Practice Test 1 Flashcards by Gurpinder Deol

Which of the following indicator classifications will often change prior to large economic adjustments, which makes them useful in predicting future trends. (Select one)

Chronology Indicator

Coincident Indicator

Fraternal Indicator

Lagging Indicator

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This license holder meets the same education and experience as a broker, but their role, responsibilities, and limitations are that of an associate. (Select one)

The broker

Assessor

Associate Broker

Associate

Associate Broker

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A brokerage is a legal entity with legal rights and responsibilities. The brokerage may operate as a sole proprietorship, a partnership, or a corporation.

True or False: While the broker is a legal entity, the broker is the one who is authorized by the Real Estate Council of Alberta (RECA)to trade in real estate. All associate brokers, and associates conduct business on behalf of the broker.

True

False

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Joaquim has discovered the trust account for the brokerage is short by $1,800. A quick check of the ledger shows that a $200 disbursement was accidentally charged as a $2000 disbursement. He moves brokerage funds to cover the difference while the money is recovered.

True or False: Joaquim should immediately report the shortage to the Registrar.

True

False

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As a real estate professional, you have responsibilities to your clients and to your brokerage and for complying with the legislation as determined by the government and RECA. While RECA’s role may appear to just be the governing body of the real estate council of Alberta, a key responsibility is primarily to protect consumers. Which actions does RECA take to protect the consumers in Alberta? (Select ALL that apply)

Addressing any complaints consumers may have about real estate licensees.

Establish the Prime Rate for lending.

Inspecting brokerages to ensure compliance with legislation and regulations.

Manage MLS® listings for Real estate professionals

Providing a list of top brokerages monthly at https://www.reca.ca

Responsible for services including registries, land titles, and the Alberta King’s Printer.

Set guidance on commission distributions among brokerages and their associates.

Addressing any complaints consumers may have about real estate licensees.

Inspecting brokerages to ensure compliance with legislation and regulations.

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True or False: A Broker must have ownership interest in the brokerage for which they are responsible.

True

False

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Which residential property type includes unique forms of ownership including timeshares and fractional ownership, and may have issues related to usage, private easements, and seasonal considerations? (Select one)

Condominium Sales

Mobile Home Sales

New Residential Sales

Residential Sales

Recreational Property Sales

Rural Residential Sales

Recreational Property Sales

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Which of the following types of real estate includes real estate that has as its primary purpose farming? (Select one)

Commercial

Industrial

Residential

Rural

Special Use

Rural

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How often does the real estate brokerage trust account need to be reconciled? (Select one)

Weekly

Monthly

Quarterly

Annually

Monthly

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Priority is the order in which those who are registered on the title are paid. Which of the following registered interests takes priority over a primary mortgage? (Select ALL that apply)

A lien (encumbrance or financial claim) filed after the registration date of the mortgage

Condominium fees

Property taxes

Second mortgages

Unregistered mortgages

Property taxes

Second mortgages

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A buyer comes into the brokerage and asks to see listings of homes in his price range. He is shocked to discover that in the last 6 months homes that used to be included are now above the price he is able to afford. Which of the following reasons may explain this? (Select ALL that apply)

Housing prices have increased.

Housing prices have decreased.

Supply of available homes has increased.

Supply of available homes has decreased.

Housing prices have increased.

Supply of available homes has decreased.

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True or False: Real estate refers to the physical land and the structures that are attached to it.

True

False

True

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Treaties between Indigenous peoples and the Canadian government resulted in designated reserves for First Nations people.

True or False: The Real Estate Council of Alberta regulates transactions on reserve lands, as governed by the Indian Act.

True

False

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Certain actions can result in circumstances that make individuals ineligible to become or continue to be licensed. Other circumstances do not prevent professionals from renewing their license. From the following list, select the circumstances which make individuals ineligible to become or continue to be licensed. (Select ALL that apply)

Lifetime withdrawal.

Failure to recertify by the annual expiration date.

Licence suspended or revoked by Registrar.

Licence is “parked.”

Not a Canadian citizen.

Failing a Certified Criminal Record Check (CCRC)

Lifetime withdrawal.

Failure to recertify by the annual expiration date.

Licence suspended or revoked by Registrar.

Failing a Certified Criminal Record Check (CCRC)

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True or False: You must first be hired by a brokerage to finalize the licensing process and complete the authorization.

True

False

True

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Specialization allows property management brokerages to concentrate on managing a sector of properties needing their services. Which specialization includes mixed-use buildings, shopping centres, strip malls, gas stations, and repair shops? (Select one)

Agri-business property management

Commercial property management

Industrial property management

Residential property management

Retail property management

Commercial property management

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True or False: Tax legislation (i.e., the Income Tax Act) has distinctions between an employee and an independent contractor.

True

False

True

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There are two ways for real estate professionals to connect with a brokerage: as an employee or an independent contractor.

Which of the two methods is under the direction and control of the brokerage representing the employer in all business dealings? (Select one)

Employee

Independent Contractor

Both Employee and Independent Contractor

None of the above

Employee

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True or False: Self-regulation in the industry enables the industry to hold its own disciplinary investigations and administer sanctions.

True

False

True

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After which of the following process steps are you authorized to practice as a licensee? (Select one)

After you are hired with a brokerage.

After you begin the application process.

After you complete and return the application to the broker, and the broker accepts the application.

After the broker submits the application to RECA along with all licensing fees.

When RECA receives the application and the application has been accepted online.

When the registration to a brokerage is complete.

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True or False: The executor of an estate becomes the automatic property owner of the property to be disposed.

TRUE

FALSE

False

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Evaluate each of the following fiduciary obligations, and determine if it applies to a Sole Agency relationship with a SELLER. (Select ALL that apply)

Confidentiality.

Full accounting.

Full disclosure.

Hold funds in a private account for the buyer.

Obedience to lawful instructions.

Reasonable care and skill.

Signatory authorization for all real estate related transactions

Undivided loyalty.

Confidentiality.

Full accounting.

Full disclosure.

Obedience to lawful instructions.

Reasonable care and skill.

Undivided loyalty.

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Which of the following events would result in a breach of an agency relationship by the agent? (Select ALL that apply)

Failure to disclose a conflict of interest.

The agent fraudulently presents information making it look like the deal is a bargain.

The fees and commissions earned are not fully disclosed in the written service agreement.

The real estate professional requests general advice from the broker on how to legally proceed with a financial situation the client has found themselves in.

The real estate professional shares consented to private information to a lender about client in order to secure the best possible rates for the client.

The real estate professional shares the client’s property information with prospective buyers.

Favoring a customer over a client in a transaction

Failure to disclose a conflict of interest.

The agent fraudulently presents information making it look like the deal is a bargain.

The fees and commissions earned are not fully disclosed in the written service agreement.

