“As a Realtor, I see a mortgage agent license as an asset for my clients, in helping them secure a home as well as the most appropriate mortgage,” said Idalia Batson-Grazette, a real estate agent with Right At Home realty in Toronto and now a mortgage agent with Matrix Mortgage. “I saw becoming a mortgage broker as a natural progression.”
The 35-year veteran of real estate took that step two months ago. She’s not alone with a growing number of Canadian real estate agents taking provincial licensing exams and signing up with mortgage brokerages looking for well-connected professionals, according to industry professionals.
Likely driving the trend are new mortgage rule changes meant to lower Canadian household debt but that have made it more difficult for homebuyers to win financing at the Big Five. Forecasts predict increasing demand for mortgage brokers as more and more Canadians, out of necessity, explore borrowing options available through the broker channel.
The Canadian debt-to-income ratio, in fact, rose from 93% in 1990 to 148% in 2009, according to a new study by Statistics Canada. First-time buyers, in particular, have been affected, with younger Canadians taking on more debt to own a home and then steadily paying it down as interest rates began dropping and credit flowed.
Among those Canadians carrying debt, unattached individuals had a total average debt of about $69,000, compared to $102,000 for lone parents, and $147,000 for Canadians in couples with children.
Those kinds of pressures haven’t killed the dream of homeownership, although they have made many Canadians more cautious about sharing their financial information. That sensitivity will likely accrue to the benefit of Batson-Grazette and others offering her kind of dual expert services.
“Everyone has an aversion to filling out forms and sharing information with various professionals,” she told MortgageBrokerNews.ca. “In dealing with me as a real estate agent and a mortgage broker, a client is limiting any loss of privacy.”
An increasing number of his own clients are now relying on him to fulfill that same dual role, said Michael Tepper, a real estate broker and principal mortgage broker with Nadlan Realty Ltd. He acquired both designations in 2008, with his brokerage focused on residential and commercial real estate and financing. Another mortgage broker/real estate broker works on his team.
Still, Tepper doesn’t foresee a glut of Realtors looking to expand their businesses by becoming mortgage professionals, even in Central and Eastern Canada where home sales are expected to slow. The country’s aging population further limits the number of first time homebuyers in both the short- and long-term.
The learning curve for real estate agents looking to make the jump may also slow further migration.
“It’s a very hard transition and I think real estate professionals have to ask themselves if they have the time to become a professional in both industries,” said Brian Matthey, president of Verico The Mortgage Professionals, in Kingston, Ont. “I don’t know that I, as a mortgage broker, would have the time to devote to becoming a real estate professional and the same applies in the opposite direction. The number of people in our industry doesn’t matter, but the number of professionals does.”
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