Mortgage Architects to Launch Franchise Model

Mortgage-ArchitectsMortgage Architects, a national brokerage focused on mortgage planning, is launching a new franchise model, effective June 1.

To date, Mortgage Architects (MA) has operated as a full-service corporate-style mortgage brokerage.

President & CEO Bob Ord says, "We recognize the market has changed and that some top-performing brokers want to own and run their own businesses while still accessing a myriad of services that will help them efficiently run and grow their volumes.”

“Our goal is to provide franchise owners vision and leadership along with the best and most comprehensive self-serve e-business solutions in the industry."

MA says its new “Franchise Plus” option will be the only mortgage franchise in Canada to provide payroll and paperless compliance services. Franchise brokers will also have access to:

  • myNext mortgage Company, MA’s proprietary lender, with highly competitive pricing and trailers
  • Technology-based marketing solutions
  • Customer relationship management (CRM)
  • MA’s private intranet information portal
  • Training and reporting

MA’s Franchise Plus owners will require their own broker license and need to sign a 5-year contract. There is also a 3-year contract option with a higher payout for those who don’t require payroll and compliance.

In addition to franchising, MA will retain its full-service broker model. That program entails a slightly higher split but includes:

  • Use of corporate branding
  • Licensing under the corporate brokerage (depending on province)
  • Advanced product support
  • Additional mortgage planning tools, including MA’s new “Client Monitor” program
  • Custom marketing
  • A stock option program
  • Business and team recruiting

MA also offers a successful “Streaming” desk whereby brokers get access to preferred rates at major lenders via MA’s centralized underwriting service. A broker’s volume in this program counts towards that individual’s own lender status levels.

Since its inception, MA has focused on recruiting only experienced brokers who produce over $25 million a year in volume. It will continue that tradition under these new programs.


Rob McLister, CMT

  1. This is probably a smart move by Mortgage Architects because 90/10 was uncompetitive. Does anyone know what the splits will be for each type of franchise?

  2. Let us not forget that DLC also charges $150 a month for advertising and requires a lengthy seven year contract.

  3. The word has it that DLC was fined by CRA and now they are charging HST on thier 5%, so when you pay your 5% and your monthly 150 for each and every agent, add 13% Sales tax to it!!

  4. Why not just join VERICO? No splits, no advertising fees, no long term contracts and they have all the stuff everyone else has.

  5. Funny that Mortgage Architects say they’re the only ones in Canada doing payroll and paperless compliance for franchise owners. Maybe they should do their research prior to making such a bold statement. Mortgage Alliance has been doing this for 3 years now with their self made Mortgage BOSS all in one software system.

  6. Why not join Verico?” While you are at it you should buy a Coffee Time franchise over a Tim Hortons…..they both have the same stuff (coffee, muffins) as stated above by James…..compare the success of those 2 franchises…..and Coffee Time fees are cheaper…..that strategy worked great for them. DLC might not be for everyone, saying that, Bill you might want to check YOUR FACTS before talking about the HST, all franchise models are required to pay into this no matter what super broker you work under, if they are not paying the HST they will be the ones being fined or you are . Honestly, it is the back and forth pathetic rumours like this that hold our industry down and why the general public does not have any idea what we do. At the end of the day, no matter what company you are with you should stop focusing on what others are doing and do your job. There is a saying “Great minds talk about ideas and small minds talk about people”. I wish you success (no matter what company you represent).

