Time to transform Mortgage Brokers Act, say B.C. brokers

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While CAAMP is effectively asking the B.C. government to tinker with the province’s Mortgage Brokers Act, some brokers are calling for a complete overhaul, one that clearly places brokers at the reins.
 
“The entire act needs to be modernized,” says Sandy Higgins, the president and owner of The Mortgage Centre Island Properties. “The mortgage industry is interested in developing as a profession and looking for legislative change that permits mortgage brokers in British Columbia to define their own standards and increase the level of self-regulation.”
 
CAAMP issued a statement on the MBA discussion paper, stating that self-regulation has merit.
“An important issue is whether the focus of any legislation will be on the mortgage broker channel, which includes originators and lending activities, (such as) a mortgage administrator  license or whether it will primarily focus on being a piece of legislation that covers only originators,” says CAAMP.
 
According to CAAMP’s numbers, mortgage brokers account for roughly 25 per cent of mortgage distribution across Canada, except for B.C. where the total is higher.
 
Another province with a discussion paper out is Alberta, which is examining the role of MICs and private lenders.
 
“Alberta, with its current discussion paper is headed d own a road where it will relinquish responsibility for regulating not only Mortgage Investment Corporations, but potentially private lending as well,” states CAAMP. “Ontario and Saskatchewan on the other hand have legislation that provides for the ability to regulate lending activities.”
 
CAAMP cautions that “before a decision on the regulatory framework is made, B.C. sub brokers should be clear about what the governing body will do, what powers it will have and what it will cost.”
 
CAAMP has offered to assist B.C. in any such review, citing its experience in mortgage research.
 
One of the recommendations made to the provincial government is to have tiered licensing, in common with other provinces. These would consist of a brokerage license (company), a broker license (operational person or key regulatory contact), a sub-broker (associate or agent license) and an administrator license (for flexibility).
 
CAAMP has 1,650 members in British Columbia, with 12,000 members nationwide. B.C. is the second-largest mortgage broker channel province with some 3,300 licensees. 
 
  • Samantha Gale, MBABC on 2013-04-03 2:43:07 PM

    Sandy Higgins is right. The MBABC is of the view that the British Columbia Mortgage Brokers Act needs more than just being tinkered with - it needs a complete overhaul, which includes a fresh new approach to regulation. This 40 year old piece of legislation is seriously outdated and needs modernization to bring it into line with current mortgage broker practices. The MBABC has been talking to BC brokers at town hall meetings, and on a continuous basis as well- BC brokers and other BC industry groups representing realtors, notaries and MICs have all clearly vocalized their support for the self regulation of mortgage brokers. The concept behind self regulation is one of democracy and industry representation, where the BC industry has a say in how it is regulated rather than a case of having government impose a structure on unwitting individuals. On an other issue, BC brokers have a strong reciprocal relationship with their Alberta counterparts, and accordingly the MBABC has been in contact with RECA on the question of the regulation of private mortgage lenders - from our discussions it appears that RECA will continue to regulate private mortgage lending in Alberta. I would suggest that this is good news for BC private mortgage lenders.

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