needed to know about them. “Even if doesn’t end up being suitable for everyone, I don’t see why this product shouldn’t be something every Canadian knows about and considers as part of their retirement plan,” she says. “A house is the biggest asset most people have heading into retirement, and other than a reverse mort-
HomeEquity made the decision to rebrand in the middle of 2017. The next step was to look for a creative agency to partner with. Seeing how people in the advertising world perceived the company was an interesting experience for Ziomecki and her team. After a brief search, the bank decided to enlist the services of Zulu Alpha Kilo, a Toronto-based creative agency that has worked with Bell, Interac and Harley Davidson, and recently helped the Centre for Addiction and Mental Health with its own rebrand.
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“When we first engaged with Zulu, we did some quantitative and qualitative consumer research to find out what older Canadians think about retirement, and especially their financial situations,” Ziomecki says. “We got a lot of good insights about how they approach retirement and what they want in retirement. We found that older Canadians want security as well as the freedom to do what they want, which could be a small thing like going out for food with their friends once a week or something big like taking a trip around the world. The findings kept coming back to being in control and having freedom.” HomeEquity also conducted a research study through Ipsos, a global market research and consulting firm. The research backed up what HomeEquity already knew about Canadians and their attitudes toward retirement: Ipsos found that 93% of Canadians
aged 65 and over believe it’s either somewhat important or very important to stay in their current home throughout their retirement. Sixty-nine per cent of those in the over-65 demographic cited maintaining independence as the number-one reason why they want to stay in their home during retirement. “As the only financial institution in Canada that works exclusively with seniors, we are real advocates for this older generation,” Ziomecki says. “We have been working with older people for over 30 years, and we know more about this demographic than anybody else. We know how they make plans, spend money and make decisions.” Ziomecki expects the rebrand to also benefit mortgage brokers who partner with HomeEquity. Raising awareness of reverse mortgages and boosting the credibility of the product will likely to drive more business to
brokers who are eager to expand their books of business among the growing demographic of Canadians aged 55 or older. HomeEquity already has a group of engaged brokers who have a good understanding of reverse mortgages, but Ziomecki recognizes the need to reach out to brokers who are familiar with the product but need to learn more. “This rebrand will put the reverse mortgage into the mainstream and help brokers get more clients,” she says. “It means more money in brokers’ pockets because this category is not going anywhere. The number of Canadians over age 60 will grow by 19% between 2016 and 2022, and we are growing at an unprecedented rate. It’s a real transformational time. Over the past five years, brokers have been an integral part of our success, and they really have embraced the product. This rebrand is only going to accelerate the growth.”
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12/07/2018 2:43:42 AM
PEOPLE
BROKER INSIGHT
The broker’s guide to divorce Sherry Corbitt of Mortgage Intelligence tells CMP how she found her ideal niche in catering to clients dealing with a separation
CMP: What made you first get into the mortgage broker industry? Sherry Corbitt: I was previously a new homes sales agent, but I felt like I needed a change. The mortgage broker who worked on the new home site with me suggested I try the mortgage industry. It seemed like a logical fit after working in real estate, and I made the switch eight years ago.
CMP: How would you describe your time in the industry? SC: It’s been great. I opened an office with a co-partner who does home, auto and life insurance, so we both offer complementary services. That allows us to share a database. We opened seven years ago, and it’s been really good. Two years ago, I became a Certified Divorce Financial Analyst, which allows me to niche market to clients who are going through the stress of a separation.
CMP: What complications do people going through a separation face? SC: Some of the challenges are around the separation agreement; people don’t realize how important it is to have that in place. Lenders need to know on paper what you are going to owe and receive if you need to pay or receive support – they need to have that clearly outlined. Another issue is when a down payment
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is coming from the sale of the matrimonial home – there are lots of things clients need to be educated on in that scenario. You’d be hard pressed to find a lender who would bridge finance for you off of a matrimonial, for example. Budgeting as a single person is another issue that separated people experience. A lot of clients have challenges around understanding what they can afford and the true cost of having a house.
with my marketing. I network a lot, so I’m getting to be known as the person to deal with if you’re going through a separation. A lot of people will call me and not even know I do mortgages; they just think I’m a divorce expert. But I don’t mind that at all. If I can help that person to make the first step, which might be talking to a lawyer or mediator, they will circle back to me when they have to deal with the mortgage. It’s nice to have an ask that’s different.
