Forum

Broker news forum is the place for positive industry interaction and welcomes your professional and informed opinion.

Notify me of new replies via email
Mortgage Broker News | 20 Jul 2010, 10:50 AM Agree 0
CanEquity says it's offering the lowest mortgage rate in Canada, lower than its 3.81 per cent rate.
  • John | 21 Jul 2010, 02:11 AM Agree 0
    Seriously, is this posting above for real? Can I blatantly post advertising for my firm / products / etc.? I'm sure we could probably also call it non-compliant, you can't legally say "XYZ offers lowest rate in Canada"
  • LM | 21 Jul 2010, 02:15 AM Agree 0
    With a large enough fee, I could advertise a 0.0001% 5 year fixed rate.
  • Dave | 21 Jul 2010, 02:17 AM Agree 0
    I tried the calculator on the CanEquity website and it shows a 5 year rate of 4.14%. The rate being quoted seems to be the 3 year rate although it is not even the correct rate.
  • AB Mortgage Broker | 21 Jul 2010, 02:18 AM Agree 0
    Just what the industry needs, more brokers charging fees! It's not about rate people... As a broker I too have a rate available to me much lower than 3.81%, but I push product and service. What good is the lowest rate if the product is gutted with a bonafied sale clause? Live by rate, die by rate!!
  • Barbara Chan | 21 Jul 2010, 02:24 AM Agree 0
    This for sure is a Lendwise rate, at this going soon enough average finder's fee and vb is going to be down to an industry standard of 50 BPS.

    Please only use Lendwise when you really need to, keep our industry alive!
  • fayed | 21 Jul 2010, 02:26 AM Agree 0
    Is this a CanEquity adversment? Really
  • BC Mortgage Broker | 21 Jul 2010, 02:27 AM Agree 0
    I can get a rate much lower than 3.81% however I follow ethics and as such I do not publish it. The fact that CanEquity is advertising the rate goes against all ethical standards. I would request that you delete this article immediately.
  • Marc | 21 Jul 2010, 02:31 AM Agree 0
    Once again we see a broker who takes no pride in their work and services provided. Unfortunately, it seems like we are heeded towards the same place where real estate agents/brokers are today, where they sell themselves so cheap, with every other shmmo now claiming to be a real estate agent. Enough of this nickel and diming. Lets start realizing that we are professionals and we deserve to be paid as such. It actually takes skill and knowledge of figures to be a good broker, unlike a real estate agent who requires very little thought. All they need is a driver’s license, and access to the MLS system. Also, how is it that this newsletter has become an advertising platform for Can Equity?
  • AB Mortgage Broker | 21 Jul 2010, 02:48 AM Agree 0
    I can't believe the brokerage owner, you know who you are, approved this crap. As Professionals we should be conducting ourselves as such. The financial planning industry wouldn't tolerate this from it's members and neither should we. Come on CAMMP, get some backbone and clean up our industry! Strip them of their AMP for unethical business practices!!
  • Ron | 21 Jul 2010, 02:51 AM Agree 0
    We all know it is very important to be honest about the products we are offering, we need to make sure the public clearly understands the different contract provisions of these stripped down, low rate mortgages. But don't fool yourselves. Rate advertising is here to stay, commission buy downs are here to stay. You can choose not to be involved with it but don't be so foolish as to waste your time wishing it will end. There is a simple concept at work here: intermediaries will be eliminated as technology diminishes their value. We can talk about great service and great advice till we are blue in the face; the ultimate truth is our clients want low rates. When you get a mortgage for yourself or family don't you want the best rate? Try not to be intellectually dishonest here, comsumers want low rates as long as the product features and contract shortcomings are truthfully disclosed, consumers want the chance to make up their own minds. The Internet means the consumer will continue to gain a greater knowledge of product pricing and none of us can wish that away.
  • ON Mortgage Broker | 21 Jul 2010, 03:08 AM Agree 0
    I just wish I thought of this model myself and beat them to the punch. If their clients are saving a lot of money, even with the fee, this is a superior way to do business. In the end, what the client receives is the most important part of generating return and referral business. Who cares how we get paid.
  • AB Mortgage Broker | 21 Jul 2010, 03:11 AM Agree 0
    Are you serious? If at the end of the day all you are is low rate, you are a commodity. If your client doesn't see the value in you as their mortgage planner, then you have failed your client! You're right, schisters are in every business and there is nothing we can do about that, but those ethical brokers, who are true professionals, can sell beyond rate. Give some thought to your previous statement. Perhaps a coach would do you well.
  • ON Mortgage Broker | 21 Jul 2010, 03:15 AM Agree 0
    @Dave:
  • ON Mortgage Broker | 21 Jul 2010, 03:16 AM Agree 0
    @Dave:
  • ON Mortgage Broker | 21 Jul 2010, 03:17 AM Agree 0
    @Dave: Sorry for the extra posts. Browser's messing up. This is the site they're talking about: ratesmortgage.com
  • richard | 21 Jul 2010, 04:13 AM Agree 0
    I looked at the www.canequity.com website and could not find this rate anywhere. CMP neglected to include the web site address from the actual press release (which I did find on their site with "obvious buy-down" 3.81% rate.) www.ratesmortgage.com has the correct calc. The admin fee seems to be based on the loan amount. It's probably how they are buying down the rate. There is some savings there, but how's the service? Are they making any money?
  • Greg Williamson | 21 Jul 2010, 04:41 AM Agree 0
    Not sure who "Ron" is but it appears you are a part of CanEquity. No disrespect to you and your model but I think you are slightly overhanded in sounding the death alarm to brokers who choose to have a model different then you.

