- What do I need to know about the Mortgage Brokerages, Lenders and Administrators Act, 2006?
- The name of the Act refers to lenders and administrators. Are these new areas of regulation?
1. What do I need to know about the Mortgage Brokerages, Lenders and Administrators Act, 2006?
The Mortgage Brokerages, Lenders and Administrators Act, 2006 (Act) went into full effect on July 1, 2008. All Mortgage Agents, Brokers, Brokerages and Administrators now require a licence to do business in Ontario. This Act also applies to Real Estate Brokers who act as Mortgage Brokers in Ontario.
The Act sets out the framework for regulating the mortgage broker industry in Ontario. Under the Act, there are four types of licences:
- All Mortgage Brokerages and Administrators in Ontario need to apply for a licence at the Financial Services Commission of Ontario (FSCO).
- Each Mortgage Brokerage (after it has become licensed) must initiate licensing applications on behalf of its Mortgage Brokers and Mortgage Agents
The licensing regulations set out:
- Licence requirements for Mortgage Brokerages and Mortgage Administrators
- Licence requirements for Mortgage Brokers and Mortgage Agents
- Exemptions from licensing requirements
To learn more about the Act, visit FSCO’s website
2. The name of the Act refers to lenders and administrators. Are these new areas of regulation?
The name of the Mortgage Brokerages, Lenders and Administrators Act refers to lenders and administrators, to better reflect the activities that are subject to licensing and regulation. Currently, individuals who lend money on the security of real estate must be registered as Mortgage Brokers. Mortgage Brokers who administer mortgages on behalf of others are also subject to regulatory requirements. These requirements are clarified in the Act.
As an added consumer protection measure, regulatory oversight has been expanded to require anyone who administers mortgages to become licensed.
Financial Services Commission of Ontario