CMP: How did you decide to get into this niche? SC: I was looking at my 2015 numbers and
CMP: You’ve operated during a tumultuous period for the mortgage industry. What have been some of the biggest challenges you’ve faced? SC: The challenges are always the same:
was trying to find a common theme. I realized that a portion of my clients were separating and divorcing – this was when the area I operated in was the divorce capital of Ontario. So it seemed like a logical move, and it’s not a niche that many people market to, so it allowed me to have more creativity
regulations and the rules that we all have to follow, and then explaining to clients how it impacts what they can and cannot do. We also have to make sure we’re offering superior products.
CORBITT’S TIPS FOR GROWING BUSINESS “I enjoy marketing, and finding different ways to get out there and be recognized has been important for me. I also have the right setup: I have an office, support staff and a family that allows me to go out and do a different type of marketing when it’s needed. It comes down to having the right people who can deal with the stuff that can bog you down in your business. It’s about finding time to spend more time working on your business, not just in your business.”
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FAST FACTS: SHERRY CORBITT
Works as a mortgage agent for Mortgage Intelligence
Has been in the industry since 2010
Previously worked as a Realtor, journalist and marketing manager
“If I can help a person to make the first step, which might be talking to a lawyer or mediator, they will circle back to me when they have to deal with the mortgage” CMP: What tips would you give to other brokers who are just starting out in the ind? SC: Develop an idea of how you want to advertise, and do what you do best and hire for the rest. So, if you’re not good at graphic design, it’s better to find someone who can do it at a reasonable price rather than spend three hours trying to learn something new. Play to your strengths, know what you enjoy
doing, and have a unique ask when you’re out there in the networking world or even with your clients. Know what you’re passionate about and what you can offer that someone else can’t – it’s important to be a specialist. People want to know they’re working with someone who’s the best, so find a couple of products that really speak to you and then become an expert in them.
Territory includes the Durham Region, Brooklin, Whitby, Clarington, Ajax, Oshawa, Pickering, Bowmanville and Port Perry
Specializes in mortgages for people going through a divorce or separation
Runs charity events for the Durham Humane Society
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12/07/2018 2:43:59 AM
SPECIAL PROMOTIONAL FEATURE
LENDING
Inside a lender’s rebrand CMP sat down with Michael Jones, president and CEO of Haventree Bank, to find out why now was the time for the lender to rebrand
IT’S OFFICIAL: Equity Financial Trust is no more. But the lender hasn’t exited the marketplace; it has simply changed its name as part of a rebranding process that also involves transforming from a trust company to a Schedule I bank. Going forward, the organization will be known as Haventree Bank. “The simplest reason for making the change was that we were often confused with our competition,” says Michael Jones, Haventree Bank’s president and CEO. “We also felt that the word ‘bank’ resonates more than the word ‘trust.’ If you are a mortgage broker introducing your customer to a financial institution for the first time, we think Haventree Bank sounds more appealing than Equity Financial Trust. ‘Bank’ is a term that is understood and trusted by everyone.” In addition to creating some cost savings, the transition from trust company to Schedule I bank will also enable Haventree to fund more mortgages and introduce new solutions, such as its second-mortgage product, which was launched when the rebrand was in the design stages and is available only to Haventree’s status brokers. “We like to share the benefits of our new identity with our broker partners, and the
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second-mortgage product is an example of that,” Jones says. “But there are other advantages to being a bank, both in terms of attracting capital and maintaining liquidity. Those are two important aspects for us to continue growing and to continue offering high-quality products to our broker partners.” Choosing a new name was no easy task. In fact, Jones describes it as a “long and arduous process.” After considering more than 500 names over a two-year period, the name Haventree Bank was introduced – and from that point, there was no looking back. “I think the name found us, and I say that because of what we do,” Jones says. “What distinguishes us from the competition is that we help our customers become something new in terms of their ability to borrow. We help them find a place of refuge and to put down new roots for the future. I think the new name is a perfect fit for us.” One of Haventree’s main areas of focus is helping people who have experienced a life event that has resulted in bruised credit, such as unemployment, illness or divorce. The bruisedcredit segment is one Jones expects to continue to grow in coming years. In most cases, these clients are already on a pathway to repairing
their credit when they approach the bank. Haventree simply provides a product to help those individuals on their final push toward securing long-term financing from an A lender. “In a way, we are a house of repair for those people,” Jones says. “At the end of the process with us, which generally takes a year or two, we have generated a prime customer. We are not in the prime business, so at maturity, we do not compete with our mortgage broker partners for that customer. We are a lender that solves a very specific problem and enables clients to take advantage of other opportunities that come up in the future.” Another priority for Haventree is making sure the credit-repair process goes as smoothly as possible. The bank has taken efforts to ensure that no unwelcome surprises interrupt the journey from bruised credit to prime borrower and has created a free home warranty product to make that a reality. For many clients, shelling out $5,000 to replace a broken furnace simply isn’t possible, and that’s where the home warranty
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“What distinguishes us from the competition is that we help our customers become something new in terms of their ability to borrow. We help them find a place of refuge and to put down new roots for the future” Michael Jones, Haventree Bank comes into play. “We don’t charge a premium, so the client doesn’t pay anything other than the rate of interest that is charged on the mortgage,” Jones says. “It means the client can sleep at night with peace of mind. They know the process of repairing their credit is not going to get interrupted by an older yet essential piece of household equipment breaking down.”
