Module 6 - Mortgage Administration

What is required of a mortgage administrator regarding public relations and public relations materials?

They must handle payments to the lender/investor
They must create a policies and procedures manual
They must have errors and omissions (E&O) insurance
They must establish a complaints process (correct)

What is the duty of a mortgage administrator in relation to the creation of a mortgage administration agreement?

Establish a complaints process
Handle payments to the lender/investor
Have errors and omissions (E&O) insurance
Create a mortgage administration agreement that clearly outlines the terms of service and fees associated with the mortgage administration (correct)

What does the duty to have insurance, as per O. Reg. 189/08 s27, apply to?

Maintaining financial guarantee
Creating a policies and procedures manual
Handling payments to the lender/investor
Having errors and omissions (E&O) insurance (correct)

What is the responsibility of a mortgage administrator regarding deemed trust funds?

Prepare and submit an audited financial statement for the authorized trust account (B) Signup and view all the answers

What is the duty of a mortgage administrator regarding the establishment of a complaints process?

Create a process to handle complaints about any administration activities (C) Signup and view all the answers

What should be included in the policies and procedures manual of a mortgage administrator?

All of the above (D) Signup and view all the answers

What is the purpose of the mortgage administrator obtaining written acknowledgements from lenders/investors?

To confirm that the mortgage administrator made the required disclosures about potential conflicts of interest (B) Signup and view all the answers

What are trust funds, as defined in the regulations?

Funds held on behalf of another party and not belonging to the brokerage (B) Signup and view all the answers

What is the timeline for depositing all payments, including mortgage interest and principal payments received from a borrower, into the trust account?

Within one business day of receiving the funds (C) Signup and view all the answers

What is the consequence of misappropriation of trust funds?

Potential imprisonment (B) Signup and view all the answers

What is required if a mortgage administrator identifies a shortfall in the trust account?

Contact FSRA and provide audited financial statements for the year-end (B) Signup and view all the answers

What does a mortgage administration agreement formalize?

The expectations and duties of each party involved (B) Signup and view all the answers

What type of entities can FSRA issue a mortgage administrator's license to?

To corporations, partnerships, or sole proprietorships (D) Signup and view all the answers

In what name can a mortgage administrator's license be issued?

Either in the legal name or in one other name that is registered to the corporation, partnership, or sole proprietorship (A) Signup and view all the answers

What tasks is a mortgage administrator responsible for?

Processing renewals, following up on late payments, processing payments, producing mortgage statements, communicating with lenders and borrowers (D) Signup and view all the answers

Under which act are there specific regulations that a mortgage administrator must adhere to?

Mortgage Brokerages, Lenders and Administrators Act, 2006 (MBLAA) (A) Signup and view all the answers

What is the responsibility of a mortgage administrator according to O.Reg.411.07?

Administering the loan from funding of the mortgage loan until it is paid off (B) Signup and view all the answers

What does a mortgage administrator need to ensure while administering a loan?

Compliance with regulatory requirements and ensuring customer satisfaction (D) Signup and view all the answers

What must be deposited into the administrator's trust account within two days of receipt?

Mortgage payments (C) Signup and view all the answers

What is a key component of the administrator's role in relation to the lender/investor?

Monitoring and tracking mortgage payments (B) Signup and view all the answers

What is the source of revenue for administrative fees?

Borrower's mortgage payments (A) Signup and view all the answers

What is the purpose of participation by the administrator in the up-front lender fee?

To earn fees for setting up the administration (B) Signup and view all the answers

What is a common practice to reduce time depositing and clearing funds for receiving and issuing funds to investors?

Making pre-authorized debit arrangements with the borrower (C) Signup and view all the answers

What should be included in the administration agreement in relation to communication and reporting to the lender/investor?

Who pays for legal services in case of default and power of sale (C) Signup and view all the answers

What is the advantage of using power of sale for a mortgage lender?

The procedure is relatively inexpensive compared to a foreclosure (C) Signup and view all the answers

What action can the mortgage lender take if there is insufficient money from the sale to repay the amount owing on the mortgage loan?

Pursue the personal covenant for the shortfall (A) Signup and view all the answers

When can the power of sale proceedings begin?

Day 16 of the mortgage being in arrears (C) Signup and view all the answers

What happens if the property is sold for less than what the lender is owed?

The lender can obtain judgment or garnish wages (C) Signup and view all the answers

What is the responsibility of the mortgage administrator when selling the property under power of sale?

To obtain fair market value and possibly reduce the price if necessary (C) Signup and view all the answers

What action can be taken if the borrower cannot bring the mortgage payments up to date after the notice period?

The borrower must pay off the entire mortgage or vacate the property (B) Signup and view all the answers

What is an advantage of using power of sale according to the text?

The lender can recover funds more quickly compared to foreclosure (D) Signup and view all the answers

What happens after the property is sold under power of sale?

All costs and fees will be paid off, and any remaining equity will go to the borrower (C) Signup and view all the answers

What does Day 15 signify in relation to power of sale proceedings?

The day when private lenders typically take immediate action (A) Signup and view all the answers

What action can be taken if there is more equity in the property than the loan balance?

The mortgage administrator must advise any lender with a lien on the property about power of sale (A) Signup and view all the answers

What is the primary responsibility of the administrator in managing risks and issues?

Maintaining a checklist for dealing with any issues that may arise (D) Signup and view all the answers

In what situation can the mortgage lender start foreclosure proceedings?

If any covenant under the mortgage is violated (B) Signup and view all the answers

What is the advantage to the lender once a court order of foreclosure is obtained?

The mortgage lender becomes the property owner (B) Signup and view all the answers

What is a disadvantage to the lender in a foreclosure process?

Land transfer tax is payable upon registration of the final foreclosure order (A) Signup and view all the answers

What is one of the advantages of a power of sale over foreclosure for the mortgage lender?

The mortgage lender can sell the property in a timely fashion (D) Signup and view all the answers

What is the first step in completing a power of sale?

Completing a search of the title to the property (A) Signup and view all the answers