Additional requirements for Ontario agents dealing in private mortgages came into effect this year. Are more on the way?
Ontario’s tiered educational course for agents transacting in private mortgages came into effect this year – and the introduction of further courses and qualification requirements across the agent profession more generally would be a welcome development, according to a Hamilton-based broker-owner.
Carmen Costa (pictured), of TCG Lending Centres, told Canadian Mortgage Professional that the strengthening of educational standards in the profession was to be welcomed, particularly in an economic climate as volatile and unpredictable as that facing borrowers in 2023.
“A lot of people are upset about this private course. I’m so excited,” she said. “The Wild Wild West is now being tamed, or at least starting to be tamed. There’s going to be a little bit more control on that private sector; I would like to see that happen a little bit more on As and Bs. I’d love to see that happen as well.”
The question of whether current qualification requirements for newcomers entering the mortgage agent profession are sufficient has been a prominent one across the industry in recent years, especially with an influx of new agents arriving during the COVID-19 pandemic.
Costa said additional courses for new entrants would help maintain standards in the industry and ensure a high level of competence among fledgling agents, factors that at present are heavily dependent on the brokerage they join.
“I think there should be more education when it comes to newer agents entering the field, especially people that don’t have the financial background,” she said. “I don’t think we do justice with the education piece – it’s left up to the broker house to do and I think there’s a lack in the broker house facilitating that.”
Top of mind for Costa’s team are six-weekly refreshers, keeping agents up to date with rules, standards and new developments, while new agents are put through a two-week training session regardless of whether they’re arriving from the banking side or another brokerage.
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— Canadian Mortgage Professional Magazine (@CMPmagazine) July 5, 2023
Why blindly following trends is a bad move for mortgage agents
One industry trend that Costa said was particularly worrisome of late has been a tendency to generalize about the most suitable financing option for borrowers without doing a detailed rundown of each individual client’s specific circumstances.
Shorter-term mortgages, such as two- and three-year products, are proving hugely popular at present – but it’s essential not to simply assume that those are the best choices for every borrower irrespective of their own conditions and tolerance for risk, she added.
“When I sit with my customer, I do an analysis of their whole portfolio and then I give them the recommendation based on their portfolio, not what the market is telling you to do, [which is] to time the market to try to get the best rate or to try to get over the top of the recession,” Costa said.
“Nobody can time the market. It’s important and key for us to remember we are professionals: we sit with a client and we have to do a full analysis on their portfolio – just like if you were going to go and buy stocks or bonds, you have to do a risk analysis. You have to go through all of that.”
The value of a tailored approach
Rather than applying a one-size-fits-all approach to every borrower, Costa emphasized the importance of digging into their own profile and devising a tailored solution – and not setting too much heed on short-term trends.
“When did we lack that? It’s not about following trends. It’s about doing what’s right for that particular client, for that snapshot, that time in their life,” she said. “You really have to do a full analysis on your client and you need to see what’s the best product for them based on their risk tolerance. The thing is, we don’t even do that anymore.”
It’s a current shortcoming in the industry that could be addressed, at least in part, by higher educational standards, according to Costa.
“For me, we’ve lost that touch of actually doing our job properly, sitting down with the client and spending an hour and a half putting these solutions together,” she said. “We lack that – and there’s no education piece on that. That’s something that I would love to be pushed forward for our industry.”
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