Favoring a customer over a client in a transaction

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There are multiple types of authority in representation relationships. In this type of authority, the person assigned to oversee the disposition of real estate on behalf of a person who is in bankruptcy is known as a: (Select one)

Assignee.

Assignor.

Dower.

Executor.

Power of Attorney.

Probate.

Trustee.

Trustee

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A seller or buyer customer is an individual who has elected not to be represented by an agent in a transaction but instead represents themselves. If you represent the seller in an agency relationship, and the buyer is unrepresented (a customer), what should you discuss with the seller? (Select ALL that apply) That you must act in the best interest of the customer. That you must share all information given to you by the customer, with the seller, even if it is confidential (unless it were received while acting as the customer’s agent). That you will not give the customer information or advice that is not in the seller’s best interests. That you will use your judgement on the customer’s behalf and give them advice.

That you must share all information given to you by the customer, with the seller, even if it is confidential (unless it were received while acting as the customer’s agent). That you will not give the customer information or advice that is not in the seller’s best interests.

The licensee is expected to have the professional skill and capacity to know and address certain issues in a transaction before they arise. True or False: The licensee should NOT wait for clients to ask specific questions or request specific services if they already know what would be required to prevent harm to client interests. TRUE FALSE

True

In a transaction brokerage situation, which of the following services may NOT be provided by the licensee? (Select ALL that apply) Acting as sole agent for both buyer and seller. Acting as transaction facilitator. Explaining to the parties what each part of a contract means. Fiduciary responsibility to all parties Full disclosure with both parties. Providing advice about aspects of the property or transaction.

Fiduciary responsibility to all parties Full disclosure with both parties. Providing advice about aspects of the property or transaction.

Clients often don’t know what concerns they should have in the real estate process. This is why they seek advice and counsel from real estate professionals. Which of the following ways are used to uncover client concerns? (Select ALL that apply) Give them a list of services offered. Give your clients a chance to speak and encourage them to ask questions. Interview potential clients to get a sense of what they’re looking for in an agent relationship and their personalities. Provide to them the brokerage address and contact points. Ask open ended questions and be an active listener.

ive your clients a chance to speak and encourage them to ask questions. Interview potential clients to get a sense of what they’re looking for in an agent relationship and their personalities.

True or False: While you may suggest a non-resident client consult tax specialists for guidance, real estate associates are expected to be tax specialists for property transactions in which they are involved. TRUE FALSE

FALSE

A real estate licensee is required to have the professional skill and capacity to know and address certain issues in a transaction before they arise. This is considered a “standard of care.” Therefore, real estate professionals should not wait for clients to ask specific questions or request specific services if they already know what would be required to prevent harm to client interests. The standard of care to which real estate professionals are held includes informing the client of what? (Select ALL that apply) Things they do not know to ask about. The possible consequences of their lawful instructions to you. The potential results of any decisions made. Any costs to the trade that they may not have anticipated.

Things they do not know to ask about. The possible consequences of their lawful instructions to you. The potential results of any decisions made. Any costs to the trade that they may not have anticipated.

Jeffrey is looking into hiring a real estate professional to sell several of his properties. Jeffrey is a very private person, and really doesn’t like anyone learning about his personal information. He works very hard to keep his “digital footprint” at near zero. He understands he’ll have to provide some information to sell his properties, but wants to keep the distribution of his information to an absolute minimum, preferably, with just one person. Which type of agency contract allows Jeffrey to have a single real estate professional act as his agent, with protections in place to prevent his personal information from being accessed by other agents at the brokerage? (Select one) Common law agency relationship. Customer relationship. Designated agency relationship. Designated customer relationship. De facto agency relationship.

Designated agency relationship.

There are multiple types of authority in representation relationships. In this type of authority, a perfectly competent owner delegates signing authority with a notarized legal document to another person when they are unavailable, such as if they are travelling abroad and difficult to reach. (Select one) Assignee. Assignor. Dower. Executor. Power of Attorney. Probate. Trustee.

Power of Attorney.

Carter has come to Balloon Real Estate Brokerage to find an agent to sell his home. He works with Pradeep as his real estate agent, and signs a written service agreement (WSA). Pradeep explains that the brokerage operates in a way that each associate has their own clientele within the brokerage, and that they do not share information about clients between agents. The WSA also clearly explains that Pradeep is the only associate at the brokerage who will be able to assist Carter on behalf of the brokerage. Three days later, Francine comes into the same brokerage to buy Carter’s home. She meets Pradeep at the door who invites her in. Francine mentions the home, and Pradeep tells Francine that he needs to introduce another associate to Francine, as Carter has requested that Pradeep not represent both the buyer and seller in the transaction. Francine meets with Alayah who happily takes her on as a buyer client. In the above Scenario, what is the brokerage model, and in what capacity are the clients being represented? (Select one) Designated Agency and Sole Agency. Designated Agency and Transaction Brokerage. Common Law Agency and Sole Agency. Common Law Agency and Transaction Brokerage. Implied Agency and Self-Representation. Self-Representation and Sole Agency.

Designated Agency and Sole Agency.

Which conditions allow you to disclose confidential client information (including NDA related issues). (Select ALL that apply) You have permission from your client. The law requires disclosure. When you are in an agency relationship and you determine it is in the client’s best interest, even though you don’t have direct permission from the client. The real estate brokerage or associate is the agent of the seller or buyer (their client), and a customer has provided information to the agent. The real estate brokerage or associate must share all information given to them by the customer, even if it is confidential, unless it was received while they were acting as the customer’s agent.

You have permission from your client. The law requires disclosure. The real estate brokerage or associate is the agent of the seller or buyer (their client), and a customer has provided information to the agent. The real estate brokerage or associate must share all information given to them by the customer, even if it is confidential, unless it was received while they were acting as the customer’s agent.

RECA’s Customer Acknowledgement form describes the role of the real estate professional as (2.1.a), “we have no agency obligations to you, especially fiduciary ones. In a fiduciary relationship, you rely on someone to act in your best interests.” True or False: “Have no agency obligation” means a real estate professional has no obligation to disclose information to a customer, including fees, commissions, and information that is not in the real estate professional’s client’s best interest. TRUE FALSE

TRUE

Historically, it was assumed that every associate in a brokerage had equal access to the same clients and client information and therefore, under common law, it was acknowledged that agency relationship was always between the consumer and the brokerage. Regardless of the type of real estate (residential, rural, commercial, or property management), practice and brokerage models have now evolved enabling individual agents to maintain client confidentiality. In Alberta, real estate brokerages may operate as one of two different types of brokerages. What are they? (Select one) Crown law, and designated agency brokerages. Designated agency, and common law brokerages. Designated agency, and sole agency brokerages. Implied agency, and designated agency brokerages. Implied agency, and transaction agency brokerages. Sole agency, and common law agency brokerages.

