Brokers often call for more regulatory oversight to help weed out unethical professionals and one recent update from FSCO has been met with positive reactions. But some brokers believe more can be done in other areas of focus.
“Once again, kudos to FSCO for weeding out non-licensed activity in the brokerage space,” Glenn May-Anderson of FDS Broker Services wrote on MortgageBrokerNews.ca. “These individuals and companies do nothing but harm us all by refusing to play by the rules, and bring down those of us who are legitimately doing business in the space.”
May-Anderson’s comment was in response to a story about FSCO warning industry professionals about an unlicensed mortgage brokerage that is soliciting the public to invest in a condo project in Toronto.
“MetroZen (Canada), a real estate development company that works alongside Zen Mortgage Corp., is not licensed to solicit mortgage business,” an official statement from FSCO stated. “FSCO has been notified that the company is soliciting the public on its website, metrozen.ca, to invest in a large-scale condo project called MetroZen located at Highway 401 and Markham Road.”
However, while FSCO has set its sights on weeding out unlicensed individuals, one broker believes the organization should also focus on licensed players who charge up-front fees.
“There are brokers who charge up-front application fees and (customers) become disillusioned toward the broker industry (as a result),” Ken Lankin of Mortgage Intelligence told MortgageBrokerNews.ca. “I think we need better compliance through FSCO and OSFI; I think there should be more compliance (requirements) for the big brokerages, specifically, to watch over fees.”
Under current regulations, mortgage brokers can charge an up-front fee for mortgages in excess of $300,000 and one professional has suggested upping that threshold.
“The ministry could get involved and up the minimum mortgage amount,” Bill Handsaeme of Dominion Lending Centres Forest City Funding told MortgageBrokerNews.ca.
Related: FSCO warns about unlicensed syndicated mortgages