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What Could Have Been

People handshake agreement close deal gapIf there were ever a time that the mortgage broker industry needed to come together, this is it.

Our game is changing. Brokers have decent market share, but agent revenues per deal are dropping, and they may not stop dropping for the foreseeable future. On top of that, regulatory tightening is making it harder to do our jobs, lenders are looking for ways to cut origination costs and the Internet has started to disintermediate slow-to-adapt brokers. It’s not unreasonable to think these trends could conspire against broker networks and cut funding for industry initiatives going forward.

So it was with a degree of disbelief that I watched last week’s developments with Canada’s two national broker organizations —one being the established industry association, the Canadian Association of Accredited Mortgage Professionals (CAAMP), and the other being the upstart Canadian Mortgage Brokers Association (CMBA).

Depending on who you ask, it’s either the best time in history to start a new national broker association or the worst time. But one thing is certain: it would have been so much more productive if the two could have smoothed over their differences for the common broker good.

Why? Well, we as an industry do not need more division. We have bigger fish to fry and enough associations working against each other as it is.

We don’t need more duplication of conferences, awards shows and golf outings. Most sponsors (lenders, insurers, suppliers) absolutely do not have the budgets for it. Most of them would much prefer to back one association, other things equal. But now they’ll have to increasingly choose, thereby diluting their support among ever-more events and affecting event quality.

We don’t need overlapping education. Focusing intellectual power on enhancing existing curriculums, creating one national education standard and leveraging existing learning distribution platforms is infinitely more efficient.

We don’t need more boards and association salaries. Organizations are expensive and time consuming to manage. That money is better spent on direct costs of promoting the broker channel (e.g., advertising, PR, lobbying, self-regulatory enforcement, etc.).

We don’t need more voices appealing to policy-makers and regulators. We need one strong voice that is actually heard through all the noise. The more parties that petition our government, the more we look like individual disorganized special interests.

We don’t need to exclude lenders and leverage broker numbers against them. Without lenders, brokers don’t eat. If lenders feel we’re working against them, absolutely nothing good will come of that long term.

We don’t need two brands and two messages marketed to consumers. Too many consumers are confused enough by what we do.

We don’t need more dues to pay. Many brokers don’t understand the value in paying dues as it is.

We don’t need more diversion of resources. Pooling revenue is the best way to fund powerful widespread marketing campaigns that consumers recognize.

CMBA’s brand (trademark) is strong, and it would have been beneficial for the entire industry to use it, not just regional association members. But it takes more than a good logo to reach consumers, policy-makers and regulators. It takes economies of scale, relationships and industry-wide (not just broker-wide) buy-in. Imagine how much more powerful our industry voice would have been had the association leaders found a way past politics and protecting their turf to find common ground.

Hearing about the CMBA was disappointing to this author, not because the good people involved with CMBA don’t have valuable ideas, but because valuable ideas are rarely implemented as well when key stakeholders don’t work together.

Fortunately, despite two years of trying to work things out, there’s reason for optimism that the two sides will eventually realize the mistake that’s been made. On that subject, one of the best quotes heard last week was from Dan Putnam, Chair of CAAMP: “We’re still open to conversations with all regional associations,” he said. “Never say never.”

In that spirit, may the regionals and CAAMP always keep their doors open to each other because, as CAAMP CEO Jim Murphy rightly noted last Friday, “We’re all in this channel together…We succeed together or we fail together.”