Haventree will also continue to focus on the business-for-self segment. In recent years, many of the larger lenders have turned their backs on business owners or the self-employed because they don’t have the time to properly assess incomes. Ensuring that people without a consistent salary can still get financing is important to Haventree and its leadership team. “We have designed our operations to reflect
our aim of making this a priority,” Jones says. “Some of the income assessment work is heavy lifting and requires great attention to detail, but we have trained our underwriters to be experts. In the prime business, there has been a tendency to look for faster and cheaper ways of doing things, and you don’t need a team of well trained underwriters to run that type of business. However, for us, it is something we are prepared to invest our time, energy and capital in.” Becoming a key supporter and proponent of the broker channel is another aim that is central to the Haventree philosophy. Those efforts can be seen in the loyalty program the bank has created for brokers who bring in high-quality business, something quite unique in this segment of the market. “We should be thought of as a producer of prime customers,” Jones says. “That should appeal to brokers and resonate with them, because once the client is finished with us, then they can accompany that borrower on the next phase of their journey.”
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12/07/2018 2:44:17 AM
SPECIAL PROMOTIONAL FEATURE
ALTERNATIVE AND PRIVATE LENDING
A wealth of options CMP caught up with industry insider Bryan Jaskolka of Canadian Mortgages Inc. to get his view on the growth potential in the alternative and private lending markets
CMP: What sort of impact are the most recent mortgage stress test rules having on Canadian borrowers? Bryan Jaskolka: It seems clear right now
broker who is able to build meaningful and mutually beneficial partnerships with alternative lenders? BJ: First and foremost, it’s preferred service.
that first-time home buyers are experiencing the biggest impact. Those people now have to qualify at a higher rate, no matter what their down payment is. According to some of the recent Bank of Canada statistics, the rules could disqualify anywhere from one in eight to one in 10 people, depending on location. That takes a decent percentage of people out of the pool and is pushing people toward alternative lenders – both the B channel and non-regulated lenders.
Brokers might also receive preferred pricing and greater access to exceptions with lenders and access to volume bonus programs. There’s a wide variety of benefits that come from having relationships with any lender category, whether it’s an institutional or an alternative lender.
CMP: Given the current environment, how important is it for brokers to embrace the alternative lending space? BJ: It is critical. It’s clear that buyers have less purchasing power and homeowners have less refinancing capacity as a result of the rule changes. If they aren’t seeking out alternative sources of financing, they are really leaving a lot of dormant equity in their properties. Even at higher rates compared to what banks may offer, alternative lenders still offer a very viable solution for people to refinance their debt or generate working capital or funds for real estate investment. Brokers who aren’t utilizing those tools are missing out on one of the fastest-growing segments in the mortgage marketplace.
CMP: What are the benefits for a
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BJ: When they meet a new lender, brokers should really try to understand the business the lender is looking for. Just because a lender is private, it doesn’t mean they lend on anything and everything regardless of credit or other considerations – that’s a misconception many people have of private lenders. CMP: What are the risks for brokers who are reluctant to build partnerships with alternative lenders?