Designated agency, and common law brokerages.

Identify all of the following that apply to designated agency relationships. (Select ALL that apply) The client is a client of the brokerage but the brokerage designates a specific associate(s) to the specific transaction. The real estate brokerage shares client information among associates. The real estate brokerage puts barriers in place to isolate client information to only their own appointed associate (agent). An individual real estate professional works exclusively as the client’s agent. Clients are individuals that are being helped by an agent specifically named under a written service agreement with the brokerage. Clients receive support for buying and selling real estate.

The client is a client of the brokerage but the brokerage designates a specific associate(s) to the specific transaction. The real estate brokerage puts barriers in place to isolate client information to only their own appointed associate (agent). An individual real estate professional works exclusively as the client’s agent. Clients are individuals that are being helped by an agent specifically named under a written service agreement with the brokerage. Clients receive support for buying and selling real estate.

Which of the following are included in the elements of responsibility for an Agency relationship? (Select ALL that apply) Act as Executor. Enter Probate. Clients Best Interests. Confidentiality. Full Accounting. Full Disclosure. Obedience to lawful instructions. Reasonable Care and Skill. Signatory Authorization. Undivided Loyalty.

Clients Best Interests. Confidentiality. Full Accounting. Full Disclosure. Obedience to lawful instructions. Reasonable Care and Skill. Undivided Loyalty.

True or False: You can build trust with your clients and customers by being consistent in your duty to follow rules and to set expectations about both your business practices and the types of services you are permitted to provide. TRUE FALSE

True

Anna is a real estate professional who is approached by a newlywed couple looking to get into their first home. Because the wife’s job is likely to move locations to another province in about a year, they only want to live there until that time, and then rent it out. What type of ownership option should they investigate? Fee Simple Leasehold Life estate

Fee Simple

More properties are being fitted with security cameras and nanny cams, often directly accessible through the internet. While it is illegal for a third party to record a conversation secretly in Canada, the lines are blurred with what you can do in your own home and the intent of security device. Client conversations that might reveal negotiation strategies, prices, or other transaction related details should be communicated outside of the home for optimal protection of the client’s best interest. TRUE FALSE

True

Real estate associates have a responsibility to keep client information protected. Which of the following are included in the individual real estate associate’s responsibilities? (Select ALL that apply) Make a reasonable effort to ensure the information is accurate. Notify the Privacy Commissioner of any incident involving loss, unauthorized access, or disclosure of personal information (breaches)where a reasonable person would consider there is a real risk of significant harm to an individual because of that breach. Prepare and implement a compliance program consisting of appointing a compliance officer, maintaining current written compliance policies and procedures, training, and risk assessment. Protect personal information by making sure they have reasonable security measures against risks.

Make a reasonable effort to ensure the information is accurate. Notify the Privacy Commissioner of any incident involving loss, unauthorized access, or disclosure of personal information (breaches)where a reasonable person would consider there is a real risk of significant harm to an individual because of that breach. Protect personal information by making sure they have reasonable security measures against risks.

If your organization is being investigated by Alberta’s Office of Information and Privacy Commissioner (OIPC), what actions can the OIPC take during the investigation? (Select ALL that apply) Attempt to resolve complaints. Give advance rulings regarding any matters that the Privacy Commissioner could investigate. Investigate complaints, requiring documents to be produced within 10 days. Issue monetary judgements.

Attempt to resolve complaints. Give advance rulings regarding any matters that the Privacy Commissioner could investigate. Investigate complaints, requiring documents to be produced within 10 days. Issue monetary judgements.

Tyrone has taken on a client to sell a property in the city. The market is considered a “hot seller’s market,” with most properties listed going under contract within a week. Many of them receive offers within hours of posting, and often unconditional. The client seems prepared for this and provides pictures of the property to Tyrone to publish on MLS®, along with a great deal of information about the property, including dimensions and amenities. A quick search reveals to Tyrone that these are the same pictures and descriptions used just three years ago when the house was purchased by the client. Tyrone signs a listing contract with the client and begins to prepare the marketing. As part of the due-diligence process, Tyrone visits the property to confirm the details. When he arrives, immediately he notices the property is severely under cared for, with peeling external paint, some broken windows that are taped with cardboard, a garage door that is apparently off the rails, and a yard and garden that has trash everywhere. Tyrone could list the property under his brokerage’s existing (and compliant) template with the pictures and descriptions that do not reflect the current state. If he did, which of the following requirements/obligations would he be violating, with regard to the legislated obligations of standards of practice? (Select ALL that apply) Be true and accurate. Clearly display the full name of the brokerage. Disclose key information, including sources of information. Clearly display the name of the licensed associate.

Be true and accurate. Disclose key information, including sources of information.

Which of the following criminal offenses is described as when someone receives something valuable (money or gifts) for doing, or not doing, something connected with the business or affairs of the principal without transparency to all parties? (Select one) Criminal interest rate De facto enterprise Fraud Secret commissions

Secret commissions

The Competition Act prohibits representations made to promote a product, service, or business interest that are false or misleading. Which of the following does this apply? (Select ALL that apply) Marketing Advertising Social Media Oral Claims

Marketing Advertising Social Media Oral Claims

A potential client comes into the brokerage seeking a real estate agent to help them with a transaction. The client hands the receptionist a folder that contains the client’s basic information as well as copies of financial statements, a T-4 form, and several pay stubs. The client tells the receptionist that he’d like to schedule time with a real estate agent who can assist with his transaction. The receptionist informs him that all agents are out right now, but she can call him as soon as someone returns. The potential client agrees and leaves. He leaves the documentation in the folder with the receptionist. The receptionist has no legal obligation under PIPA for the personal information, because the person who left it there did so of their own free will and they are NOT yet a client. TRUE FALSE

False

As a licensee, you see different phrases for “personal information” that sound as though they mean the same thing. The three most common phrases are personal information, privacy, and confidential information. Which of the three phrases is the right of an individual to choose what information they make available to others, including an organization or government agency (Select one) Personal information Privacy Confidential information

Privacy

Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA) differs from the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) in which of the following ways? (Select one) PCMLTFA has an extensive website that provides numerous guidelines and notices for businesses that are mandated to use their system. PCMLTFA is an independent agency, whereas FINTRAC is legislation. PCMLTFA is legislation, whereas FINTRAC is an agency governed by the PCMLTFA. There is no substantial difference, both are legislations that deal with money laundering.

PCMLTFA is legislation, whereas FINTRAC is an agency governed by the PCMLTFA.

