Going forward, it sounds like IG will be in and out of the mortgage rate market as opportunities permit. It will not be undercutting all competitors (like it did here) on an ongoing basis.
Here’s Veselinovich’s take on how the promotion went and what to expect from IG – mortgage-wise – for the rest of the year.
On the success of the promotion:
“Things went extraordinarily well. The volumes flowed in much quicker than we anticipated.”
“We positioned it as a limited-time offer. Unlike some competitors with limited-time offers that seem to be around forever, this one lived up to its name.”
On the profitability of a 1.99% variable-rate mortgage:
“For us, this made sense from an economic perspective and client attraction perspective…In other words, we didn’t lose money on the deal. This hinges on the fact that we were able to secure a block of funding at very attractive pricing for us.”
On how successfully it attracted new clients:
“We did attract a number of new clients…[including clients] from existing financial institutions that were already approved and decided to move to IG…”
On inaccuracies in the media:
“I stopped listening to some of the media after the first day because there was truly misinformation out there. Some of the commentators [who were] asked to speak about [the 1.99% rate]…may have had vested interests that were different from informing the public. Some of it was honest mistakes…”
On the likelihood of future such promos in 2014:
“I think it’s highly likely that we’ll have opportunities to have blocks of [low-cost] funding. And as those blocks are there we’ll continue to take the same type of approach as we’ve done here…”
“We’ve been doing mortgages for over 60 years at Investors Group, primarily to our existing clients…Of course, we’re now expanding that and looking at opportunities to attract more people to Investors Group. The quality of the [borrowers attracted by this promotion] has been fantastic.”
Rob McLister, CMT (email)