MORTGAGE BROKERS AND AGENTS : THE LICENSING PROCESS

CONSULTATION DRAFT REGULATION

made under the

MORTGAGE BROKERAGES, MORTGAGE LENDERS
AND MORTGAGE ADMINISTRATORS ACT
A CONSULTATION DRAFT


MORTGAGE BROKERS AND AGENTS :
THE LICENSING PROCESS

INTERPRETATION

Definitions

  1. In this Regulation,

    "affiliate", with respect to a corporation, has the same meaning as in the Business Corporations Act;

    "approved program of education" means an education program approved by the Superintendent;

    "effective date" means the day on which subsection 2 (4) of the Act comes into force;

    "finance company" means a corporation, other than a financial institution, that meets both of the following criteria:

    1. A material business activity of the corporation involves,

      1. purchasing, discounting or otherwise acquiring promissory notes, acceptances, accounts receivable, bills of sale, chattel mortgages, conditional sales contracts, drafts and other obligations representing part or all of the sales price of merchandise, or services,

      2. factoring or purchasing and leasing personal property as part of a hire purchase or similar business, or

      3. making secured and unsecured loans.

    2. The shares of the corporation, or a corporation with which the corporation is affiliated, are listed on a stock exchange in Canada or outside Canada that is a prescribed stock exchange for the purposes of the Income Tax Act (Canada).

REQUIREMENTS FOR A MORTGAGE BROKER'S LICENCE

Requirements

  1.  
    1. An individual is eligible to have a mortgage broker's licence if all of the following requirements are satisfied:

      1. The individual must be at least 18 years old and be a resident of Canada.

      2. He or she must have a mailing address that is suitable to permit service by registered mail.

      3. He or she must be authorized by a brokerage to deal in mortgages or trade in mortgages on its behalf.

      4. He or she must have successfully completed an approved program of education within three years before applying for the licence.

      5. If the individual applies for the licence more than 24 months after the effective date, he or she must have been licensed as a mortgage agent for at least 24 months of the 36 months immediately before the date he or she applies for the mortgage broker's licence.

    2. An individual shall be deemed to satisfy the education requirement of paragraph 4 of subsection (1) or the experience requirement of paragraph 5 of subsection (1), or both, if the Superintendent is satisfied that the individual has a combination of education and experience that is equivalent to the requirement or requirements.

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Transition

  1.  
    1. An individual shall be deemed to satisfy the education requirement of paragraph 4 of subsection 2 (1) if all of the following circumstances apply:

      1. The individual makes his or her first application for a mortgage broker's licence before the first anniversary of the effective date.

      2. The individual was, immediately before the effective date,

        1. a director or officer of a corporation registered under the Mortgage Brokers Act,

        2. a partner in a partnership registered under the Mortgage Brokers Act,

        3. the proprietor of a sole proprietorship registered under the Mortgage Brokers Act, or

        4. employed or authorized to arrange or deal in mortgages on behalf of a person who was registered under the Mortgage Brokers Act,


        and the Superintendent had been notified under the Mortgage Brokers Act before the effective date of the individual's status as described in subparagraph i, ii, iii or iv.

      3. The individual,

        1. has successfully completed one of the following courses:

          1. Financial Services Underwriting Program offered by Seneca College after 1998;

          2. Mortgage Brokers Program offered by Seneca College in 1994, 1995, 1996, 1997 and 1998;

          3. Education course sponsored by the Ontario Mortgage Brokers Association before 1995, or

        2. was, immediately before the effective date, exempt under subsection 4 (3), (4) or (7) of Regulation 798 of the Revised Regulations of Ontario, 1990 (General) made under the Mortgage Brokers Act from the requirement in subsection 4 (1) of that regulation to have successfully completed an educational program approved by the Superintendent.

    2. An individual shall be deemed to satisfy the education requirement of paragraph 4 of subsection 2 (1) if both of the following circumstances apply:

      1. The individual applies for a mortgage broker's licence before the first anniversary of the effective date.

      2. The individual was registered as a real estate broker under the Real Estate and Business Brokers Act, 2002 immediately before the effective date.

Non-suitability

  1. An individual is not suitable to have a mortgage broker's licence if any of the following circumstances apply:

    1. The individual's past conduct affords reasonable grounds for belief that he or she will not carry on business in accordance with law and integrity and honesty.

    2. He or she is carrying on activities that will contravene the Act or the regulations if he or she is licensed.

    3. He or she has made a false statement or has provided false information to the Superintendent with respect to the application for a licence.

