To all: MortgageQuote Existing and Future Private Equity Mortgage (PEMTM) investor-lenders
Recently seen on a publicly posted website that belongs to a government and securities commission regulated mortgage investment company; in an answer to a potential investor's question regarding guaranteeing of principal and risk:
IS MY PRINCIPAL GUARANTEED?
No. Your investment is secured by the mortgages held by the fund, and there is always risk associated with this type of investment. It is our business to manage risk on behalf of our investors and we have a strong record of successful risk management.
Well, at MortgageQuote, we have always preached about the risks of investing your money in any mortgage investment that is not directly registered on the underlying real estate - AVOID IT. Investing in the shares of a mortgage investment company is no less risky than investing in the shares of a company listed on a financial exchange. You are really placing your trust in the people who RUN THE COMPANY; you do not get the benefit of the safety of the underlying mortgage investment and there are many companies who have good mortgage investments but go into CCAA or CHAPTER 11 because not of the risk of the underlying investments but the RISK OF POOR BUSINESS MANAGEMENT. (Contact us if you have questions about this paragraph).
Anyhow, the point is this:
ANY COMPANY WHO SAYS THEY ARE IN THE BUSINESS TO MANAGE RISK ON BEHALF OF INVESTORS should also have the supporting third-party, objective proof to show HOW the business manages risk. One internationally recognized and certifiable approach is implementing an ISO 9001 quality management system. The ISO 9001 quality management system enables businesses to prevent and correct unwanted actions and outcomes. The system is a nothing less than a risk management system.
All savvy investors know that any company in the finance industry whose management purports to be in the BUSINESS OF MANAGING RISK, is required to let the audience know what tested, certifiable, auditable and established risk-management system they have in place to effect the risk management outcome. If not, the savvy investor knows that it's only BS: "Business Selling-a-line."
Conclusion:
FOR COMPANIES WHO ADVERTISE FINANCIAL INVESTMENTS, IT IS NOT SUFFICIENT TO REPRESENT BY MERELY STATING YOU ARE MANAGING RISK, IT IS INCUMBENT UPON THE COMPANY TO ADVERTISE PROOF OF HOW THEY MANAGE RISK - IN A MANNER THAT THE INVESTOR CAN VERIFY WITH A THIRD PARTY SOURCE BEFORE DECIDING TO INVEST.
MortgageQuote Canada Corp. is your answer.
(1) FOR MORTGAGE INVESTOR-LENDERS, IS MORTGAGEQUOTE IN THE BUSINESS OF MANAGING RISK?
YES
(2) HOW DOES MORTGAGEQUOTE MANAGE RISK?
CERTIFICATION TO ISO 9001:2008 QUALITY MANAGEMENT SYSTEM (QMS)
(3) CAN A PROSPECTIVE OR EXISTING LENDER OBTAIN THIRD-PARTY VALIDATION OF MORTGAGEQUOTE'S (QMS)
YES (HERE) - OR EMAIL US
#1 in Canada for Quality Management in the Finance Industry: serving the needs of borrowers, brokers and investor-lenders (proof).
Learn more at investor.mortgagequote.ca
Dedicated to Quality Management in the Finance Industry; a finance application of Conformity Science. Conformity Science (www.conformity.org) includes the subordinate, abstracted concept system represented (or expressed) by the designated terminological phrase: "Bungay Unification of Quantum Processes Algorithm"; also represented as the "Principles of 'BlockChain'" or the simplified compound term: "BlockChain"; and the application thereof, on a pan-industry, pan-functional basis.
Showing posts with label Corporate Borrowing. Show all posts
Showing posts with label Corporate Borrowing. Show all posts
Sunday, 3 April 2016
Friday, 17 October 2014
CORPORATE APPLICANTS AND MORTGAGE BROKERS: THE DEFINITIVE GUIDE TO CHOICE
Do you work for a corporation that presently seeks or may one day, seek to apply for a mortgage? Don't go straight to a Mortgage Broker, it's the wrong thing for a corporation to do. To understand more, read below, an excerpt from the MortgageQuote.ca webpage entitled:
Corporate/Commercial (VenCap MortgageTM), Private Business Owner, Construction, Renovation & Developer Borrowers
ATTENTION ALL PROSPECTIVE CORPORATE CLIENTS:
PLEASE NOTE:
MortgageQuote.ca only accepts corporate clients if the corporate entity has approached at least their own institutional bankers first; and preferably a second banker or institutional lender in order to get a first and possibly, second institutional opinion respecting their project and mortgage financing request. Why?
