People, processes and technology are shaping the mortgage industry in ways that would have been considered impossible a decade ago, and one of the people leading the charge is Ed Karthaus.
As executive vice-president of sales and marketing at Home Trust, Karthaus brings tech experience that few in the mortgage industry can rival. A natural on the ice rink, Karthaus attended university in the US on a hockey scholarship; after receiving a business degree, he knew that a career in the technology sector awaited. Over the next 20 years, he carved out a niche for himself as someone who not only understood the tech industry, but also had a natural ability in sales and marketing.
“My career has always been purpose-built,” Karthaus says. “I’ve had a chance to work with some of the best technology companies, including Xerox, Oracle and NCR Teradata, among others.” He has also served as a consultant, which allowed him to hone his craft with clients across a range of tech, financial services and venture-stage companies.
Bringing tech to mortgages
While Karthaus’ career disciplines stretched throughout the tech world, he primarily focused on financial services. His experience eventually led him to Filogix, where he served as executive vice president of sales and marketing services, responsible for selling and implementing new technology standards for originating and underwriting mortgages.
“My time was all about using technology to solve business problems and create new business opportunities,” Karthaus says. “The mortgage industry was perfect because I was part of a great company creating a new technical standard in the industry on both the originating and underwriting sides. My understanding of an end-user perspective, as well as an information technology perspective, served me well.”
In his role, Karthaus dealt with more than 100 different lenders and thousands of mortgage brokers country-wide, and he learned quickly.
“I had to understand how mortgage lenders and brokers operated,” he says, “and I got a chance to see and work with many lenders from coast to coast, ranging from Schedule I banks to private lenders and everything in between, so having that hands-on field experience was invaluable in my career development.”
Over time, his role at Filogix expanded to include customer and professional services. The company continued to grow and subsequently was sold to D+H. When Yousry Bissada, with whom Karthaus worked at Filogix, joined Home Trust in August 2017 as president and CEO, he tapped Karthaus once again to serve as EVP of sales and marketing for the lender, where he heads up mortgage sales, credit cards and marketing. Earlier this year, he was given the added responsibility of overseeing Home Trust’s Visa business.
While Karthaus focuses on changing the mortgage digital landscape, the company itself plays a pivotal role in the Canadian mortgage industry, particularly in the alternative space, for borrowers who are self-employed, new to the country or have bruised credit.
“We have great people, people passionate about our great industry, and I’m thankful to be part of a great organization with a tremendous future,” Karthaus says.
Moving with the times
Many in the mortgage industry might also recognize Karthaus as the prolific speaker on the transformation taking place in the borrower market as millennials’ preferences transform the way mortgage brokers conduct business.
“The mortgage marketplace is undergoing a change whereby baby boomers are being replaced by millennials as the majority of mortgage borrowers in the country,” Karthaus says. “The way in which you communicate with a baby boomer is different than how you communicate with a millennial. For example, boomer borrowers grew up with more face-to-face and direct contact, whereas millennials are more digitally inclined, so you’re using a lot more technology than you ever have – that means social media, web, email, text, video and obviously much more. Mortgage brokers need to adapt to that changing demographic and the evolving technology.”
Karthaus tours Canada, giving brokers tips on how to leverage technology to better communicate with customers and prospects. He recently spoke at the Mortgage Professionals Canada symposium to further elucidate how the broker channel can latch onto the coattails of the digital revolution within the industry.
“We’re going to see a lot of innovation in the mortgage industry through the use of digital technology,” he says, “and that’s everything from expanded use of chatbots to transaction monitoring and real-time adjudication.”
Canada’s mortgage industry hasn’t adopted technology at the same rate that technology has evolved, but Karthaus doesn’t despair because he knows that younger millennials are just entering the stage where they’re starting to contemplate homeownership. The change will gather more momentum as Generation Z follows suit.
“The technology itself won’t be the competitive advantage; the application of technology will be,” he says. “You could have a CRM, but if you don’t use it effectively, it’s no competitive advantage. The way brokers apply technology will differentiate them from other brokers.”
Karthaus has nothing but optimism for the broker channel going forward. He doesn’t believe for a minute that mortgage brokers will become obsolete.
“There will always be a role for mortgage brokers in the industry because the one thing technology cannot do is apply real-life experience and that level of expertise to a mortgage borrower’s situation,” he says. “The young couple who comes to a mortgage broker and wants a mortgage hasn’t thought about a lot of the curveballs life will throw them that a broker can prepare them for. Brokers help set them up for success.”