TORONTO, Sept. 8, 2014 /CNW/ - A report from the Mortgage Broker Regulators' Council of Canada (MBRCC) should help bolster the confidence borrowers have in the services being provided by mortgage brokers in Canada. The report indicates that most mortgage brokers work to direct their residential clients toward suitable mortgages. However, the report also notes that there is still room for improvement in a number of areas.
Canada's mortgage broker regulators have identified mortgage suitability as a priority and a concern that is shared across the provinces. "Unsuitable mortgages can have a devastating financial impact on borrowers and their families," MBRCC Chair Kirk Bacon said. "We've also seen national economies around the world suffer when too many households are stuck with unsuitable mortgages." The report confirms that mortgage brokers have an important role in ensuring that the mortgages Canadians receive are suitable.
The MBRCC met with a number of industry associations to map out the role and activities of mortgage brokers in new residential mortgage transactions. They gathered information to develop a benchmark understanding of the processes and practices mortgage brokers ought to employ to ensure the mortgage advice and options they provide are suitable for their clients.
The MBRCC then conducted a survey of mortgage brokers with regulators in Alberta, Newfoundland & Labrador and Ontario reaching out to select brokers to participate. The survey was designed to determine how closely current practices align with the benchmark. Participants were questioned on a variety of topics, including assessing a client's need and circumstances, developing product option(s) and disclosures. According to the report, the vast majority of the 1,113 brokers surveyed have adopted practices that are integral to providing suitable options and advice to mortgage consumers.
"We now have a much clearer picture of what mortgage brokers are doing to help ensure the suitability of new residential mortgages," Bacon stated, noting that the report was viewed as the foundation for future collaborative efforts among the regulators. "The MBRCC plans to build out from it to further our work in protecting Canada's mortgage consumers and improving the marketplace."
The report is one of a series of successful collaborative efforts for the country's provincial mortgage broker regulators. Since its establishment in 2012, MBRCC members have worked together to identify common concerns, develop shared solutions and harmonize the regulatory landscape. Included in the efforts already completed by the MBRCC are standardized risk disclosure materials for consumers in all provinces, competency and curriculum requirements for all mortgage broker licensing courses and an online tool to assist brokers in identifying the possible licensing and registration rules for transactions that cross provincial borders. MBRCC members are also currently working together to develop national licensing education standards and a harmonized course accreditation process.
The MBRCC is an inter-jurisdictional association of mortgage broker regulators that seeks to improve and promote harmonization of mortgage broker regulatory practices to serve the public interest. Its members work together and with stakeholders to identify trends and address common regulatory issues through national solutions that support consumer protection and an open and fair marketplace.
MBRCC members represent the nine provinces that currently have legislative and regulatory frameworks governing mortgage brokers or have an interest in developing one; British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Quebec, New Brunswick, Nova Scotia and Newfoundland & Labrador.
Mortgage Brokering Product Suitability Review: Link
MBRCC Homepage: www.mbrcc.ca
MBRCC Newsletter: Link
SOURCE: Mortgage Broker Regulators' Council of Canada
For further information: English Contact: Martin Boyle, Mortgage Broker Regulators' Council of Canada, Martin.Boyle@fsco.gov.on.ca, 416-590-7031; French Contact: Stéphanie Fournier, L'Organisme d'autoréglementation du courtage immobilier du Québec, firstname.lastname@example.org, 1-800-440-7170 ext. 8693