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How is specialized lending meeting the challenges of 2023?

The mortgage market has changed profoundly over the past 12 months – but how are specialized lending solutions helping borrowers in challenging times? Two of the space’s top executives give us their takes

Grant Armstrong

Community Trust

Industry experts

Leanne Conroy

MCAN Home

Grant Armstrong has been working in the mortgage industry for over 20 years, driven by a passion for delivering excellence to both clients and partners. While at RBC, he specialized in finding solutions for non-traditional lending clients, partnering with some of Canada’s top alternative lenders. Grant then moved to CIBC and led the mortgage options group to record-setting sales results by focusing on training and development. In 2020, Grant joined Community Trust to lead the national sales and lending team and its expansion across Canada, supporting brokers in the alternative lending space with a focus on technology, innovation, and organizational development.

Community trust

Grant Armstrong

Leanne Conroy is a celebrated leader and expert in the alternative lending sector, having garnered numerous awards for her work. She has dedicated 14 years to the mortgage industry, with eight of those years focused on alternative lending. Leanne is a sought-after source for market trend analysis, training, and education within the industry. Leanne is an ardent advocate for women in the mortgage industry, actively working to promote gender diversity and empowerment. Her efforts to create an inclusive environment extend to her personal life, where she champions a balanced approach to work, life, and well-being.

MCAN Home

Leanne Conroy,

“I think it’s going to be a great year for mortgage brokers. I think there’s more opportunities for brokers to help Canadians than there have ever been before”

Grant Armstrong, Community Trust

IN AN INCREASINGLY volatile and complex mortgage market, the role of brokers is becoming ever more important in helping borrowers navigate challenging and difficult times. That was a prevailing message from a recent CMPTV discussion on the specialized lending space and how it’s helping service the needs of Canadians in 2023, featuring two leading executives in the sector. Leanne Conroy, director of sales at MCAN Home, and Grant Armstrong, Community Trust’s director of originations, gave their thoughts on how lenders and brokers alike are adjusting to the shifting mortgage landscape – with Conroy highlighting the crucial part played by brokers. “The deals, specifically, are very complicated. And we as lenders … are trying to simplify those deals,” she said. “But I think the most critical thing in this environment is to push our homebuyers toward mortgage brokers. “They are the stewards who can kind of navigate Canadian homebuyers through this difficult and ever-changing environment. And that’s why it’s very important for Canadians to choose mortgage brokers.”

“[Brokers] are the stewards who can kind of navigate Canadian homebuyers through this difficult and ever-changing environment. And that’s why it’s very important for Canadians to choose mortgage brokers”

Leanne Conroy, MCAN Home

The simple mortgage applications of times gone by are increasingly a thing of the past, Armstrong said. With borrowers now submitting an often-sizeable number of documents, he paid tribute to the work of brokers who are asking all the right questions of those clients. “They’re calling their clients and they’re saying, ‘How do you make your money? How does your business operate?’” he said. “So the conversations that we’re having today with them [are], ‘What do you want to see as a lender? What information do you want to see in the application to make it simple, to make it easy, and to ultimately be able to fund that transaction?’”

“Things change, but they [also] stay the same, and we have to stay on top of it. We have to be agile, and hopefully we’ll be having this great conversation next year at this time,” she said. As for what brokers and agents should be keeping top of mind about a market that’s presenting its fair share of both challenges and opportunities for mortgage professionals, Armstrong said the best brokers working with Community Trust are changing their approach to include more notes to lenders – and not just at the underwriting stage. “Brokers have gotten very good at submitting a deal and putting notes as to why the deal should be approved,” he said. “But they’ve now taken it a step farther and started putting notes on the documentation – not only why the deal should be approved, but why these are the right docs. And in the alternative space, documents are everything.

One of the most significant changes in 2023 compared with previous years is that lenders are noticing an unsurprising shift away from homebuying and investment purchases to meeting the financial goals of the borrower, Armstrong said, whether through refinancing or restructuring. “You’ve got clients who financed their properties a year ago and they’re up for renewal. Now, what are they doing? They’re looking at interest rates that are two percent, three percent, four percent higher than they were last year,” he explained. “Some are taking advantage of some equity that’s grown, maybe they put a lot on a downpayment last year, so they’re going to pull a little bit out to help them. Some are just looking to restructure their debt load.”

“So my advice for brokers: Continuously share what is going on with this file with the lender, with the fulfilment specialist. Submit those great notes up-front as to why the file should be approved. Give us some notes, as well, as to why the documents you’re providing are the right documents, and you’ll see your files fly through a lot faster.” It’s also essential for brokers to liaise with BDMs and develop as comprehensive a knowledge of lenders as possible, Conroy said, particularly when it comes to understanding what type of collateral those lenders will or won’t deal with.

Many Canadian homeowners are having difficulty with their renewals because of higher rates, Conroy said, and submissions are becoming increasingly complicated – meaning a core focus at MCAN Home has been structuring deals to simplify them and find the best solution for clients, according to Conroy. “Having these guidelines that can help with extended ratios and a 35-year amortization can really help borrowers still maintain comfortable payments on their mortgages, which … with the rates jumping, and jumping, and jumping, can be very stressful for clients when they’re not really sure how they’re going to be able to afford their monthly payments,” she said.

Armstrong said Community Trust undertook a comprehensive revision of a number of its underwriting policies and procedures late in 2022, with its BDMs currently involved in the task of bringing brokers and agents up to speed with how it packages deals. Top of mind for MCAN, meanwhile, has been a collaborative approach to new projects, Conroy said, with the company on the cusp of launching an exciting new product and working closely with a new partner to launch a “pretty unique” homebuyer program.

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That goes both ways, with the best lenders also willing to help out their broker partners and point them in the right direction when a certain deal might not fit. “A good partner will let you know if they’re not interested in your collateral. They’ll try to work with you and let you know which lenders will, because we’re partners,” Conroy said.

Community Trust is a flexible alternative to larger, more traditional financial institutions. We have been working with our valued partners as a leader in the alternative lending space for many years. We are also leaders when it comes to service and technology, with a firm commitment to providing brokers with innovative solutions that make working with us even easier and faster, giving them all the support they need to succeed with their clients. Above all, we genuinely care about the partners we work with, their clients, and about helping Canadians become more financially successful and secure. This underlying motivation is what drives everything we do.

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MCAN Home is proudly owned by MCAN Financial Group, a leading Canadian real estate investor since 1992, with a reputation for financial stability and strong performance. MCAN Home is a national lender providing a full suite of mortgage solutions to Canadians through an accredited network of mortgage professionals. We put people first. That means building an award-winning culture that celebrates diversity and the experience of individuals – our team members, our partners, and our clients. Their stories drive our growth and innovation.