Which of the PIPEDA’s Fair Information Principles indicates that a person has the right to know how the organization collects and protects their information, AND has the right to address any questions or concerns and understand the organization’s policies and procedures? (Select one) Accountability Accuracy Consent Challenging Compliance Identifying Purposes Individual Access Limiting Collection Limiting Use, Disclosure, Retention Openness Safegaurds

Accountability

When an organization no longer needs personal information for legal or business purposes, what should the organization do with the personal information? Destroy or render the records as non-identifying. Move the records to a permanent archive with secure access only. Nothing. There is no requirement regarding personal information that no longer has a purpose. Take the personal identification and make contact, to indefinitely require the data.

Destroy or render the records as non-identifying.

Which of the following situations are examples of anti-competitive conduct by real estate professionals? (Select ALL that apply) Advising a landlord to reject a tenant on the basis of their business being a competitor to your own. An agreement between the three largest firms in the city to show properties listed only by those of the largest firms. Confirming with a client that another brokerage has listings they can be shown. Suggesting to other brokerage associates that they avoid doing business with ABBA brokerage’s associates. Two brokers, talking over lunch together, decide to set their brokerage’s commissions 1% lower than the other brokerages in town.

Advising a landlord to reject a tenant on the basis of their business being a competitor to your own. An agreement between the three largest firms in the city to show properties listed only by those of the largest firms. Suggesting to other brokerage associates that they avoid doing business with ABBA brokerage’s associates. Two brokers, talking over lunch together, decide to set their brokerage’s commissions 1% lower than the other brokerages in town.

To avoid making false or misleading statements, a real estate professional should always verify that their claim is true and accurate. TRUE FALSE

True

To determine if the claim was false or misleading material, a court would consider whether an average consumer would likely be influenced into obtaining the product or service. TRUE FALSE

True

Consent is NOT required when contacting former clients with electronic marketing materials. TRUE FALSE

False

During a real estate transaction, the buying associate must fill out a Fintrac ID on both the buyer and seller. If the seller refuses, the transaction cannot proceed. TRUE FALSE

False

During a real estate transaction, the buying associate must fill out a Fintrac ID on both the buyer and seller. If the seller refuses, the transaction cannot proceed. TRUE FALSE

As a licensee, you see different phrases for “personal information” that sound as though they mean the same thing. The three most common phrases are personal information, privacy, and confidential information. Which of the three phrases is information about an identifiable individual? (Select one) Personal information Privacy Confidential information

Personal information

Obtaining consent is key when processing someone’s personal information. Consent is when a person provides information to you, even when they do not know how you will utilize the information. TRUE FALSE

True

Which of the PIPEDA’s Fair Information Principles is described as when a person gives permission to an organization to possess personal information? (Select one) Accountability Accuracy Consent Challenging Compliance Identifying purposes Individual Access Limiting Collection Limiting Use, Disclosure, Retention Openness Safeguards

Consent

Brokerages have many information barriers to help protect client information. Which of the following help secure the client information or provide barriers to access? (Select ALL that apply) Documented and audited brokerage privacy policies. Cybersecurity plans and reviews. Privacy Officers. Locked server and storage rooms. Third-party shredding services.

Documented and audited brokerage privacy policies. Cybersecurity plans and reviews. Privacy Officers. Locked server and storage rooms. Third-party shredding services.

True or False: Foamed-in-place insulation has a higher insulating value (R-value) than fiberglass batting. TRUE FALSE

True

When considering “green real estate,” a likely association is with energy-efficient components. Green properties also include the materials used in the construction. What properties of bamboo makes it a popular “green” material? (Select ALL that apply) High strength to weight ratio, making it a great option for flooring and cabinetry. Is commonly recycled into plastic bags. The leaves are consumed by Pandas, which are very popular at zoos. The plant is not killed during harvest and has a high self-regeneration rate (making it a renewable resource).

High strength to weight ratio, making it a great option for flooring and cabinetry. The plant is not killed during harvest and has a high self-regeneration rate (making it a renewable resource).

True or False: Maintaining situational awareness increases the likelihood of recognizing when the situation becomes unsafe. TRUE FALSE

True

Illegal Cannabis grow-operations, or "illegal grow-ops", create an indoor nursery for illegally cultivating cannabis. This is not the same as a resident owning and cultivating four or less cannabis plants, which is legal in Canada. To establish an illegal grow-op, a building's systems may have been altered, compromising the integrity of the building and creating safety, health, and fire hazards. Which of the following are signs or characteristics that a property may have been used as a grow-op? (Select ALL that apply) Condensation on the inside of windows. Equipment either discarded or hauled away, including fertilizers, containers, pots, wiring, PVC pipe, C02 tanks, and fuel tanks. Hardwood flooring. Odour similar to rotten cabbage or skunk. Primary bedroom on the main floor. Roof free from snow, when surrounding properties are still snow covered. Unusual electrical hookups. Windows covered with black plastic, foil, or dark, heavy curtains. Windows with vertical blinds.

Condensation on the inside of windows. Equipment either discarded or hauled away, including fertilizers, containers, pots, wiring, PVC pipe, C02 tanks, and fuel tanks. Odour similar to rotten cabbage or skunk. Roof free from snow, when surrounding properties are still snow covered. Unusual electrical hookups. Windows covered with black plastic, foil, or dark, heavy curtains.

True or False: Real estate professionals have a duty to disclose material latent defects in all situations. TRUE FALSE

True

Reese has recently inherited several properties from his uncle. These properties are commercially zoned, but Reese was told several also had “discretionary uses” that were approved by the development authority. What are the responsibilities a licensee has, with regard to due diligence on the properties before sale? (Select ALL that apply) Conduct property inspections on each property to identify all potential areas of concern for the buyers. Investigate each property’s zoning classification and authorized uses. Investigate whether or not the sale of the property will impact the discretionary use authorization. Provide detailed descriptions of the properties as they are classified by the municipality to the client.

Investigate each property’s zoning classification and authorized uses. Investigate whether or not the sale of the property will impact the discretionary use authorization. Provide detailed descriptions of the properties as they are classified by the municipality to the client.

Which of the following land use district (zone) would allow large parcels with low density and mixed dwellings? (Select one) Commercial. Industrial. Residential. Recreational. Special Use.

Residential.

From a buyer’s perspective, which of the following property types is likely to be the most economical for first-time buyers, usually has just one floor, may of may not have private laundry facilities, but has several adjoining units? (Select one) Apartment. Detached. Duplex. Row. Semi-detached. Triplex. Fourplex.

Apartment.

What is the purpose of a land use classification? (Select one) Address things like maximum building heights, location of buildings, and other construction on the property, and what the property will be used for. Address things like building durability, electrical, plumbing, energy efficiency, and safety of occupants. Confirm that the use of a property complies with the municipality’s land use plan. Dictate what the land is used for and what can be built on the land. Used for planning and for describing to others what kinds of developments are permitted in each zone.

Used for planning and for describing to others what kinds of developments are permitted in each zone.

