Client Update: Requirement to register as a mortgage brokerage and mortgage administrator in New Brunswick

On April 1, 2016 New Brunswick’s Mortgage Brokers Act came into force, requiring businesses acting as mortgage brokerages or as mortgage administrators in New Brunswick to be licensed.

A mortgage brokerage is a business that on behalf of another person solicits third parties to obtain mortgage loans or to make an investment in a mortgage. Businesses that negotiate mortgage loans or investments on behalf of others, or that provide advice in regards to mortgage loans or investments, also acts as a mortgage brokerages. The individual mortgage brokers and associates who act on behalf of mortgage brokerages must also be licensed.

Mortgage administrators are businesses that receive payments from a borrower and remit those payments to investors, monitor the performance of a borrower or enforce a mortgage.

Licence application process 

Licences are granted and administered by New Brunswick’s Financial and Consumer Services Commission. Applications are completed online. The application fee for a mortgage brokerage and mortgage administrator is $600. In addition, there is an annual fee of $600 to maintain either licence. The application fee for a mortgage broker and mortgage associate is $300, with an annual fee of $300 to maintain either licence. Additional financial security may also be required for a licence, which is determined on a case by case basis.

The application for a mortgage administrator licence also requires the following from applicants:

  1. A trust account maintained in New Brunswick for funds received under administered mortgages;
  2. A minimum of $25,000 in working capital, or such higher amount determined to be necessary;
  3. Registration as a New Brunswick corporation or extra-provincial corporation;
  4. Disclosure forms from its officers and directors concerning previous disciplinary actions, criminal convictions, bankruptcies, judgments and civil proceedings against them;
  5. A director or officer who has been appointed to serve as principal administrator, responsible for reviewing policies and procedures to ensure compliance with the Mortgage Brokers Act;
  6. Proof of a policy of errors and omission insurance that provides for extended coverage for losses from fraudulent acts, at a minimum coverage of $500,000 with respect to a single occurrence, and $1,000,000 with respect to all occurrences involving the mortgage administrator in a one year period; and
  7. Completion of a disclosure as to whether the applicant has been previously licensed or registered anywhere in any capacity to deal with the public, whether any such registration or licencing was refused, restricted, suspended, revoked or cancelled; whether it has been disciplined by a regulatory body or is currently the subject of an investigation conducted by such a body anywhere, and whether or not there are any unsatisfied judgments against it, or any current legal proceedings pending against it.

The application for a mortgage brokerage licence requires all items listed for mortgage administrators plus the following from applicants:

  1. The individual who will be acting as principal broker:
    (a) If the applicant is a corporation, this individual must be a director         or officer;(b) If the applicant is a partnership, this individual must be a partner;
    (c) If the applicant is a limited partnership, this individual must be a         general partner or a director/officer of the corporation that is the
    general partner; or
    (d) If the applicant is a sole proprietorship, the sole proprietor must          act as the principal broker.
  2. Disclosure of the particular business activities the applicant intends to undertake as a mortgage brokerage.

The application for a mortgage broker or associate requires the following:

  1. The name of the brokerage firm the applicant will be working for;
  2. Details of prior mortgage related work experience as well as all prior employment history;
  3. Completion of a disclosure as to whether the applicant has been previously licensed or registered anywhere in any capacity to deal with the public, whether any such registration or licensing was refused, restricted, suspended, revoked or cancelled; and whether the applicant has been disciplined by a regulatory body or is currently the subject of an investigation conducted by such a body anywhere;
  4. Disclosure of any judgments, civil proceedings, criminal convictions, or bankruptcies against the applicant;
  5. Disclosure of any dismissals for cause;
  6. Proof of completion of the educational requirements; and
  7. A Criminal Records Check report.

Failure to obtain a licence

If a corporation, partnership, or limited partnership acts as a mortgage brokerage without first obtaining a licence it is liable to pay a fine that will not exceed $1,000,000 for each occurrence. Similarly if a corporation were to act as a mortgage administrator without first obtaining a licence it is liable to pay a fine that will not exceed $1,000,000 for each occurrence.