“It’s important to have a good relationship with a reputable private lender because they can really help accelerate anybody’s business, whether their clientele is traditionally A or they are already involved in the alternative or self-employed space” Bryan Jaskolka, Canadian Mortgages Inc. It’s important for brokers to realize that lenders want to do business with people who are good to do business with. Just like there are many lenders in the marketplace, there are also many agents and brokers. It’s a two-way relationship that, once established, can be mutually beneficial for both parties.
CMP: How can brokers go about building those relationships?
BJ: You could be losing out on a lot of revenue. Most astute and experienced agents will tell you that even AAA borrowers can benefit from a private lender in certain situations. Lots of clients with great credit and good incomes go to private lenders to get second mortgages at competitive and attractive rates. A good example is a bridge mortgage that can be used by someone who plans to sell
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their home but wants to do some renovations to the property beforehand. Most people are able to improve the marketability of their properties by getting that financing, without affecting the underlying mortgage and paying interest penalties on that. We see a lot of clients with great credit getting second mortgages from private lenders. There is a misconception that today’s private lending space is the same as it was 25 years ago, but things have changed. Today, things are run on a process-driven basis, just like any institutional lender.
CMP: There are so many options out there in the marketplace. How can brokers go about identifying the most suitable alternative lender to partner with? BJ: Be cautious of lenders who appear to be fly-by-night. Look for lenders who have some proven longevity and have a good reputation. It’s fair to say that no company is perfect, and most have somebody who has made a complaint or left a bad review online. Overall, when looking at the private lending space, brokers should consider their own reputation, too, and how that could be impacted by partnering with the wrong lender. It’s important to have a good relationship with a reputable private lender because they can really help accelerate anybody’s business, whether their clientele is traditionally A or if they are already involved in the alternative or self-employed space.
CMP: Given that regulations are expected to continue tightening, what’s your outlook for Canada’s alternative lending space? BJ: It’s clear that the industry is going to continue to grow. The Bank of Canada recently reported that MICs and other private lenders accounted for 8% of mortgages in Ontario last year. The overall asset growth within the space, and the fact that regulators will continue to monitor the private lending environment, will ultimately produce a more robust and scalable industry that is going to provide a good alternative source of financing outside of the regular banking channels in Canada.
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12/07/2018 2:44:34 AM
SPECIAL PROMOTIONAL FEATURE
INTEREST-ONLY MORTGAGES
The benefits of flexibility CMP spoke to MERIX Financial’s Boris Bozic to get the inside scoop on the lender’s new product: the Interest-Only Flex Mortgage MERIX FINANCIAL recently launched a brand-new product, the Interest-Only Flex Mortgage, geared toward homeowners and investors looking to purchase or refinance up to 80% of the value of the home and take advantage of lower monthly payments during the term. The product offers clients an interest-only payment or a combination of an interest-only payment and an amortizing (principal and interest) payment with either fixed and ARM rates, giving clients choice and flexibility with their finances. Boris Bozic, founder and CEO of MERIX Financial, sat down with CMP to share more about this significant opportunity for brokers and homeowners.
Big Five, and they can offer solutions where they may not have been able to previously. For borrowers, it’s primarily about providing additional cash f low for those with other liabilities – for example, student loans. The monthly mortgage payments are comparatively lower than they would typically pay; therefore, they can dedicate those excess funds to other outstanding debts. It also speaks to borrowers whose circumstances may change over the next few years – for example, for maternity/paternity leaves, etc.
CMP: Why did MERIX Financial develop this product? Boris Bozic: We felt there was a need for
borrowers. However, it could be for clients with seasonal work who would like to pay down their mortgage using the 20% repayment feature on a schedule that fits their irregular cash flow; clients who are living in markets with high real estate prices who want to purchase a home in their desired neighbourhood with manageable monthly payments; investors looking to improve wealth over the long-term, who can put that extra cash to better use through investment opportunities, rather than repaying the principal on a mortgage; clients looking for lower monthly payments to save for home renovations to improve property value; and property investors who own multiple rentals and
it. Affordability of homes is an issue, and cash flow is increasingly important. With the increased cost of carrying homes and interest rates on the rise, there was an opportunity to innovate and offer something new to the industry.
