While there’s debate in the mortgage industry over whether or not consolidation is beneficial for the broker channel, Dominion Lending Centres weighed in with an incontrovertible fact.
“Our agents’ average income is $90,000 per year, while the industry average is between $38,000 and $42, 000,”said DLC President Gary Mauris. “You do the math and determine if the tools DLC provides are valuable.”
Peter Puzzo, a DLC broker, says that being under a respected national banner helps with both lenders and customers.
“Though the majority of my business is referral-based, I find that the DLC logo on my business card gives me added credibility,” he said. “I also believe that our lender partners view DLC as an industry leader with a reputation of having experienced brokers who are forging strong relationships with their clients. It goes without saying that a national brand allows head office to pool our volumes and put forth compensation packages that otherwise might not be available.”
However, being part of a massive network isn’t for everyone, and Mauris says the independent channel is a valuable component of the industry. Sometimes, the two can be married.
“We offer the best of both worlds,” said Mauris. “If you want to leverage our brand, then great; if you want to truly be an indie brand and retain your independence, we allow you to be an entrepreneur and do that while still using our tools and scale.”
According to Albert Collu, president of VERICO, it’s in achieving critical mass that networks provide value to mortgage brokers because that impels innovation, whether through technology or marketing.
“When companies amalgamate and become larger, it allows companies to reinvest in support structures, which may manifest in technology and services and attract new partners and affiliates to the table so that you can deploy new products,” said Collu. “For instance, insurance, credit cards, direct-to-consumer campaigns to feed leads to a broker, white label mortgages and white label products in general. That’s what the aftermath of amalgamation allows us all to do. The broker enjoys some of that strength as well.”
Networks also play a major role in standing up to overzealous regulators and forcing them to consider the industry’s concerns. While regulators do not always listen, not having a buffer like a multi-billion dollar network lobbying on the broker channel’s behalf isn’t palatable for the average mortgage professional. Mauris suspects that regulators would simply trample independents.
“Networks are also a loud industry voice heard by government and regulators,” he said. “Unfortunately, that is much more difficult for independents.”