Sources are telling MortgageBrokerNews.ca more about Kevin O’leary’s foray into the industry, suggesting he'll brand a white-label product offered by a leading mortgage servicing company then use his name and an advertising campaign to generate leads -- leads meant to bypass brokers.
An official announcement is expected to come at CAAMP’s Mortgage Forum in Vancouver next week, said a source with inside knowledge of the deal, pointing to O’Leary’s scheduled address, which itself has raised eyebrows given his mortgage business may compete with brokers.
An associate of O'Leary now tells MortgageBrokerNews.ca that the announcement won't come at the event, and before hundreds of brokers, many of hostile to the venture.
Still, sources, speaking on condition of anonymity, are fleshing out more details about the Dragon's business model, which will see him front a series of commercials, appearances and press releases meant to capitalize on his notoriety.
"The ads will feature him, most certainly, and there will be a 1-800 number, I understand, that connects the leads," one source told MortgageBrokerNews.ca. "Brokers won't be involved and I understand that the fixed mortgages being offered will be serviced and (processed) through that company, which normally relies on brokers to generate business."
Sources are suggesting the rates attached to the white label will compete with buydown rates already in the marketplace. The venture capitalist will reportedly take a lower cut to facilitate the reduction.
Another source, within the mortgage servicing company, told MortgageBrokerNews.ca that the proposed deal remains in negotiations. Still, some brokers are scratching their heads as to why O'Leary will address the CAAMP conference if brokers aren't directly involved in the venture.