If a sole proprietor acts as a mortgage brokerage without first obtaining a licence they are liable to pay a fine that will not exceed $500,000 or to imprisonment for a term not exceeding one year, for each occurrence. Similarly if an individual were to act as a mortgage broker or mortgage associate without first obtaining a licence, they would liable to pay a fine that will not exceed $500,000 or to imprisonment for a term not exceeding one year, for each occurrence.

It should also be noted that the Mortgage Brokers Act does not provide for any grace period, during which a business could act as a mortgage brokerage or mortgage administrator without a licence. A licence must be obtained prior to acting as a mortgage brokerage or mortgage administrator.

Should you have any questions about this legislation or the application process, please contact James Murphy or Christopher Marr.

SHARE

Archive

Search Archive


Generic filters
Filter by Custom Post Type

 
 

Client Update: Not a “token gesture”: Nova Scotia Court of Appeal confirms deductibility of future CPP disability benefits from tort damages

January 18, 2019

Jennifer Taylor In an important decision for the auto insurance industry, the Nova Scotia Court of Appeal has confirmed that future CPP disability benefits are indeed deductible from damages awarded in Nova Scotia cases for…

Read More

Client Update: Change is the only constant – Bill C-86 changes in federal labour and employment regulation

January 18, 2019

Brian Johnston, QC and Matthew Jacobs Bill C-86, enacted as SC 2018, c. 27, will effect massive changes upon how federal labour and employment relations are regulated. They come into effect in 2019 with staggered…

Read More

2018 Year in Review: Atlantic Canada Labour & Employment Law Developments

January 17, 2019

We can all make 2019 a success by building on the year that was. For employers, 2018 was a year of many notable developments in labour and employment law across the country. We saw Ontario…

Read More

Client Update: Atlantic Canada pension and benefits countdown to 2019

December 28, 2018

Level Chan and Dante Manna As 2018 comes to an end, we countdown some pension and employee benefits developments in the last year that we anticipate may lead to developments in 2019. Discrimination in benefits…

Read More

Client Update: Canada’s Proposed Cannabis Edibles, Extracts and Topicals Regulations Revealed

December 21, 2018

Kevin Landry The first look at regulations for cannabis edibles, extracts and topicals has arrived. The Federal Government has opened a 60-day consultation period respecting the strict regulation of additional cannabis products. Notice of the consultation was accompanied…

Read More

Client Update: Recent Supreme Court of Nova Scotia decision drives home the importance of credibility

December 20, 2018

Erin Best and Kara Harrington “This case is about pain, how it was caused, by what accident and the opinions of dueling experts.”¹ “In this case, like so many, the assessment of the evidence depends…

Read More

Client Update: Land use planning in Prince Edward Island: the year in review

December 20, 2018

Jonathan Coady and Michael Fleischmann Overview Once again, the time has come to review the year that was and to chart the course for the year ahead. For municipalities, developers and planning professionals throughout Prince…

Read More

Client Update: Nova Scotia Labour Standard Code changes – domestic violence leave & pregnancy / parental eligibility

December 14, 2018

Following the various Stakeholder Consultations (which Stewart McKelvey participated in on behalf of Nova Scotia Employers), the Government has changed the Labour Standards Code Regulations effective January 1, 2019 to: a) provide for up to…

Read More

Client Update: Coming to Canada? You may need biometrics / Mise à Jour : Vous pensez bientôt venir au Canada? Vous pourriez avoir besoin de fournir vos données biométriques

December 6, 2018

Version française à suivre Sara Espinal Henao Canada has expanded its permanent and temporary immigration requirements to include biometrics – the measurement of unique physical characteristics, such as fingerprints and facial features. The new requirements,…

Read More

Proposed Changes to IP Law: Will they impact your business?

December 3, 2018

Many businesses rely on trade-mark, copyright, and patent law for the protection of their intellectual property (IP). The Federal Government recently proposed changes to IP laws, which may impact your business. Bill C-86, Budget Implementation Act,…

Read More

Search Archive


Generic filters
Filter by Custom Post Type