Commercial Mortgage Broker Agreement for Canada

Commercial Mortgage Broker Agreement Template for Canada

This document establishes a legally binding agreement between a licensed commercial mortgage broker and a client seeking commercial mortgage services in Canada. It outlines the broker's services, responsibilities, compensation structure, and compliance requirements under Canadian federal and provincial regulations. The agreement includes provisions for property evaluation, mortgage sourcing, negotiation services, and documentation requirements while ensuring compliance with provincial mortgage broker regulations, privacy laws, and anti-money laundering legislation. It establishes clear parameters for the commercial relationship while protecting both parties' interests under Canadian law.

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What is a Commercial Mortgage Broker Agreement?

The Commercial Mortgage Broker Agreement is essential for businesses seeking commercial mortgage services in Canada's regulated financial sector. This document is used when a business entity engages a licensed mortgage broker to source, negotiate, and arrange commercial mortgage financing. It establishes the framework for the professional relationship, detailing the broker's services, client obligations, compensation structure, and compliance requirements. The agreement must adhere to provincial mortgage broker regulations, federal privacy laws, and financial services legislation. It typically includes provisions for multiple property types and financing structures while incorporating necessary consumer protection and regulatory compliance elements required under Canadian law. The document serves as both a legal protection and operational guideline for all parties involved in commercial mortgage transactions.

What sections should be included in a Commercial Mortgage Broker Agreement?

1. Parties: Identification of the mortgage broker and the client, including full legal names, addresses, and any relevant registration/license numbers

2. Background: Context of the agreement, including the broker's qualifications and the client's intention to engage broker services

3. Definitions: Key terms used throughout the agreement, including technical and financial terminology

4. Scope of Services: Detailed description of mortgage broker services to be provided, including type of financing sought and property types covered

5. Broker's Obligations: Specific duties and responsibilities of the broker, including due diligence, documentation requirements, and compliance obligations

6. Client's Obligations: Client's responsibilities, including providing accurate information, timely documentation, and cooperation requirements

7. Compensation: Fee structure, commission rates, payment terms, and conditions for earning compensation

8. Term and Termination: Duration of the agreement and circumstances under which it can be terminated by either party

9. Confidentiality: Obligations regarding confidential information and client data protection

10. Representations and Warranties: Statements of fact and guarantees made by both parties

11. Regulatory Compliance: Acknowledgment and compliance with applicable mortgage broker regulations and laws

12. Limitation of Liability: Extent and limitations of broker's liability for services provided

13. Dispute Resolution: Process for handling disagreements and conflicts between parties

14. General Provisions: Standard legal clauses including notices, amendments, assignment, and governing law

What sections are optional to include in a Commercial Mortgage Broker Agreement?

1. Exclusive Agency: Terms establishing the broker as the exclusive agent for specified transactions, used when exclusivity is agreed upon

2. Multiple Brokers Coordination: Provisions for coordination with other brokers, used when multiple brokers might be involved

3. International Transactions: Additional provisions for cross-border transactions, used when dealing with international financing

4. Digital Communications: Specific provisions for electronic communications and virtual dealings, used when primarily operating digitally

5. Sub-broker Relationships: Terms governing the involvement of sub-brokers, used when the primary broker may delegate certain duties

6. Success Fee Structure: Additional compensation terms for successful placement of mortgage, used in performance-based arrangements

7. Property Management Services: Additional services related to property management, used when broker offers extended services

What schedules should be included in a Commercial Mortgage Broker Agreement?

1. Schedule A - Fee Schedule: Detailed breakdown of all fees, commissions, and payment structures

2. Schedule B - Service Level Requirements: Specific performance metrics and service standards

3. Schedule C - Required Documentation: List of required documents and information from client

4. Schedule D - Compliance Checklist: Regulatory compliance requirements and verification checklist

5. Schedule E - Property Types: Detailed list of commercial property types covered under the agreement

6. Appendix 1 - Broker Credentials: Copies of broker's licenses, certifications, and professional credentials

7. Appendix 2 - Privacy Policy: Detailed privacy and data protection policies

8. Appendix 3 - Standard Forms: Collection of standard forms used in the mortgage brokerage process

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents

Jurisdiction

Canada

Publisher

Genie AI

Document Type

Mortgage Agreement

Cost

Free to use

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