    I for one agree that the state of the intermediary is in peril due to technology yes, but also sadly also due to businesses like yours who choose to go the price route.

    Let's agree on this shall we. You go your way, let us go our way, offering professional advice and ongoing mortgage management and lets see who is standing in the end :)

    Cheers,

    Greg
  • Brenda | 21 Jul 2010, 04:44 AM Agree 0
    Got to give them that much.
  • Dave | 21 Jul 2010, 05:45 AM Agree 0
    Is a low rate. I understand the concept of service but at the end of the day - if I'm willing to take the time to figure out what works best for me and can save hundreds for the effort - then I should be allowed to.

    I view it like travel. If I want someone to plan my trip for me based on what I've told them I want and who knows what I might not know to even look for, a travel agent is a great place to go. If I want cheap hotels and cheap flights and am willing to plan my own outings and risk missing a couple of the sights I might not have known to look for - I'll head over to Expedia or BookIt or the such.

    Personally - I'll take the hours it takes to research, read reviews and plan my own trip for the hundreds saved. And that's my right.

    I'm not saying a travel agent isn't worth what they charge, they are (or at least some of them). Just not to me.

    Cheers !

    Dave
  • Jason | 21 Jul 2010, 06:06 AM Agree 0
    With all due respect to this company, i've never heard of them and do not directly find them a threat to our business model at all. I would actually encourage our clients to speak to them befoe speaking to our team. Our team consists of an MBA, tax lawyer and two PFPs, there is absolutely no way that this company can compete with that type of knowledge. The fact that someone offers 20bps less on a rate means nothing if we are able to save them double that through sound tax/estate planning and investment advise. It's comparing apples to oranges. Yes the industry is changing and that is why we must continue to adapt but playing the same game that the banks play with respect to rates being the only card in their hand is a short sighted business plan that will end up haunting them in the future. Continuing to provide great advise and service to each and every client and developing a brand name that is based on honesty and knowledge is the only way that anyone is going to survive.
  • Cory | 21 Jul 2010, 06:22 AM Agree 0
    Yes, it's great to offer our clients the best rates possible, but if we continue to undercut our commission by offering these low rates, we'll put the industry in jeopardy. Lower commissions will become the standard and other benefits will be reduced, such as great aftercare service and educating our clients. This will guide our clients back to the banks. We are professionals and deserve to be paid as professions. Think of the long term impact on our industry.....
  • Scott | 21 Jul 2010, 06:41 AM Agree 0
    So what if they have the lowest rate. They're an internet company, limited clientele base. Not everyone is keen on doing a deal without a face-to-face. Its a big market, if these guys scare you then your in the wrong business. Competition will never go a way and I guarantee someone will offer a lower mortgage rate. I've seen way more questionable web pages offering stupidly low rates. Who cares. Its not like they have a 50% market share. Seriously?
  • Mike | 21 Jul 2010, 06:42 AM Agree 0
    Currently brokers exist which forces competition in the marketplace, thereby ensuring lower mortgage rates.. This is a good thing. However if we as brokers reduce ourselves to rate only with no compensation, we jeopardize the longevity of the channel. While the consumer may say who cares, they will certainly care when the channel does not exist and banks are charging posted rates only with no discounts.
  • mortgage needs | 21 Jul 2010, 06:50 AM Agree 0
    we should be concerned about the sustainability of lenders offering rates which are too low. There must be enough "orphan" loans out there from the last sorting out in this industry. Smaller lenders may not have the overheads that large deposit-taking banks or credit unions with branch banking have; even as that has not stopped some from shaving rates to outbid other lenders of any sort, in what is a practice of price discrimination. Smaller lenders have a place in the market or the borrowing public will be paying posted rates set by the large banks, even as a significant percentage must still be renewing at posted rates as the large banks have enormous distribution power by the sheer size of their branch network. Mortgage securitization has enabled lower costs, but we have to ask if this is not at the expense of transferring too much risk to mortgage investors/insurers [- and taxpayers if/when govt. is involved ]- i.e. have we gotten this right yet ? There is a balance that will work sustainably in the longer term, and this is what we should aim for never mind the size of compensation. If one were to complain about compensation at what are historically high real estate prices, then think about what has happened to prices and commissions south of the border.
