Disclosures to consumers

Disclosures to consumers

The legislation requires that specific information is provided to borrowers. Brokerages must ensure that all brokers and associates are aware of these requirements and that brokers and associates are providing the required disclosures. To assist brokerages, brokers and associates (collectively "licensees") in meeting these requirements, the Superintendent has developed the following forms:

• Initial Disclosure Form
• Mortgage Disclosure Form
• Disclosure to Borrower 
• Referral Disclosure Form

Initial Disclosure Form

The requirements for providing the initial disclosure form to a borrower are outlined in the frequently asked questions – compliance requirements.
 

Mortgage Disclosure Form

The requirements for providing the mortgage disclosure form to a borrower are outlined in the frequently asked questions – compliance requirements. For guidance read the mortgage disclosure form guidance document.
 

Disclosure to Borrower that Duty of Care is to Private Investor

Licensees must act in the best interests of the borrower, except where section 26 of the Act applies. Section 26 of the Act requires a licensee to act in the best interests of a private investor if the private investor is not represented by another licensed brokerage, and the licensee:

• solicits the private investor to make an investment in a mortgage;
• negotiates or arranges an investment in a mortgage by the private investor; or
• provides advice to the private investor with respect to the appropriateness of making a particular investment in a mortgage.

In these cases, the licensee must immediately inform the borrower in writing that it is acting on behalf of a private investor, and is obligated to act in the private investor’s best interests which may be in conflict with the borrower’s best interests.

When a mortgage is not being funded by a private investor, the licensee's duty of care is to the borrower and this disclosure form is not used.
 

Referral Disclosure Form

Under section 30 of the Regulations, licensees who receive remuneration for referring a borrower or private investor to another person must provide certain information in writing to the borrower or private investor. This disclosure must be provided no later then when the referral is made.