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Meridian Credit Union. A Quick Take

Meridian logo Meridian is the largest credit union in Ontario with over $8 billion in assets. After it acquired Desjardins in March, it redoubled its push in the mortgage broker channel. Since then, more and more brokers have begun noticing its competitive offerings.

One of Meridian’s biggest claims to fame is its lending niches. It wants to be viewed as a genuinely “common-sense” lender. Lest you be a broker jaded by that term (“common-sense lending”), have a look at some of Meridian’s products below. Its mortgages fill voids that many lenders consider either “higher risk” or suitable for branch-only products.

“Meridian is a unique lender supporting the broker channel…We embrace clients referred to us by brokers and ensure a positive new Member experience,” says Rick Arnds, Senior Manager, Emerging Markets. “That in turn supports a referral loop back to the broker in building their business.”

Mortgage-OptionsApart from its normal competitive terms, (like the 5-year variable at a respectable prime – .50%), Meridian offers a wide range of more unique products including:

  • 100% financing: Meridian’s zero-down option is for clients with excellent credit history (650 minimum Beacon), no past credit/debt issues and solid job stability. The rate? Not posted as you’d expect, but just 1.25% above discounted rate (4.73% currently). That’s the lowest advertised rate we know of for a 5% cash back down-payment mortgage. It comes with a 90-day rate hold. Owner-occupied principal residences only.
  • Construction Mortgages: There’s a dearth of flexible draw mortgages in the broker channel. Meridian’s is available at discounted 5-year fixed or variable rates with unlimited draws. Payments are interest-only throughout construction period and land advances are available up to 80% LTV. An 85 bps fee applies. Meridian also permits self-builds.
  • Second Mortgages: Up to 85% insured.
  • Stated income: Uninsured; up to 80% LTV.
  • Secured credit lines: Available in 1st or 2nd position; up to 80% LTV (75% LTV for stated income). It can go in 2nd position behind major FI’s standard charge.
  • Seasonal properties: For properties with year-round road access and a permanent heat source; available on purchases or refinances. Max 75% LTV.
  • 5-10 Unit Apartments: Existing residential properties only; 75% LTV max. Commercial pricing applies.
  • Sub-600 beacon scores: Meridian offers conventional “Sub-A” lending with reasonable rate premiums as low as 0.05%.
  • Builder 1-year rate caps: A rate hold at 1.25% off posted rates; new builds only.

Mortgage-BasicsMeridian basics:

  • Rate hold: 90 days (applies to fixed terms only), or 120 days with a 25 bps premium
  • Prepayment options: 20% lump sum per calendar year on any payment date; Min $100; 20% payment increase per year.
  • Max. Amortization: 30 years (20 years for 2nd mortgages)
  • Lending area: Within 30 minutes from one of Meridian’s 63 Ontario branches
  • Max. Loan: $2 million with sliding scale
  • GDS/TDS: Max debt ratios are 34/44%.
  • Pre-approvals: Purchases with fixed rates only (available to loyalty brokers or upon special request)

Broker note: Meridian takes applications via Filogix and shoots for 24-hour turnaround, subject to unusual volumes of course.

Rob McLister, CMT