On June 11, Mortgage Professionals Canada was invited by the Financial Services Regulatory Authority of Ontario (FSRA) to a confidential round table on non-qualified high risk syndicated mortgage investments (NQ-HRSMI). At the meeting, MPC and other senior stakeholders gave input into the issue; this week, FSRA began the process of requesting public comment into NQ-HRSMI.
In the interest of providing greater protections for investors in high-risk SMIs, FSRA has prioritized providing “effective supervision of syndicated mortgages investments”, which, MPC agrees, is integral to the protection and reputation of the mortgage brokering sector.
FSRA has identified these “red flags” of potential harm to SMI retail investors:
- loan-to-value ratios exceeding 100%
- Inclusion of a subordination clause
- Inherent conflict of interest among key participants
To learn details about and motives behind FSRA’s proposed supervision approach for high risk SMIs, please visit this FSRA page: CLICK HERE
Additionally, members who wish to comment on FSRA’s proposals as they relate to these NQ-HRSMIs should do so by September 6 here: CLICK HERE
MPC will keep members
apprised of this process. We also invite you to share with MPC your own
comments to FSRA, in order for us to be better informed as how these changes
may affect your business.