Mortgage Digest: HELOC usage rises to near two-year high as borrowing picks up

Canadian homeowners are increasingly tapping into their home equity, with HELOC (Home Equity Line of Credit) usage rising to its highest level in nearly two years, according to data from Statistics Canada.

As of September, outstanding HELOC balances totalled $170.8 billion, up 3% from last year, according to the latest data from Statistics Canada. This marks a steady increase following declines throughout 2022 and early 2023.

While HELOCs play a significant role in household borrowing, they account for just 7.8% of Canada’s $2.2 trillion in residential mortgage debt as of September.

Although balances are still below their 2012 peak of over $199 billion, the recent uptick suggests renewed demand for this form of credit.

Higher mortgage renewal costs may be driving some homeowners to use HELOCs for short-term financial flexibility, while others are consolidating higher-interest debt or funding renovations to avoid the stricter rules and added costs of mortgage refinancing.

According to data from Mortgage Professionals Canada (MPC), the average amount borrowed from a HELOC as of the end of 2023 stood at $37,495, which marked a $4,165 decrease from 2022.

FSRA seeks mortgage broker representative for its Technical Advisory Committee

The Financial Services Regulatory Authority of Ontario (FSRA) is inviting mortgage professionals and industry stakeholders to apply for membership on its Technical Advisory Committee (TAC).

The TAC provides FSRA with advice and insights to enhance consumer protection, foster innovation, and improve regulatory practices in the mortgage brokering sector. FSRA is seeking four new members to serve a three-year term starting in January 2025.

Applicants should be senior professionals within their organizations and prepared to contribute expertise on key issues facing the mortgage sector. Current committee members whose terms are expiring may also reapply.

To learn more about the TAC’s role and selection criteria, review FSRA’s updated Terms of Reference. Interested candidates must submit a resume and cover letter to MBConduct@fsrao.ca by December 18, 2024.

The first meeting of the new TAC term is scheduled for February 2025.

Fastkey expands product access for Filogix users

Fastkey is enhancing its offerings for Filogix users by providing access to a wide range of its products through a new registration process.

By way of a link made available by Filogix within the Finastra community, Filogix users can now easily access Fastkey’s suite of tools, including solutions for CRA information retrieval, online criminal record checks, FINTRAC-compliant identity verification and AML/PEP, asset reports, income verification for mortgage applicants, and credit reports.

As a result, Filogix users benefit from preferred pricing on certain Fastkey products, including the CRA information retrieval and identity verification solutions.

Fastkey’s model is “pay-per-use” meaning that there are no upfront volume purchase requirements or subscription or periodic fees. Account registration is also free.

“One of Fastkey’s missions is to simplify success for mortgage brokers across Canada by delivering seamless and user-friendly solutions that save time, increase efficiency and improve client experience,” Sam Khajeei, President of Fastkey.com, told Canadian Mortgage Trends. “By integrating our innovative solutions into Filogix’s trusted platform, we are helping to ensure that a broader segment of the industry has access to these resources at deeply discounted pricing.”

Mortgage snippets

Scotiabank has received approval from the U.S. Federal Reserve to increase its investment in KeyCorp, a prominent U.S. financial services firm. The additional 10% investment will raise Scotiabank’s total ownership stake to 14.9%. KeyCorp, with $187 billion in assets and a network of approximately 1,000 branches across 15 states, is a significant player in the U.S. banking sector. This move aligns with Scotiabank’s strategy to expand its presence in the U.S. market and strengthen its cross-border financial partnerships.

CMHC announces enhancements to housing programs: The Canada Mortgage and Housing Corporation (CMHC) has introduced changes to its Affordable Housing Fund and Apartment Construction Loan Program to boost rental housing supply and improve housing access for middle-class Canadians.
The Affordable Housing Fund will now prioritize funding for projects that incorporate energy-efficient designs and serve underrepresented populations, such as Indigenous and Northern communities. Meanwhile, the Apartment Construction Loan Program has raised its maximum loan amount to $500 million per project to encourage the development of large-scale rental housing that benefits both low-income and middle-class Canadians.

