FSRA highlights broker compensation disclosures and 2027 reviews

Make the payment explanation usable

FSRA's compensation article reminds Ontario brokerages of existing disclosure responsibilities. It says disclosures should identify the lender or third party providing compensation, describe the payment or benefit, and explain how it is calculated. A percentage, a range or another measurable method can make that explanation concrete.

A general statement that a lender pays commission may be insufficient, according to the regulator. FSRA also calls for written, plain-language disclosures, delivered early and within the applicable timelines before a consumer becomes obligated under a mortgage. Estimates should be clearly identified.

The newsletter adds that when precise compensation information is unavailable, brokerages must provide a reasonable estimate and update consumers as more information becomes available.

Recruitment will receive closer attention in 2027

FSRA says its focused reviews will examine how sampled brokerages recruit, screen and onboard mortgage agents and brokers. The accompanying article encourages documented checks of competence, conduct and suitability, supported by training and supervision.

The review announcement describes future supervisory work. It does not report findings against the brokerages that will be sampled. FSRA also says holding a licence is only one part of assessing a prospective hire; moving between firms does not resolve earlier conduct concerns.

Questions for an Ontario mortgage conversation

Our practical takeaway for borrowers in Toronto, Ottawa and other Ontario communities is to make the explanation specific to the mortgage being discussed. A payment disclosure helps make financial incentives visible; understanding it is one part of assessing a recommendation.

• Who pays the brokerage, and how is that compensation calculated for this mortgage?
• Which amounts are estimates, and when will I receive updated information?
• How does the recommendation fit my circumstances, and who can clarify questions before I commit?

This update concerns Ontario's mortgage-brokering sector. Readers arranging financing in Alberta or BC should ask their broker which provincial requirements apply to their file. For an individual decision, discuss the product, costs and obligations with a licensed broker.

Our pre-approval page and pre-approval playbook can help organize the wider financing conversation. Keep the compensation explanation alongside the mortgage documents so questions can be tied to the actual offer.