As a man who oversees products and marketing at Scotiabank’s real estate lending division, David Stafford is well-placed to monitor shifting market trends.
In the latest edition of CMT’s One-on-One series, David graciously speaks with us about rate competition, the purpose of posted rates, and the Internet’s impact on mortgage customers—among other things.
Of particular interest is David’s explanation of the value that Scotiabank places in its relationship with mortgage planners. Scotiabank is the #1 lender in the broker channel, and a tremendous supporter of it. For the first time, we get a full grasp of why brokers are so vital to Scotiabank’s business model.
Here is that interview…
Length: 13 min
Recorded: March 26, 2012
Interview transcript: Scotiabank – Managing Director of Real Estate Lending, David Stafford
Robert McLister, CMT
Great interview guys. After reading Mr. Stafford’s comments about broker business I can’t help but think what a rash decision CIBC made in selling Firstline. I think CIBC’s loss will definitely be Scotia’s gain.
Banks, not Ottawa, should tame mortgage lending: Scotiabank
http://www.bnn.ca/News/2012/4/3/Banks-not-Ottawa-should-tame-mortgage-lending-Scotiabank-CEO.aspx
Good discussion about posted rates. I hear that regulators might create a qualifying rate that is not linked to the five year benchmark. If that happens, it will be all the more reason to get rid of anachronistic posted rates.
BTW, Scotiabank’s lower 4.99% posted rate is working to its advantage right now. It makes its cash back mortgages cheaper than most of its competitors.
Pretty sure the only reason posted rates still exist are so that banks can manipulate the discounting to maximize IRD penalties.
There are also add on fees. I just learned my wife renewed a mortgage with Scotiabank in June 2013 — with a letter outlining the renewal terms. Here are the terms on a mortgage of $166,376.62: 6 months closed, 4.55%,and servicing fees of $645. So when she took the 6 month term and renewed again, the effective rate of interest would be north of 5.5%. The servicing fees include a “document execution fee” of $50, “discharge fee” $325 and “transfer/assignment fee” (transfer to itself?) of $250 … oh yes and an “annual fee” of $25. Not exactly a good deal….