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REQUIREMENTS FOR AN AGENT'S LICENCE

Requirements

  1.  
    1. An individual is eligible to have an agent's licence if all of the following requirements are satisfied:

      1. The individual must be at least 18 years old and be a resident of Canada.

      2. He or she must have a mailing address that is suitable to permit service by registered mail.

      3. He or she must be authorized by a brokerage to deal in mortgages or trade in mortgages on its behalf.

      4. He or she must have successfully completed an approved program of education within two years before applying for the licence.

    2. An individual shall be deemed to satisfy the education requirement of paragraph 4 of subsection (1) if the Superintendent is satisfied that the individual has a combination of education and experience that is equivalent to it.

Education exemption

  1.  
    1. An individual is exempt from satisfying the education requirement of paragraph 4 of subsection 5 (1) if both of the following circumstances apply:

      1. The individual is authorized to deal in mortgages on behalf of a brokerage that,

        1. is licensed to carry on business as a mortgage lender,

        2. is a finance company, and

        3. is, or is an affiliate of, the lender for all the mortgages that brokers or agents authorized to deal in mortgages on behalf of the brokerage deal in.

      2. The Superintendent is satisfied that the brokerage will provide the individual with such training as the Superintendent considers adequate.

    2. An agent's licence issued to an individual who is exempt from the education requirement of paragraph 4 of subsection 5 (1) by virtue of subsection (1) shall not be amended to replace the name of the brokerage on whose behalf the individual is authorized to deal in mortgages or trade in mortgages with the name of another brokerage unless,

      1. the individual successfully completes an approved program of education required by paragraph 4 of subsection 5 (1); or

      2. subsection (1) applies to the individual in respect of the other brokerage as well.

    3. An individual shall be deemed to satisfy the education requirement of clause (2) (a) if the Superintendent is satisfied that the individual has a combination of education and experience that is equivalent to it.

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Transition

  1.  
    1. An individual shall be deemed to satisfy the education requirement of paragraph 4 of subsection 5 (1) if all of the following circumstances apply:

      1. The individual makes his or her first application for an agent's licence before the first anniversary of the effective date.

      2. The individual was, immediately before the effective date, employed or authorized to arrange or deal in mortgages on behalf of a person who was registered under the Mortgage Brokers Act and the Superintendent had been notified under the Mortgage Brokers Act before the effective date that the individual was so employed or authorized.

      3. The individual has successfully completed one of the following courses:

        1. Introduction to the Canadian Mortgage Industry offered by Seneca College, Conestoga College or Durham College after 2001.

        2. Introduction to the Canadian Mortgage Industry offered by Fanshawe College after 2002.

        3. Introduction to the Canadian Mortgage Industry offered by Sheridan College after 2003.

        4. Mortgage Brokering for Agents offered by Georgian College after 2003.

        5. Mortgage Agent offered by Algonquin College after 2003.

        6. Mortgage Brokering - Principles and Practices for Agents offered by Sheridan College in 2003 and 2004.

        7. Mortgage Brokering I offered by Seneca College after 1994 and before 2003.

        8. Mortgage Brokering 101 offered by Conestoga College in 2000, 2001 and 2002.

        9. Mortgage Brokering I offered by Durham College in 2001 and 2002.

    2. An individual shall be deemed to satisfy the education requirement of paragraph 4 of subsection 5 (1) if both of the following circumstances apply:

      1. The individual applies for an agent's licence before the first anniversary of the effective date.

      2. The individual was employed or authorized to deal in mortgages on behalf of a person who was registered under the Mortgage Brokers Act for at least 24 of the 36 months immediately before the effective date, and the Superintendent had been notified under the Mortgage Brokers Act before the effective date that the individual was so employed or authorized.

    3. Subject to subsection (4), an individual shall be deemed to satisfy the education requirement of paragraph 4 of subsection 5 (1) if both of the following circumstances apply:

      1. The individual makes his or her first application for an agent's licence before the first anniversary of the effective date.

      2. The individual was, immediately before the effective date, employed or authorized to arrange or deal in mortgages on behalf of a person who was registered under the Mortgage Brokers Act, and the Superintendent had been notified under the Mortgage Brokers Act before the effective date that the individual was so employed or authorized.

    4. An agent's licence issued to an individual who is qualified by virtue of subsection (3) shall not be renewed unless the individual successfully completes an approved program of education required by paragraph 4 of subsection 5 (1) before the expiry date of the licence.

Non-suitability

  1. An individual is not suitable to have an agent's licence if any of the following circumstances apply:

    1. The individual's past conduct affords reasonable grounds for belief that he or she will not carry on business in accordance with law and integrity and honesty.

    2. He or she is carrying on activities that will contravene the Act or the regulations if he or she is licensed.

    3. He or she has made a false statement or has provided false information to the Superintendent with respect to the application for a licence.

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