  7. Hi Kevin,
    From what I know, Mortgage Alliance has a very efficient payroll system and a streamlined compliance process.
    By no means do I want to come across as “selling” any particular model. I’d prefer to remain impartial. Nonetheless, one difference I’d point out is that Mortgage Architects’ compliance process includes review of all files by a corporate compliance officer, as opposed to the franchise owner doing it solely him/herself. That type of full service may be available through Mortgage Alliance on an exception basis, but it is standard with Mortgage Architects.
    Cheers…

  8. In response to Concerned Reader,Paul and Kevin:
    Concerned Reader, thanks for positive words, we appreciate it. As far as the HST is concerned, you are correct, all franchise and licensee models are legally bound to remit this to CRA.It is only remitted on the 5% franchise fee (in our case)not on your commissions.FTR-CRA has never fined DLC.
    As far as the 7 year contract Paul, that only applies to franchise owners not agents.Every franchise contract in the world (Tim Hortons, Remax, Royal Lepage, Boston Pizza etc is between 5 and 20 years.There are several reasons for it but we want owners who are committed to building strong sustainable long term operations. Also owners need the security of knowing they have our model, our support tools, our structure and the power of our National Advertising campaign in perpetuity, not month to month.
    James, we definetely do not have all the same stuff.I would be happy to have you and any other agents, owner,or competitor in a room and show you a direct head to head comparison of DLC next to any other model in Canada.
    There is room for all of us, and Verico as well as many other models have great operations and appeal to certain individuals.
    I would be sincerely grateful if you would put your name and company beside your comments when you post untrue or negative opinions on others without all the facts.
    Anyone reading this forum or who would like to discuss any of this further can easily reach me directly at 604.939.8777 or via email to gary@dominionlending.ca

  9. Dear Gary Mauris: Since you have volunteered your time in this forum, here are couple of simple questions I have, I am not implying anything but curious to know your responses:
    1) Have you been offering signing bonuses to people to join your company? If yes, is that money coming out of your broker’s Marketing fund?
    2) A franchise team of 30 people (30 x$150x 12 months x 5 years= $270,000), is this math correct? Do you provide audited financials for your marketing fund for franchise owners?
    3) Isn’t the fact you are charging tax on your 5% portion is because you are not a brokerage but a franchisor, but companies like Mortgage Alliance or Mortgage Architects, who are actual brokerages don’t have to charge taxes?
    4) If someone does accept your signing bonus do they have to pay 40-50% tax on that, since it’s considered a bonus?

  10. Dear Joe,
    When your team or company is coming over to DLC we will cover all costs. As a matter of fact, our slogan is No time, No cost, No Kidding!!On large teams these expenses can be quite significant. We think this is good business practice. Never would this come out of the DLC marketing Fund.
    You math is correct on the Advertising fund for a 30 agent team. Every agent in Canada contributes $1800.00 per year. For this, agents receive websites with: AUTOPILOT MEDIA,monthly newsletters to their complete databases, video-blogs,HD consumer video’s, unlimited access to the DLC INTRANET with 3400 pages of tools, templates and marketing programs, over 500 hours of downloadable training video’s focused around generating leads,maximizing technology, social media and the mobile movement. The power of the National Branding Campaign has been incredible,and our consumer awareness and acceptance is making converting inquiries into customers easier than ever before.
    Where we spend our ad dollars, and in which markets, and on which programs is distributed to our network several times per year. If you are a DLC owner you may request at anytime, a complete breakdown of the adfund and we are happy to oblige.
    Mortgage Alliance and Mortgage Architects under their new Franchise model will be required to collect HST on all franchise remittances also.What our competitors do and how they operate is their business, and i prefer to focus on what we are doing, not what they are doing.
    Now, based on the fact that you again didn’t put your first and last name, I suspect you are a competitor trying to cast doubt on our model and the success that we are having. As stated in my message above, you can call me directly with any questions you have.

  11. Seems like this post attracted a lot of knowledgeable veterans to the table. I am interested in becoming a mortgage broker. Would anybody like to comment on which brokerage will give me the best education and support to become the best broker I can be?
    I sincerely appreciate all comments. Thanks.

