Controversial document infuriates brokers

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Them’s fighting words: A document from an RBC employee outlining the differences between mortgage brokers and specialists is drawing the ire of brokers – charging it mischaracterizes their work, their qualifications and their motives.

“Brokers will farm out your mortgage to a number of companies and then will set you up with a financial institution based on only the lowest rate, no other factors,” reads the undated document  -- “Understanding the difference between mortgage specialists and mortgage brokers.” An RBC logo and the name of one of its British Columbia mortgage specialists appear on the flyer. 

There’s more.

“When selling your mortgage the broker and the financial institutions reviewing your file may pull numerous credit bureau requests depending on their software capabilities,” continues the document, which aims to provide mortgage specialists with talking points to answer client questions. “Brokers will charge set up fees and have other hidden costs you should be aware of.”

Neither the specialist nor RBC corporate communications in Vancouver returned MortgageBrokerNews.ca  calls Friday.

Still, the flyer has now been posted to industry websites across the country, with more than 250 brokers venting their rage and disappointment.

“I think the relationship between mortgage brokers and mortgage specialist is akin to some of the biggest rivalries in sports,” Greg Williamson, founder of 180 Degrees Coaching, told MortgageBrokerNews.ca. “But this is misleading and for those who read it and don’t know our business, it will mislead them.”

The broker was one of the first to post it on his blog website, www.gregwilliamson.ca. One of the document’s most glaring inaccuracies, maintains Williamson, is the suggestion brokers repeatedly run reference checks on clients.

“If a mortgage broker is using Filogix, they’re generally only pulling a credit check once,” he said. His blog has now attracted more than 280 responses, mostly from brokers concerned the RBC flyer will erode consumer confidence in their industry.

Under another section marked “Training and Educational Differences,” the writer extols the financial planning and institutional knowledge of bank mortgage specialists. She then offers a much briefer synopsis of broker qualifications: “Depending on your province, mortgage brokers must be licensed through the Accredited Mortgage Professionals course. Only this course is required, no financial planning included.”

Many brokers are concerned that the document may speak to the bank’s corporate attitudes about the broker channel. It is, in fact, the only one of the Big Five that has never used external brokers.

“There were obviously inaccuracies in the report,” CAAMP President and CEO Jim Murphy told MortgageBrokerNews.ca. “I’m in discussions with senior officials from RBC that they were not aware of it and are looking into it.”

  • @kiltedbroker on 2011-04-19 4:09:08 AM

    What a great platform for mortgage professionals to have excellent conversations with clients and referral sources about the difference between us and the bank! There is no doubt about the advantages of using a broker, and I welcome this opportunity to talk about it!

  • Zoltan M. Padar MortgagePRO Ltd. broker on 2011-04-19 4:10:12 AM

    I bet the mortgage specialist, whom we can thank in this discussion, did not mentioned the fact, the only alternative presented by him/her is only one lenders product. Mortgage Brokers generaly have all lenders products at their fingerprints, thus offering choices to clients. More so, offering a professional plan to ensure client retention as well.

  • Dean on 2011-04-19 4:11:41 AM

    The employee obviously has an axe to grind; probably lost a lot of business to a broker. What they failed to cite in the article is that the vast majority of Brokers are formers Bankers, and that we left the Banking Side to provide our clients with better service, selection, value and yes, cheaper pricing.

  • vittorio on 2011-04-19 4:12:02 AM

    wow, that shows that Royal bank is running scared that they need to make up lies in order to win mortgage clients. maybe just maybe Royal bank has reliazed that Mortgage Brokers offer so much more that their mortgage specialist that they are losing deals after deals. this type of misleading information has been around for many years. it just shows how Royal Bank is losing business and feel this is the only way they can compete. To bad they could learn alot from mortgage brokers. Silly banks I guess they will never learn.

  • Kevin Power, President Power Mortgages Inc on 2011-04-19 4:12:55 AM

    This does not surprise me in the least. RBC has never supported the brokerage industry and has always been a pain the side of our industry. It is truly amazing though, that RBC and other bank mortgage specialists continue to call themselves mortgage brokers. I have clients who have called banks asking for information about mortgages and were told that they would have one of their mortgage brokers contact them. The usual case of sucking and blowing at the same time. At least this guy was stupid enough to put his opinion in writing.

  • John Woods, The Mortgage Centre, Fitzwiliam Mortga on 2011-04-19 4:13:43 AM

    As a member of CAAMP I will fully expect my national association to to not only be in touch with RBC over this obviously misleading document but also take whatever steps are appropriate to force this specialist and RBC to retract this misleading comments.

