01 May 2011

Consumer Protection Enhanced By New Regulations For Mortgage Brokers

Manitobans who choose to use a mortgage broker will now have access to more information as the province enhances consumer protection for homebuyers through new regulations for mortgage brokers, Finance Minister Rosann Wowchuk announced today.

"Unlike other mortgage industry professionals, mortgage brokers were not subject to regulation.  Homebuyers trust mortgage brokers to give them sound and objective advice on what mortgage best suits their financial situation.  These rules strengthen accountability," said Wowchuk.

The minister said the new regulations will protect homebuyers by ensuring mortgage brokers are licensed and their activities are regulated.

Brokers will also be required to provide more information to consumers including disclosing:

  •  any fees or commissions they receive for a mortgage referral,
  •  any information about fees paid to a mortgage broker by a lender, and
  •  details of the responsibilities involved in obtaining a mortgage.

"A home is a family's single biggest investment and by implementing these regulations, homebuyers can now have more confidence when making their big purchase," Wowchuk said.

Since 2009, the Manitoba Securities Commission has worked in consultation with the industry to strengthen the regulations.  The Manitoba Securities Commission (MSC) is a special operating agency of the Government of Manitoba that protects investors and promotes fair and efficient investment business practices throughout the province, the minister said.

The minister noted the Canadian Association of Accredited Mortgage Professionals (CAAMP) is working with the MSC to develop and administer courses related to the changes, an approach taken by other provinces where similar requirements are in place.

The new regulations come into effect May 1.

Article released by Manitoba Government News Release.