Mortgage brokers are now voicing relatively favourable critiques of CIBC’s offer to buy their FirstLine BasisPOINTS, with at least one veteran going so far as to call it “a pretty good deal.”
“Anyone who doesn’t take advantage of this deal is crazy,” said Ron Butler, a broker with Verico Butler Mortgage told MortgageBrokerNews.ca Monday, reacting to “Full and Final Release” sent out to brokers last week.
On Friday, CIBC shared that formal settlement offer with FirstLine brokers, offering them “$0.05” for every BasisPOINT or, alternatively, two Aeroplan Mile points for each. The move comes on was made as CIBC winds down operations of FirstLine Mortgages.
“Thank you for your support of FirstLine Mortgages,” reads the Termination of FirstLine Mortgages Broker Agreement and Related Matters. “As we recently announced, FirstLine Mortgages, a division of CIBC Mortgages Inc. (“FLM”), will no longer accept any new mortgage applications as of the close of business on July 31, 2012. As we work towards this date, there are a number of actions you may need to take, which are detailed in this letter.”
“Any POINTS held by you at the close of business on December 1, 2012 will be cancelled and you will not be able redeem these POINTS in accordance with the terms of the Agreement,” reads the correspondence.
Some brokers are not happy that the exchange rate for BasisPOINTS was brought down from its original 8 cents/point to the current 5 cents/point now on the table, said Butler, himself long-time partner with FirstLine.
But he said brokers should remember that the program was primarily conceived as a “marketing tool for FirstLine” and that “the bank didn’t have to give a penny.”
Still, it’s hared to tell what percentage of brokers might chose to cash in their points and what percentage might prefer the Aeroplan Miles, said Butler.
“I think though that there would be some tax advantages to getting Aeroplan Miles because cash would become part of a broker’s income,” he added.