FCAC and OBSI: How to File a Mortgage Complaint in Canada

The Canadian Mortgage Charter

Introduced in the 2023 Fall Economic Statement and refined through 2024, the Canadian Mortgage Charter is a federal policy framework that codifies how banks and federally regulated lenders must treat mortgage borrowers — especially those facing payment shock at renewal. It is not a statute; it is enforced through OSFI supervisory expectations and FCAC market-conduct oversight.

The Charter's six core requirements:

1. Early renewal contact. Lenders must contact borrowers 4-6 months before renewal (many now send letters up to 9 months out).
2. Proactive outreach for borrowers at risk. Lenders must identify borrowers likely to struggle and reach out with options before they default.
3. Temporary amortization extensions. Allow temporary extensions of amortization for qualifying hardship cases — up to the original remaining amortization.
4. Waive certain fees. No prepayment penalty on hardship-driven sales; no fees for making lump sum prepayments from severance or other qualifying sources.
5. No stress test on insured straight switches. Mirrors the November 2024 OSFI exemption that later extended to uninsured borrowers.
6. Permit interest-only payments on mortgages in serious hardship temporarily while the borrower regains stability.

If your lender fails to honour these — for example, refuses to discuss hardship options when you're clearly struggling, or imposes a fee the Charter prohibits — the failure itself is a ground for a complaint. See the full Charter guide.

Step 1: Internal Complaint Process

Every federally regulated bank in Canada has the same three-tier internal complaints process, mandated by the Bank Act and OSFI guideline E-23. You must work through these steps (or at minimum attempt to) before escalating externally.

At the end of the internal process, the bank must issue a written final response. Keep this document — you will need it for OBSI.

Step 2: External Escalation — OBSI

On November 1, 2024, OBSI became the sole external complaints body for all federally regulated banks. Before this change, the major banks (RBC, TD, BMO, and for a period Scotiabank) had used ADR Chambers Banking Ombuds Office (ADROBC), while others used OBSI — creating an inconsistent two-tier system critics had flagged for over a decade. The federal government's 2024 reform consolidated everything under OBSI.

OBSI's process:

1. File your complaint with OBSI online (obsi.ca), by phone, or by mail. You have 180 days from the bank's final response.
2. OBSI triages the file and contacts the bank for its records (usually 30 days).
3. Investigation phase. An OBSI investigator reviews both sides' evidence, asks questions, and assesses whether the bank treated the complainant fairly according to the Bank Act, Charter, and general standards of good banking practice. Typical investigations take 3-6 months.
4. Recommendation. OBSI issues a written recommendation. If in your favour, this can include monetary compensation up to $350,000 per complaint (the cap was raised from $350,000 in 2021 from the earlier $350,000 limit — it remains $350,000 as of 2026).
5. Bank response. The bank has the option to accept or refuse. Refusals are publicly reported in OBSI's annual report and draw OSFI and FCAC scrutiny. In practice, acceptance rates are above 99%.

OBSI is free for the complainant. It is funded by banks and investment dealers through an industry levy.

FCAC: The Market-Conduct Regulator

The Financial Consumer Agency of Canada (FCAC) is the federal market-conduct regulator for banks and federal insurers. It does not resolve individual disputes. Instead, it enforces federal consumer-protection rules — and if it finds a pattern of non-compliance, it can issue violations, fines, and public naming.

FCAC handles complaints in two ways:

• Intelligence gathering. Every complaint to FCAC feeds the supervisory intelligence that informs its regulatory priorities. Individual complaints are not resolved, but they shape enforcement action.
• Direct enforcement. When FCAC identifies clear breaches — for example, tied selling (requiring mortgage insurance as a condition of the mortgage, which is illegal under the Bank Act), failure to provide prepayment penalty disclosure as required, or systematic violations of the Canadian Mortgage Charter — it can issue Notices of Violation, administrative monetary penalties, and compliance orders.

Filing with FCAC is free and can be done in parallel with OBSI. FCAC's website has a standard complaint form; they accept complaints even if you haven't gone through the internal process first.

Typical Complaint Scenarios

Here are four common complaint types and how they tend to be resolved:

See our guide to IRD vs. 3-month interest for how hidden posted-rate IRD penalties arise and common renewal mistakes for patterns that often produce complaints.

Documentation Checklist for a Strong Complaint

Credit Union and Provincial Lender Complaints

Provincial credit unions are not covered by FCAC or OBSI. The complaint path is:

• Internal process first — credit unions have their own escalation procedures, often shorter (some resolve at the branch).
• Provincial regulator — FSRA (Ontario), BCFSA (BC), AMF (Quebec), provincial Credit Union Deposit Guarantee Corp (Prairies and Atlantic).
• Quebec specifics — Desjardins and its caisses are regulated by the AMF, which has broader consumer-protection powers than most provincial regulators.

Non-federally-regulated private lenders and MICs are regulated at the provincial level under mortgage broker legislation (FSRA in Ontario, BCFSA in BC, etc.). Complaints about mortgage brokers or private lender conduct go to the same provincial regulator. See lender types in Canada for the regulatory breakdown and credit union renewals for provincial specifics.

Frequently Asked Questions