  • Janet Kostner on 2011-04-19 4:15:29 AM

    RBC is also a member of CAAMP, they have broken the cardinal rule about speaking ill of other brokers or members, this is definitely something that CAAMP should address and file a complaint with RBC and demand a retraction, how low can they go

  • lynn wallace on 2011-04-19 4:17:54 AM

    she needs to make a formal apology, and hopefully she understands what she did wrong

  • George Tinnes on 2011-04-19 4:18:20 AM

    not surprising that a specialist under a lender who does not deal in the broker origination world will provide literature that is not accurate and then hide under the corporate protection.
    When talking about Accredited Mortgage Professionals courses, this person may have missed the topic relating to the ethics and integrity of the business.

  • corbett connors on 2011-04-19 4:18:44 AM

    It’s quite obvious this lady has very little experience and/or is lacking confidence? I am sure RBC would not be careless enough to approve a message with such libelous comments. Lets hope they do the right thing and remove this lady from their ranks?.I imagine they would not want this kind of publicity. But on the other hand this is RBC ???

  • Concerned Broker on 2011-04-19 4:22:18 AM

    According to one Financial Planner, the document should be forwarded to the BC Securities Council for enforcement. Without a CFP designation, you cannot use the term Financial Planner and even Financial Advisor (is questionable), as the RBC Mortgage Specialists are holding themselves out as Personal Financial Planners.

    Furthermore, they are promoting cross selling which also fattens their commissions.

  • Kate on 2011-04-19 4:23:16 AM

    I think most of us in the industry would not be surprised about this approach from RBC. I have found that RBC employees are very well-versed in erroneously criticizing mortgage brokers. Since they use the same words & arguments in many branches, I conclude that it is corporately instituted & approved. Why would we think otherwise?

  • Roberto Noriega on 2011-04-19 4:38:53 AM

    Typical Marketing War where brokers’ opponents are bank specialists (the competition) and the battleground to be won are the customers.
    Though clichéd brokers have to know their opponents in order to outbid, outbalance and outflank the competition, the planning done is for better innovation and ingenuity to win the clients. But to besmirch or vilify your competition is a cheap shot (despite current trend of dog-eat-dog pedestrian style).
    Clients however nowadays are no longer what they used to be in the past deemed as the ‘dupe of charlatan’. Most clients now simply not buying what they wanted to hear. Clients conduct their own due diligence. Ergo, the competition who adopts that kind of mudslinging style is actually shooting self in the foot.

  • MK Woodson on 2011-04-19 4:45:57 AM

    Question is: What's CAAMP doing about this. Is this libel?

  • @kiltedbroker on 2011-04-19 4:46:23 AM

    Just read the document from the woman at RBC, worth a good laugh, she has no idea! Towing the company line!

  • Paul Ouellette on 2011-04-19 4:51:15 AM

    Kilted Broker ??? WTF...I'm not the only celticly afflicted mtg broker out there ?? Who would have ever known !! Slainte M8, Paul Ouellette, Windsor Ont.

  • Gale Tracey AMP on 2011-04-19 4:51:39 AM

    It is unfortunate that this RBC Specialist took it upon herself to write her own version of how a Mortgage Professional, Licensed Mortgage Broker or AMP conducts business. As we are ethically bound I cannot see that we would take it upon ourselves to distribute this type of literature about unlicensed and undesignated Mobile Bank Specialists to compete for a clients business.

  • Concerned Associate on 2011-04-19 4:54:38 AM

    I think it is time the Banks were required to have their employees obtain licences to sell mortgages. Clearly there is a need for ethics training.

  • John Matin Mokrenko on 2011-04-19 5:00:44 AM

    What do you expect.Just look from were the commments are coming from.The RBC is arguably the worst financial institution in the whole country when it comes to client satisfaction and service.

  • James Shinners on 2011-04-19 5:02:56 AM

    What does she know, Mobile Mortage Specialists only finance Mobile Homes, right!? LOL

  • Stan Applebaum on 2011-04-19 5:04:13 AM

    From the mid-1990's to the mid-2000's … I was an active broker who called upon a MORTGAGE SPECIALIST from RBC on many occasions … I didn't receive a FINDER'S FEE … that wasn't the point … the RBC MORTGAGE SPECIALIST … underwrote the deal in his own INIMITABLE WAY to get deals approved that would have been turn downs by any of the OTHER major banks who paid finders fees.

