Mortgage Broker

CMBAnews Defending Our Territory CMBA directors and members met with the Federal Finance Minister about October's blindsiding regulations announcement BY JANET MCKEOUGH CMB MAGAZINE cmba-achc.ca fall 2016 | 11 O n October 14, CMBA – Atlantic directors and members met with Federal Finance Minister Bill Morneau in Halifax to voice concerns about the recent regulatory changes to mortgage lending. e CMBA advised Minister Morneau that with mortgage brokers funding over $70 billion annually and servicing over 55 per cent of first-time buyers, we were disappointed not to be part of the consultations. We asked if it was possible for the implementation of the regulations to be postponed until further consultation could take place. e reply: No. However, the minister said he was aware of concerns with respect to monolines, and added there would be an opportunity for feedback and input. When asked why only two weeks' notice was given instead of the typical three months, Morneau replied that the government's concern for consumer debt load was the reason for quick implementation. Morneau strived to ensure he understood our issues and asked if we thought the federal government should not be concerned about foreign ownership in Canada and consumer debt load. We replied that we support the government in these areas; however, we feel the blanket approach and continual focus on mortgages is not the answer. Mortgages are a debt attached to an asset that typically appreciates in value and builds the net worth and security of Canadians. e granting of mortgages is under stringent guidelines and defaults are at an all-time low. It is our belief the government needs to focus on unsecured credit and how it is granted. Recognizing the government faces challenges around this, we suggested irresponsible lending practices by a mortgage holder aer advancement of a mortgage could be a reason to make the default policy null and void. Hence, the onus for responsible granting of credit would be with the lender, and have a higher risk to their investors and shareholders. We also shared our concerns as to how the balance of power has moved from an even playing field to favouring balance sheet lenders; how the new regulations deemed to help the middle class will most likely hurt them the most and delay first-time buyers from entering the housing market; how homeowners in rural markets will have limited options, as most lenders, regardless of loan-to-value, default- insure these mortgages; and how delayed entry into home ownership could potentially increase consumer debt via non-asset-related credit purchases. We were fortunate to have a roundtable discussion with the Minister. e recommendations put forth in the CMBA submission were noted as well as the above concerns. We were invited to continue the dialogue, and will have ongoing correspondence with the office of the Finance Minister as well as our local Members of Parliament. Left to right: Janet McKeough, Director CMBA Canada; Nicholas Hamblin, President CMBA Atlantic Canada; Bill Morneau, Federal Finance Minister. BREAKING NEWS

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