He has his issues with the proposal, but on a fundamental level this broker agrees increased disclosure is a good thing.
“I’m like the only guy in Canada who agrees with FICOM,” Ron Butler
, broker with Verico
Butler Mortgage, told MortgageBrokerNews.ca. “And it will come to pass, sooner or later. It will come to pass in every province eventually.”
Never one to mince words.
However, Butler does have his issue with the proposed interpretation change to FICOM’s Form 10, which would require mortgage documents to explicitly state how much brokers are compensated.
“I only have one problem with FICOM and I’ve said it openly on a number of occasions: The only difficulty I have is it’s very difficult to give a perfect answer (about commission earnings),” Butler said. “The difficulty I have is I don’t really know at the time; I probably know 95% of the income but I probably don’t know 100. Because some of that stuff is at the end of the year – I don’t know what I’m going to get until then.”
Butler said he doesn’t want to be held under a microscope but that he thinks full disclosure of the total gross income of a file is fair.
He also disagrees with one main argument that has been put forth by many mortgage brokers.
“Because in other businesses people have to disclose what they make. I know broker like to say, ‘well, they have to disclose because they’re actually charging the client for (their services), so of course they have to disclose. Our clients aren’t giving us any money, so we shouldn’t have to disclose that,’ Butler said.
“Well, wait a second. Shouldn’t you have to disclose what influenced you to go where?” he continued. “If lender A pays you $5,000 and lender B pays you $7,000 for a small rate difference, shouldn’t I be able to see the basics of that?”