CMP: How do you see this meeting the needs of mortgage brokers and their clients? BB: Brokers will have choice – or, at the very least, have more choice. It’s no longer required of them to just support one of the
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CMP: What other types of clients would this mortgage be suitable for? BB: Well, in my estimation, it’s suitable to all
want to keep mortgage expenses low. I don’t want to pigeonhole this product – the possibilities really are endless. Adaptations are being provided by our customers, too; they are utilizing this product in ways and in scenarios that we didn’t even contemplate.
CMP: What are the main advantages of the Interest-Only Flex? BB: The biggest one, of course, would be the monthly payments. That’s why someone would want this over a traditional mortgage – the cash flow. It’s extremely customizable and flexible to be exactly what you need in your financial situation. Other advantages would be things like LTV up to 80% – maximum 65% in interest-only, and the remaining 15% can be in an amortizing loan. It also applies to all mortgages: purchases, refinances, switches and rentals.
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CMP: Does it meet B-20 requirements? BB: Absolutely. Obviously great effort was made to ensure that the mortgage features were B-20 compliant. Also, the product speaks to the concerns that regulators and government officials had that a large portion of borrowers’ disposable income went towards mortgage payments. Because Canadians are predisposed to ensuring that their mortgage payments are up to date, the greater economy doesn’t benefit – those are the government’s words, not ours. Therefore, we created a product that allows Canadian borrowers to still provide shelter for their families, but with lower payments so that the excess funds can be applied to other market sectors.
CMP: Will this product be launched in Quebec in the future? BB: Not for the foreseeable future, but we plan on other innovative products and launches solely for the Quebec marketplace.
CMP: How does the compensation on this mortgage work? BB: It’s identical to our existing commission
“That’s why someone would want this over a traditional mortgage – the cash flow. It’s extremely customizable and flexible to be exactly what you need in your financial situation” Boris Bozic, MERIX Financial CMP: How do you position this mortgage’s higher interest rate to brokers and borrowers? BB: That is a challenge. Both brokers and borrowers are hardwired to look at interest rate only. This is not an interest rate mortgage. This is a cash flow mortgage. Therefore, some time is required to educate the broker
base as well as the borrower – but numbers speak for themselves, and the math should guide brokers and borrowers alike. One of the education tools we’ve created is an Interest-Only Flex calculator that will demonstrate to your client which product mix will provide the best cash flow option for their specific situation.
structure, whether it be trailer fees through MERIX or upfront compensation with our Lendwise model. Nothing changes.
CMP: What has the initial reaction to Interest-Only Flex been like? BB: Extremely positive. We’ve received significant kudos for launching something new and being innovative. The response in larger urban centres – i.e. GTA and GVA – has been very positive, given that our loan limits can now be up to $2 million on an uninsured basis.
CMP: Are there any future innovations in the pipeline from MERIX Financial? What’s next? BB: There’s always something that’s next. It’s what we do. A lot of our focus and attention is geared towards the digital experience for the broker and the borrower. Stay tuned.
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SPECIAL PROMOTIONAL FEATURE
COMMERCIAL SERIES
Unfinished business The Financing Hub’s Paul McGill explores some key reasons why commercial deals fall apart – and how brokers can keep it from happening
TOO OFTEN in the commercial space, money is left on the table that doesn’t need to be. When commercial transactions don’t close, a great deal of time and effort goes into compiling (by the agent) and underwriting (by the lender) those commercial submissions, but ultimately one or both parties don’t see any revenues as a result of the efforts they’ve put in. Here at The Financing Hub, we have a unique view of what’s going on in the commer-
Hub lender-users. Here’s what I found.
The big transactions First, transactions over $10 million have good closing rates. Why is that? Put a lot of zeros behind any number and people get more serious. Typically, everyone puts more time and detail into creating $10 million-plus submissions. The broker plays much more of a direct advisor role – involved earlier in the project, working with the borrower on
It seems that finding an interested lender and then taking the time to work with them is the better answer for clients. Our analysis showed that his increases the number of closings and generates more placement fees cial brokering space. As an industry-wide platform, we see hundreds of deals – large and small, covering almost every type of funding request you can imagine. As a result, we see what works and what doesn’t, including for those transactions that didn’t close. For this article, I asked my team for an analysis of our past application flows, and also reached out to a number of our Financing
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funding options and securing everything needed to get the application closed. At this level, there are clear, exclusive broker-advisor mandates. Larger commercial brokers just won’t work without those mandates in place. We also found that there was limited deal shopping. It seems that finding an interested lender and then taking the time to work with them is the better answer for clients.