Which of the following property types is the only property type that does not include a land component? (Select one) Land. Mobile. Multi-family (Multi-unit). Recreational. Residential.

Mobile.

True or False: In a multiple offer situation the seller may choose to inform each buyer that there are not only other offers, but also what each offer contains. TRUE FALSE

True

A brokerage shall keep separate and have available at its registered business office in Alberta or the City of Lloydminster all records for each trade or potential trade. TRUE FALSE

True

In Alberta, there is legislation that encompasses hazards which can be physical, emotional, or mental. These are generally termed occupational health and safety. True or False: Your brokerage should provide you with information on the OHS guidelines in Alberta and how they are implemented on the job. TRUE FALSE

True

Negotiating should be an exchange of ideas, in which all parties cooperate. The negotiator should be looking for the parties' common interests and needs. True or False: If an agent is representing a buyer, the goal should be to ensure the best interest of both the buyer and seller during negotiations. TRUE FALSE

False

A real estate licensee has a duty to keep the client's personal information confidential. True or False: Because of the nature of agency relationships, confidential client information can be used by an agent to which it was provided, even when the client has NOT given specific consent for the agent’s action. TRUE FALSE

True

Christopher and Allison are selling their home. As their agent, on the day of listing you receive four separate offers. Two of them have 24-hour consideration clauses, and the other two, while lower, allow more favorable closing conditions (one doesn’t even require an inspection!). As their agent, what actions should you take? (Select ALL that apply) Discuss the advantages and disadvantages, with Chris and Allison, of informing the other buyers of the offers. Inform Chris and Allison that they may accept an offer, or counter on any offers. Pick out the best two offers and present them to Chris and Allison. Reject all offers and request rebids, now that you know the market is a seller’s market. Show all offers to the buyers and request rebids before showing the offers to Chris and Allison. Show all offers to the sellers. Present offers on the basis of all their terms, conditions, dates, inclusions, and exclusions and not only on price

Discuss the advantages and disadvantages, with Chris and Allison, of informing the other buyers of the offers. Inform Chris and Allison that they may accept an offer, or counter on any offers. Show all offers to the sellers. Present offers on the basis of all their terms, conditions, dates, inclusions, and exclusions and not only on price

Often, conflicts will occur during meetings with clients, with other agents, or in public situations. Some strategies or communication methods can be employed to help prevent conflict, others to resolve conflict. Which of the following methods can be used to prevent conflict? (Select ALL that apply) Active Listening. Be dismissive. Call security if threats of violence are made. Listen without formulating responses. Map out next steps, pivot if appropriate. Multitasking during conversations. Paraphrase the other party’s viewpoint.

Active Listening. Listen without formulating responses. Map out next steps, pivot if appropriate. Paraphrase the other party’s viewpoint.

Occasionally, the relationship between an agent and their client breaks down. This most often happens when the client is expecting the agent to perform a certain way, which may differ from what they offer or are capable of. Or, the client’s actions and decisions are making it difficult for the agent to fulfil their obligations to the client. Who is the person to discuss the different options and walk the agent through the process of potentially ending the relationship? (Select one) A neutral broker from another brokerage. A neutral arbiter assigned by RECA. Any other associate from the brokerage. The agent’s broker.

The agent’s broker.

True or False: If at any time there is a shortage of money in an account in which money is held in trust, the brokerage shall deposit the brokerage’s own money into the account as soon as the amount of the shortage is discovered. TRUE FALSE

True

Which of the following methods is a valid strategy to help you stay focused on long-term goals and short-term goals? (Select one) Attending the various learning opportunities provided through your brokerage, board, and association. Identify how much money you need to earn to be successful. Take up a new hobby or travel to a new place. Write down the goal and review regularly.

Write down the goal and review regularly.

Opal is building a website for herself. In addition to her brokerage’s requirements, what other compliancy does Opal need to ensure for the website? (Select one) Brokerage policies and procedures. Internet Access and Guidelines from Service Alberta. Online Guidance from the Ministry of Service (OGMS) The Real Estate Act Rules.

The Real Estate Act Rules.

SMART goals are Specific, Measurable, Achievable, Relevant, and Time Sensitive. The following goal is missing one of these elements. "Contact five new potential clients, and screen for interest in signing into an agency relationship." Select the element that is missing from the above goal. (Select one) Specific. Measurable. Achievable. Relevant. Time Sensitive.

Time Sensitive.

The records, books, accounts, and supporting documentation in relation to each trade or potential trade in real estate must identify each trade or potential trade and must contain which of the following? (Select ALL that apply) A description of the real estate. A listing of client concerns that were addressed by the agent. The names of the parties to the trade or potential trade. The nature of the trade or potential trade. A unique index system of identifying and locating files quickly (ie. File numbers) Video logs of conference room conversations.

A description of the real estate. The names of the parties to the trade or potential trade. The nature of the trade or potential trade.

Which of the following are software examples that support efficiency? (Select ALL that apply) Client Relationship Management (CRM). CREAWEBForms®, NexOneAgent, and DealSimple (forms management). Enviromint/Deal Manager (manages brokerage transactions). Face-to-Face MLS® Systems. Smart Phone utilities and applications Slack or Workplace (communication tools)

Client Relationship Management (CRM). CREAWEBForms®, NexOneAgent, and DealSimple (forms management). Enviromint/Deal Manager (manages brokerage transactions). MLS® Systems. Smart Phone utilities and applications Slack or Workplace (communication tools)

In many situations, minor consumer complaints are not required to go through the formal complaint process (such as through RECA) and can be handled through the Voluntary Broker Resolution Process (VBRP). What are the benefits of brokers using the VBRP to deal with disputes? (Select ALL that apply) Allows the consumer, broker, and real estate professional to meet and either negotiate on their own or involve a mediator. Avoids or ends a formal complaint. Generally, requires less then 5 minutes to complete. Once started, prevents filing of formal complaints.

Allows the consumer, broker, and real estate professional to meet and either negotiate on their own or involve a mediator. Avoids or ends a formal complaint.

Following a RECA investigation, who receives the written report from the investigators? (Select one) The broker of record of the brokerage or associate under investigation. The Minister of Service Alberta. To the brokerage or associate under investigation. To the head of the respective industry council. To the RECA Registrar.

To the RECA Registrar.

Industry councils cannot hold an investigation into matters that are not in their industry. Nor do they have the power to deal with a business enterprise outside of the Real Estate Act. However, there are certain conditions under which the Real Estate Council of Alberta (RECA) MAY have jurisdiction. The following list contains situations ranging from absolutely within RECA jurisdiction to absolutely outside of RECA jurisdiction. Select the conditions which create uncertainty about RECA’s jurisdiction. (Select ALL that apply) If the buyer is in Alberta, using an Alberta brokerage, and the real estate is located in another province or country. If the buyer is in another province, but using a mortgage broker, real estate brokerage, and/or property management in Alberta. If there is real estate involved and the buyer and real estate are located in Alberta. If there is real estate involved and the buyer and real estate are located in another province. The components of the deal involve multiple jurisdictions, including Alberta.

