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Mortgage Broker News | 19 Dec 2014, 12:06 PM Agree 0
Alternative lenders’ market share has grown to record levels in 2014, according to new data from one major bank.
  • Jeff | 19 Dec 2014, 01:21 PM Agree 0
    The harder you make it to get an "A" mortgage, the more "B" mortgages are going to borrowed. A lot of this pertains to higher credit requirements. A few late payments on credit cards does not mean that a client will not pay his/her mortgage. I have been getting declines recently on clients that have never missed a mortgage payment in their lives, just because their beacon score is a bit too low or they missed a couple of credit card payments a couple of years ago. As far as refinances are concerned, the Ministry of Finance needs to base rules on specific markets rather than nationally. Having the same rules for an economically depressed area as an economically stable area, such as the City of Ottawa, does not make sense.
  • Ross Taylor | 19 Dec 2014, 01:59 PM Agree 0
    Bad credit deserves to be in the Alt A space. Thank goodness these lenders are stepping up to fill the ridiculous void left by some A lenders increasingly scared of their own shadows
  • Corey K | 20 Dec 2014, 12:43 PM Agree 0
    Easy there...define bad credit first! I couldn't agree more with Jeff...even more to the point, the Mortgage Specialists of major banks themselves are attempting to push their existing mortgage clients into a sub-prime mortgage over the most ridiculous infractions that resulted in lower beacon scores. The bank shall remain nameless of course BUT the clients beacon score dropped to 648 and the Mortgage Specialist went on to explain that they would now have to go to their "alternative partner" whereby they were quoted a 1% fee and a rate of 4.89%. Thank goodness the clients co-worker just finished a mortgage with me and I was then referred into the deal and Im very proud to report I had a major lender in our channel take the deal at 2.89% and didn't even blink at the 648 beacon score. Bad credit is a loosy goosy paint brush , bad things happen to good people , oversights on a credit card payment OR being just slightly over-limit on credit cards can bring the score down...bad credit?...NO!...they were there to consolidate all the debt to begin with and erase all those issues in one swoop! I got it done and saved the client close to $30,000 in interest charges and fees over the next 5yrs!
  • Ross Taylor | 20 Dec 2014, 01:13 PM Agree 0
    Hey Corey, I agree completely that 648 is perfectly adequate for an A lender deal. I work with bad credit clients every day in our other business (debt relief and credit specialists) And a good deal of our work is spent rebuilding credit and increasing scores and managing trade facility balances to optimize the score and prepare for a mortgage in the future.

    What I should have said is when the credit report is clearly bad (and as you say, it is not just the score - I have seen very healthy 630 scores and very ugly (or weak) 690 scores) - perhaps as a result of the client recovering from an insolvency event or a chronic disregard for payment due dates etc. In these cases, we need alternative and private lenders to keep these clients in the real estate market, while doing everything possible to help them earn their promotion to the A leagues.

    When our team places a second mortgage for a client, for example, we always have an exit strategy.
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