Them’s fighting words: A document from an RBC employee outlining the differences between mortgage brokers and specialists is drawing the ire of brokers – charging it mischaracterizes their work, their qualifications and their motives.
“Brokers will farm out your mortgage to a number of companies and then will set you up with a financial institution based on only the lowest rate, no other factors,” reads the undated document -- “Understanding the difference between mortgage specialists and mortgage brokers.” An RBC logo and the name of one of its British Columbia mortgage specialists appear on the flyer.
There’s more.
“When selling your mortgage the broker and the financial institutions reviewing your file may pull numerous credit bureau requests depending on their software capabilities,” continues the document, which aims to provide mortgage specialists with talking points to answer client questions. “Brokers will charge set up fees and have other hidden costs you should be aware of.”
Neither the specialist nor RBC corporate communications in Vancouver returned MortgageBrokerNews.ca calls Friday.
Still, the flyer has now been posted to industry websites across the country, with more than 150 brokers venting their rage and disappointment.
“I think the relationship between mortgage brokers and mortgage specialist is akin to some of the biggest rivalries in sports,” Greg Williamson, founder of 180 Degrees Coaching, told MortgageBrokerNews.ca. “But this is misleading and for those who read it and don’t know our business, it will mislead them.”
The broker was one of the first to post it on his blog website, www.gregwilliamson.ca. One of the document’s most glaring inaccuracies, maintains Williamson, is that suggestion brokers repeatedly run reference checks on clients.
“If a mortgage broker is using Filogix, they’re generally only pulling a credit check once,” he said. His blog has now attracted more than 280 responses, mostly from brokers concerned the RBC flyer will erode consumer confidence in their industry.
Under another section marked “Training and Educational Differences,” the writer extols the financial planning and institutional knowledge of bank mortgage specialists. She then offers a much briefer synopsis of broker qualifications: “Depending on your province, mortgage brokers must be licensed through the Accredited Mortgage Professionals course. Only this course is required, no financial planning included.”
Many brokers are concerned that the document may speak to the bank’s corporate attitudes about the broker channel. It is, in fact, the only one of the Big Five that has never used external brokers.
“There were obviously inaccuracies in the report,” CAAMP President and CEO Jim Murphy told MortgageBrokerNews.ca. “I’m in discussions with senior officials from RBC that they were not aware of it and are looking into it.”
My personal comments are: these RBC Specialists deal with one institution and one set of Mortgage Products. In many cases,
I would challenge them to have 30 years of Industry experience….enough said.
Rick Moran, AMP, OMB # M08001997
Tuesday, April 19, 2011
Tuesday, April 5, 2011
First-time buyers in major Canadian markets move to get in ahead of higher interest rates, says RE/MAX
MISSISSAUGA, ON, April 5 /CNW/ - Driven by the threat of higher interest rates down the road, first-time buyers are contributing to strong upward momentum in residential housing markets across the country, according to a report released today by RE/MAX.
The RE/MAX First-Time Buyers Report, highlighting trends and developments in nineteen major Canadian centres, found that low interest rates and balanced market conditions have provided significant impetus in 2011, particularly at lower price points. Just over 30 per cent of markets are reporting sales in excess of 2010 levels as a result, while almost 70 per cent have experienced an upswing in average price. Leading the country in terms of percentage increases in the number of homes sold are Western Canadian markets, including Saskatoon (up close to 15 per cent), Greater Vancouver (up close to 12 per cent), and Winnipeg (up just over 11 per cent). With an average price hike of close to 20 per cent year-to-date (February), Greater Vancouver continues to show unprecedented strength, followed by Hamilton-Burlington (eight per cent), Quebec City (seven per cent), Winnipeg (close to seven per cent), GreaterToronto (five per cent), and Greater Montreal (five per cent).
"Despite homeownership rates approaching 70 per cent, there is clearly room for growth as entry-level buyers make their moves from coast-to-coast, undeterred by higher housing values and changes to lending criteria" says Michael Polzler, Executive Vice President, RE/MAX Ontario-Atlantic Canada. "Many purchasers intent on realizing homeownership are scaling back on expectations or are willing to sacrifice location, quality and/or size to make their dream a reality - not unlike generations before them."
Inventory levels, while tight in several larger centres, are more balanced overall, giving first-time buyers a good selection of housing product from which to choose. Not surprisingly, condominium apartments and town homes have become the first step for many entry-level purchasers, especially in Greater Vancouver, Victoria, Kelowna, Edmonton, Calgary, London-St. Thomas, Hamilton-Burlington, Greater Toronto, the Island of Montreal, and Halifax-Dartmouth where average prices have risen unabated in recent years.
"With the Canadian economy on firmer footing overall, residential real estate is well-positioned moving into the traditionally busy spring market," says Elton Ash, Regional Executive Vice President, RE/MAX of Western Canada. "Consumer confidence is climbing in conjunction with economic performance, and concerns over a secondary recession fade with each passing day. The mood is cautiously optimistic, as first-time buyers enter the market."
Changes to recent financing criteria have not created the anticipated run up in activity in most markets. From a financial standpoint, most rookie home buyers remain quite prudent. Those making the leap are not doing it lightly, buying within their means. While this most recent round of policy tightening will likely have a negligible effect on demand, the message is getting across.
