Merix Financial’s always observant CEO Boris Bozic could have a PhD in mortgage industry analysis, if there were such a thing. Last Thursday he appeared on Canadian Mortgage Hangout. Here were 10 of his notable quotables from that webcast.
- “When you have regulators that threaten ‘interest rates are going up’ (for multiple years)…eventually the consumer says ‘enough already’”
- “The only statistic that I really look at is the employment number…If people are working, they can make their payments.”
- “The monolines play a critical role…in terms of offering (consumer) choice…And it’s only now that the government is realizing that.”
- Monoline lenders will represent about “$23 billion in volume” in the brokerage space in 2013.
- The recent drop in market share for monolines is a “direct reflection to the limitations on conventional mortgages today…The banks have been able to benefit from a number of those changes.”
- “…An issue for all of our monoline lenders…is the availability of conventional financing, because of the restrictions and the cap on bulk insurance.”
- “…The tone and the tenor coming out of Ottawa is that the government is looking to scale back the ‘risk’ (i.e., the sovereign guarantee on insured mortgages) for Canadian taxpayers.”
- Regarding the bad wrap on bulk insurance: “Wouldn’t’ you rather have the sovereign guarantee on a 70% LTV (mortgage) versus the 95%’er?”
- “One of the things we should be considering [is that a] 95% mortgage should be priced differently than a 70% LTV.”
(CMT Note: For a while now, many lenders have been offering cheaper rates on insured mortgages with 5% down, than those with 20-30% down. And it’s not by choice. It reflects the reality of what’s available in today’s funding market.)
- “It would be beneficial…if we went back to a risk-based pricing”.
Rob McLister, CMT