Maria, a newly licensed mortgage agent in Ontario, receives an application from David, a first-time homebuyer in Toronto, for a $600,000 mortgage on a $750,000 condominium. David has limited credit history but a stable income. Under what circumstances can Maria operate as a sole proprietor?

Question: Maria, a newly licensed mortgage agent in Ontario, receives an application from David, a first-time homebuyer in Toronto, for a $600,000 mortgage on a $750,000 condominium. David has limited credit history but a stable income. Under what circumstances can Maria operate as a sole proprietor?

Answer options: ✅ Maria cannot operate as a sole proprietor; she must be employed by a licensed mortgage brokerage.

• Maria can operate as a sole proprietor if she registers her business name with the Financial Services Regulatory Authority of Ontario (FSRA).
• Maria can operate as a sole proprietor for her first year of licensing, after which she must join a brokerage.
• Maria can operate as a sole proprietor if she secures professional liability insurance independently.

Correct answer: Maria cannot operate as a sole proprietor; she must be employed by a licensed mortgage brokerage.

Explanation: In Ontario, mortgage agents must be employed by or engaged by a licensed mortgage brokerage and cannot operate as sole proprietors directly to the public, as stipulated by the Mortgage Brokerages, Lenders and Administrators Act, 2006 (MBLAA).