Quote:
Originally Posted by onetwo_threefour
I don't think I am. I talked to one of my broker associates this morning who confirmed that it's a CMHC requirement that there not be a loaned down payment. All you guys are talking about is subverting that rule by saying that if the client gets the money more than 90 days in advance, you can pretend it's their own resources even if you know it's really a loan from the parents. I am not saying it doesn't happen, but as far as I am concerned it is over the line ethically speaking as a lawyer for me to act in that scenario. I'm not as clear on the Broker's obligations to the lender, but at a minimum I would think it to be borderline unethical for a broker not to advise the lender that the client is borrowing their down payment if it potentially violates CMHC requirements.
As a lawyer representing the lender and the purchaser it is definitely over the line for me not to disclose it to my lender client if I know that it's a CMHC requirement.
Others may feel differently, but in my view that's the kind of thing that should not be happening.
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Trust me on this. Borrowed money in your account for 90 days means it is your funds. And who said anything about not disclosing? This is how it's disclosed: Of course, all debts are reported. The lender sees this as a debt. They know about these debts. All they're concerned about is your ability to repay. If you can handle the mortgage and the other loans, why do you think this is unethical. Believe me, I'm the most above-board person there is. I'd never suggest this if it was wrong. IT'S NOT! I'm not a broker but I refer lots of clients to brokers and am well versed in these matters.