  12. Hi John, I haven’t seen every firm’s educational programs so I apologize if I’m overlooking anyone. However, I do know that Mortgage Alliance and DLC, in particular, have significant training resources available. I’d also encourage you to find a mentor and work under him/her for at least 1-2 years (at a fair split for both of you).
    Good luck!
    Rob

  13. Dear Gary,
    did you just acknowledged that the $1800.00 per year is for day to day operation items such as technology, templates, Intranet, websites and MARKETING?
    So why do you call that a marketing fund? Shouldn’t that be called “day to day Operation’s fund”?
    In your latest emails & advertisements you have talked about being 1800 brokers and a $10.0 Billion in originations? Is that correct number?
    If that number is accurate, which assume it is! That is almost $5,600,000 per agent and $1800 per year for marketing fund per agent, so your agents actually pay you another 3.5 basis point for marketing, day to day operations and technology? $1800 / ($5,600,000 x 105 Basis point x 95% split). Is this a correct math?
    So does that make your franchise fee a 91.5%?
    Also dear Gary, A complete breakdown of how you spent the marketing fund money and providing audited financial statements are 2 different things, don’t you agree?
    Dear Gary, These are just questions and I am not implying anything at all! Looking forward to your response!

  14. Dear Cameron, or should I say Joe?
    Our advertising dollars are spent on advertising, period! Everything else that DLC offers is free of charge to all agents in Canada.
    The feedback from our agents and owners has been excellent. If you want to spend your time more productively, our team would be happy to work with you to seamlessly bring you over to DLC.
    Unless you put your first and last name to the post I will not be engaging you any further is this rhetoric. If you want to examine all models side by side and in this forum, I would be happy to participate.
    Thanks for the interest in DLC.

  15. Gary: here is what you just stated “Every agent in Canada contributes $1800.00 per year. For this, agents receive websites with: AUTOPILOT MEDIA,monthly newsletters to their complete databases, video-blogs,HD consumer video’s, unlimited access to the DLC INTRANET with 3400 pages of tools, templates and marketing programs, over 500 hours of downloadable training video’s focused around generating leads,maximizing technology, social media and the mobile movement”
    So what you just said is that $1800.00 per agent is not for marketing dollar and its for your operations! is that correct?
    why do you call this marketing fund, if is used for your operations?

  16. Hi Gary,
    I’m currently a DLC Agent, I’m having a bit of a time finding “over 500 hours of downloadable training video’s focused around generating leads,maximizing technology, social media and the mobile movement” on the intranet. Could this be linked a little better from the entry page, I can’t seem to find it anywhere.
    Thanks

  17. I think Gary makes an excellent point, there are many different models out there, and brokers will select the model which best suits their business. Some are a fit, some are not.
    It is counter productive for any business to focus on what the competition is doing when running their business. True, it is important to understand what is in the marketplace, but it is also fundamentally important to focus on our own business.
    To do otherwise is to do disservice to our franchise owners, network members, service providers, and customers.
    Just my two cents.

  18. I have to respectfully disagree. I think it’s irresponsible for a brokerage not to study its competition carefully. Brokerages owe their agents the best possible value proposition. If management doesn’t use competitors as a benchmark there is no way to objectively gauge progress as a business. Any owner who claims to ignore the competition either has no business sense or is lying.
    The brokerage I’m with took its eye off the ball. Now I’m moving to a company that has tools to better serve my clients. There are two or three companies in this industry with any edge whatsoever. The rest are also-rans that should merge before they are eliminated.

  19. Well said Dan. This is a dying industry! while some of our new models have offered great commisions and splits to brokers, they have taken significant value out from the industry.
    we have so many brokerages that are struggling with no vision!
    How do you run a business at 2%, 3% or even 5%? you just cant! every one in our industry has focused on “More, More, More”
    The problem is that there is no more! Franchises or broker houses not making money because agents taking high splits, the National brokers are not making money because their franchises taking 95 or 100% splits and now lenders arenot making enough money! so where do we go from here?
    You know your industry is in trouble when your technology provider (filogix) makes more money on a $10.0 billion brokerage then that actual brokerage making!
    The problem with our industry is:
    “Greed, lack of vision, Ego’s, lack of leadership, and stupid people think that they are smart because they make lots of easy money”

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