    The RBC MORTGAGE SPECIALIST(S) SINCE I used more than ONE … continually added deals to my year that would NEVER HAVE BEEN DONE ANYWHERE ELSE … at the BEST RATE and with CMHC APPROVALS, that is, up to 95% LTV …

    RBC has NO BUSINESS dissing INDEPENDENT Mortgage Brokers/Agents …

    The issue is corporate … get off YOUR high horse RBC … the fact is INDEPENDENT Mortgage Brokers/Agents have contributed in the past to RBC's bottom line …

    This must mean that MORTGAGE BROKERS ARE GAINING MORE BUSINESS therefore RBC MORTGAGE SPECIALIST’S need to put the ‘other’ down to convince the John Q. Public … desperate for market share RBC MORTGAGE SPECIALISTS need any tool they can latch on to in order to maintain theirs!

  • Michael Celuch on 2011-04-19 5:07:52 AM

    Typical of the ignorance of bank employee's who can't develope their own sources of business without bashing the competition. She's not the first nor will she be the last to use these tactics.

  • ahmed buksh on 2011-04-19 6:00:35 AM

    RBC mortgage specialists are not licenced , the morgage brokers are by taking appropriate courses and continued aducation requirements , they only pull one credit history and can send to multiple lenders and thus shop for the best rate . the morgage brokers discloses that there are working for the clients and not the bank and RBS specialists work for the RBC , ( conflict of interest. )Mortgage brokers have more the one banks or financial institutions product knowledge , RBC specialist is not a real specialists , they call them specialists because they can't be called mortgage brokers . can
    brokers are specialsts also .

  • Cheryl Brown, AMP on 2011-04-19 6:15:06 AM

    This could be the best publicity that the broker industry could have ask for. And all the the expense of RBC.

  • David O'Gorman Principal Broker on 2011-04-19 6:26:34 AM

    If only CAAMP had pushed in Ontario & BC so ALL BANK ROAD RATS were licensed, like in Alberta, we would not have this disemination of false information...this "mortgage specialist" does not explain, verbally or in writing, like every other bank "mortgage specialist", that the commission she earns on every mortgage is tied directly to the interest rate charged to the borrower...get the poor borrower to pay posted rates,she earns 125 to 135bps...have the borrower pay the discounted rate & she only gets 30-40 bps on a 5 year mortgage....left that part out of her advertising material...instead of flogging designations maybe CAAMP should be advertising the truth about mortgage brokers vs banks...but thats not going to happen.

  • A. Graham on 2011-04-19 6:32:44 AM

    Surprise! Maybe the RBC Specialist is unaware that a great number of Brokers are ex-Bankers some with extensive financial planning, lending and banking backgrounds!

  • Maria Jose Martins, MBA on 2011-04-19 6:35:07 AM

    Mortgage Brokers/Agents do not have hidden fees. As licensed professionals, we have an obligation of full disclosure on every aspect of the mortgage transaction - all part of the "Code of Ethics" obligation. In fact, there are no fees applied on regular institutional transactions. Mortgage Brokers/Agents get paid Finders Fees from the banks. Where there a broker fee may apply is on those sub-prime and/or privately funded transactions and the Mortgage Brokers/Agents disclose the amount or percentage up front. This is all in adherence to the rules and regulations that govern the Mortgage Broker industry. That RBC Mortgage Specialist is to get educated.

  • Glen on 2011-04-19 7:36:25 AM

    Corinne S is the name on the document that I have seen. She operates in Vancouver and Richmond BC
    I suggest that Mtg Brokers (&Sub brokers in BC) ask your referral sources if they have seen anything from an RBC mortgage rep titled "Understanding The Differences between Mortgage Specialists and Mortgage Brokers"
    If so please note who has received this erroneous information. Contact Jim Murphy (pres and CEO with CAAMP) and the Mtg Brokers Association of BC for to confirm that you have referral sources who have received the material that CS has handed out.

  • Elfie Hayes on 2011-04-19 7:58:19 AM

    With so many ethical rules broken in one marketing piece perhaps it's time RBC dealt with this issue by offering her a fond farewell. I tried to leave her a comment on her website today, but the site is no longer functioning. Can we take that to mean she has left the building? I hope so.

  • Christopher Bisson, B.Comm., A.M.P. on 2011-04-19 9:19:46 AM

    The very fact that the RBC Mortgage Specialist is flat out full of misleading information puts a smile on my face: It underscores the person's lack of confidence in their abilities and their company's products.

  • Rob Campbell on 2011-04-20 12:56:40 AM

    I couldn't stop laughing while reading this RBC Rep’s handout. This material can’t be any farther from the truth as we all know, but sadly the public doesn’t. It proves how important it is to keep our clients well informed and up to date with what we do and how we do it. Thank you Corrinne for helping us Brokers appreciate the skill and professionalism that we carry.

