Don Scott, our latest guest on the RENN podcast, is the CEO and owner of Frank Mortgage. Don Scott is a veteran in the mortgage market with over 30 years of experience. His journey began on the Capital Market side of the business, where he worked for financial giants like CIBC, Deutsche Bank, and Maple Bank. Scott’s extensive experience allowed him to develop a deep understanding of the market dynamics and make personal relationships with many lenders.
When Scott left his last banking job, he realized he didn’t want to return to traditional banking. Instead, he decided to tackle some of the issues he had observed in the mortgage market. This led to the creation of Frank Mortgage, a company that represents his vision for a more transparent and customer-friendly mortgage market.
“I’ve always just loved the mortgage market and been very involved.” – Scott for Real Estate News Network Podcast
Frank Mortgage aims to revolutionize the traditional mortgage process, which Scott describes as “opaque, cumbersome, and confusing”. Scott believes that this doesn’t have to be the case. By leveraging technology, Frank Mortgage offers an open and transparent mortgage marketplace that is easily accessible to customers.
Scott emphasizes, “People don’t wake up and go ‘I’m going to get a mortgage,’ they wake up and go ‘I’m finally gonna get a house.’ This is about buying homes, owning property, this is not about getting a mortgage or a means to the end. So if we can simplify the process so that the homeownership journey is a little more joyful like it’s supposed to be.”
What sets Frank Mortgage apart from other mortgage brokers is its commitment to being the agnostic middle ground. The company does not own a lender and does not intend to, thereby eliminating the traditional broker bias. When a customer applies through their platform, an algorithm takes the information and compares it against all of the lender underwriting criteria and their product features. This allows customers to instantly see the kind of products they can qualify for, providing them with real choices in the market.
Scott envisions a future where the mortgage process is completely online, with end-to-end integration between the broker and the lender. He believes that in 5-10 years, the market will look completely different, with machine learning potentially helping in decision-making. He wants Frank Mortgage to be a leader in this development.
In a recent episode, the topic of whether one should go to a mortgage broker was discussed. The host, Tony Ning, posed a scenario: “If a customer says, ‘I have good credit, a solid employment history, a stable income, and a provable downpayment, I don’t need a mortgage broker.'” Don responded by highlighting the value that mortgage brokers bring to the table. He pointed out that many lenders they deal with don’t go directly to consumers; they only deal through mortgage brokers. This means that by not going through a broker, you could be missing out on potential lenders and competitive rates.
Scott also drew attention to the current state of the market. He mentioned that the rate on an insured 5-year mortgage at Frank Mortgage is currently 4.84%, a figure that none of the banks come close to when you look at their posted rates. This stark difference underscores the potential savings that can be achieved through a mortgage broker.
Moreover, Scott emphasized that brokers often offer different incentives to customers, sometimes in the form of discounts on the rates. This practice further enhances the financial benefits of working with a broker.
Scott concluded by saying, “Maybe dealing with the bank is easy, but loyalty to your bank shouldn’t cost you money.”
This statement embodies the essence of his argument: while it might seem simpler to stick with your bank for a mortgage, doing so could end up costing you in the long run. By contrast, working with a mortgage broker like Don Scott can open up new possibilities, potentially leading to better rates and significant savings.
