Industrial Alliance (IA) consistently leads the mortgage rate market. At the moment, it has the lowest (or near lowest) rates on 2-, 3-, 4- and 5-year fixed terms.
Its mortgages are more restrictive than most, but if you’re the type of person who will sell a kidney to save 10 basis points, you’ll certainly find its rates enticing.
Here’s the thing. IA mortgages are primarily available through brokers and, unfortunately, IA doesn’t deal with all brokers.
For those who are not on its list, NEXSYS Financial offers an extremely valuable service that lets brokers submit through it.
(NEXSYS processes applications for a number of other lenders as well, including Home Trust, ResMor, ICICI, MCAP, and First National.)
NEXSYS’s raison d’être is to free up brokers’ time. Its low-variable-cost back office handles the closing process so brokers can spend their efforts servicing clients and prospecting for new business.
In turn, the company charges brokers a fee. It ranges from 15 bps (worst case), to free, depending on unit volumes and funding ratios. Apart from that, brokers receive each lender’s full finder’s fees.
In addition to deal submission, NEXSYS has a service called “Advantage Plus” where it collects and processes documentation from the end-client on behalf of the agent. It then follows the deal to completion to ensure all lender conditions are met and that it closes on time. This service ranges from $100 to free depending on volume.
All in all, NEXSYS provides a useful service. Its main drawback is lender availability. Its lender list is limited because it chooses to deal only with lenders in which it has “top-tier status.”
Moreover, NEXSYS says its existing core lenders are diverse enough to meet virtually any client need. (We’d differ on that, but it doesn’t matter because you don’t need to send NEXSYS every deal anyway.) That said, NEXSYS plans to add new lenders in the future. It’s in talks with a few right now. It says lenders are attracted by its 80% funding ratio and “virtually non-existent” derogatory clients.
Service quality is another broker concern. How does a mortgage agent know that NEXSYS will treat clients with the same care as the agent herself?
NEXSYS realizes this is a legitimate broker concern, so it created what it calls a highly efficient system for document tracking and collection. It then staffed itself with a team of client-service-oriented fulfillment professionals.
Roland Mechler, Director of Operations, says “Hands down, our team does a better job than (most) agents themselves in treating the customers in a professional, friendly manner.”
He adds, “There is an added bonus for agents not to be the ‘bad guy’ in having to collect docs.” In other words, brokers can outsource what clients consider to be the least pleasurable part of a mortgage.
Another consideration for brokers is lender volume bonus (VB). Lower volume brokers may find slightly higher VB elsewhere—like through their own brokerage network’s deal submission desk. Then again, most of NEXSYS’s lenders (like IA) roll VB into the finder’s fee anyway so this is partly a moot point.
There is one last tip we’d offer if you’re going to use NEXSYS:
Send them good straightforward deals.
In our experience, you don’t get to deal with the underwriter directly. Therefore, when exceptions are required you can’t fight for your own deals and things sometimes get lost in translation. This happened on one application we sent in.
That aside, our overall experience with NEXSYS has been positive thus far. They’re certainly worth a try if you need access to a lender on their list.
Rob McLister, CMT
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