Networks buffer brokers from regulators

Networks buffer brokers from regulators

Networks buffer brokers from regulators

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.”

3 Comments
  • David Larock 2018-10-23 10:14:31 AM
    I don't think a voice is valuable just because it is loud.

    For example, if that loud voice shouts that each new round of mortgage rule changes is unnecessary and will destroy our housing markets while ignoring the obvious risks of unchecked household debt accumulation, it hurts our credibility as industry stakeholders.

    It also drowns out quieter, more measured voices which offer targeted and specific feedback that might otherwise lead to meaningful policy changes.

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  • John Bargis 2018-10-23 8:01:26 PM
    As I read through this article, I can't help but to feel as though I was being pitched by a politician who's only defense is to fear monger, hoping to cast doubt in the minds of the masses by claiming to have access to facts and data that's simply unavailable to the networks or substantiated.

    Seriously? Does anyone of sound mind really believe that "Networks buffer brokers from regulators" - This is nothing short of one of the most absurd statements I've ever heard in my 28 years in the business. Where exactly are all the great successes of the protective networks? Are the regulators really such villains who's mandate is to shut our industry down, or are they just perhaps lacking in sound knowledge about third party originations that the associations, lenders and industry partners are all assisting with by providing appropriate data they can work with. I personally sit on a committee that has met with the regulators several times, and I can unequivocally confirm that they're interest is in the industry as a whole that serves the consumer well with no agenda.

    This article is a feeble attempt to mislead the industry on the realities independence, and isn't even worthy of a response to the rest of the inaccuracies reported. I'm living proof of these realities as an independent who's team has access to every lender at top comp, and all without having to pay a cent to a network.
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  • Gary Mauris 2018-10-28 3:30:14 PM
    Quick note- our conversation was taken out of context. My info article was sent to CMP as an email, So should not have been misconstrued.

    I made no mention of the regulators trampling independants. We work hard to work within the regulatory framework and wholly support any regulatory mandates as they protect the consumer and therefore our industry.

    We have worked with this journalist many times before and he is outstanding and usually always accurate. Unfortunately this article contained a couple comments that were not provided by me.

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