Mortgage Broker Licensing Overview
In New Brunswick, every person carrying on the business of brokering or administering mortgages is required to comply with the Mortgage Brokers Act, S.N.B.2014, c.41 and both rules, MB-001 Mortgage Brokers Licensing and Ongoing Obligations and MB-002 Mortgage Brokers Fees. The Act and the rules provide the legislative framework for the regulation of mortgage brokerages, brokers, associates and mortgage administrators in New Brunswick.
Under this Act, there are four types of licenses:
1. Mortgage Brokerage is a corporation, partnership or sole proprietorship that:
- solicits another person to obtain a mortgage loan or to make an investment in a mortgage, but only if the soliciting is done on behalf of another person
- negotiates or arranges a mortgage loan or an investment in a mortgage on behalf of another person
- provides advice to a person with respect to the appropriateness of:
- obtaining a particular mortgage loan
- making a particular investment in a mortgage
2. Mortgage Broker is an individual who brokers mortgages on behalf of a mortgage brokerage and has the education and experience necessary to supervise an associate.
3. Mortgage Associate is an individual who brokers mortgages on behalf of a mortgage brokerage.
4. Mortgage Administrator is a corporation that:
- receives payments made by a borrower and remits those payments to the investor
- monitors the performance of a borrower with respect to his or her obligations under the mortgage
- enforces or takes steps to enforce payment by the borrower under the mortgage
Every individual that provides the services offered by a mortgage brokerage (brokerage) must be licensed as either a mortgage associate (associate) or a mortgage broker (broker). Your classification/licensing is based upon your level of education and experience in mortgage brokering.
Each associate and broker will work on behalf of one mortgage brokerage that must also obtain a licence. Each brokerage will have one principal broker who will act as the main contact between the brokerage and FCNB. Under the legislation, the principal broker is also responsible for the overall supervision of the brokerage compliance requirements.
A mortgage administrator (administrator) is a separate licence for those corporations that carry on the business of administering mortgages. Associates and brokers do not work on behalf of an administrator. It is possible that an administrator will also undertake the activities of a brokerage; in this case it would need to obtain an administrator licence and a brokerage licence.
The Mortgage Brokers Act (Act), and rules MB-001 Mortgage Brokers Licensing and Ongoing Obligations, and MB-002 Mortgage Brokers Fees (the "rules") came into force on April 1, 2016.