Over the weekend the government announced new mortgage regulations that require federal financial institutions to revise the mortgage penalty disclosures they currently provide to consumers. These changes were first promised over two years ago by the Finance Department in an effort to bring clarity around the calculation of pre-payment penalties and to ensure consumers were receiving sufficient information on mortgage products.
Federally regulated financial institutions have until November 5th, 2012 to comply with these changes and compliance will be closely monitored by the Financial Consumer Agency of Canada (FCAC). The FCAC is also requiring lenders to provide more information around pre-payment privileges, including fees for early repayment, the dollar amount of allowable pre-payment, tailored information required for the consumer to calculate their own penalty and even an explanation on factors that would affect their penalty.
Check out this week’s Friday Mortgage Round Up which will be released on March 9th for a more in-depth look into these changes.