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Mortgage Broker News | 31 Aug 2011, 09:30 AM Agree 0
Brokers – specifically, a bigger piece of their action – helped cushion the blow for Scotiabank in its third quarter even as its overall market share fell – a validation, say brokers, of their value proposition.
  • Kevin Power, President Power Mortgages Inc | 01 Sep 2011, 04:46 AM Agree 0
    It is great to hear that we are contributing to our lenders successes. All lenders have their short comings. The biggest concern that I have with Scotia is their STEP Product, far too many customers and mortgage agents do not understand the impact that that product has on their own book of business and the "Customer Retention Stronghold" that this product gives the bank on the equity in the home and borrowers not easily being able to move away on maturity. Collateral Charge Term mortgage documents are registered for 100% of the value of the property, which ties o]up all of the equity and these documents are not acceptable for switch transfer on maturity. We today's 85% max LTV on refinances makes it almost impossible for clients to leave.
  • Max J. Cafissi | 01 Sep 2011, 04:46 AM Agree 0
    I am surprised by Scotia Bank's success through the Broker channel. Personally, neither myself nor any of my Agents have sent a deal to Scotia for over 2 years. Scotia was the first Lender to introduce the Collateral Mortgage and Split Level Mortgage, both products that are designed to limit the clients' ability to "switch" their Mortgage at maturity. They were also the first Lender to require the clients to attend at the Branch for signing of documents which I feel is another ploy used by Branch Staff to discredit the Broker. we in the Broker Community are now complaining about how Lenders are thrying to cut us out of the equation. well, I say that we are to blame for this because we have been guided by greed, not by doing what is best for the client. My suggestion would be to deal only with Lenders that allow the Broker to complete and submit all documentation, and that don't require the security to be registered as a Collateral Mortgage.
  • @kiltedbroker | 01 Sep 2011, 07:10 AM Agree 0
    I agree with you Max. I think that it is a failure of the broker channel to use Scotia. I had a Scotia rep in my office tell me that the initial mortgage origination alone is not worth Scotia being involved within the broker channel and that the only reason they lend is because they have the opportunity to cross-sell the client and retain them long term. With branch signings, this is pretty much common knowledge.

    The bank is our direct competition, I don't understand sending clients there at all. How much stronger could our mono-line lenders be if we redirected all the broker business currently heading to Scotia (and TD for that matter) to them?

    When was the last time Scotiabank sent you a referral? Complete failure if you ask me.
  • Ontario Broker | 01 Sep 2011, 07:42 AM Agree 0
    You both are concerned about the STEP or Split level mortgage but neither of you mention TD Canada Trust's wholesale effort to cut out the Mortgage Broker's retention efforts all together with the across the board 125% of value collateral mortgage. I have always found that the Step mortgage is usually the best product for the type of client that needs it and isn't that our mandate get the client what they want.
  • Matt | 01 Sep 2011, 04:58 PM Agree 0
    It's ironic. If Scotia weren't so draconian and impossible to underwrite with they could blow their quota's out of the water. I've tried and tried to work with them but even A business is tough if it doesn't fit their rules. And believe me they have a lot of them. I'm all for backing the mono lines. Scotia haven't done me a single favour ever.
  • DanP | 01 Sep 2011, 10:11 PM Agree 0
    Knowing what we know about the Banks' position regarding Brokers, why then do Brokers continue to send clients their way? Whatever their motive, could it be the Banks have made it easier to deal with them in Brokers' efforts to get their deals approved? If so, what does that tell you about the mono-lenders approval process? Is there a message the mono-lenders, who are supposed to be Brokers' right-hand, should take away from this whole situation? Food for thought!
  • Kevin Power, President Power Mortgages Inc | 02 Sep 2011, 06:01 AM Agree 0
    Further to my original message, I did not want to get into too much detail and sound like I was beating up on Scotiabank, but I have never done a STEP Product with them and haven't sent a client in five years. I stopped doing sending deals to TD a few years ago when they presented their new contract for signing. It was an extremely one sided agreement in favour of TD and not in our best interest to sign. Their utilization of Collateral Charge documents almost a year ago was just a further reiteration that I had made a good decision to not sign their broker agreement.
  • Ron Butler | 02 Sep 2011, 08:25 AM Agree 0
    WE do alot of business wiht Scotia and the branches have sent us 14 turndown referrals this year with 3 deals done.

    They are very stong marketers to the clients we bring them and they try very hard to retain their business.

    It's a battle but monolines want to retain business as well.

    Collateral Charges are here to stay, unless the government puts an end to it. Eventually monolines will do the same.

    Everything you ever needed to know in life you can learn from the Godfather movies: keep your friends close and your enemies closer.
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