TDFS Specialty Mortgage – Mortgage of the Year

Rewind one year and you’ll find yourself in a mortgage environment where few want to lend to you unless you have a 600+ Beacon score and/or considerable home equity.

When a lender comes along in that kind of environment and offers up to 90% uninsured financing, without Beacon score restrictions, it’s a big deal.

That’s exactly what TD Financing Services (formerly VFC Home Mortgage) did when it launched on February 13, 2009.

TDFS’s sole mortgage offering is its Specialty Mortgage, a 3- or 5-year product for the underserved non-prime market. Its niches include:

• Clients with minimal established (or re-established) credit
• Stated income deals without NOAs and rigid income reasonability rules
• Clients in credit counselling
• Low-beacon rental deals
• Borrowed down payment situations

TDFS also has two other key advantages:

1. A broad national lending area (most non-prime lenders are regional)
2. A recognized brand

On that last point, one big problem with subprime lenders over the last few years has been staying power. We’ve seen the likes of Accredited, Xceed, HSBC Finance, GE Money, Money Connect, and others exit the non-prime market.  That’s left countless borrowers stranded at renewal.  In contrast, TDFS President, Erik de Witte, says “The TD brand gives customers and brokers a high degree of comfort that we will be there when it is time to renew.”

TDFS’s first year has not been devoid of challenges, however. Witte concedes that VFC’s service at times “suffered due to application flow as brokers learned about (VFC’s) programs.”  TDFS is working diligently to improve its service commitment in 2010.

Overall, it was a very successful inaugural year for the company’s mortgage division.  TDFS says volumes met its expectations for 2009, and given its unique offerings, we wouldn’t be surprised if it markedly exceeded its targets this year.

The bottom line:  TDFS filled some very critical voids over the past 12 months, moreso than any other lender.  It is therefore this year’s selection for Canadian Mortgage Trends’ Mortgage of the Year.