Affordability remains a growing concern in most markets, and—aside from first-time purchasers—no one is more in tune with that than housing planners and developers. In fact, the growing demand for reasonably-priced product is creating a shift in the country's housing mix. That trend is expected to gain traction in coming years, as builders look to create greater options for those seeking to realize homeownership. In recent years, builders have helped ease the move to homeownership by concentrating on intensification—condominium buildings with smaller suites and small-lot subdivisions offering detached, compact homes at a fraction of the cost of a traditional single-family home. On the flip side, the affordability factor is also breathing new life into tired older neighbourhoods, and that, in turn, is contributing to rising values.
As prices escalate, first-time buyers are indeed spending more—some out of necessity, but others are simply in a position to do so. Unlike in years past—a greater percentage of today's first-time buyer pool is comprised of dual-income, college or university-educated couples with solid earnings. They're spending close to average price or slightly more to secure—in most cases—a better location or a home that will grow with them. Yet, the fact remains that those on a tighter budget can get in for considerably less, with reasonable choices in every major market across the country. While some may feel discouraged by eroding affordability levels, the underlying confidence in the concept of homeownership is rising.
"While market conditions are one thing that influences first-time buyers, few things trump the fundamental belief in homeownership," says Sylvain Dansereau, Executive Vice President, RE/MAX of Quebec. "Today's entry-level buyers are steadfast in their mindset. They know they have to live somewhere, but they simply don't want to pay someone else's mortgage. Savvy or practical, they remain a driving force. The bottom line is that the demand for entry-level product will remain steady. The role of starter homes in the marketplace is becoming ever more vital."
Rick Moran, AMP, OMB # M08001997
The RE/MAX First-Time Buyers Report, highlighting trends and developments in nineteen major Canadian centres, found that low interest rates and balanced market conditions have provided significant impetus in 2011, particularly at lower price points. Just over 30 per cent of markets are reporting sales in excess of 2010 levels as a result, while almost 70 per cent have experienced an upswing in average price. Leading the country in terms of percentage increases in the number of homes sold are Western Canadian markets, including Saskatoon (up close to 15 per cent), Greater Vancouver (up close to 12 per cent), and Winnipeg (up just over 11 per cent). With an average price hike of close to 20 per cent year-to-date (February), Greater Vancouver continues to show unprecedented strength, followed by Hamilton-Burlington (eight per cent), Quebec City (seven per cent), Winnipeg (close to seven per cent), GreaterToronto (five per cent), and Greater Montreal (five per cent).
"Despite homeownership rates approaching 70 per cent, there is clearly room for growth as entry-level buyers make their moves from coast-to-coast, undeterred by higher housing values and changes to lending criteria" says Michael Polzler, Executive Vice President, RE/MAX Ontario-Atlantic Canada. "Many purchasers intent on realizing homeownership are scaling back on expectations or are willing to sacrifice location, quality and/or size to make their dream a reality - not unlike generations before them."
Inventory levels, while tight in several larger centres, are more balanced overall, giving first-time buyers a good selection of housing product from which to choose. Not surprisingly, condominium apartments and town homes have become the first step for many entry-level purchasers, especially in Greater Vancouver, Victoria, Kelowna, Edmonton, Calgary, London-St. Thomas, Hamilton-Burlington, Greater Toronto, the Island of Montreal, and Halifax-Dartmouth where average prices have risen unabated in recent years.
"With the Canadian economy on firmer footing overall, residential real estate is well-positioned moving into the traditionally busy spring market," says Elton Ash, Regional Executive Vice President, RE/MAX of Western Canada. "Consumer confidence is climbing in conjunction with economic performance, and concerns over a secondary recession fade with each passing day. The mood is cautiously optimistic, as first-time buyers enter the market."
Changes to recent financing criteria have not created the anticipated run up in activity in most markets. From a financial standpoint, most rookie home buyers remain quite prudent. Those making the leap are not doing it lightly, buying within their means. While this most recent round of policy tightening will likely have a negligible effect on demand, the message is getting across.
Affordability remains a growing concern in most markets, and—aside from first-time purchasers—no one is more in tune with that than housing planners and developers. In fact, the growing demand for reasonably-priced product is creating a shift in the country's housing mix. That trend is expected to gain traction in coming years, as builders look to create greater options for those seeking to realize homeownership. In recent years, builders have helped ease the move to homeownership by concentrating on intensification—condominium buildings with smaller suites and small-lot subdivisions offering detached, compact homes at a fraction of the cost of a traditional single-family home. On the flip side, the affordability factor is also breathing new life into tired older neighbourhoods, and that, in turn, is contributing to rising values.
As prices escalate, first-time buyers are indeed spending more—some out of necessity, but others are simply in a position to do so. Unlike in years past—a greater percentage of today's first-time buyer pool is comprised of dual-income, college or university-educated couples with solid earnings. They're spending close to average price or slightly more to secure—in most cases—a better location or a home that will grow with them. Yet, the fact remains that those on a tighter budget can get in for considerably less, with reasonable choices in every major market across the country. While some may feel discouraged by eroding affordability levels, the underlying confidence in the concept of homeownership is rising.
"While market conditions are one thing that influences first-time buyers, few things trump the fundamental belief in homeownership," says Sylvain Dansereau, Executive Vice President, RE/MAX of Quebec. "Today's entry-level buyers are steadfast in their mindset. They know they have to live somewhere, but they simply don't want to pay someone else's mortgage. Savvy or practical, they remain a driving force. The bottom line is that the demand for entry-level product will remain steady. The role of starter homes in the marketplace is becoming ever more vital."
Rick Moran, AMP, OMB # M08001997
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