  • Doug | 21 Jul 2010, 07:20 AM Agree 0
    If our society continues down its current path of being fully focused on price (or rate), soon enough society will not have many options left to choose from, people will be making poor choices, and the remaining handful of corporations will be free to charge whatever they like.
  • AB Mortgage Broker | 21 Jul 2010, 07:30 AM Agree 0
    These guys are in direct violation of both the Fair Trading Act and Competition
  • AB Mortgage Broker | 21 Jul 2010, 07:43 AM Agree 0
    These guys are in direct violation of both the Fair Trading Act and Competition Act, not to mention Lendwise's "No Advertising Policy". To suggest they have the lowest rate in Canada is misleading. Obviously there are many others able to offer the same rate and maybe even lower. According to RECA's definition, the add is misleading. Also, Daryl doesn't hold a valid mortgage associates license which begs the question, why is he speaking on a subject when RECA prohibits him to do so. What's actually going on here is that this company is willing to discredit themselves in the name of publicity. They are an internet business look for higher page rank a this article is one way to achieve that. They know that the industry will do nothing to punish them, so to them there is more reward than risk. I would ask that you send all complaints via email to info@RECA.ca. Together we can clean up our industry.
  • Ron | 21 Jul 2010, 08:04 AM Agree 0
    AB Mortgage Broker & Greg W: I have nothing to do with Can Equity, I am a Verico guy. I am 20 years in the business and a 100 million of annual originination so I guess I am still standing. I have listened to Greg speak so many times about brilliant concepts that move the consumer and the realtor totally away from rate issues. I admire all the technique behind it. I acknowledge the real professionalism a great mortgage broker brings to his craft and the value he brings to his clients. The point I am making is that the we all know in our hearts the consumer wants a great rate. I dispise bait and switch so I am not endorsing this CanEquity program but please keep a leval head. All the travel agents 25 years ago thought the consumer would never book his own travel, all the stock brokers never believed the consumer would make his own trades, all of Canada's real estate agents just had MLS exclusivity knocked out from under them. If any angry person here ever used Expedia or ETrade maybe they should think twice.
  • Zoltan Padar MortgagePRO | 21 Jul 2010, 08:15 AM Agree 0
    Hello Interesting, AB Broker;
    Your have got this just right on, RECA should get involved end get this mess cleaned up. Also if any of you have oppinion, why do not put your full name on this comments. Anyway, unfair practices are hurting everybody, not just the perpetrator. There are no absolute lowest rate, only today's best rate as products are changing every day. Besides, if you want to give up part of your commission, you are a desperate idiot, I do not care who you are. Maybe should work at the flea market. One think is for sure; lenders are successful at pushing industry members to go against each others. This is not competition, this is american style capitalism, buckle your belts. I thought, though, all of the governing, licensing agencies are not only created to fine people, but to educate and teach them how to be a professional. And again, this is Zoltan Padar, Broker MortgagePRO Ltd...who are you...
  • Ken Lankin | 22 Jul 2010, 03:06 AM Agree 0
    Beack in the 70's and 80's finders fee's were not paid. Old Montreal Trust stepped up to the plate and offered the first finders fee in the market place and others followed.
  • KL | 22 Jul 2010, 03:11 AM Agree 0
    Sorry folks - wrong button .. So - all institutions have worked very hard to come up with and maintain a happy broker community. Now companies like this are asking us (well not really asking) dictating smaller fees for for smaller rates. For most of the long time quality brokers you have earned your stripes and more so earned your rewards with specific lenders. Treat your clients to what you know - not some gimmick that will no doubt be short lived !!
  • mortgage needs | 22 Jul 2010, 12:34 PM Agree 0
    ...can make a much larger difference than a small shave in rates. A Buyer who has a good Realtor help locate suitable properties and negotiate price can end up with a much smaller absolute dollar debt amount to service for the next 25 years of his/her working life. There is no use bidding down rates to unsustainable levels such that some lenders go belly up, giving us "orphan" loan problems.
  • Den | 22 Jul 2010, 03:44 PM Agree 0
    It's not wise at all to say "the lowest mortgage rate in Canada" I just find 3.79% by similar on-line "nobodyknows" company. I propased this article to be removed. Anyone knows whom to write a complain?
  • mookie | 23 Jul 2010, 05:49 PM Agree 0
    Very irresponsible on cmp's part here for a number of reasons.

    1. don't say they offer the lowest rate unless you are sure of it, please do the research before publishing it. I can offer 3.75% for a 5 yr fixed with no fee.