If the buyer is in Alberta, using an Alberta brokerage, and the real estate is located in another province or country. The components of the deal involve multiple jurisdictions, including Alberta.

Certain people doing anything to administer the Real Estate Act who have done so to the best of their abilities and with no bad intentions, cannot be sued for those activities. This is part of the immunity provisions granted. From the list below, and with the above conditions, select all those who are immune. (Select ALL that apply) Associate brokers licensed through RECA. An official administrator. Any member, officer, or employee of RECA. Brokerage associates licensed through RECA. Brokers licensed through RECA. RECA. The Board of Directors of RECA. The Industry Council. The Minister.

An official administrator. Any member, officer, or employee of RECA. RECA. The Board of Directors of RECA. The Industry Council. The Minister.

True or False: The Alberta government reserves most mineral rights on land titles using the legal description, “excepting thereout all mines and minerals.” True. False

True

When a registrar receives a complaint, they review the information provided by the complainant (the person complaining). The registrar then has which of the following options? (Select ALL that apply) Act as arbiter between the complainant and the accused in a formal hearing at the associated brokerage. Inform the complainant that the investigation is ongoing to avoid further complaints, even when the investigation has ceased. Investigate the complaint. Refuse to investigate the complaint. Stop investigating the complaint. Tell the investigator to stop investigating the complaint.

Investigate the complaint. Refuse to investigate the complaint. Stop investigating the complaint. Tell the investigator to stop investigating the complaint.

Robert and Dale are working at the same brokerage. It is a common law brokerage. Robert and Dale commonly consult with each other about their clients and have done so repeatedly over the last several weeks. Dale reports to Robert that his client is making an offer on one of Robert’s listings. Does a conflict of interest exist? (Select one) No. Only if the client is informed. Only if Dale was paying attention during the conversation. Yes.

Yes

From the following list, which are the advantages provided by having a professional group of peers govern the same body of professionals? (Select ALL that apply) A professional’s peers also have insight into whether a negative outcome in a transaction is beyond the control of the professional, or due to their negligence. Conversations of both problems and advances are easier with someone of the same professional background. Members prefer all other members be just like themselves in nationality, race, creed, religion, gender, and other preference. Members of these groups want to be judged, at least in part, by other people who understand the pressures and difficulties of that profession.

A professional’s peers also have insight into whether a negative outcome in a transaction is beyond the control of the professional, or due to their negligence. Conversations of both problems and advances are easier with someone of the same professional background. Members of these groups want to be judged, at least in part, by other people who understand the pressures and difficulties of that profession.

A real or apparent incompatibility between a licensee’s interests and the interests of the client or potential client Which of the following is described above? (Select one) Agency Interest. Agency Conflict. Conflict of Agency. Conflict of Interest. Designated Agency. Designated Conflict.

Conflict of Interest.

W Which of the following best describes a reciprocal insurance program? (Select one) The insurance carrier is owned by the policyholders but is managed by a separate organization. The insurance carrier is owned by a separate organization, but is managed by the policyholders. The insurance funds are provided by the policy holders, but owned and managed by a separate organization. The insurance funds are provided by the policy holders, the ownership belongs to the government, the management is handled by the policy holders.

The insurance carrier is owned by the policyholders but is managed by a separate organization.

In a contract or an agreement, there are generally two parties. Anyone outside the contract is a third party. Which of the following scenarios would result in third party liability by the licensee? (Select ALL that apply) A licensee knows the purchase of a home is contingent on the sale of another property but fails to include the contingency in the contract. The purchase falls through, and the client is sued for damages. The purchase fell through because the client’s other property didn’t sell. The client claims the licensee was liable for damages as the licensee knew the financing was contingent and didn’t include it in the contract. An agent hits another agent’s vehicle backing up in the parking lot. The agent with the damages is third party liable. Someone brings a claim against a licensee for encroachment of property. The licensee’s personal driveway was recently poured, and it is believed to be on the wrong side of the property line of the licensee. The neighbor is the third party, and the licensee is liable. Someone brings a claim against the licensee’s client and the client then clamed the damages were caused by the licensee’s actions or omissions.

A licensee knows the purchase of a home is contingent on the sale of another property but fails to include the contingency in the contract. The purchase falls through, and the client is sued for damages. The purchase fell through because the client’s other property didn’t sell. The client claims the licensee was liable for damages as the licensee knew the financing was contingent and didn’t include it in the contract. Someone brings a claim against the licensee’s client and the client then clamed the damages were caused by the licensee’s actions or omissions.

Ahatia has begun working for ABBA Brokerage. During her training, Ahatia is informed of not only all the brokerage’s policies and procedures but provided additional training on the standards of professional conduct outlined by the Real Estate Act. Ahatia’s first client for a real-estate transaction hands her a cheque for the deposit on a property. The cheque is made out directly to Ahatia. Ahatia tells the client this is incorrect, but the client informs Ahatia that it’s the “last cheque I have,” and requests that she personally cash the cheque and deposit it on the client’s behalf. Ahatia does so. There is no problem with the transaction, and the deal closes without issue. Later, Ahatia’s broker discovers what she has done. Even though the situation worked out well, the broker informs Ahatia that what she did was not acceptable and has consequences. What liability did Ahatia’s actions expose her to (regardless of whether or not action is taken)? (Select one) Ahatia is NOT liable for any damages to the client (civil liability), and is NOT liable for failure to follow regulatory requirements (regulatory). Ahatia is NOT liable for any damages to the client (civil liability), and is liable for failure to follow regulatory requirements (regulatory). Ahatia is liable for any damages to the client (civil liability), and is liable for failure to follow regulatory requirements (regulatory). Ahatia is liable for any damages to the client (civil liability), and is NOT liable for failure to follow regulatory requirements (regulatory).

Ahatia is liable for any damages to the client (civil liability), and is liable for failure to follow regulatory requirements (regulatory).

Jessica and Chad are interested in becoming clients of Jun Ho, who was recommended by a close friend. They have a meeting with Jun Ho at 2pm. When they arrive, an administrative assistant hands them some paperwork to fill out titled “Written Service Agreement (WSA)” that establishes an agency relationship with Jun Ho. Jun Ho comes in about 15 minutes later and asks if they have the documentation complete. Jessica and Chad have completed it but have NOT signed. Which of the following statements are TRUE? (Select ALL that apply) Jun Ho could reduce risk by mandating the WSA be signed before proceeding with the first meeting. Jun Ho could reduce risk by meeting with the clients prior to them signing a contract. Jun Ho has decreased risk by taking on Jessica and Chad without even knowing why they are there. Jun Ho has increased risk by having Jessica and Chad complete paperwork without him Jun Ho is following best practices by having a WSA in place before communicating with a client.

