Fresh from gobbling up a much larger residential and commercial mortgage player, online lender Nesto Inc. has its eye on a larger slice of the mortgage market.
Since its founding in 2018, Montreal-based Nesto has grown rapidly. Its most recent spurt occurred in June with theThe deal pushed Nesto into the big leagues of non-bank lenders as well as into the commercial mortgage sector. Nesto-CMLS has $60-billion in outstanding mortgages, up from Nesto’s $10-billion prior to the deal. The combined company has 1,000 employees in 10 offices across the country compared with 300 Nesto staff.
With mortgage rates now hovering around 5 per cent, those homeowners will see a significant increase in their payments and they will be looking for their cheapest options. Since borrowing costs started increasing in 2022, the big six Canadian banks have gained market share from other lenders. As of the end of last year, they had 64.8 per cent of the new mortgages or mortgage originations. That was up from 53 per cent at the end of 2022, according to data from CMHC.