  • Fiona K on 2011-04-20 2:32:28 AM

    The unfortunate part is that no action will be taken against this mortgage specialist. High producing "golden children" at RBC are untouchable. I can only imagine what would happen if a CAAMP member issued this sort of document against a fellow broker......

  • Carolyn Jones on 2011-04-20 10:09:57 AM

    While it is unfortunate that the writer will get away with this, face book and other blog reports will help to get the truth out there. It is really sad, that's all I can say.

  • Corey on 2011-04-20 10:42:05 PM

    My only worry is that because of this publicity nightmare this rep could be disciplined and on the street looking to find a job as a broker before the week is out !!!

  • vittorio on 2011-04-21 4:41:01 AM

    It is so nice to see mortgage brokers and associate coming together, stand together about an unjust in our industry, while I agree with everything that everybody has said, I am glad to see so many associates coming to the aid of our industry. Most Mortgage brokers work their butt off to make sure that their clients receive the best advice and rates. Too bad it has taken a bad word from a person who does not know nothing for us to band together and show the world that we are strong as a unit and we believe in what we do.

  • mikeross on 2011-04-25 11:19:33 AM

    Terrific work! This is the type of information that should be shared around the web. Shame on the search engines for not positioning this post higher!

  • Matthew Buxton - Alberta Mortgage Solutions on 2011-04-26 2:34:47 AM

    As Mortgage Brokers and Agents we need to unite against this type of marketing and business practice. It is unfortunate RBC did this but no surprise for those who have been in the industry for some time. I see it as an opportunity - we are obviously having an effect on them! Keep up the good work!

  • Linda on 2011-04-26 7:02:03 AM

    What a fantastic opportunity to better educate people about our industry. The article was almost sad - is that how hard the whip is being cracked at RBC - it lead someone to write utter rubbish? Guess high fives to all of us .. we have been too busy working hard securing great rates and giving knowledgeable advice to our clients all the while apparently RBC is seeing their market share disappear .. good to know. Set up fee? Never charged one. Commissions? Isn't that how their pay is structured? RBC pays commissions based on volumes plus bonuses for certain levels and add on commission for other RBC products utilized by the client AND on top of that pension benefits .. guess she left that out. She is a former bank manager and therefore would be well versed in RBC policy and doctrine. Shame. Shame.

  • Dissapointed on 2011-05-19 3:43:54 AM

    The writer's comments in this page are laughable. I find it very funny that Vernon Jones writes “If a mortgage broker is using Filogix, they’re generally only pulling a credit check once,”. So as long as the broker uses this system then it’s only GENERALLY pulled once. He should have just said that not all brokers pull multiple credit bureaus but some do.

    I urge you to so a study on the level of education on Mortgage specialist vs Mortgage brokers to see for yourselves as you will be proven wrong. RBC Mortgage Specialists come from the Advise side of the bank with many years of experience, along with post secondary educations and countless other financial courses.
    RBC is a leader in the industry on the side of Ethics as well as compliance with the many federal acts that govern the financial industry.
    One RBC mortgage specialist definitely made an error on pointing out some of the problems occurring in the broker industry. These problems in the broker industry do not sum up the whole broker industry and that is why it was an error to generalize but these comments on this board are borderline libel/slander and just plain ignorant. The inaccuracies in this mortgage specialist’s flyer are tiny compared to the inaccurate comment made on this board by these so called moral mortgage brokers. Jealousy has reared its ugly head. Instead of looking at someone else, look at yourselves!

  • ExRBC Mortgage Specialist on 2011-04-19 11:41:23 PM

    Most so called RBC mortgage specialists have little in the way of any credit training, if any. They usually come from the ranks of side counter staff who are well known for their lack of knowledge. RBC Mortgage specialists have no ongoing training requirements unlike the AMP's, and they certainly have no Ethical training.
    There is an old saying in sales:"Only show what you know". In this case CS shows that she knows next to nothing about credit, her market or her competition.
    She might as well have said: "If you want the best rate , go to a broker"

  • Gregory B Stanley CFP AMP CSEC on 2011-04-19 5:22:25 AM

    I am both a CFP, a mortgage broker, and a brokerage owner and I find that the word 'specialist' misleds the public. What is the RBC rep's specialty besides representing ONE lender? Banks don't require the same disclosure rules or ethics that mortgage brokers are legally bound too either. This creates an unfair playing field where distortions of the truth will occur. Sadly, I do agree that most mortgage brokerage promotes a rate sensitive style of marketing. Thinking outside the box to stand out more than just beating a rate makes better sense. It creates clients instead of just customers.

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