Mortgage broker complaints rise at biggest BBB

  • feed
  • Google+
by |

Despite a slowing market, complaints against mortgage brokers, filed with the country’s largest Better Business Bureau region, crept up this year.

The BBB of Mid-Western & Central Ontario – including the GTA -- reported that as of November this year it had received a total of 10 customer complaints, ranging from charges of rate misrepresentation, and penalty disputes to unspecified fees to cancelled deals. The rise eclipses last year’s numbers by more than 10 per cent.

According to the BBB records for this year, one complaint closed as resolved (consumer confirmed resolution), five were assumed resolved (company responded, but consumer did not get back to BBB), one was administratively judged resolved and three were not responded too by the business (company made a good faith effort, but consumer was dissatisfied).

In 2011, one complaint closed as resolved, four were assumed resolved one was closed unresolved and three were administratively judged resolved, said Fiona Dunba, manager for dispute resolution and information services at BBB.

"Mortgage brokers make up a very small percentage of our overall complaints," she said. "To put it in perspective, we are reporting approximately 12,000 complaints for 2012 and a total of 12,348 for 2011."

Still, the growing number of complaints against brokers is striking considering that in recent year the BBB appears to have been struggling in attract members of the channel. For instance, there were only 17 brokerages/brokers members in 2011, that number went down to 16 in 2012.

Across the country, industry regulators have also been busy investigating and, indeed, acting on consumer complaints lodged against mortgage professionals.

For example, a partial list from the Real Estate Council of Alberta indicates no fewer than five suspension orders, 12 administrative penalties and some four lifetime suspensions were issued.

A partial list of decisions handed down by FSCO this year indicated that more than six brokers were fined, two were suspended and two others had licenses revoked for various offences.

In British Columbia, records indicate that the FICOM handed down three cease-and-desist orders against three brokers.

  • Ontario Broker on 23/11/2012 6:11:13 AM

    BBB is in my opinion just a "protection racket", with the implication that if you don't belong to us you must be a crook. I find that organizations that belong to the BBB are companies I have my doubts about doing business with. Why do you need a sticker/plack tht says "I'm Honest"? What professional, doctor ,lawyer, accountant, dentist belongs to BBB? ...and if you recall here in Toronto, there were significant issues with a past head of BBB.
    If you want to call yourself a professional & look professional why would you want to be associated with the BBB?
    We have professional associations at the national & provincial levels, as well as regulations coming out our wazzoos with government employees by the score to enforce them...spend your "protection" money in belonging to your provincial association first, & if you have more money to burn belong to the national association.

  • Julia Krause on 23/11/2012 6:21:44 AM

    I've been saying this for years now, but I'll say it again... the lack of practical, real-life training in the industry is the reason so many mortgage brokers don't know what they're doing, and it's hurting consumers. New brokers are supposed to "watch and learn from" someone who has been in the business for a while, most likely some 'old boy' who is passing on old unethical behavioural habits. Now we have an industry full of mortgage brokers who not only don't know what they're doing, what they DO know is probably unethical...
    How do I know this? I've been in the business for 20 years. For 3 years I travelled back & forth across Canada giving training sessions for new brokers. I saw it all, all across the country. That's how I know. The reputation of all mortgage brokers is going down the tubes... and it's really sad :( Until the associations and the big national brokerage companies step up and make training & ethical behaviour a priority, things will keep getting worse.

  • Don C on 23/11/2012 7:56:06 AM

    Julia's comments noted, however, is the training that Bank reps or employees receive any better than that of many brokers. As a broker and a former long time banker, the answer is no.
    There are bad apples in all levels of finance. I don't think educating the broker is stricktly the answer. We must also educate consumers to understand what makes a good vs bad agent so that they don't end up getting poor service.

  • Joe the broker on 23/11/2012 8:10:55 AM

    BBB means nothing anymore , not that it ever really did. 10 complaints? who cares. I've received more than 10 complaints myself this year from people who were fed up with their own bank mistreating them so I arranged their mortgage for them and they were happy happy happy! :)

  • Paolo Di Petta | dipettamortgage.com on 24/11/2012 9:06:24 AM

    One has to ask - how many bank complaints did the BBB receive? How many of these complaints were for different brokers? How many of these complaints were frivolous or resolved amicably? That should put these numbers into more context.

    Not to mention, I could probably count 10 complaints that I have with my local TD branch alone...

Broker news forum is the place for positive industry interaction and welcomes your professional and informed opinion.

Name (required)
Comment (required)
By submitting, I agree to the Terms & Conditions