    2. the article implies that canequity is offering the lowest rate in the country, yet doesn't quote an exact rate. The admin fee is also unknown.

    I AM NOT AGAINST BROKERS PUBLISHING THEIR RATES OR SPECIALS, BUT DO IT HONESTLY AND DON'T CHARGE THE CLIENTS A FEE, BECAUSE THEN THEIR EFFECTIVE RATE GOES UP AND NOW YOUR ADVERTISING A FALSE RATE.

    PLEASE GET THE FACTS FIRST !!! WHAT IF THEIR FEE IS 1% OF THE MORTGAGE AMOUNT !!

    PLEASE CMP, GET YOUR ACT TOGETHER, AND DON'T SAY THAT YOU ARE NOT A CONSUMER WEBSITE. CONSUMERS DO HAVE ACCESS TO YOUR WEBSITE. IF YOU WANT TO RUN A WEBSITE WITH NO CONSUMER ACCESS, THEN REQUIRE BROKERS TO LOGIN FIRST.
  • John | 23 Jul 2010, 07:56 PM Agree 0
    I don't quite grasp the complaint about CMP carrying this article? They are reporting what CanEquity is spewing, right or wrong. This is an open forum and I think the comments made here will show any semi-savvy consumer to be very wary of CanEquity. I certainly have some strong ammunition from this article to steer my clients away.

    Note of interest that CMP has not deleted one derog including comments about this publication. Keep up the good work
  • JP | 24 Jul 2010, 01:12 PM Agree 0
    If Ron thinks lowest rate is the only way forward, I'll sit back and keep enjoying all the RBC, PC and FLM refugees that I take care of!! Intelligent consumers want intelligent mortgage advice.
  • Glenn | 27 Jul 2010, 02:41 AM Agree 0
    Just because this brokerage decides they want to commoditize mortgages doesn't mean the rest of the industry needs to. Sure, the website is non-compliant, and they are marketing rates they should not, and they are being deceptive (and in violation of the MBLAA in Ontario) by not clearly indicating the "administration fee." So what? The regulators will catch up with them eventually...Ask any Insurance Broker - you ignore FSCO at your peril...

    I agree with Greg in that we are a service-based industry. But I also agree with Ron that there are some people who will commoditize mortgages, just as travel and investments have been commoditized by online providers, and by "discount houses." I think the future of the Mortgage Broker is parallel to the Investment house. If clients want to negotiate their own rate, or think they know enough about mortgages and understand all the ins-and-outs, prepayment privileges, penalties, etc. then let them do so with self-serve applications.

    Personally, I see real value in the services we provide as Borrowing Advisors or Debt Advisors, akin to Investment Advisors. I use a travel agent. I use an Investment Advisor. I use an Insurance Professional. I don't begrudge them any additional costs I may have by using them, because I value their advice. We need to think of Mortgage Brokering in the same light.

    The CanEquity site makes me laugh when they speak of "educating the consumer" about brokers, because all they are really doing is educating them about the lowest rate. Here I agree with Greg. Mortgages are becoming more and more complicated, and we have a tremendous opportunity to transform our industry from sales-focused to advice-focused, getting clients OUT of consumer and rotating debt, and teaching them about the benefits of mortgage debt if used properly.

    Stick to your guns, educate your clients, ask for referrals, dazzle them with service. That's how we'll keep increasing market share, and chipping away at the banks. If we raise the bar for our own behaviour, the clients will follow.
  • Gary | 28 Jul 2010, 06:24 AM Agree 0
    It sounds like many brokers feel like they can only provide great service if they aren't offering the best rates available. I have seen many brokers who have commented here, offer less than the best rates they could offer so they can buy down the rates when they need to to save a client that wants the best rate and nothing else.
  • Gary | 28 Jul 2010, 06:32 AM Agree 0
    If a client qualifies for the best rate or close to it, an ethical broker should offer it whether or not they can bank any points with their lender to buy down rates later or lease a vehicle or get other personal perks. Personally I don't think the mortgage business is very complicated though many clients need some education and I can provide that very well while still offering "best rates". My goal is to "dazzle them with service and rates" if I can, and then watch the referrals come in.
  • Joe | 02 Sep 2010, 01:04 AM Agree 0
    This is their "sales pitch" on the first call - I can get you 3.18...then comes the higher rates once they start processing your application.
  • Consumer POV | 14 Sep 2010, 05:09 AM Agree 0
    So, from a dumb consumer point of view, seeing comments like "poor choices, options, service, educate your clients, ask for referrals" leave me a bit baffled. Can someone mention a specific case where a product option would be better for the consumer than a lower rate? And, really, what is service? Most brokers and banks I've dealt with sign you up, then disappear. What should I be expecting?
Post a reply