Mortgage Broker Licensing Practice Exam · Question
Under Canada's Interest Act, prepayment privileges on a residential mortgage with a term over 5 years allow the borrower to prepay after how many years?
Section 10 of the federal Interest Act lets a borrower (natural person, non-corporate) prepay any mortgage with a term over 5 years after 5 years, with a maximu
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Question: Under Canada's Interest Act, prepayment privileges on a residential mortgage with a term over 5 years allow the borrower to prepay after how many years?
Answer options:
- 1 year
- 3 years ✅ 5 years (Interest Act s. 10)
- Never without penalty
Correct answer: 5 years (Interest Act s. 10)
Explanation: Section 10 of the federal Interest Act lets a borrower (natural person, non-corporate) prepay any mortgage with a term over 5 years after 5 years, with a maximum penalty of 3 months' interest.
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Question explanations
- What is the typical time frame for a mortgage agent to provide the required disclosure statement to a client?
- Funds received from a client or investor that the brokerage holds on their behalf must be deposited into:
- Ontario mortgage agents must complete which of the following at each licence renewal?
- Which entity is responsible for licensing and regulating mortgage brokers and agents in Ontario?
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