What’s the odds on ‘MCC’ by 2014?

What’s the odds on ‘MCC’ by 2014?

What’s the odds on ‘MCC’ by 2014?
Amid congratulations for Dominion Lending Centres and president Gary Mauris comes speculation on just how long The Mortgage Centre will remain a distinctly separate entity.
“My question is, what will Mortgage Centre have as a unique selling proposition, both to brokers who are considering partnering with them and to consumers who are considering working with an MCC broker?” asks Doren Aldana, owner of the Mortgage Marketing Coach. “In other words, what is their unique reason for being?
“If MCC isn't able to come up with – and live out – a compelling answer to that question, its demise or replacement seems inevitable.”
That sentiment reflects that of several other industry players following last week’s acquisition announcement.
John Bargis, a broker with The Mortgage Edge in Richmond Hill, said he doesn’t see the logic behind DLC buying MCC, then allowing the brands to continue operating separately.
“I fail to understand the acquisition of MCC, especially with the intent of running two separate brands with different profit models,” says Bargis. “Nevertheless, I don't see how this news brings any value to the broker industry, which ultimately should be first and foremost on all of our minds with the challenges we all face going forward, big or small.”
Mauris told MortgageBrokerNews.ca last week that he would be keeping MCC intact, and that he was “working to keep the MCC head office team intact going forward,” promising to earn the respect of the MCC agents.
The DLC president added that MCC would continue to operate as an independent brand, and that the purchase would not affect the day-to-day operations of the company.
Bargis questions that vision will come off as planned.
“My personal opinion is that unless the veteran MCC franchise owners see value in the DLC brand and jump on board,” he says, “they will likely choose to go independent, which is technically what they are now anyway without the CIBC brand behind them.”
In fact, Bargis wonders if those already with DLC will now opt for the MCC model.
“What will be interesting to see is if existing DLC franchise owners choose to switch… should it actually be permitted to exist by DLC in the long run?” he says.
  • Look At All The Sour Grapes 2013-06-19 9:33:14 AM
    Wow. Once again the naysayers help Mortgage Broker News create a non-story to post online. Of course people are going to speculate on what will happen. The question is: Is it newsworthy?

    Let's remember that DLC is not a bank, they are a national franchisor of mortgage originators. Let's also not forget that Invis and Mortgage Intelligence went through a similar situation, and they have maintained two brands quite nicely thank you - something that clearly has slipped Mr. Aldana's and Mr. Bargis' memory/awareness.

    Why publish this drivel? According to the DLC folks I have spoken with, there are absolutely no plans to force integration, because Gary and his team (quite wisely) understand that not everyone wants the same model as DLC. This allows them to operate two separate business models and capture a larger share of the market, to the benefit of both companies (from a scale perspective). Quite a smart move, when you think about it.

    Besides, CIBC wasn't adding any value for the franchise fees MCC broker/owners were paying, and DLC to my understanding is working with these same broker/owners to determine what their priorities are in terms of additional support and tools they would like to see.

    It makes no business sense for DLC to buy MCC with the intent of integration, simply because they have already (most likely, based on the phone calls I have received in the past) tried to recruit most of those brokerages. Forcing conversion would simply see them leave and go somewhere else, or create a new brand, thereby negating the price DLC paid for the acquisition.

    Could DLC still integrate everyone into one brand? Maybe. But I don't think Gary and his team got to where they are by being stupid. I say we all sit back and see what happens, and let time be the judge.

    Besides, anything that makes our industry stronger is a good thing. Our real battle is with the banks, not each other. It's a shame most brokers haven't figured that out yet.
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  • Steve 2013-06-19 10:50:16 AM
    I 100% agree with John!

    Gary and DLC People can spin this in anyway they like but here are the Facts:

    DLC is 95-5% plus Monthly Advertising & 7 year commitment
    MCC is 98-2% No Advertising and only 5 year commitment.

    SO will Gary Run 2 separate brands for next 2-3 years? I highly doubt that! Because if I am a DLC franchise owner will request to move to MCC and get 98% Split and don't pay any advertising!

    If I am a MCC franchise why would I go down on my pay and get 95-5 plus pay monthly advertising payments?

    The Word on the Street was that DLC offering all MCC franchises signing bonuses to join his company. So if you were a $200 Million Franchise, you would get a $200,000 Signing bonus but you need to sign a 7 year deal, now those MCC franchises are free agents! they didn't get anything and CIBC got that money. If I am a MCC franchise why wouldn't I go to Verico, Mortgage Architects or Alliance and get a signing bonus anyway?

    I fully expect that there will be many changes coming to MCC and their business model but for now Gary and DLC is doing a good job calming these people up!
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  • John Bargis 2013-06-19 2:06:15 PM
    To the anonymous posting "Look At All The Sour Grapes," I say ignorance is bliss...In order to understand and appreciate my comments, you would have to have a clear understanding of the industry.
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