One of our recent lost trades has raised serious concerns about the extent to which some brokers will go to squeeze out other brokers and even implicitly threaten to complain to regulators. This story is not about winning or losing. It’s about what happens when industry professionals start exploiting policy quirks and trust gaps to their advantage.
No, I am not calling for new rules or regulatory intervention. This is the responsibility of our broker community.
settings
We are working with a client on a three-year fixed conventional mortgage. We are approved by a major bank at an interest rate of 3.94%; no purchase allowed given the competitive price of this particular offer. The customer is happy. Everything is working as expected.
Then the curveball came.
A few days later, the client said another broker offered them an interest rate of 3.89%. At that time, the rate did not exist in the broker channel. We suspected, and later confirmed, that competing brokers were using a portion of their commissions to create lower prices valid speed.
We explained the mechanics to the client and offered to upgrade the documentation internally to improve our offer. We’re also happy to offer cash back. But before the lender could respond, the client asked us to cancel the document. We did so quickly.
FSRA threats
A few hours after the cancellation, we received a sharply worded email from the customer asking for written confirmation. The message includes this line:
“Please provide me with written confirmation that your application has been submitted bank Representing us has been cancelled. Please note that if we do not receive this written confirmation within the next 48 hours then we will unfortunately have no choice but to lodge a complaint with the regulator FSRA: the Financial Services Regulatory Authority of Ontario. “
This is not written by a client.
Borrowers often do not refer to “FSRA” and “bank” using precise broker-specific terms. (bank Being named and using a name that is only used within the broker community) this was clearly drafted or directed by a competing broker for obvious reasons.
Know your lender’s vulnerabilities
Some lenders only allow one broker to set up a file in their system for a specific borrower. Once a trade is submitted, no other broker can act on it unless the first file is cancelled.
That’s the system; most of the time it works.
But in this case, competing brokers pressure clients to issue regulatory threats not to address wrongdoing but simply to clear the way. Their offer wasn’t much better. In fact, we later learned that their approval rate was 3.99%, which was higher than our approved quote.
“3.89%” is smoke and mirrors and is achieved by adding cash back to the deal, which we are prepared to do.
Their strategy worked. Clients align with the broker who comes up with the lower number first. Our escalation with the lender was moot.
What’s the real problem?
Losing a deal is part of the profession. No one funds every file. But when a broker starts directing clients to send threatening emails mentioning regulators just to push another broker aside, then in my opinion we have crossed a line.
This is not to protect the client’s interests. This is the story of a broker who used scare tactics disguised as a compliance issue.
This is not illegal. The FSRA won’t even act on it. But this is unprofessional. And it is corrosive.
A letter to all agents
To be clear: I am not calling for new regulations. I also don’t expect lenders to overhaul their policies. Lenders would rather lose the broker’s loyalty than lose the deal entirely.
This is a matter of professional standards, not policy.
So I think as brokers we can do better:
- Stop weaponizing compliance language. If you direct a client to make an FSRA threat simply to close a deal, you are abusing trust and abusing the regulatory process.
- Be transparent about acquisitions. If your offer relies on cash back to beat other prices, say so. Customers should understand the complete structure of their mortgage.
- Treat competitors as peers, not enemies. You don’t have to like losing, but you do have to behave professionally. A quick phone call instead of a demand email goes a long way.
Why this matters, even if customers never notice
To the client, it’s just “the brokers are fighting over my mortgage.” They reached an agreement. The lender obtained the mortgage. No harm, no foul, right?
But inside, things are different. What was lost was another bit of professionalism and a bit of goodwill among colleagues. If left unchecked, these tactics can undermine the credibility we have built over the years in the broker channel.
In the UK this doesn’t happen. Everyone, whether broker or affiliate, works to the same rate schedule. Cash back and buyouts are not possible. Winning business is based on service, execution and advice, not pricing gimmicks.
last word
I won’t name names. I didn’t cry. But I believe this is one of many examples of competitors using this tactic to win business from other mortgage brokers.
What I’m saying is this: If brokers continue to use regulatory threats and opaque pricing strategies to squeeze each other out, we will all lose in the long run. We have lost the respect that comes with calling ourselves professionals.
This is not a policy issue. This is a person’s problem.
We can solve this problem if we want to.
Opinion articles and the views expressed therein are those of the respective contributors and do not necessarily represent the views of the publisher and its affiliates.
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Broker Competition FSRA Mortgage Brokers Mortgage Broker Community Opinion Ross Taylor
Last modified: October 15, 2025
