assign a fiduciary duty on mortgage brokers to act in best interests of their customers. An exception is California, where a 1979 ruling of the Supreme Court of California did establish fiduciary duties of mortgage brokers. This means that consumers, in states other than California, may be charged excessive rates and fees and are encouraged to do some shopping around prior to any agreement. Predatory mortgage lending and mortgage fraud Mortgage fraud is when one or more individuals defraud a financial institution by submitting false information willfully. Some mortgage brokers have been involved in mortgage fraud according to the FBI. Predatory mortgage lending is when a dishonest financial institution willfully misleads or deceives the consumer. Some mortgage consultants, processors and executives of mortgage companies have been involved in predatory lending. Some signs of predatory lending include: Falsifying income/asset and other documentation. Not disclosing Yield spread premium or other hidden fees BEFORE the settlement/closing. Failing to provide all RESPA documentation, i.e. Good Faith Estimate, Special Information Booklet, Truth in Lending, etc. so the borrower may clearly understand the mortgage terms and lender policies. Convincing borrowers to refinance a loan without any true benefit. Influencing a higher Loan Amount and inflated appraisals (usually in tandem with an appraiser). Unjustly capitalizing on a borrower's relative ignorance about mortgage acquisition. Another unethical practice involves inserting hidden clauses in contracts in which a borrower will unknowingly promise to pay the broker or lender to find him or her a mortgage whether or not the mortgage is closed. Though regarded as unethical by the National Association of Mortgage Brokers, this practice is legal in most states. Often a dishonest lender will convince the consumer that he or she is signing an application and nothing else. Often the consumer will not hear again from the lender until after the time expires and then they are forced to pay all costs. Potential borrowers may even be sued without having legal defense. Mortgage brokerage in Canada The laws governing mortgage brokerage in Canada are determined by provincial governments. Most provinces require mortgage brokerage companies to carry a provincial license. Nova Scotia Mortgage Brokers in Nova Scotia are licensed by Service Nova Scotia and are regulated under the Mortgage Brokers and Lenders Registration Act. Many brokers in Nova Scotia are members of the Mortgage Brokers Association of Atlantic Canada. More information about the various mortgage programs that are available to