Underwriting Application: Identification Requirements in Canada

Play an AI-generated podcast conversation about this lesson

Which of the following is considered a form of secondary identification?

Social Insurance Number (SIN) card issued by the Government of Canada
Certificate of Canadian Citizenship
Birth certificate issued in Canada (correct)
Driver's license from any country

What criteria must be met for identification to be considered authentic for identity verification?

Include a photo of the person (correct)
Must be expired to show it was previously valid
Include a signature of the person
Should be issued by any organization

In the case of Mary reviewing an Ontario driver's license, why should she not accept the identification?

The license number is too long with 16 digits (correct)
The hologram is not visible
The expiration date is missing
The license number is too short with 12 digits

Which of the following would not be classified as secondary identification?

Foreign passport (D) Signup and view all the answers

What distinguishes a co-applicant from a co-signer and a guarantor?

A co-applicant is never financially responsible for the debt (A) Signup and view all the answers

Which of the following is a requirement for identification to be considered authentic?

Include a unique identifying number (B) Signup and view all the answers

How many pieces of identification are typically required by lenders to comply with Canada's Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA)?

Two pieces of identification (D) Signup and view all the answers

Which of the following is NOT a form of primary identification according to the text?

Social Insurance Number card (B) Signup and view all the answers

Which of the following statements is TRUE according to the text?

Two forms of primary identification can be used (D) Signup and view all the answers

Which of the following is a form of primary identification according to the text?

Certificate of Canadian Citizenship (containing your photograph) (A) Signup and view all the answers

What is the purpose of the identification requirement mentioned in the text?

To comply with Canada's Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA) (C) Signup and view all the answers

Which of the following combinations of identification is acceptable according to the text?

A Nexus/CANPASS card and a Firearms Licence (A) Signup and view all the answers

What is the main difference between a co-applicant and a co-signer?

A co-applicant's income is included in mortgage calculations, while a co-signer's income is not. (A) Signup and view all the answers

Why might a co-signer be required for a mortgage application?

If the applicant does not have sufficient income to qualify. (D) Signup and view all the answers

What is the role of a guarantor in a mortgage application?

To guarantee that the applicant will meet their obligations. (C) Signup and view all the answers

Why might a guarantor be required in a mortgage application?

If the applicant does not have sufficient income and requires extra assurance. (B) Signup and view all the answers

How is a personal covenant different from a legal covenant tied to a property?

Personal covenants are tied to an individual, while legal covenants are not tied to properties. (C) Signup and view all the answers

In what circumstance would a co-applicant's income and debts NOT be included in mortgage calculations?

If the co-applicant has poor credit but enough income. (B) Signup and view all the answers

What does a mortgage borrower in Canada pledge as collateral?

Real property and personal covenant (D) Signup and view all the answers

What does the 'Character' component of the 5 Cs of Credit refer to?

The borrower's stability and traits unrelated to collateral or finances (A) Signup and view all the answers

Why is a borrower's failure to pay child support considered a negative factor in the 'Character' component?

It indicates the borrower may be irresponsible with finances (D) Signup and view all the answers

What is the purpose of a budget according to the Financial Consumer Agency of Canada?

To help manage money and balance income with expenses and savings (D) Signup and view all the answers

Why is creating a budget important for a potential mortgage borrower?

To determine if they can afford the mortgage based on their current lifestyle (D) Signup and view all the answers

What are the 5 Cs of Credit?

Credit, Collateral, Capacity, Character, Capital (C) Signup and view all the answers