Competing online may become a fact of life for B lenders

Competing online may become a fact of life for B lenders

Competing online may become a fact of life for B lenders
It’s a match-making service that may soon become a fact of life for B lenders, and as reported in CMP this spring, it’s  making rapid progress in that direction.
As CMP highlighted in its May issue, the submission process for brokers can take as little as two minutes, with the mortgage professional completing an application on the site and sending it off to as many lenders for whom the deal fits within their guidelines. Brokers can also opt to send the deal to just one player for consideration.
“We have 31 lenders signed up from B.C., 15 from Alberta and 11 from Ontario,” says Al Kelly, the founder of Strategic Matches. “We definitely should have more people on the website from Ontario, but the registration of lenders in that province is different from Alberta and B.C. Some are listed on FSCO, but a lot are not. The challenge for me has been chasing these non-conventional lenders down and making sure they are substantial enough to be included on the website.”
Each application form is configured to supply relevant information to a lender, so that it can be quickly and accurately assessed for any potential loan.
The only cost to brokers is an assessment fee upon a successful referral. It is free for lenders to participate on the website.
But for the moment, the only real obstacle Kelly is facing is getting the word out about Strategic Matches.
“We’re still in the rollout phase, and media exposure is big for me,” says Kelly. “It is good to get articles like the one in CMP magazine, and to be on MortgageBrokerNews. It helps a ton.”
Kelly explains that it may be difficult to explain the concept to people, but once they see it in action, “the light bulb goes on.”
And for a consumer culture that is turning to the Internet more and more for its search for goods and services, the idea of Strategic Matches makes as much sense as the services offered by, or
“Shopping on the Internet is common, and consumers are using it more and more,” says Kelly. “Mortgage financing is a commodity like anything else. I’ve been two-and-a-half years working on this – we’re not going away.”
  • Ron Butler 2013-07-18 7:08:47 AM
    "Mortgage financing is a commodity" well, that's interesting. I think A mortgage rates are being commoditized but I actually believe the B mortgage lending process is not a commodity. I think we as mortgage brokers need to know if there is a rehabilitation strategy or an exit plan in place for the client. We need to know how the MIC or private lender will handle renewals. We need to understand if the MIC or private lender is likely to require repayment on maturity. So I think the B financing process is not a commodity.

    That being said I think online marketplaces are real and growing and will dominate more as the years go on.

    So I salute Mr. Kelly and hope that his site develops into the thing all consumers want: a place that drives costs down and increases competition to the consumer's benefit.
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  • Paolo Di Petta | 2013-07-18 9:42:34 AM
    I agree with Ron, the private market is a very different space, ESPECIALLY with non-institutional private lenders (vs. Institutional Privates/MIC's). Almost always, there's an exit strategy that should be determined, and that requires someone with an in-depth understanding of the private market.

    More importantly, terms vary greatly from lender to lender. This isn't the mainstream (commoditized) market - private lenders generally don't get caught up in competition - they offer a deal and with the exception of a few minor points, it's "take it or leave it". All of them have their own risk tolerances and lending preferences, and they have that luxury because they don't sell the commodified "one-size-fits-many" product that the banks offer.

    And that's all right. Most of the time, these are temporary solutions.
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  • Robert Gascon 2013-07-19 5:30:11 AM
    My business model is very different, in the private lender space. It provides a platform for private lenders to manage their portfolios. Moving from the kitchen table to the new world. No more post dated cheques and reports. The private lender space has been ignored and it is time to give them to tools to succeed. Good Luck Mr . Kelly
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