Are sleazy brokers cheapening the industry?
Brokers say inexperienced agents – including those who sat dormant until real estate sales picked up this summer -- are flooding the market to make a quick buck.
“Quality of agents in the industry and the quality of mortgage brokerage operators (is my biggest concern right now),” Paul Mangion, principal broker and partner at the Mortgage Centre M.O.S. MortgageOne Solutions Ltd., told MortgageBrokerNews.ca. “We look more like used car salesmen today than ten years ago. People join because they think it’s easy and quick money; they don’t treat it as a career.”
These fly-by-night brokers can have a detrimental impact on the reputation of their more scrupulous and experienced peers – and it’s a lot easier to damage a reputation than to maintain one.
“They last long enough to do damage and then they move one,” Mangion said. “When (brokers) do a good job, customers tell one person, if you do a bad job, they tell 10.”
Some industry leaders have inherited clients from these brokers… and the headaches that come with them as well.
“When these clients come to me, it complicates matters and they are flagged by CMHC because their prior documentation wasn’t properly taken,” Jeff Mayer told MBN. “I’ll give an example: We got a red flag (which requires all documentation up front) and that was only because another broker gave them the wrong phone number. Why would you flag something just for having the wrong phone number?”
And this lack of thoroughness may be due to an lack of caring and ignorance.
“There are too many guys out there with no clue on what’s going on in the market; they’re blasting all these deals and they’re getting the information wrong,” Mayer said. “Most new agents don’t give full information or documentation. All they care about what they make and where they work.”
As for a solution, perhaps it can only come from a regulatory standpoint.
“There should be minimum requirements to hold their licensees and you should be active to hold it,” Mangion believes.