March 28, 2013
New Regulations Now in Place to Provide Clarity on Mortgage Penalties
A recent article at Canadian Mortgage Trends discussed the improvements to providing clarity on mortgage penalties. Specifically the IRD (Interest Rate Differential) These improvements came to place because of the Department of Finance. Starting last September banks were required to develop online educational material about penalty charges including IRD as well as online mortgage prepayment charge calculators. Now additional changes and clarity have come into place.
These changes are:
1. Annual Statements: Banks will outline prepayment options as well as give info on prepayment charges
2. Prepayment Charge Quotes: Upon your request showing your actual prepayment charge, the way they calculated the charge and the time period it's good for.
3 Toll-free phone support: Trained telephone reps in place to answer all questions related to this issue.
These are great improvements that FCAC (Financial Consumer Agency of Canada) announce and put in place this month. All is good news for borrowers especially considering the amount of people who break or at least consider breaking their existing mortgage term for many reasons and possible benefits.
If you have any questions regarding this information please feel free to give me a call or email.
Tony Marchigiano | Mortgage Specialist - Mortgage Sales BC Region, RBC Royal Bank | Royal Bank of Canada | T. 604-505-7109 | F. 778-737-0054
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