Institutional bankers are the best free source of guidance and the cheapest mortgage source for corporate entities.
Rationale:
Corporations often retain Mortgage Brokers when they don't need to. In a corporate context, a corporation's own banker is a far better source of capital to a corporate applicant.
Further, corporate transactions are based upon many more factors than non-corporate transactions and decisions to lend money to corporate applicants can only take place after a complete corporate underwriting process has taken place.
Unlike with institutional banks, MortgageQuote.ca's corporate underwriting services are not free; both upfront Mortgage Broker retainer fees and downstream Mortgage Broker service/origination fees are payable. Proper corporate governance requires that a corporation should only bind itself to a Mortgage Broker Services Agreement with MortgageQuote.ca if there is a clear and demonstrable need established for a non-bank, brokered financing solution.
Further, MortgageQuote.ca does not seek to enter into a services agreement with a corporation that could already be satisfactorily qualified for financing from an institutional bank or lender. It makes no sense because even if MortgageQuote.ca were to arrange a "cheaper mortgage", Mortgage Broker fees are still payable so when the overall cost of borrowing is calculated, the cost of the Mortgage Broker's involvement will increase the corporations overall costs and often make the broker-sourced "cheaper option", more expensive than a non-brokered institutional bank solution.
In many cases, one of the key benefits of a mortgage brokered transaction is that the Mortgage Broker may identify a lender who may be both "cheaper" and "less burdensome" conditions-wise, than the corporations current available financing option. Or, the broker-sourced lender may be more expensive but will also loan a higher amount of money, or require less conditions precedent. Only once a corporation has approached its own "go-to" bankers, can a starting level of understanding be established, so that the overall finance-raising strategy can include a determination of whether or not the corporation may want to invest in the services of a Mortgage Broker for a second opinion or alternate, broker-sourced possible financing solutions.
It would be considered poor corporate governance if a corporation simply retained a Mortgage Broker merely because the corporation does not have an employee available to manage the financing request process. This is a false logic because in many cases of corporate mortgage finance, the Mortgage Broker fee may be more than the annual salary of the corporation's average employee. Indeed, if the corporation is truly a going-concern, it should simply appoint its CFO or if the corporation does not have a CFO, then its accountant, to take the role of approaching its own bankers. That's far less expensive than a third party Mortgage Broker and proper corporate governance. Shareholders will require that all competent corporate managers would act like this.
Therefore, all potential MortgageQuote.ca corporate applicants should go to at least their existing institutional bankers first. It truly is the right thing to do.
If, after the corporation has approached at least its own bankers and the bankers can not approve the financing; or, the bank can approve some sort of financing but not enough; or, the banks conditions are too burdensome, or the bank is materially too slow, then the corporation may want to reach out to MortgageQuote.ca.
The primary contact officer of the corporation will be required to disclose to MortgageQuote.ca the efforts the corporation sought to obtain financing from at least their own bankers and why exactly they realized the bank would not be helpful.
This process establishes two critically important and indisputable things:
1 - it provides MortgageQuote.ca with an honest, 3rd Party assessment of the corporation's financing request from the bankers point of view. This will enable MortgageQuote.ca to quickly and freely understand the corporations strengths and weaknesses from a credit underwriting prospective.
2 - it provides the corporation with the realization that if their project is truly worth it to them, then a mandate for a non-bank solution, namely a Mortgage Broker solution is established. The only question left for the corporation is "which mortgage broker to use".