Our analysis showed that this increases the number of closings and generates more placement fees compared to spending the same amount of time and effort trying to find a lender who will do the transaction more quickly or with a better rate. At this level, everyone involved is focused on doing what needs to get done to close the project so the client can start generating new revenues. Unfortunately, we see this
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important focus missing at other levels, which results in too many submissions becoming unfinished business.
The medium-sized transactions Transactions between $3 million and $10 million don’t have the same closing ratio. Our analysis showed that the number-one reason for the lower closing ratio appears to be that too many agents are not getting
exclusive broker mandates. The second culprit was excessive deal shopping, usually by agents without the proper mandate. When we reviewed the lender decline responses for this category, we found that many times, the lender had already seen the deal from one or more agents, but with no material changes made since the last decline. A $3 million to $10 million mortgage is substantial. No lender is going to autho-
rize a transaction of that size without a well structured, fully compiled submission. As a broker, you shouldn’t be putting in that level of effort without a clear mandate from the borrower, agreeing to work with you on an exclusive basis. At the same time, we noticed that the borrowers at this level often fall into the category of knowing just enough to be dangerous. When the broker is called in, the borrower often already has a half-baked idea of what the financing presentation should include. If there’s a niche that really cries out for professional broker-advisors, this is it. As a borrower, a broker who is simply going to shop or re-shop my application doesn’t warrant exclusivity or much of my time. However, a broker-advisor who is going to work with me and my team to find a viable solution that will secure my needed funding is absolutely worth my time. Be an advisor, but one with an exclusive mandate. Don’t waste your time with someone else’s unfinished business. We recently did a webinar on how brokers can work with a borrower’s team. A key suggestion that came up was how to prove that you’re the professional financing advisor your borrower should be working with. If you’re interested, you’ll find one of our Hub Hints on that subject on our website, thefinancinghub.com.
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SPECIAL PROMOTIONAL FEATURE
COMMERCIAL SERIES
Most often, the brokers who abandon these files are those who primarily derive their income from residential business. When inexperience brings them up against a wall, they abandon their commercial deals The small transactions No other level leaves more money on the table than transactions under $3 million. Believe it or not, abandonment is one of the primary reasons commercial transactions in this category don’t close. Most often, the brokers who abandon these files are those who primarily derive their income from residential business. When inexperience brings them up against a wall, they abandon their commercial deals and go back to their residential business. Before you do that again, let’s do the math. On a $1.4 million commercial submission, the standard fee is $14,000 or more. For a $650,000 application, the fee is $6,500 or more. You’d have to achieve $2.8 million and $1.3 million, respectively, in residential mortgage placements to replace just one of those commercial transactions. Even if you just refer the application to another placement source, you as the originating agent still stand to receive $2,800 or $1,300 if your referring broker places the application. Please stop
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leaving all this money on the table. Failing to do the upfront work is another key reason commercial brokers aren’t earning their fees. For a residential application, with four or five pieces of standard information, a broker can often get a strong indication of whether a lender will do the deal and what the rate range will be. Brokers often try this same approach with commercial lenders, only to get early declines. Commercial needs all the work done upfront. You can’t wait to start the work once you have a soft commitment in hand. The same thorough application and document review you would do later might uncover key points ahead of time that can materially add to the submission. Unfinished business isn’t good for you or your client. For you, closing fees are your livelihood. For your client, it means missing out on the longer-term revenues they might attract from the property. No matter what size transaction you take on, get an exclusive mandate and be your borrower’s advisor, not their shopper. Always be closing-focused, finish more business and don’t leave any money on the table.
Paul McGill is president of The Financing Hub, which is dedicated to delivering effective digital solutions for commercial real estate financing.
www.mortgagebrokernews.ca
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More Options. More Lenders. More Solutions.