Jun Ho could reduce risk by mandating the WSA be signed before proceeding with the first meeting. Jun Ho has increased risk by having Jessica and Chad complete paperwork without him

The Real Estate Council of Alberta (RECA) is established as an industry council by the Real Estate Act (REA). RECA is responsible for producing the content of the rules governing licensee conduct for the real estate industry. Which of the following is NOT something created or produced by RECA? (Select one) Bylaws. Policies and procedures of conduct for the licensees. Real Estate Act Regulations. Real Estate Act Rules.

Real Estate Act Regulations.

In 1995 the Real Estate Act represented a large change and upgrade in legislation concerning licensees. True or False: The Real Estate Act was the first legislation in Alberta making licensees self-governing (self-regulation). True. False.

True

Once an appeal is made, the hearing panel reviews the information. True or False: Following review, the hearing panel decides whether there should be a hearing. True. False.

True

True or False: The registrar may refuse to grant a license to an applicant, even if they have passed all the required education and training. True. False.

True

REIX Errors and omissions insurance spreads the cost of licensees' errors, omissions, and negligence findings or judgments across the entire pool of licensees. How does errors and omissions insurance reduce risk? (Select one) The insurance decreases the likelihood that the injured person will get reimbursed, and decreases the likelihood that the licensee will be bankrupted by a claim. The insurance decreases the likelihood that the injured person will get reimbursed and increases the likelihood that the licensee will be bankrupted by a claim. The insurance increases the likelihood that the injured person will get reimbursed and decreases the likelihood that the licensee will be bankrupted by a claim. The insurance increases the likelihood that the injured person will get reimbursed and increases the likelihood that the licensee will be bankrupted by a claim.

The insurance increases the likelihood that the injured person will get reimbursed and decreases the likelihood that the licensee will be bankrupted by a claim.

Which of the following is the best definition of professional risk? (Select one) The assumption of the cost associated with the real estate professional’s actions during a funded and closed transaction or on behalf of a brokerage for a specific period of time. The assumption of the cost associated with the real estate professional’s actions during a transaction or on behalf of a client for a specific period of time. The assumption of the value associated with the real estate professional’s client’s actions during a transaction. The assumption of the value of the real estate professional’s time during a transaction or on behalf of a client for a specific period of time.

The assumption of the cost associated with the real estate professional’s actions during a transaction or on behalf of a client for a specific period of time.

Which key term in the Real Estate Act are the rules made by an Industry Council? (Select one) Bylaws. Council. Industry Council. Real Estate. Rules.

Bylaws. Rules.

Which of the following is NOT one of the four purposes of RECA? (Select one) To administer the Real Estate Act’s regulations, bylaws, and rules. To enable licensees and brokerages to market their services to the general public and secure commissions. To protect against, investigate, detect and suppress fraud as it relates to the business of licensees and to protect consumers. To provide, or support the provision of, services and other things that facilitate the business of licensees, as provided for in the regulations. To set the strategic direction and ensure the effective operation of the Council.

To enable licensees and brokerages to market their services to the general public and secure commissions.

Determining when to refer a client to another expert, third-party service, or licensed agent is part of the real estate professional’s responsibilities. From the following list, select all those items which describe conditions under which a licensee will refer a client to professionals or experts. (Select ALL that apply) The scenario falls within the limitations of your license. The scenario falls outside the scope of your knowledge, skill or expertise. The brokerage can support you in the situation. Your client specifically asks if you have referrals for a specific service. You are called upon to offer advice outside the scope of your qualifications.

The scenario falls outside the scope of your knowledge, skill or expertise. Your client specifically asks if you have referrals for a specific service. You are called upon to offer advice outside the scope of your qualifications.

Any individual (or corporation) who negotiates a mortgage deal on another person’s behalf for compensation requires a mortgage broker’s license. There are exemptions to this rule. From the following list of basic scenarios, identify those which would NOT require a mortgage broker’s license. (Select ALL that apply) A bank lending money to a home buyer from its own mortgage fund. A group of institutional investors who hire an individual to find borrowers and manage the lending process. A private individual lending money directly to prospective mortgagors. Someone compensated for connecting a borrower to a lender, and assisting with the negotiations, if it’s just a one-time event.

A bank lending money to a home buyer from its own mortgage fund. A private individual lending money directly to prospective mortgagors.

Jamal and Yolanda are meeting with Cherie to find a mortgage. Cherie mentions that she is an affiliated mortgage broker, and hands them some documentation to both sign, and get started collecting information from Jamal and Yolanda about their financial situation. Jamal stops the process and says, “What do you mean ‘affiliated?’” What is meant when Cherie says she is an “affiliated” mortgage broker? (Select one) Cherie is affiliated with a mortgage brokerage. She should inform Jamal and Yolanda what brokerage she works for, and provide them the actual name. Cherie is affiliated with other mortgage brokers. This means if Jamal and Yolanda come in, and Cherie is not there, they can be supported by any of the licensed mortgage brokers on site. Cherie has a direct affiliation with bank, credit union, treasure branch, or loan corporation. She is not a licensed mortgage broker, but actually a “mortgage specialist,” who performs a similar role to a mortgage broker but is only allowed to deal in the products and services offered by the employer. Cherie has a direct affiliation with a lender. The lender may be owned by the mortgage brokerage or the brokerage’s parent company. In this case, Cherie may be incentivized to place deals with the affiliated lender, rather than seek out other options in the broader marketplace.

Cherie has a direct affiliation with a lender. The lender may be owned by the mortgage brokerage or the brokerage’s parent company. In this case, Cherie may be incentivized to place deals with the affiliated lender, rather than seek out other options in the broader marketplace.

As a real estate professional, you are not authorized to perform certain activities that require a mortgage broker. From the following scenarios, determine which of them either require you to refer the client or contact to a mortgage professional. (Select ALL that apply) A private lender offers you a fee to connect them with buyers seeking specific rates and terms. Client asks you to offer advice on mortgage terms and rates. Client asks you to act as an intermediary between them and their lender. Client requests you provide an estimate of what the value of their home would be in the market. Client asks you what the latest Prime Rate is in the market. Lender asks you to advertise on their behalf or to seek out potential borrowers. Your client asks you to investigate several banks and what their lending terms are.

A private lender offers you a fee to connect them with buyers seeking specific rates and terms. Client asks you to offer advice on mortgage terms and rates. Client asks you to act as an intermediary between them and their lender. Lender asks you to advertise on their behalf or to seek out potential borrowers. Your client asks you to investigate several banks and what their lending terms are.

