| For all you mortgage brokers out there, you should have a read of a recent article in the Globe and Mail, found at He refinanced his mortgage to settle high-interest debts. CIBC and CMHC repaid an interest-free loan instead – The Globe and Mail.
For those that do not have an account with the Globe, a borrower used a title insurer to handle their refinance with a major Canadian lender. The funds were to be used to pay off credit card and lines of credit debt. Instead, the lender used almost $60,000 to pay off an interest free government loan the couple had taken out years before. As you can probably imagine, once the interest free loan was paid out, it was not coming back. As mentioned in the article, the case highlights the potential risks for consumers when banks rely on companies that provide title insurance to process real estate transaction. In the words of the Globe and Mail, the borrowers did not have a lawyer, who would have had a duty to ensure their interests were protected. Their words, not mine. A little self serving I know, and many borrowers prefer the title insurance refinance program as it is a little less expensive, but clearly a mistake was made that our office would not make and if we did, we would make the client whole. We shall see if the borrowers receive any kind of settlement. Enjoy the great weather, chat soon. |