Bryan Jaskolka has always had entrepreneurship coursing through his veins. While in high school, he and a friend started Nevidia Internet Solutions, which grew so successful that, after university, the two were able to sell the company.
“We built it into a large business by university, so we turned around and sold it,” Jaskolka says. “When I did that, I learned a lot about technology, websites and business development. So I moved into a similar role in my next job – marketing, direction, all matters technology.”
By this time – the early 2000s – the internet was part of the fabric of everyday life, but it didn’t take much sleuthing for Jaskolka to realize that the Canadian mortgage industry was woefully behind the times. While he had no previous experience working with mortgages, he recognized an opportunity.
“It seemed to me that, at the time, the mortgage industry was quite backwards technologically,” he says. “People barely had websites when I got into the business, which is crazy considering that it was only 10 to 15 years ago. The question then became: How do we bring mortgages to the 21st century with websites, online applications, digital files and other things that are commonplace today but at the time were groundbreaking? I started as a traditional mortgage agent trying to help borrowers in the subprime space, and I managed to build a lot of experience off the bat. Fortunately, I also saw how I could do what everyone else was doing, but make it more efficient not just for us, but for our borrowers, too.”
In 2005, Jaskolka co-founded Canadian Mortgages Inc. with his father, and for the first five years of the company’s existence, he worked as an agent and had a hand in more than 1,000 mortgage transactions in multiple jurisdictions. During this period, Jaskolka had started investing his money in mortgages and quickly realized that the yields on private mortgages were extraordinary. As a result, in 2012, Canadian Lending Inc. was born.
“I had some money left over from the financial crisis, and we bought a few private mortgages with it and got some experience,” Jaskolka says. “As we did that, I felt that it would be a good direction forward for the business. To some extent, from that time forward, we began a pivot to focus exclusively on the private sector, where we deal with borrowers and service the mortgage broker community. Over 95% of our business comes from mortgage brokers. We’re a direct lender to the mortgage wholesale community, like Home Trust, for example, but just in the private space. We work with all networks, large and small brokerages.”
The private channel is a hodgepodge of lenders with an equally vast array of standards, something Jaskolka acknowledges can be worrisome.
“Honesty and integrity, not to be cliché, are things that certainly were, and to some degree still are, lacking in the private mortgage space, generally speaking,” he says. “Our philosophy is, just because you borrow from a private lender, it doesn’t mean you shouldn’t get the same service as you would from a bank. You pay a certain risk premium based on your situation, but we always try to do right by our investors, brokers and borrowers. If we’re ethical and people start using us more, we’ll start attracting even more clients. That’s always been our philosophy, and it’s been our secret for success. People like working with us because they know we treat their clients with care from start to finish.”
The role of regulation
Regulators have had their sights set on the mortgage industry for years now, and it seems naïve at best to believe more regulatory changes aren’t coming down the pipeline. While the industry is largely resistant to change, Jaskolka believes that anything that protects its integrity can only be a good thing – and that’s especially true with respect to the private channel.
“I think the regulators who are involved in within the mortgage space are looking more closely at private mortgages, as they should be,” he says. “There have been a lot of private mortgages done over many years that don’t come remotely close to following the regulatory guidelines that exist out there. As an operator, one of the scariest things is when I talk to an investor and they say they’ve never seen an investor/lender disclosure or some form of due diligence and paperwork for the mortgages that they’re buying. We’re all in favour of regulatory action, and we think it should be applied to the people who are not doing things correctly, especially.”
If new regulations intended for the private channel come to fruition, Jaskolka isn’t worried because his company’s existing protocols are already quite stringent.
“I have no doubt that a lot of people are very concerned, but it doesn’t concern us that much because we’re not one of those private lenders that takes an appraisal and lends you at 90% value with no questions asked,” he says. “We do our due diligence and don’t just buy random mortgages that are thrown our way. We aren’t far off from the regulatory requirements that I’ve seen.”
As the government has taken steps to tighten lending guidelines at traditional financial institutions, mortgage originations in the private channel have exploded. But despite the myriad lenders in the space, Jaskolka knows CMI will stand out.
“For a smaller segment of the mortgage industry,” he says, “there’s larger share of market share distribution [among private lenders], and we believe our model and our approach will continue allowing us to gain more market share.”