O’Leary tips his hand

O’Leary tips his hand

O’Leary tips his hand

TV personality Kevin O’Leary may be tipping his hand as to what exactly his new mortgage business will focus on.

 “The whole reason I am doing it is to get people locked in,” O’Leary said during a segment on CBC’s Lang & O’Leary Exchange focused on the pros and cons of renting versus owning a home.  That’s “precisely why I started O’Leary Mortgages is because we sell fixed rate mortgages, it won’t vary.”

O’Leary intrigued and worried some mortgage professionals earlier this month when he released a cryptic video announcing his plans to launch O’Leary Mortgages. It fails to detail whether he intends to become a lender or a brokerage head.  

His comments about offering fixed mortgages still leave that question unanswered at the same time they have attracted some broker objections. O'Leary Mortgages is set to launch late this month.

“This is a mission for me,” O’Leary said. “There will be thousands of people with variable mortgages that will be slaughtered…with fixed mortgages they’ll have five years of knowing what they’ll exactly pay.”

The strategy, however, doesn’t work every time, according to Steve Garganis, a broker for The Mortgage Centre, in Oakville, Ont., who wrote in his blog that over 80 per cent of his clients are either on or have been in variable rate mortgages.

Although Garganis would not recommend a variable rate mortgage for most new mortgages today because fixed rates are at near historical lows, he maintains that the case for persuading a client currently in a variable to move to fixed may be a difficult one to make.

 “This is where I am very concerned,” he writes. “We have a very well-known TV personality that comes out and says everyone should lock into a fixed-rate mortgage,” he wrote. “There is no one-size- fits-all mortgage; everyone is different and has different needs.”

 

6 Comments
  • David Larock 2012-11-14 5:17:29 AM
    I couldn't disagree more with Kevin O'Leary's opinion that borrowers with deeply discounted variable-rate mortgages will "get slaughtered" if they don't lock in right now, but the truth is that neither of us knows for sure.

    The difference between our approaches is that I readily acknowledge this fact and Kevin basically says that anyone who doesn’t do what he says is an idiot.

    In the advice business, strong, brash one-size-fits-all opinions have a way of catching up with you.

    Let's file that one away and check back in a few years to see if those who followed Kevin’s ‘gospel truth’ ended up being happy with his advice ... and best of luck with your new venture Kevin ...
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  • Jerry 2012-11-14 6:52:43 AM
    Kevin O'Leary also said that Obama was a one term president and would never win again. I don't put to much faith in his predictions or projections. He got rich off a kids learning company bought by Mattel in the 90's and it was the worst purchase of the companies history. His O'leary fund is also down. http://www.theglobeandmail.com/report-on-business/rob-magazine/kevin-oleary-hes-not-a-billionaire-he-just-plays-one-on-tv/article4564334/?page=all
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  • Nick Hamblin Ideal/MI 2012-11-14 7:11:00 AM
    More Bluster from Kevin but shows how little he really understands about the mortgage market , one word - convertible
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