Mortgage Agent Licensing Practice Exam · Question
A Principal Broker (PB) of an Ontario mortgage brokerage firm becomes aware that one of the Level 1 Mortgage Agents operating under their license has been advising clients on complex investment strategies related to real estate, which falls outside the scope of mortgage brokerage services. The PB has not directly authorized this activity. What is the PB's immediate and necessary action under FSRA's regulatory framework?
Principal Brokers are ultimately responsible for the conduct of all agents operating under their license and must ensure compliance with MBLAA. They are require
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Question: A Principal Broker (PB) of an Ontario mortgage brokerage firm becomes aware that one of the Level 1 Mortgage Agents operating under their license has been advising clients on complex investment strategies related to real estate, which falls outside the scope of mortgage brokerage services. The PB has not directly authorized this activity. What is the PB's immediate and necessary action under FSRA's regulatory framework?
Answer options: ✅ The PB must immediately stop the agent from providing such advice, take appropriate disciplinary action, and if necessary, report the unauthorized activity to FSRA.
- The PB should review the agent's licensing status and, if the agent is not licensed for investment advice, simply instruct them to cease the activity.
- The PB is not directly responsible for an agent's individual actions outside of mortgage brokering, so a verbal warning to the agent is sufficient.
- The PB should allow the agent to continue, provided the agent obtains separate professional liability insurance for investment advice.
Correct answer: The PB must immediately stop the agent from providing such advice, take appropriate disciplinary action, and if necessary, report the unauthorized activity to FSRA.
Explanation: Principal Brokers are ultimately responsible for the conduct of all agents operating under their license and must ensure compliance with MBLAA. They are required to supervise agents and ensure they do not engage in activities beyond the scope of their license or the brokerage's authorization. Failure to act swiftly could result in regulatory action against the PB and the brokerage.
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- Which of the following is NOT a primary provider of mortgage default insurance in Canada?
- When must a mortgage agent provide the borrower with certain disclosures regarding the proposed mortgage, part
- Michael and Jennifer are applying for a mortgage to purchase a home in Calgary for $700,000. Their combined gr
- Which of the following scenarios would typically lead to a higher mortgage interest rate for a borrower?
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