Responsibilities and Prohibitions - Mortgage Brokerage

Purpose: To explain mortgage brokerage responsibilities and prohibitions

This bulletin applies to all mortgage brokerages.

A broker of a mortgage brokerage must ensure the brokerage complies with its responsibilities and prohibitions. These responsibilities and prohibitions help ensure the brokerage and its mortgage brokerage professionals deal in mortgages competently and in accordance with legislation. Mortgage brokerage prohibitions focus on the proper employment of industry members within the brokerage, and payment of commissions and referral fees.

Mortgage brokerages must:

A brokerage’s licence authorizes the brokerage to deal in mortgages only in the name that appears on its licence. If the brokerage’s name is 123 Mortgage Services Ltd., it must always appear in full on all brokerage agreements and advertising. A brokerage may not abbreviate the name to 123 Mortgage. Consumers must be able to identify the corporate entity with which they are dealing.

The brokerage may register a trade name of 123 Mortgage for the brokerage, in which case the Real Estate Council of Alberta (RECA) must approve the trade name. If RECA approves the trade name, it would also appear on the brokerage licence.

Other responsibilities
Brokerages also have a responsibility to immediately notify the executive director in writing:

There are a number of prohibitions that govern a brokerage’s operation, particularly with respect to the employment of mortgage industry professionals, and the payment of commissions and referral fees.

Mortgage brokerages must not employ, permit or engage a mortgage industry professional to deal in mortgages on its behalf if that industry professional is registered with another brokerage. Brokerages must not employ an individual to deal in mortgages until RECA authorizes them and the individual has met all requirements of real estate legislation, including paying all levies, fees, premiums, fines, administrative penalties and other amounts.

Mortgage brokerages must not pay any commission or remuneration, either directly or indirectly, in connection with a deal in mortgages except:

Mortgage brokerages must not pay referral fees or any other remuneration either directly or indirectly in connection with a deal in mortgages:

Mortgage brokerages must not offer a lender or investor a mortgage loan guarantee either on behalf of itself or on behalf of any other industry member.


The associate collected enough personal information to pull a credit bureau on the borrower. These actions would indicate the associate thought there was a potential deal. The associate has breached the legislation. The associate did not make the required disclosures, did not recent consent from the borrower for a credit bureau report or to collect, maintain, use and disclose the borrower’s personal information. Additionally, the brokerage did not have a record of the potential deal.

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