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Mortgage Broker News | 18 Aug 2016, 08:15 AM Agree 0
One regulator has issued a consumer warning for a controversial product offered by many brokers
  • Dave | 18 Aug 2016, 09:20 AM Agree 0
    Just ask Urbancorp investors...
  • Dustan Woodhouse | 18 Aug 2016, 09:43 AM Agree 0
    It seems to me that current mortgage Broker training, such as it is, focuses exclusively on helping clients obtain mortgages.

    Assisting clients with borrowing funds secured against real estate is where it ends. At no point in the course I took do I recall a single sentence of instruction around assisting clients with investment decisions. In fact I do recall some language advising that we steer clear of being perceived to be offering any advice we are not licensed to give including but not limited to tax planning, contract law, and investing.

    To suggest, based on the licensing courses, that a mortgage Broker is even half as qualified (officially) to offer investment advice as a certified financial planner would be disingenuous. And if a Broker does feel that they are able to offer expert investment adice then they should take the time to get themselves licensed accordingly.

    It is easy to understand how the public could have the misconception that a mortgage Broker would be the go to source for advice on investing in mortgage products.

    However I find it difficult to understand how Mortgage Brokers can have the same misunderstanding around their own abilities.

    This is just the unlicensed (when it comes to investment advice) opinion of one Broker.
  • Ron Butler | 18 Aug 2016, 10:05 AM Agree 0
    I have been advocating for ending mortgage broker involvement in large syndicated mortgages for years. This is simply not a product that mortgage brokers should be selling. That being said mortgage brokers have been successfully dealing in private mortgages for years and have been by and large doing a very good job for their investors.

    Large multi-million dollar projects are NOT the same thing as a private first mortgage on a single family detached and in Ontario at least the sale of those huge syndicated mortgage investments should be transferred from FSCO to the OSC.
  • Cat | 18 Aug 2016, 10:35 AM Agree 0
    I concur with you Ron Butler! Being securities educated I often ask where the protection is with no answer. For that reason; I am out!
  • I agree with Ron Butler | 18 Aug 2016, 01:52 PM Agree 0
    As usual, Ron has nailed it.
  • Chuck Barrett | 21 Aug 2016, 06:26 PM Agree 0
    The Fortress style mortgage products should be sold as securities through Offering Memorandums or Prospectus to sophisticated investor clients by licensed securities firms.

    As a long time syndicated mortgage lender and administrator, I can confirm that the level of risk in well underwritten commercial or residential syndicated mortgage is far less than that on a speculative development loan.

    I firmly believe that mortgage brokers and agents are opening themselves up to sizeable legal claims when numerous of these investments fail to perform as advertised and investors suffer material losses.

    FSCO should immediately reclassify this type of investment to the purview of the OSC and ban mortgage brokers and agents from selling these type of third party syndicated investments.
  • Paul Redley | 23 Aug 2016, 02:24 PM Agree 0
    Clearly the regulator considers SMI's to be a high risk investment and as Ron Butler points out, these are not your regular private res/commercial investments. They require carful detail disclosures by the broker/agent.

    My question is where is Glenn May-Anderson of FDS comment on this new filing?
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