“Monolines and non-deposit-taking lenders have been at a steep disadvantage since late 2016 due to OSFI’s overarching policy changes in the insurable mortgage market. Refinances, non-owner-occupied properties, mortgages with amortizations over 25 years, properties over $1 million – all have been deemed uninsurable and are thus being passed off to traditional bank lenders, who do not require securitization of loans. Even if they have a willing investor, non-deposit-taking lenders will translate the higher cost to the consumer, effectively pricing themselves out of the market. I support stringent lending regulations and due diligence, but only when the playing field is even.”
Blue Pearl Mortgage Group
“I do not believe OSFI is intentionally targeting non-banks or the broker industry, but I do believe there is a misunderstanding regarding how this will affect the average Canadian family. By implementing these changes, the OSFI is not only restricting potential homeowners’ ability to purchase their dream home – or even any home – but also ensuring that current homeowners may not be able refinance their homes.
Micromanaging our market is the wrong direction to go. If OSFI is willing to work with all types of institutions and brokers, that will allow a way to protect all in the industry, especially homeowners.”
Mortgage specialist and manager of broker support
Clear Trust Mortgages
“No, the broker industry and monoline lenders are not targeted by OSFI – the industry is collateral damage in the government’s objective to reduce risk in the housing market. Consumer protection is not the mandate of OSFI; protection of financial institutions and system is.
Given the Canadian banking system is amongst the world’s strongest, and there has been no evidence of lenders taking unreasonable risks, it’s safe to say the system has worked and further regulation is not required. History has shown that too much government intervention will hurt banks, monolines, brokers, consumers – and ultimately, the financial system and economy as well.”