Do you work for a corporation that presently seeks or may one day, seek to apply for a mortgage? Don't go straight to a Mortgage Broker, it's the wrong thing for a corporation to do. To understand more, read below, an excerpt from the MortgageQuote.ca webpage entitled:
Corporate/Commercial (VenCap MortgageTM), Private Business Owner, Construction, Renovation & Developer Borrowers
ATTENTION ALL PROSPECTIVE CORPORATE CLIENTS:
PLEASE NOTE:
MortgageQuote.ca only accepts corporate clients if the corporate entity has approached at least their own institutional bankers first; and preferably a second banker or institutional lender in order to get a first and possibly, second institutional opinion respecting their project and mortgage financing request. Why?
Institutional bankers are the best free source of guidance and the cheapest mortgage source for corporate entities.
Rationale:
Corporations often retain Mortgage Brokers when they don't need to. In a corporate context, a corporation's own banker is a far better source of capital to a corporate applicant.
Further, corporate transactions are based upon many more factors than non-corporate transactions and decisions to lend money to corporate applicants can only take place after a complete corporate underwriting process has taken place.
Unlike with institutional banks, MortgageQuote.ca's corporate underwriting services are not free; both upfront Mortgage Broker retainer fees and downstream Mortgage Broker service/origination fees are payable. Proper corporate governance requires that a corporation should only bind itself to a Mortgage Broker Services Agreement with MortgageQuote.ca if there is a clear and demonstrable need established for a non-bank, brokered financing solution.
Further, MortgageQuote.ca does not seek to enter into a services agreement with a corporation that could already be satisfactorily qualified for financing from an institutional bank or lender. It makes no sense because even if MortgageQuote.ca were to arrange a "cheaper mortgage", Mortgage Broker fees are still payable so when the overall cost of borrowing is calculated, the cost of the Mortgage Broker's involvement will increase the corporations overall costs and often make the broker-sourced "cheaper option", more expensive than a non-brokered institutional bank solution.
In many cases, one of the key benefits of a mortgage brokered transaction is that the Mortgage Broker may identify a lender who may be both "cheaper" and "less burdensome" conditions-wise, than the corporations current available financing option. Or, the broker-sourced lender may be more expensive but will also loan a higher amount of money, or require less conditions precedent. Only once a corporation has approached its own "go-to" bankers, can a starting level of understanding be established, so that the overall finance-raising strategy can include a determination of whether or not the corporation may want to invest in the services of a Mortgage Broker for a second opinion or alternate, broker-sourced possible financing solutions.
It would be considered poor corporate governance if a corporation simply retained a Mortgage Broker merely because the corporation does not have an employee available to manage the financing request process. This is a false logic because in many cases of corporate mortgage finance, the Mortgage Broker fee may be more than the annual salary of the corporation's average employee. Indeed, if the corporation is truly a going-concern, it should simply appoint its CFO or if the corporation does not have a CFO, then its accountant, to take the role of approaching its own bankers. That's far less expensive than a third party Mortgage Broker and proper corporate governance. Shareholders will require that all competent corporate managers would act like this.
Therefore, all potential MortgageQuote.ca corporate applicants should go to at least their existing institutional bankers first. It truly is the right thing to do.
If, after the corporation has approached at least its own bankers and the bankers can not approve the financing; or, the bank can approve some sort of financing but not enough; or, the banks conditions are too burdensome, or the bank is materially too slow, then the corporation may want to reach out to MortgageQuote.ca.
The primary contact officer of the corporation will be required to disclose to MortgageQuote.ca the efforts the corporation sought to obtain financing from at least their own bankers and why exactly they realized the bank would not be helpful.
This process establishes two critically important and indisputable things:
1 - it provides MortgageQuote.ca with an honest, 3rd Party assessment of the corporation's financing request from the bankers point of view. This will enable MortgageQuote.ca to quickly and freely understand the corporations strengths and weaknesses from a credit underwriting prospective.
2 - it provides the corporation with the realization that if their project is truly worth it to them, then a mandate for a non-bank solution, namely a Mortgage Broker solution is established. The only question left for the corporation is "which mortgage broker to use".
To learn more, email us at info[at]mortgagequote.ca.
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