The Financing Hub Brings Online Technology to the Commercial Mortgage Application Process Discover More:
www.TheFinancingHub.com In exclusive partnership with MERIX Financial
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MAGAZINE The only independent magazine dedicated to mortgage industry news, opinion and analysis
WEBSITE Breaking news, in-depth profiles, features, online forum and Mortgage Broker TV
ENEWSLETTER Daily news service delivered straight to your inbox every morning
Find out more and subscribe at mortgagebrokernews.ca CMP subs ad2 Path-SUBBED.indd 2018.indd 1 54-55_Career 54
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PEOPLE
CAREER PATH
A NATURAL SALESMAN Decades in sales have taught Robert Jennings the importance of rolling with the punches
Jennings got an early grounding in business fundamentals when he inherited the largest paper route in town from an older boy in his neighbourhood “Suddenly I had 80 clients – it was like running my own business. I learned a lot; I learned the hard way. I was very humbled by what I learned as a paperboy and thought business was a natural path”
1996
BUILDS A BUSINESS
2006
GETS HIS FEET WET Jennings’ first job out of university, with Citifinancial, conferred a skill set that went well beyond academia
“I had no idea what I was getting into. I just knew I had to wear a shirt and tie every day and was excited about that; little did I know I was dealing with some unique financial situations. There was no better experience for a mortgage broker” 2014
WINS NATIONAL RECOGNITION Jennings gained a national profile when he snagged a spot on CMP ’s Young Guns list “It was the first time I was recognized on a national level; 2014 it really helped elevate my personal brand. The award was based on 2013’s numbers – I wrote $26 million that year – so I knew the good year I’d had in 2012 was not a fluke. It was a big milestone for me; I was very proud of it”
YOUNG GUNS
2017
HAS HIS BEST YEAR SO FAR Jennings’ goal to spend five years hustling paid off last year when renewals and referrals helped him land $40 million in deals. He capped off the banner year with his wedding to wife Diane “I always said that if I work my butt off for the first five years, it’ll get easier – it sure got busier. It all fell into place; it was the best year of my life”
2001
NAVIGATES THE ICEBERGS While studying business at Memorial University, Jennings’ summer job selling boat trips to tourists who had made the journey to Twillingate (known as the iceberg capital of the world) earned him a reputation as a natural salesperson “It’s easy to sell boat trips when there are icebergs; when the icebergs melt, that’s when it’s hard – I’d sell on the scenery, the sea, the idea of going with friends. My boss used to tell me I was a natural”
2011
FINDS MORTGAGES Just as he was starting to feel burnt out at his job and realizing that a promotion would likely require leaving Newfoundland, Jennings was introduced to East Coast Mortgage Brokers founder Claude Sullivan “He had the idea to start his own brokerage and saw some potential in me as a salesperson. I wanted to control my own destiny; I was very confident in myself. Mortgage brokering was emerging here at the time; it seemed like the perfect fit”
2014
BUYS IN Having hit his professional stride, Jennings came to a fork in the road that culminated in him becoming a co-owner of the brokerage “I realized I was really good at this and thought I could either start my own business or invest in the company I was proud to be a part of. The choice was easy, and I haven’t looked back. We’ve grown by leaps and bounds, but the fundamentals remain the same”
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PEOPLE
OTHER LIFE
TELL US ABOUT YOUR OTHER LIFE Email mortgagebrokernews@kmimedia.ca
Although the Raptors and Maple Leafs have had floats in the parade, most come from local community groups
100
Entrants in the 2017 parade: 63 floats, 17 bands and 20 groups of walkers
20,000
Estimated number of spectators the parade draws each year
60
Minutes it typically takes to walk the parade route
SANTA’S HELPER There’s nothing like a parade, says Ontariobased broker Gunther Kaschuba – and he ought to know
CHRISTMAS IS a busy time for many, but it’s especially demanding for Burlington mortgage broker Gunther Kaschuba, who has served as the chairperson of the city’s Santa Claus Parade since 2004. Kaschuba says that while planning for the event is spread across the year – the first organizing meeting is held in February – activity ramps up greatly in the days just before the parade. Booking bands, arranging for road closures and devising an
order for the 100 floats, bands and groups on foot is a challenge that he likens to putting together a jigsaw puzzle. On the day of the parade, Kaschuba can be found in a golf cart, “herding people along” and rushing back to Santa Claus in his sleigh with the names of children along the parade route to call out through his megaphone – a tradition that’s an endless source of delight for Kaschuba. “I love watching the kids,” he says. “There are a lot of smiles on the parade route.”
56 www.mortgagebrokernews.ca
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s n o i t a l u t a r g n o C
TO OUR
2018 YOUNG GUNS
Aaron Baxandall
Jason McKague
Matthew O’Neil
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Jason Armstrong
Kevin Mayer
12/07/2018 2:46:16 AM
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