Mortgage brokers and lenders: your rights
Mortgage brokers and lenders like credit unions, provincially regulated trust companies, and finance companies (but not federally regulated banks) must be licensed and follow rules set out in the Mortgage Brokers’ and Lenders’ Registration Act. The legislation outlines your rights in relation to getting and paying back a mortgage.
By law, mortgage brokers and lenders must give you the details of the mortgage and explain the terms for prepayment before you sign the mortgage.
Credit unions, provincially regulated trust companies and finance companies are regulated under the Mortgage Brokers’ and Lenders’ Registration Act. Federally regulated banks are not.
A mortgage lender is the organization that lends you the money for your mortgage. A mortgage broker acts as an intermediary between the lender and the borrower.
The lender or mortgage broker must:
- give you the details of the mortgage, including the total amount, the term, and the interest rate before you are asked to sign the mortgage
- explain the terms for prepayment (if the lender does not, you have the right to prepay the mortgage)
- give you a copy of the mortgage
- send you a statement once per year that shows the status of the mortgage at the time the statement is printed
- give you an amortization table (a document that shows the amount you have borrowed (the principal), and shows how each payment is spilt between paying interest and paying down the principal)
Requirements to operate
A mortgage brokerage or lender must be licensed as a mortgage broker, mortgage lender, lender, or agent of lender. Individual brokers are not required to be licensed, but may broker mortgages on behalf of a licensed company.
All mortgage lenders or brokers must have a permanent address for their business, and must show it to you if you ask to see it.