If you’re a mortgage broker and you don’t remember First Marathon Mortgage, you probably weren’t in business in 2002. That’s when ING Direct bought the company and re-branded it.
Well, that company is back as the mortgage broker channel’s newest lender, Marathon Mortgage Corp (MMC). And it’s run by the same man who ran First Marathon back in the day, CEO Harold Kennedy. Also back is VP of Marketing & Origination Terry Dolson.
“The support for First Marathon is the past,” Kennedy says. “Ninety per cent of our staff is from the original First Marathon.”
Kennedy aims to earn business largely from the broker relationships he’s had for two decades. “The model is to connect with people that First Marathon did business with. Relationships matter. Our brokers know they have a direct line to Harold and Terry.”
Its secondary advantage, according to the company, is speed. Unlike most competitors, “We actually adhere to the four-hour turnaround time on approvals and 48 hours on docs,” he promises.
First Marathon targets strictly AAA clients and currently routes deals through Industrial Alliance. It hopes to have a direct funder relationship this summer. The firm is currently in soft launch mode with TMG The Mortgage Group in B.C. and Ontario, as well as 20 individual franchises and independent firms. It plans a wider-scale launch this fall in all provinces except Quebec.
Here are its lending guidelines. (God bless lenders who put their policies on an easily accessible website like this.)
The Marathon Mortgage story is four years in the making. Kennedy says it took far longer than anticipated to launch, partly because “market conditions and policies changed since 2008, making it harder to start a new lender.”
“The due diligence process is tougher today, and it should be,” he adds. “We had a wake-up call with what happened in the U.S. and all of a sudden people are taking a second look at how lenders do business. Look how hard it is to find buyers of [mortgage] products today…”
The servicing aspect also took considerable time to develop. MMC plans to do all of its own mortgage servicing “in phase II.” So it decided to build that servicing technology from scratch, no small undertaking.
Prior to the sale to ING, First Marathon was originating, underwriting and servicing upwards of $200 million a month in prime residential mortgages, which gives the founders a strong track record. But mortgage competition in 2015 is magnitudes more intense than it was in 2002. Growth opportunities are far harder to come by in today’s “A”-mortgage space. We’ll have to wait and see if MMC finds another competitive edge besides relationships and service, or if those are enough to win the war for this familiar upstart.
Sidebar: One of MMC’s board members is bond guru Hank Cunningham. Cunningham, now the Fixed Income Strategist at Odlum Brown, was Managing Director at First Marathon Securities back when ING bought its mortgage subsidiary.