Controversial statements from another RBC mortgage specialist have now resurfaced – again in B.C. and again attracting broker ire.
“As a mortgage broker who has practiced for over 33 years, I take exception to the misinformation in a February 11, 2010, article written by another RBC mortgage specialist, even before this latest incident,” John Ribalkin, president of Verico Nova Financial Services, told MortgageBrokerNews.ca Tuesday. “The primary job of a bank ‘mortgage specialist,’ working within the confines of their particular bank, is to sell that bank’s mortgages. A ‘mortgage specialist’ working for ‘X’ bank is not going to offer the borrowing client a mortgage with ‘Y’ bank … that is simply not their job.”
The comments –which prompted a complaint to the Financial Institutes Commission of British Columbia (FICOM) – stem from a column that ran in a local North Shore newspaper early last year. Like a recent document coming from another Vancouver RBC employee, the piece attempts to explain the differences between brokers and bank-employed specialists.
“The difference is that as an RBC mortgage specialist, my primary product is an RBC mortgage, however, I have access to over 20 other lenders in the event that the client doesn’t meet regular guidelines,” reads the consumer advice column. “There’s a myth in the marketplace that mortgage brokers get you a better rate than a specialist from a bank. Mortgage brokers just shop the banks that deal with brokers, and while they ‘shop’ for the best rate they also ‘shop’ for their best commission.”
The boast riled brokers in B.C., concerned the specialist had overstated the independence of RBC mortgage specialists. They were also angered by her attempts to downplay the customer service and ethical guidelines their broker registration mandates, said Ribalkin, who was spurred into action.
The newspaper later agreed to run both a letter to the editor from Ribalkin and an independent column clarifying the position of brokers.
The CAAMP Hall of Fame recipient and one of the founding members of the MBABC also filed a request with FICOM, asking it to investigate how exactly RBC mortgage specialists help arrange mortgages for clients that “don’t meet regular guidelines.”
Under B.C. law, anyone who works for a financial institution by placing mortgages with third-party lenders is viewed as a “contractor” -- not an employee of the bank. It means that unlike mortgage specialists employed by a bank, those contractors must be registered with FICOM in order to provide that service. The complaint has yet to be resolved, with FICOM updating Ribalkin as late as last month.
B.C. brokers are now contending with a more recent document from another Vancouver mortgage specialist at RBC. The bank has now distanced itself from the inaccurate description of brokers as “farming out” mortgages to lenders, charging “hidden fees” and performing multiple credit checks on a client.
“The RBC brand is defined by our clients and partners and we sincerely apologize for the inaccurate information that was presented in the document,” wrote RBC Public Affairs Advisor Nicole Fisher, in a letter to broker associations in Western Canada.
Both incidents speak to an increasingly competitive mortgage industry in Vancouver as housing prices continue to soar and stagnant incomes – plus new federal mortgage rules – make it harder for borrowers to qualify. Those factors are projected to increase the number of homebuyers seeking out the assistance of brokers, a move that could increase market share for the broker channel at the same time it reduces business for the Big Five.