Ontario veterans hoping new re-licensing requirements would send a rush of “uncommitted” agents heading for the exit appear to have gotten their wish, with the province confirming as little as 72 percent of some 9,700 agents had renewed with only a day left on the clock.
As of March 30 – less than 24 hours before this year’s drop-dead deadline – only 7,022 agents in the province had submitted renewal applications, via their brokers, according to the official website for the Financial Services Commission of Ontario. That loss of 2,500 agents is considerably larger than the approximately 460 licensed brokers and principal brokers who failed to meet the cutoff date
For Ontario, the agent numbers, in particular, represent its biggest-ever drop-off in licensees. The figures also dwarf industry estimates of 10 per cent to 15 per cent, offered in the months leading up to the March 31 deadline.
Missing that drop-dead date has major consequences. Not only has the agent’s licence expired, but if he or she attempts to re-apply as a new agent or broker, they’ll be required to admit “non-compliance” and take the re-licensing education by June 30, 2012.
They’ll also have to dig deeper in their pockets and pay the $800 fee for a new agent or broker licence rather than the $700 fee to renew.
But most of the 2,000 agents opting to forego re-licensing likely have no real interest in staying in the business.
In December, the provincial regulator identified as much as 10 per cent to 15 per cent of the province's 9,000-plus licensed agents as no longer working at a brokerage and, therefore, unauthorized to sell mortgages.
Those mortgage professionals have likely abandoned the business since the 2010 renewal period or have taken up administrative or management positions within the industry.
Brokers have viewed their departure as generally a good thing, arguing part-time agents effectively erode industry reputation at the same time they lack the skill and commitment to manage increasingly complex client applications.
One broker, in fact, called on other brokerage heads in Ontario to cut loose those kinds of agents rather than renew them last month.
“I’m just now undertaking the process and choosing not to renew about eight of my agents who are just not committed enough to the industry and mortgage brokering,” Paul Mangion, principal broker of The Mortgage Centre - M.O.S. MortgageOne Solutions Ltd. , in Mississauga, told MortgageBrokerNews.ca. “I’d like to see other broker-owners take a look at their own agents and look at not renewing them either as a way of increasing industry professionalism and efficiency.”