IT'S A tough time for Canadians looking to get on the
property ladder. Rising inflation costs coupled with economic uncertainty and
creeping rates have left many individuals worried about paying their bills and
considering refinancing their mortgages. Research from Abacus Data found that
for 43 percent of Canadians, the current housing crisis is adding to their
overall financial stress; 35 percent say that their quality of life has
dropped; and 33 percent reveal that they now suffer from mental health
challenges because of the stress.
Andrew Gilmour, senior vice-president at CMLS Residential,
explained to CMP that this crisis has led to the creation of a new alternative
lending product to help Canadians achieve financial freedom and their
homeownership dreams – aveo Flex40.
Homeownership dreams
“CMLS’s mission has always been to provide Canadians with
innovative homeownership solutions,” explained Gilmour. “This is why we
position aveo Flex40 as the ‘missing middle’ between traditional alternative
lenders and the private space, offering a unique product position.
“We differentiate ourselves through our clear and
transparent fees and a defined path for clients to graduate to better financial
standing with a prime mortgage. Namely, aveo Flex40 offers several significant
advantages that greatly improve cash flow for clients. These include a 40-year
amortization, extended GDS/TDS ratios, and no loan-to-income requirement on
some of our products.”
And this help can’t come quickly enough. Research found
that, among non-homeowners, 72 percent want to buy a home but 45 percent are
pessimistic about that dream becoming a reality. Furthermore, among those aged
18–29, 41 percent still hold out hope – but most say their optimism is caving
in as housing costs climb and savings plummet.
Aside from homeownership, aveo Flex40 is also designed to
help clients with debt reconsolidation and improve their overall financial
picture, especially in the current climate. The extended amortization and other
flexible features included in aveo Flex40 lead to better cash flow, the ability
to pay off other debts, and improvement of the client’s financial foundation.
Graduation to prime
Aveo Flex40 goes beyond just securing that mortgage – it
improves clients’ overall financial stability.
“Unlike many private lenders, we are invested in our
clients’ long-term financial well-being and aim to provide a streamlined
qualification process for existing clients seeking to move to a prime mortgage
product once their credit has improved,” said Gilmour. “We offer both
alternative and prime products, which is unique in the market, ensuring that as
clients improve their credit scores, we can continue to support them with
suitable options.”
The aveo Flex40 product aims to provide a comprehensive
client solution beyond just a mortgage. As Gilmour explained, CMLS considers
itself a reliable partner with significant capital and a variety of lending
choices, offering a full suite of products for brokers and their clients.
“Our key differentiator is our commitment to helping clients
‘graduate’ out of their credit curve, which is something many competitors do
not focus on or even actively work against by charging more at each renewal.”
A typical aveo Flex40 client
It’s this uber-flexible and empathetic approach that makes
aveo Flex40 stand out in a crowded market. While there’s no real stereotypical
candidate for the new product, it is specifically designed to help people who
are stuck in a difficult and financially unstable position.
“A typical client who benefits would be someone looking to
refinance their mortgage due to credit card debt, student loans, or other life
events,” explained Gilmour. “The aveo product allows them to qualify based on
their credit criteria, pay off existing debts through the refinance, and then
have a lower mortgage payment due to an extended amortization, resulting in
more money in their pocket each month. This debt reconsolidation also leads to
improved credit scores, enabling them to ‘graduate’ over time to a prime
mortgage product.”
Flex40 also offers significant buying power for purchases
because in most cases there is no stress test nor loan-to-income test. With a
40-year amortization at the contract rate and extended ratios, it provides a
great solution for clients who might not qualify for a traditional mortgage due
to debt ratios or insufficient free cash flow.
“As mentioned, the program optimizes cash flows, giving
clients a higher affordability power and an improved ability to qualify for a
mortgage,” added Gilmour. “This shifts the conversation from just rates to
suitability, helping clients achieve their homeownership goals.”
Broker partnership throughout client journey
Aveo Flex40 isn’t just a win for customers; it’s a big help
to brokers too. As Gilmour told CMP, for partner brokers, working with aveo
counts toward their volume requirements in the seamless partnership program, a
benefit they might not find elsewhere.
“Additionally, we aim to streamline the approval process for
existing clients and reduce associated costs down the road. Crucially, we want
to partner with brokers on client graduation, meaning if a client they brought
to us for an aveo Flex40 mortgage later qualifies for a prime mortgage through
us, the broker will still receive full compensation for the new deal.”
In an environment where traditional mortgage solutions are
falling short for a growing number of financial rehabilitation and long-term
homeownership. By addressing both the affordability crisis and the structural
challenges faced by borrowers with compromised credit or high debt loads, the
product offers tangible relief and a path forward.
And, with Canadians under increasing financial pressure and
optimism around homeownership waning, this solution arrives at a pivotal time.
It’s not just about closing a deal; it’s about creating stability, enabling
progress, and building stronger financial futures for both clients and the
brokers who serve them.
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