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A new digital mortgage company
Jan 24, 2017
New Models for Mortgage Lending:
Mogo Finance Technology Inc. has registered as a broker in three provinces and launching an online and mobile interface where users can compare rates, apply for a mortgage and track their payment progress. The Vancouver – based fintech company has registered in British Columbia, Alberta and Ontario with plans to expand throughout Canada. Mogo also offers personal loans. The new platform includes an interactive dashboard for users to walk through the whole mortgage process. The company will receive a commission on mortgages completed through this service. (Postmedia Network, which owns the National Post, has a revenue sharing agreement with Mogo.)
According to Mogo, the product aims to make the process more transparent. Founder and chief executive Dave Feller said “ if you look at a typical mortgage experience , and go to any bank website, everything is a black box” “ We really outline the whole process” Their goal is to effectively become a full offering, just like a digital bank without the bank.
MogoMortgage’s fee-based model, which gives Mogo upfront revenue without capital requirements or credit risk, helps de-risk the company,said Steven Salz, research analyst at M Capital Partners in Toronto. The Street has historically been concerned about Mogos cash burn and liquidity, he added. “It’s good for the company in the sense that they are trying to diversify into more fee-based, off- balance sheet products….I think it should be interesting for them”, said Salz.
This comes as Canada’s biggest banks invest heavily in fintech, as technology transforms all aspects of how banking is done.
Adapted from Armina Ligaya Financial Post