As Canada’s largest-non-bank mortgage lender, First National appreciates the vital role played by mortgage brokers in helping Canadians arrange financing to purchase their first homes. It’s why we created Merlin, the market’s first online underwriting system. But our commitment to mortgage brokers and borrowers goes deeper than technology. We’ve built a unique culture in every one of our branches where our teams strive to be the best. What does that mean? We asked some underwriters and team managers in our Toronto Branch: Victor Morais, Stefano Tarantino, Nishani Drepaul, Dillon Charron, and Annisa Ally.
Tell us about your branch.
We serve mortgage brokers directly throughout Ontario and in Atlantic Canada. Any application that comes through Merlin in these territories is reviewed by our team. We’re at the front line of service and we strive to make our due diligence process as fast, and painless as possible. We don’t always extend credit, but we always try to reach our conclusions quickly, which we think is a key part of being respectful to brokers and borrowers alike.
How many mortgage applications do you review per day?
Including pre-approvals, about 15 per day for each of us in the busiest months and between 2,000 and 2,500 per year. The more we can do, the better.
What does it mean to be the best?
It means treating every single application from every broker with the utmost care and consideration. It means always being available. And it means being able to do rigorous analysis at the fastest turnaround possible. Being the best isn’t just a subjective goal, it’s a way of behaving that we measure and manage.
Do you sacrifice anything in the name of speed?
Never. We don’t compromise our standards when we review a file and we don’t take shortcuts in service either. We strive to meet the needs of each broker by learning how they like to work and taking as much off their plates as we can. Brokers are busy helping borrowers and building their books, so anything we can do to make their lives easier, we do. For new brokers, this means sharing how our underwriting policies work upfront, including what sources of borrower income we consider – which tend to be different across lenders – and coaching them on the information we need to arrive at a quick decision. We pride ourselves on investing in our broker relationships.
What qualities or characteristics are required to be an underwriter at First National?
The right attitude is paramount. We know that brokers have many competing choices. So we make it our business to be the best in service. We always remember that at the end of every transaction is a borrower. They aren’t buying a car or jewelry; they are buying a home and they are counting on their mortgage broker and First National to make that happen within a specific timeframe that is often very aggressive due to conditions of the offer to purchase. If we aren’t at our best, someone could lose the home of their dreams. It’s an awesome responsibility that we take very seriously.
Can you think of a situation where turnaround time was vital to a deal?
It happens all the time but here’s a recent example. A borrower needed to arrange financing by 5pm to meet a condition of offer. We received the mortgage application at noon. Together with the broker, we worked through the due diligence, got the mortgage insurer to drop what they were doing to review the file and made it all happen by the deadline. It’s in emergency situations like this when the strength of our processes and our desire to be responsive really shows through.
Doesn’t the need to manage risk and look at deals objectively, on their merit, create a roadblock to providing the best service?
The best service doesn’t always end with a yes to funding a deal as originally presented. Obviously being able to provide an unequivocal approval is what everyone wants. But it’s in the best interests of all concerned if the borrower can afford the house they are buying. If they can’t, or we think they can’t, we say so and we communicate that decision quickly, which is part of being respectful to our broker partners. But we also go the extra mile to see if there are creative solutions in situations where a deal doesn’t appear to make sense on the surface. Being the best is about being a solutions provider.
But isn’t approving a mortgage a black and white process?
Qualification rules are black and white but there are shades of grey in some files. The numbers as presented don’t always tell the story. For that reason, we are willing to go the extra mile to uncover the fine details of the borrower’s background, credit history and sources of income. We like doing the detective work. There is something uniquely satisfying when we’re able to bridge the gap to make good deals happen.
Can you provide an example?
One of our long-time broker partners called to tell us he was working for a couple who wanted to purchase a million-dollar home. One spouse had a 614 Beacon Score and the other had a Beacon Score of 640. Those numbers didn’t really add up for an insured deal. But in talking to the broker, we learned that the couple’s young son had died of cancer two years earlier. Obviously, this had an affect on their financial situation and their credit scores. This provided context and we found mitigating circumstances in that their extended families were prepared to help out by appearing on the mortgage and helping with the down payment. We felt strongly about this application and so we went to bat to get it approved. This deal might not have happened at another financial institution, but it did at First National because we were prepared to dig deep.
It seems obvious from this example, but what motivates you to be your best?
Empathy is a motivator for sure but at the end of the day, it’s not about compassion. It’s about extending credit when it’s deserved. It’s about doing what’s right for brokers, borrowers and First National. It’s about safeguarding our reputation and our relationships. Motivation also comes from the fact that we are only as good as our last deal. We can’t rest on our laurels. We have to earn and re-earn our place in the market by being the best every time out. Excellence is also contagious.
What does that mean?
Each of us sets a high standard of performance. Working together brings out the best in each of us. Teamwork and effort are defining characteristics here, as is loyalty. Most of us have been in the mortgage industry for 10 years or more and there is very low turnover at First National. It’s like being part of a family. When we put all of that together with a strong sense of camaraderie, we create the right conditions for best-in-class performance.
What role does Merlin play in helping your branch do its best?
Merlin standardizes our approach to underwriting and it also streamlines it. We can literally fly through the screens to complete our reviews. It displays everything we need in fields. When we talk to underwriters at other institutions, they often complain about having to process mortgage applications across as many as eight different internal IT systems from origination to funding. That’s an inefficiency that we avoid. Everything we need is built inside Merlin, from document submission to ratio calculations. Merlin also provides live, real-time updates to brokers on the status of their deals, so it’s very user friendly and convenient for brokers, not just for us.
Doesn’t technology get in the way of providing personal service?
No, it enables us to provide service on an efficient basis across our region, which is very broad and includes several time zones. Brokers want commitments quickly and generally don’t want to spend time on the phone with us. If they want to chat, that’s certainly something we welcome but it’s not the norm. We develop trusting relationships by doing our jobs quickly and effectively and avoiding needless back and forth. Getting deals done on time is the way to form strong relationships.
Is there anything else at First National that allows you to be the best?
Yes, when we do pre-approvals, we don’t just run computer models, we dig in and do a full underwriting to see exactly what the borrower can afford. It means when First National gives a pre-approval, it means something. We think brokers and borrowers appreciate our pre-approvals because they carry weight with realtors. As well, if the borrower doesn’t qualify for an insured mortgage, First National offers Excalibur, which is an alternative product available in Ontario. As underwriters, we like the fact that Excalibur exists because it allows us to help self-employed borrowers secure home ownership when they are outside the credit box required under B-20 regulations. It’s part of having a complete, best-in-class product lineup for brokers. Another difference maker is the presence of fulfilment specialists.
What does a fulfillment specialist do?
Once a deal is approved, it’s sent to a fulfillment specialist to make sure all the i’s are dotted and t’s are crossed. In some lending institutions, underwriters do double duty by reviewing all paperwork and it creates a bottleneck that delays approvals and funding.
As the industry changes, what will it take to remain the leader in broker service?
Desire. We are a competitive group and we constantly look for ways to increase our edge on other financial institutions. Our training department does a great job in keeping us informed of the latest trends in our industry and we use that information not just to increase our knowledge but to fuel our desire to be the best for brokers and borrowers.