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Posted Apr 26, 2018, 11:46 AM
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Registered User
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Join Date: Apr 2018
Posts: 13
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Here are the 2 Memos I received yesterday, I welcome any helpful input.
From FMP Mortgage Investments (Fortress)
We are sorry to announce that FMP Mortgage Investments Inc. will be submitting an application to surrender its mortgage brokerage license. As a result, FMP Mortgage Investments will be suspending all business operations indefinitely.
Several recent developments have negatively impacted our business. Recent police activities related to syndicated mortgages have been widely reported in the media, and we are completely in the dark as to the reasoning behind this activity, as well as the current or future status of companies we have partnered with in the past.
FMP Mortgage Investments is also without a principal broker. Provincial law requires all mortgage brokerages to have a licensed principal broker to supervise mortgage activities. The law also prohibits us from communicating with our customers regarding their specific mortgages until such time as we have a new principal broker in place.
Our primary concern has always been and will continue to be for you, our customers. Unfortunately, due to recent circumstances, we will no longer be able to serve you. However, we have every confidence that the new mortgage administrator for all of the syndicated mortgages that FMP Mortgage Investments has brokered, FAAN Mortgage Administrators, will continue to represent your interests and answer all of your questions.
Below you will find a document containing information and directions on who to contact with any mortgage inquiry you may have, to ensure you can receive responses to your questions during this transition period.
We want to reiterate that the closure of FMP Mortgage Investments will not impact the projects associated with your mortgage investments. The developer and its consultants and contractors remain responsible for completing the projects on time. As always, we remain confident in real estate as an asset class, and expect that the developers will do their best to ensure their projects are successfully completed, refinanced, or sold in a timely manner.
Thank you for having lent money in a syndicated mortgage through FMP Mortgage Investments.
This is the Memo From FAAN
April 25, 2018
Attention: Lenders in BDMC Syndicated Mortgage Loans
RE: BUILDING & DEVELOPMENT MORTGAGES CANADA INC. (“BDMC”)
The purpose of this letter is to advise you of developments concerning the engagement
between BDMC and FAAN Mortgage Administrators Inc. (“FAAN Mortgage”) in respect of
managing BDMC’s mortgage administration duties.
As you are likely aware, on February 22, 2018, BDMC wrote to lenders to advise that BDMC had engaged FAAN Mortgage to assume responsibility for the management of all of BDMC’s mortgage administration duties in connection with the syndicated mortgage loans listed on Schedule “A”. That engagement was part of a settlement between BDMC and the Financial Services Commission of Ontario relating to the regulation of syndicated mortgage loans.
On April 20, 2018, pursuant to an order of the Ontario Superior Court of Justice (Commercial List) (“Appointment Order”), FAAN Mortgage was appointed as trustee (“Trustee”) over all of the assets, undertakings and properties of BDMC. The Appointment Order was issued following an application made by the Superintendent of Financial Services pursuant to section 37 of the Mortgage Brokerages, Lenders and Administrators Act, 2006, as amended, and section 101 of the Courts of Justice Act, as amended.
A copy of the Appointment Order and the Application Record, which contains the materials filed by the Superintendent in connection with its application for FAAN Mortgage’s appointment as Trustee, is available at www.faanmortgageadmin.com.
As was the case prior to the issuance of the Appointment Order, as Trustee, FAAN Mortgage will continue to manage the administration of the syndicated mortgage loans, including:
(i) corresponding and transacting with borrowers and lenders, including, where
appropriate, signing various documents on behalf of BDMC in connection with
requests for subordination or other matters;
(ii) reviewing and communicating with lenders regarding any borrower requests for,
among other things, a subordination of a syndicated mortgage loan to construction
lien financing;
(iii) reviewing and communicating with lenders regarding any borrower requests for,
among other things, an extension to the dates established in a syndicated mortgage
loan, including completion dates and payment dates;
(iv) remitting payments to lenders; and
(v) if necessary and appropriate, taking enforcement action where a syndicated
mortgage loan is in default.
FAAN MORTGAGE ADMINISTRATORS INC. | 920-20 Adelaide Street East Toronto, Ontario, M5C 2T6
For clarity, the Trustee is not appointed over any of the projects with syndicated mortgage loans administered by BDMC (“Projects”) and the applicable developers/borrowers remain in control of the Projects.
The Trustee continues to review the status of the Projects and the syndicated mortgage loans, and to communicate with the developers and borrowers to understand project timelines and potential outcomes for the syndicated mortgage loans. As relevant information becomes available, the Trustee will continue to keep lenders apprised of the status of their syndicated mortgage loan, including the underlying Project, by sending notices and other communications directly to lenders and/or by posting notices to the Trustee’s website. Please note that FAAN Mortgage has been receiving an extremely high volume of calls and emails, particularly since the events of April 13, 2018 and media reports. In order to allow us to respond to you in a timely and efficient manner, we kindly ask that prior to calling or emailing you reference the list of frequently asked questions attached to this notice. We understand that this is a very unsettling time for many lenders and we are working diligently to provide you with relevant information and clarity. Please note that if there are urgent matters that you as a lender require notice of, we will send a communication directly to you. We thank you for your cooperation.
Yours truly,
FAAN MORTGAGE ADMINISTRATORS INC.
IN ITS CAPACITY AS COURT-APPOINTED TRUSTEE OF
BUILDING & DEVELOPMENT MORTGAGES CANADA INC.
AND IN NO OTHER CAPACITY
FAAN
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