“In Ontario and B.C. the governments are very concerned about the financial services industry as a whole and consumer protection,” Samantha Gale
, executive director at the Canadian Mortgage Brokers Association, told MortgageBrokerNews.ca. “They’ve kind of rushed this legislation through that requires anybody who does debt settlement services to get licensed under basically collection agency licensing.
“But it’s worded very broadly and it requires anybody who makes arrangements to do debt consolidation to get licensed under this legislation.”
British Columbia recently amended its Business Practices and Consumer Protection Act
(BPCPA), which created new licensing requirements for debt consolidation services.
Similar amendments were made in Ontario were made in 2015 to the Collection and Debt Settlement Services Act
In both cases, the amended requirements create overlaps with the respective mortgage broker courses, according to CMBA.
According to Gale, realtors and lawyers have been given exemptions under the new legislation in both provinces but that brokers have not.
“It’s really not in the consumer’s best interest. We believe authorization for mortgage brokers to do this kind of work under the applicable mortgage broker regulations (is sufficient),” Gale said. “We think that the appropriate solution would be for the governments in B.C. and Ontario by providing a mortgage broker exemption.”
The association has sent letters to both provinces urging them to reconsider extending the requirements to mortgage brokers.
“We have already received a response from the BC government advising that they did not intend for the legislation to impact mortgage brokers – they advise that they will review the Mortgage Brokers Act and contact us for further consultation on this issue,” Gale wrote in a follow-up email to MBN. “This is good news for mortgage brokers – we look forward to a similar result in Ontario.”
Legislation requiring brokers to take an extra course is putting them at a disadvantage, according to one broker association.