Mortgage Act Ontario – What Licensed Mortgage Brokers and Customers Alike Need to Know
The Canadian government strives to do what it can for citizens by considering new bills and signing Acts into law. There have been relatively new laws and regulations put into place, by the Ontario government in specific, that places the Ontario mortgage brokers association under new rules and regulations. The name of the new mortgage act Ontario is called the Mortgage Brokerages Lenders and Administrators Act. The Financial Services Commission of Ontario, abbreviated FSCO for short, released this new Act in 2006, but it did not go into effect until 2008. On July 1 of that year, the FSCO’s regulation came into effect with several beneficial consequences for consumers like you.
The purpose of the relatively new Act is to protect every consumer looking for a mortgage as well as every mortgage agent Ontario that works professionally within the industry throughout the province. To accomplish this, the mortgage act Ontario has been put in place to ensure that every Ontario resident experiences fair dealings with accredited, educated and highly-experienced mortgage brokers when arranging for proper financing in the process of buying a home. Working with unsuitable brokers that lack a mortgage license Ontario is not appropriate, and the new Act recognizes that.
Since the mortgage act Ontario came into play in July of 2008, every mortgage agent Ontario or broker working in the province has been required to carry a valid mortgage license Ontario. To be issued a license, the FSCO must deem the applicant qualified. Certain criteria are examined to determine an applicant’s eligibility and if the candidate does not meet the requirements, they are denied a mortgage license Ontario. If you want to be certain you are dealing with a licensed broker, you can verify their standing at the FSCO website. If you discover a mortgage broker or agent who is dealing in mortgages without a mortgage license Ontario, you can prosecute them by reporting their actions directly to FSCO.
If you want to rest assured that you are dealing with a licensed mortgage broker, you can seek a professional that is a member of the Independent Ontario mortgage brokers association. The members of this association are true professionals who follow a strict code of conduct. Not only are they qualified and licensed, they have undergone special training and participated in continuing education provided by Independent Ontario mortgage brokers association.
In fact, if you are interested in becoming a mortgage broker, you could apply for an approved Ontario mortgage agent course, a course that is provided by the Independent Ontario mortgage brokers association. The association recognizes the fact that continuing education is important, even for those who consider themselves mortgage professionals. New entrants into the industry can, of course, greatly benefit from completing the Ontario agent mortgage course. The completion of the comprehensive education program will provide anyone looking to obtain a mortgage license Ontario everything they need to qualify educationally.
The Ontario agent mortgage course is considered the “Gold Standard” in mortgage-agent education. The Education Committee of the Independent Ontario mortgage brokers association is dedicated to packing the Ontario agent mortgage course full of everything you need to enter the industry with experience as a studious classroom learner. Students learn the basics of processing an application and acquire the skills needed to become a productive member of any brokerage firm in Ontario immediately after completing the course. This is an advantage that helps this Ontario agent mortgage course earn its “Gold Standard” reputation.
Of course you can also choose to take your time after completing the program that is approved by the FSCO. As long as you apply for your mortgage license Ontario within two years, you are within the allowed timeframe. If you are unsure about your qualifications for a license, know that if you complete the Ontario mortgage agent course and apply within two years, you will at least meet the educational requirements. Some other basic qualifying factors to qualify for licensure are that you must be 18 years or older, live in Canada, have an email address and posses a mailing address in Ontario. Also, you must be authorized by a mortgage brokerage, such as the Independent Ontario mortgage brokers association, to deal in mortgages. You are also only permitted to work for one firm to qualify.
Two areas that every mortgage agent Ontario is affected by with the passing of the mortgage act Ontario are issues of disclosing borrowing costs and ensuring that a mortgage is suitable for the situation of the client. Brokers and agents in Ontario are affected by the governing requirements of the Act in the same way banks, credit unions and insurance companies are. The bottom line is that people seeking a mortgage must be provided with the full, fair and timely disclosure of the total amount of costs associated with the purchase of the mortgage. After all, the last thing the industry wants is for customers to place their full trust in a mortgage agent Ontario only to have the agent turn around a month or two later with hidden costs.
The mortgage act Ontario ensures that the process of obtaining a mortgage is transparent and open. Part of the job of a broker is to make sure their clients grasp the concepts of different mortgage products and what works best for them. This is an obvious fact to any broker who has completed the Ontario mortgage agent course provided by the Independent Ontario mortgage brokers association.
The second issue covered by the Act—that of ensuring that a mortgage is suitable for the situation of the borrower—is a large portion of the Act going into effect. The new mandate is that mortgage brokers take reasonable steps to ensure that the mortgage deal they have found is the best possible for the client they are working with. This means that based on the specific needs and circumstances of the customer, the mortgage will fit within what the client agrees is suitable for them.
Another addition to the mortgage act Ontario is that every mortgage agent Ontario must have the ability to provide written disclosure of every material risk involved with obtaining the mortgage. On top of a written disclosure, the broker must give the borrower time to decide the stringency of these risks as well as the terms of the mortgage itself. This is an excellent benefit to any customer who bought a house before July 1, 2008 and is accustomed to being pressured into the first “good deal” that comes along. This is definitely no longer the case as the full written disclosure reveals everything a borrower will want to know.
There are several specific inclusions in the written disclosure provided by a mortgage agent Ontario to their clients. The first is the principle amount of the mortgage. This is obviously important to establish a starting point of how much the mortgage will cost over its lifetime. Next is the annual interest rate. In the case of variable-rate mortgages, the agent with a mortgage license Ontario will know the method of calculating the annual interest rate to provide the borrower with. Then there is the installment period and the amount owed each time. Installment periods come in monthly, weekly, or bi-weekly forms. After that, the payback period for the mortgage and other applicable details in regards to compounding interest is exposed in the written disclosure. By relaying this important information, a client can determine just how much they will be spending on their Ontario mortgage. Last of all, the term of the mortgage and the total amount owed when the term expires is made known. The number calculated here is assuming that all payments are made on time without any prepayments coming into play.
As previously stated, borrowers working with a mortgage agent Ontario —whether they are a member of the Independent Ontario mortgage brokers association or not—must be provided with adequate time to consider the prices and material risks involved with the presented mortgage. The regulation mandated by the mortgage act Ontario is a 72-hour “cooling off” period. During this time, the broker’s customer must be provided with their written disclosure before they are asked to sign a mortgage instrument. This timeframe excludes Sundays and holidays. Still, the “cooling off” period can be decreased to only 24 hours if the borrower receives legal advice from a third-party source.
In the case of the actions of mortgage brokers in Ontario, the FSCO is the chief decider of rules and regulations. The organization was put in place to provide benefits to both consumers and brokers to ensure that all activities within the industry are fair. Both consumers who are seeking good deals on mortgages and professional members of the Independent Ontario mortgage brokers association who have completed the renowned Ontario mortgage agent course should know all the details regarding the mortgage act Ontario. The rules are applicable to every mortgage purchase in the province, so the Act is quite relevant to anyone who hopes to call this area home.