A slowing market and the challenges of chasing leads will undoubtedly send a growing number of former mortgage specialists back to the banks and out of the broker industry, wagers one Vancouver broker – himself a former CIBC veteran.
“I have no problem with former specialists moving into the broker channel – I made the move myself three and a half years ago after 13 years with CIBC,” said Jeff Trounsell, a sub-broker with Centum Pacific Mortgages in Vancouver. “But I would say that of those entering the market now as many as 50 per cent of them will have gone back to the banks or moved onto something else within a year. That’s different from the 60 per cent of my former colleagues at the banks who’ve come over to the broker channel in the last three years and are still at it.”
The comments echo those of at least two other mortgage specialists-turned-brokers who’ve monitored the progress of the hundreds of others in the same shoes. They're now grappling with the challenges of tracking down their own leads and closing deals without the backing of a big bank name.
Those challenges have been particularly difficult on B.C.'s Lower Mainland given the level of competition between brokers, banks and credit unions but also the growing number of mortgage professionals all vying for the same dwindling number of deals. At the same time, Banks have upped their courtship of brokers in an effort to beef up their road rep numbers and better compete with the channel.
It means that former mortgage specialists in Vancouver are more likely to beat a retreat to the banks, says industry analysts, adding to the growing number of mortgage specialists who have already moved to go part-time.
Outside other their objections to that last group, brokers have increasingly welcomed the decision of mortgage specialists and others looking to transfer out of the business, suggests a recent survey.
While 33 per cent of brokers canvassed for the last CAAMP-Maritz survey characterized the number of mortgage professionals in Canada as “just right,” a whopping 61 per cent said “there are too many brokers” across the country. Only 7 per cent argued that “there are not enough.”
In January, FSCO revealed that as much as 10 per cent to 15 per cent of the province's 9,000-plus licensed agents are no longer working at a brokerage and, therefore, unauthorized to sell mortgages.
Those mortgage professionals have likely abandoned the business in the more than 21 months since the 2010 renewal period or have taken up administrative or management positions within the industry, IMBA Executive Director Joe Rosati told MortgageBrokerNews.ca.