These enhancements reflect CMHC’s broader strategy to address Canada’s housing affordability challenges and increase rental supply nationwide.

Realtor numbers drop at Toronto’s real estate board: The Toronto Regional Real Estate Board (TRREB) has reported its first membership decline since 2011, with numbers falling 8% at peak renewal time—from 75,496 in December 2023 to about 69,000 in January 2024.
Toronto realtor Scott Ingram, who tracks TRREB membership, noted this was the steepest drop since 1991, as high borrowing costs and slower sales volumes challenge the real estate profession.

nesto recognized in Deloitte’s Technology Fast 50: nesto has been named one of Deloitte’s Technology Fast 50 winners for 2024, recognizing its rapid revenue growth and innovation in the mortgage industry.
The program highlights Canada’s fastest-growing tech companies, with nesto earning a spot due to its digital-first approach to simplifying the mortgage process.

“Our back-to-back recognition as a Deloitte Fast 50 winner is a testament to the hard work and dedication of our diverse team,” said Malik Yacoubi, Co-Founder and CEO of nesto. “With the recent acquisition of CMLS Group, we are building Canada’s mortgage ecosystem of the future.”

Pineapple expands with two new affiliate brokerages: Pineapple Financial Inc. has announced the addition of two new affiliate brokerages, Luxe Lending Corp. and Mortgage Magic, expanding its network across Canada.
In 2023, affiliate brokerages accounted for nearly 37% of Pineapple’s funded volume. The company also reported 82% year-over-year growth in agents as of October, reflecting its continued focus on growth and support for its broker network.

Next Steps: Mortgage industry career moves

“Next Steps” is a feature in our Mortgage Digests that highlights notable job changes and career advancements within the mortgage industry. If you have a job update to share, we welcome your submissions to keep the community in the loop.

Susan Carter retires after an 18-year career in the mortgage industry

Susan Carter retires after 18 years in the mortgage industry.

Susan Carter, vice president of marketing and communications at Sagen, has retired after an 18-year career in the mortgage industry, including eight years with Canada’s largest private mortgage insurer.

Since joining Sagen, Carter has played a key role in its rebranding and the company’s transition through Brookfield’s acquisition. Her career also includes leadership roles at Equitable Bank, National Trust, and American Express, as well as co-founding the marketing agency Blue Torpedo.

Carter holds a degree in drama studies from York University and has completed advanced negotiation training at Harvard Law School.

Tolga Yalkin starts new role as CEO of BCFSA

Tolga Yalkin, CEO of BCFSA

Tolga Yalkin has officially assumed his role as Chief Executive Officer and Chief Statutory Officer of the BC Financial Services Authority (BCFSA), succeeding Blair Morrison, who retired earlier this year.

Previously, Yalkin served as Assistant Superintendent of Regulatory Response at the Office of the Superintendent of Financial Institutions (OSFI), where he led initiatives on cybersecurity, crypto-assets, operational resilience, and climate risks.

His extensive experience is expected to drive BCFSA’s growth and evolution in British Columbia’s financial services sector.

Yalkin holds honours degrees in business and law from the University of Oxford, the University of Sydney, and the University of British Columbia.

MCAN Mortgage announces CEO departure and interim leadership

MCAN Mortgage Corporation has announced the departure of Donald Coulter as president, CEO, and director. The Board of Directors expressed its gratitude to Coulter for his contributions during his tenure.

The Board has appointed Derek Sutherland as interim CEO while the search for a permanent successor is underway. Sutherland, who has served as Chair of MCAN since 2017, brings extensive experience, including a previous term as interim CEO in 2023.

“I am excited to work alongside our talented and dedicated team to ensure continued strong performance and achievement of our objectives, which remains to be a focus on our core mission of providing sustainable growth and returns to our shareholders,” said Sutherland.

The Board will evaluate options for selecting a permanent CEO as the company continues its mission of delivering reliable income streams through its diversified mortgage and real estate portfolio.