skip to main content





Back to all publications
Aug 1, 2018

Regulatory Changes to the Mortgage Brokerages, Lenders and Administrators Act, 2006: Increased Brokerage Obligations for Non-Qualified Syndicated Mortgage Transactions

By Steven L. Graff, Jeremy Nemers and Andy Nguyen

Regulatory amendments that became effective on July 1, 2018 significantly expand the disclosure and information-gathering obligations – and, in practice, potential liability – of mortgage brokerages dealing in non-qualified syndicated mortgage transactions. These expanded obligations include:

a) collecting specified information from each investor-lender, including personal, employment and financial data and investment profile;

b) completing an extensive suitability assessment for each investor-lender, covering financial circumstances, investment needs, level of financial knowledge and investment experience;

c) presenting only suitable mortgage investments to each investor-lender and providing extensive disclosure about each such opportunity, including the disclosure of material risks, any fees or remuneration being received or paid by the brokerage and the brokerage’s relationship with each party to the transaction;

d) reflecting all the above on lengthy new forms approved by the Superintendent, which must be signed by the investor-lender and brokerage for accuracy and completeness; and

e) implementing a mechanism for resolving complaints from the public, and reporting such complaints directly to the Superintendent within ten days of receipt.

These expanded obligations apply to all non-qualified syndicated mortgage transactions, being a significant component of the syndicated mortgage industry that includes any of the following:

a) where the mortgaged property is not primarily residential (and, in any event, where it includes more than one commercial unit or more than four units of any type);

b) where the amount of debt secured by the mortgaged property, excluding only debt that ranks behind the syndicated mortgage, exceeds 90% of the mortgaged property’s fair market value (without regard to potential future development of the property); and

c) where the syndicated mortgage secures a debt obligation incurred for the construction or development of a property.

The Financial Services Group at Aird & Berlis LLP is currently engaged in several high-profile mandates helping stakeholders navigate through – and recover from – failed syndicated mortgages. If you have any questions about the impact of the new regulations or syndicated mortgage transactions more generally, please contact one of the insolvency and restructuring members of our Financial Services Group.

Areas of Expertise

Related Publications

Publications Article
Ontario Government Confirms Private Retail Model By Fiona Brown and Gobind Ahuja Aug 14, 2018 Yesterday evening, and less than three months before Canada legalizes the recreational use of cannabis, the Ontario provincial government confirmed that the province would reverse the previous government’s plan and allow private retailers to sell cannabis in retail locations. Confirmation that On...
Publications Article
Acquiring Cannabis Genetics Under the New Cannabis Regime By Fiona Brown, Jeremy D. Burke, Erica L. Lowthers, PhD and Gaurav Gopinath Aug 07, 2018 Licensed cannabis producers currently don’t have the genetic variety that is available to suppliers in the illicit market. As of August 7, there are 114 licensed producers in Canada and only 289 dried cannabis products are being sold in the Canadian medicinal market. Health Canada's current rules...
Publications Article
Cannabis Regulations Published – Licensing Basics By Jeremy D. Burke and Gaurav Gopinath Jul 12, 2018 Regulations supporting the implementation of the Cannabis Act were published on July 11th. The regulations include the Cannabis Regulations and the Industrial Hemp Regulations and they will come into force, together with the Cannabis Act, on October 17th. This article focuses on federal licenses ...