As Canada’s largest-non-bank mortgage lender, First National appreciates the vital role played by mortgage brokers in helping Canadians arrange financing to purchase their first homes. It’s why we created MERLIN, the market’s first online underwriting system. But our commitment to mortgage brokers and borrowers goes much deeper than technology. We’ve built a unique culture in every one of our branches across Canada where our teams strive to be the best. What does that mean? We asked the underwriters in our Vancouver branch: Ed Kim, Mariana Bakalar and Tiffany Cheong.
Tell us about your team.
Our branch is made up of experienced underwriters who spent time at other organizations before coming to First National. A couple of us came from the broker side. Tiffany worked at an insurance company in their commercial lending department. Ed’s early career featured time at a sub-prime lender, a stint in accounting at a film company, and positions at several international financing companies. Each of us brings a unique perspective but a pretty good appreciation for the B.C. market overall, the needs of brokers and the underwriting processes used by different lenders.
Speaking of other lenders, in your view as underwriters, how is First National different?
We’re a large company but we don’t act like one. We set high standards but we’re not bureaucratic. Here management is approachable, interested in what we have to say and always willing to engage in reviewing mortgage applications when there are exceptions to consider. All of that makes a huge difference in the type and quality of broker service we can offer and in the brand we project in the marketplace. Our personality is what makes our branch the best. From the perspective of underwriting itself, every institution has slightly different criteria for approving deals, but the core difference is culture.
How would you describe your branch culture?
Our culture is supportive of the individual, fueled by teamwork and relationships and conducive to performing at a high level. We work on a number of files every day and when one of us needs help, someone is always willing to pitch in to carry the ball down the field for brokers. We’re also an organization with very little turnover. People like working here and there is a great deal of continuity in service for brokers as a result.
What territory does your branch serve?
All of B.C. including the Lower Mainland, the interior – including Kelowna – and the Island. Based on the population we serve, we’re one of First National’s largest and busiest branches. Each of us would touch 20-30 files a day including new submissions as well as existing files.
When you say “touch” files, what does that mean?
Our key task is to review submitted mortgage applications for risk and compliance with First National’s lending guidelines but our key role is to build strong broker relationships. Without brokers, we wouldn’t have applications to review. It’s that simple. We work hard at the relationship side because the stronger our relationships, the more business we get to do. Every time we touch a file, we’re thinking about the people behind it.
What does it take to build good relationships with brokers?
Speedy communications and open-mindedness. To take each in turn, it’s vital for us to communicate in a clear and transparent fashion but do so quickly. When we have questions about an application, we voice them right away so there is no lost time in our reviews and similarly, when a broker has questions for us, we make the time to answer responsively. Open-mindedness is important because not every file is as it first appears. We play our part by being curious and not jumping to conclusions without the facts to support our findings or decisions. Like the old saying goes, you can’t judge a book by its cover; same with a mortgage application.
What is the point of being curious?
It’s to find, when possible, financing solutions in cases that do not appear to make sense as first presented. It’s also part of a due diligence attitude that is key to risk mitigation. We believe brokers appreciate our thoroughness and our willingness to be creative in deal formation because it can lead to a satisfactory conclusion for their clients. Brokers also know we won’t reject deals without very careful consideration. Curiosity and the outcome of it, which is greater knowledge, gives us the confidence to advocate for a deal that has exceptions.
What makes the best underwriter?
Someone who is willing to fight for a deal they believe in. It’s easy to be an underwriter on a deal where every box is checked. It’s quite different in situations where the numbers or ratios are tight. In those situations, it really comes down to the effort we make to uncover a key fact or find a structure or an approach that works. We put in the maximum effort and that’s what makes a difference, not the rates we offer. Not that rates are unimportant, but service, accuracy, responsiveness and effort from beginning to end are the things that get noticed by brokers. We also think being the best underwriter for brokers involves coaching.
What kind of coaching?
We want brokers to fully understand how we work and what we look for in our reviews. For brokers who are new to the industry or new to working with First National, we always take the time to share our approach. When they know what we need, and we know what they need, it makes the application process faster and a lot better for both parties.
Is there a recent deal where you had to be at your best?
We have to be at our best on every deal, that’s the nature of our business and the expectation we have of each other. But there are examples every day of unusual situations that challenge us to be creative and thoughtful, particularly when it comes to serving millennials, which is one of our mainstay customer groups here in B.C. A good example is an application we received from an apprentice electrician. This person was beginning his second-stage apprenticeship when he applied for a mortgage. He had a very good guaranteed wage for the weeks he apprenticed, but his overall annual income was variable. By digging into the file and into the world of apprenticeships, we were able to satisfy ourselves that this borrower had much greater earning power than what was shown on his T4. Consequently, we chose to extend credit and got an insurer on side as well by sharing our knowledge. That apprentice has turned into a reliable client.
One of First National’s signature policies is to respond to every application within four hours of submission. Are you able to meet this objective, given the effort you make to see deals through?
Some files require more time and some less but as a rule, we are very good at meeting our target. Doing so requires intense effort but since our sole focus is reviewing residential mortgage applications, and we have a system set up to do just that, it’s become very efficient. It also helps to have a lot of underwriting experience. Experience enables quick responses, but it also ensures accuracy in our reviews. We look at it this way, we want to keep everyone happy and that means being responsive to brokers and their clients but also not exposing our company to unchecked or unmitigated risk. A lender that doesn’t manage risk is not a lender that will be in business very long. First National has been in business for over three decades so that’s a pretty good indicator of our risk management capabilities.
Speaking of systems, does MERLIN technology make you better underwriters?
Absolutely. It makes us faster service providers because it’s easy to use and very advanced compared with the underwriting systems used by other lenders. A lot of time was invested in MERLIN and it shows.
What motivates you to be the best?
Personal advancement is one consideration. Being in the top tier in quarterly performance in the branch is important to each of us. But the other motivator is the feedback we get from brokers. When they tell us they appreciate the effort we made on a file, it’s a great feeling. It makes us want to work that much harder the next time.
Is there anything about your branch that brings out the best in you?
Trust. Branch management trusts us to do our job the right way every day and gives us considerable autonomy without micromanagement. They also encourage us to under promise and over deliver, which is a good way to do business. We also act as one team. Underwriters here don’t approve a deal, throw it over the fence to our colleagues in fulfillment and forget about it. We follow up to make sure an approved deal becomes a funded deal.
The lending market in B.C. is competitive. How do you plan to stay ahead of the curve?
By staying on top of industry trends, sharing our knowledge with brokers and staying hungry for their business.
In closing, what would you like brokers to know about your branch?
We’re here for them; we’re here to help. They can count us to go all out on every deal they bring our way.