A mortgage lender in Ontario has announced it’s taking steps to crack down on bad lenders.
The BMO Financial Group has been working with Ontario Mortgage and Housing Corp. to address issues that could lead to lenders charging higher fees.
It says it’s also working with credit unions to improve the quality of mortgage applications.
“We have been working closely with our Credit Union colleagues to make sure that they are doing everything they can to protect consumers and help them make informed decisions on their mortgage,” said Paul Grewal, chief financial officer of the BMO.
The bank says it has also been working to identify credit unions that are less likely to charge higher fees and provide better loan terms.
“If a borrower’s credit score drops, we may be able to help with the process of re-qualifying for a loan,” Grewalsaid.
He says the bank is also working to educate lenders about the various types of mortgages and to get more information from credit unions.
“It’s a great opportunity for lenders to work together to provide the best possible service to their customers,” Grealsaid, who is also president of the Canadian Mortgage and Credit Union, told CBC News.
BMO is also partnering with the Ontario Society of Credit Unions (OSCCU) and the Bank of Montreal on the Credit Union Mortgage Guarantee Program.
Borrowers who do not qualify for the credit union’s mortgage guarantee program can still receive a credit union loan but will be required to repay the full amount on their loans within three years.
OSCCU says the goal of the program is to make mortgage applications more accessible and more affordable to those who have been excluded from the mortgage market.
“In order to do this, the program requires credit unions and lenders to collaborate,” said OSCCO President John Deacon.
“There are still significant barriers to accessing affordable mortgage financing, and in the end, borrowers will have to bear that burden.”
OSCCUPE says it received more than 1,000 applications for the loan program over the past two years, and it expects to receive more applications in the coming months.