A change in plans

Boris Bozic wasn’t supposed to carve out a living in the mortgage industry. At least, that’s what he thought. With his sights set on becoming a real estate mogul, Bozic took a job as a mortgage broker solely to learn about the business with the intention to only stay for a short time.

“I’d always envisioned myself being a real estate mogul,” he says. “I figured anybody could sell me real estate, but what I didn’t understand is why anybody would give me money. That was the key. I really entered this profession as more of an education and thought that after six months – a year maximum – I’d be out. Here I am 30 years later.”

Bozic offered his services to the broker who arranged his mortgage, who initially rebuffed him. Undeterred, Bozic eventually wore him down and immersed himself in the world of mortgages, going through file after file to learn the brass tacks of the industry.

“He tried passing me onto other brokers, but the fact that he didn’t want me strengthened my resolve,” Bozic recalls. “I badgered him until he said, ‘Yes, come work with me.’ That’s how I got into this business.”

Laying the foundation
In 1993, Bozic moved to Vancouver, which proved to be a major turning point in his career.

“I didn’t know anybody, and I had to start fresh,” he says. “I went through some personal issues, and I figured, if I’m going to try something different and explore it, I’ll probably never have a better opportunity than I do now. It ended up having the most profound impact on my career.”

In Vancouver, Bozic worked for TMG, knocking on doors to find new clients.

“That’s what you had to do,” he says. “It was old-school back then. You had to pound the pavement because we didn’t have the technology back then to attract business like you can today. This was purely hustle – you had to survive on your wits and look someone in the eye and convince them you’re the right person to help them. I remember when the first fax machine came into the office and someone remarked that it would never last. We had to hand-deliver files to lenders and talk to underwriters a lot.”

By 2000, Bozic had moved back to Toronto to become the national sales manager for the broker channel at TD Bank. That marked his entry into the corporate world, where he learned about everything from structure and discipline to internal politics and what he calls empirebuilding. Working alongside Kathy Gregory, who eventually launched Paradigm Quest, Bozic laid the foundation for what would eventually become Merix Financial.

“It was interesting that a lot of what we came out with when we eventually launched were ideas that were pitched to the banks,” he says. “We were always told that ‘what you’re pitching is interesting, but not at this time, so carry on.’ Both of us were thinking about our businesses and realized that if we’re really this smart and think it could work, then now’s the time to do it. In essence, the bank became this petri dish because we were always in that mode and trying to grow our business.

“I’m not criticizing the bank for not adopting our ideas,” he adds. “They’re successful and risk-averse, and we understood their decision, but we felt it could work and we went out to start something brand-new.”

Business builder
Bozic founded Merix Financial in 2005 and realized early on that, rather than trying to replicate what A lenders were doing, he could establish Merix as a niche lender. While Merix originally marketed its products to established brokers, Bozic and his team soon identified an underserved market as a better target.

“We thought there would be this natural pull [from established brokers] because they’d get it from a business perspective,” he recalls, “but we changed on the fly and went after that 20-something broker who isn’t a high producer and has only been in the industry for two to four years with potential ahead of them. What that message did is resonate with those individuals. We missed the mark when we first launched with a certain segment of the broker space, and that led us to rethink our position.”

Offering trailer fees to younger brokers indeed proved to be a turning point for Merix and allowed the lender to gain more and more market share with each passing year. However, bumps in the road are an inevitability, and the OSFI’s changes to Guideline B-20 have been a major one.

“I’d be lying if I said it didn’t have an impact,” Bozic says. “When all these changes came into place, we knew there was going to be a change and it would have an impact, but we didn’t realize the depth of changes. No doubt, the way regulators in the government and the Ministry of Finance proceeded gave the banks a significant advantage, and monolines couldn’t compete with them. Now the stress test with insured business has narrowed the gap between the two in terms of what we can’t do and what they can’t do.

“With what we’ve seen in market share in 2018,” he continues, “monolines are winning some of the business back. We’re on a level playing field, or close to a level playing field, with institutional banks. There wasn’t a great deal of time to moan because you have to implement all the changes.”