Which of the following are within the scope of a Condominium Management Associate license? (Select ALL that apply) Blocking access of tenants who violate terms of the corporation. Collecting, holding or disbursing, or attempting to collect, hold or disburse, contributions levied by the condominium corporation or other amounts levied by or due to the corporation under the Condominium Property Act. Enforcing the bylaws or rules of the corporation. Negotiating or entering into contracts on behalf of the corporation. Representing commercial businesses located adjacent to the condominium property. Supervising employees or contractors hired or engaged by the corporation.

Collecting, holding or disbursing, or attempting to collect, hold or disburse, contributions levied by the condominium corporation or other amounts levied by or due to the corporation under the Condominium Property Act. Enforcing the bylaws or rules of the corporation. Negotiating or entering into contracts on behalf of the corporation. Supervising employees or contractors hired or engaged by the corporation.

Which of the following definitions correctly describes monthly condominium contributions? (Select one) The cost of each unit’s contributions to maintain the board’s salaries. The difference in maintenance costs between a larger unit and smaller unit in the same condominium property. The proportion of a unit’s size in relation to the whole condominium property, divided by 12 and expressed as a percentage. The portion of the condominium corporation’s annual budget assigned to the unit owner on a monthly basis.

The portion of the condominium corporation’s annual budget assigned to the unit owner on a monthly basis.

In addition to municipal restrictions, a condominium's bylaws will provide guidelines or restrictions regarding the use of the property, and what may be placed on the property. TRUE FALSE

True

Besides a title search on condominium properties, it is also possible to search for what is known as the condominium additional plan sheet. This report will include which of the following information? (Select ALL that apply) Any changes to the bylaws or directors. Any registrations made against the condominium plan. Common property descriptions and plats. The condominium corporation identification. The condominium corporation’s street address. Unit owner’s names

Any changes to the bylaws or directors. Any registrations made against the condominium plan. The condominium corporation identification. The condominium corporation’s street address.

Governing policies include the Condominium Properties Act and Regulations, as well as the bylaws of the condominium corporation. Governing policies provide details on the proper operation of a condominium, addressing issues such as the management of reserve funds, borrowing powers, budgeting, and other financial matters. TRUE FALSE

True

There are many condominiums management companies that provide immense value to the board and owners they serve. They bring knowledge of the CPA and Regulation, proven systems to structure financial and governance requirements, and storage solutions for the corporation’s required documents. Management companies can have a negative impact on buyers and seller due to poor communication and internal company policies and procedures that limit access to vital information buyers rely on and sellers provide. TRUE FALSE

True

Which of the following mortgage types provides the borrower with access to capital without making standard principal and interest payments? (Select one) Acreage lending mortgage. Construction draw mortgage. Cashback mortgage. Home Equity Line of Credit. Residential mortgage. Reverse Mortgage.

Reverse Mortgage.

Mortgage fraud can have drastic effects on the country’s real estate market. Which of the following are the impacts of mortgage fraud on society? (Select ALL that apply) It can make it more challenging for everyday citizens to attain a mortgage and purchase a property. It creates unnecessary supply and inventory issues. It prevents government intervention on mortgage and housing regulations. There is a financial loss component to banks, professionals, and everyday people.

It can make it more challenging for everyday citizens to attain a mortgage and purchase a property. It creates unnecessary supply and inventory issues. There is a financial loss component to banks, professionals, and everyday people.

True or False: Money laundering is a legal process used to disguise the source of money or assets that come from illegal means. TRUE FALSE

False

Which of the following mortgage types is a secured, revolving type of mortgage that operates similar to an unsecured line of credit? (Select one) Acreage lending mortgage. Construction draw mortgage. Cashback mortgage. Home Equity Line of Credit. Residential mortgage. Reverse Mortgage.

Home Equity Line of Credit.

Which of the following broad categories of fraud is generally carried out by the borrower misrepresenting facts of their financial situation to gain a mortgage approval, resulting in the fraudulent activities enabling the buyer to secure the property for their own use? (Select one) Fraud for homelessness. Fraud for housing. Fraud for private enterprise. Fraud for profit.

Fraud for housing.

True or False: Foreclosure proceedings vary from province to province. TRUE FALSE

True

Which of the following justifies a brokerage's need to collect seller/landlord and buyer/tenant information during a transaction? (Select one) Collecting the data prevents the need for client confidentiality. It is a requirement of the Canada Mortgage and Housing Corporation (CMHC) to establish identities of all parties in a lease/tenant scenario. It minimizes the possibility of mortgage fraud. Minister of Service Alberta requires the information for brokerage licensing.

It minimizes the possibility of mortgage fraud.

True or False: A down payment can be gifted from an immediate family member. TRUE FALSE

True

In most real estate situations, mortgage brokers are acting as intermediaries between a lender and a client. Mortgage brokers can represent just the client, just the lender, or both. When a mortgage broker acts as an intermediary, what are the fiduciary responsibilities of the broker? (Select ALL that apply) Complete and submit any required documentation to the lender. Evaluate and list all available options for the borrower. Explain the client’s situation to the lender using supporting documents. Explain these options in clear language and make sure the borrower understands their options. Gather information about the borrower's specific financial situation and the property that they are wanting to finance. Help the client understand and meet the lender’s requirements. Keep both parties informed about the status of the mortgage application. Treat both the client and the lender with equal care and honesty.

Complete and submit any required documentation to the lender. Evaluate and list all available options for the borrower. Explain the client’s situation to the lender using supporting documents. Explain these options in clear language and make sure the borrower understands their options. Gather information about the borrower's specific financial situation and the property that they are wanting to finance. Help the client understand and meet the lender’s requirements. Keep both parties informed about the status of the mortgage application. Treat both the client and the lender with equal care and honesty.

In a mortgage who is typically referred to as “the buyer” or individual who is obtaining the loan? (Select one) Mortgagee. Mortgagor. Primary title holder. Writ of Guarantor.

Mortgagor.

Mortgage fraud can occur in a wide variety of ways for many purposes. Which type of mortgage fraud is most commonly committed by industry insiders who use their connections and knowledge to commit and oversee or facilitate the act? (Select one) Foreclosure fraud. Fraud for housing. Fraud for profit. Fraud for title.

Fraud for profit.

Lena is a real estate agent representing a buyer. Lena’s buyer has indicated that the sale of her old home has to happen so she’ll have the equity available to secure a conventional mortgage on the new home. Lena writes up the contract, but fails to include the financing condition. The seller, Carl, is doing the exact same thing (selling one home and moving to another). Carl is expecting to close on his home to secure a desirable property. When the date of closing arrives, the deal falls through, because Lena’s client’s home has not sold. This causes a ripple effect where Carl cannot purchase the new property, which he then loses to another buyer. What are the potential consequences of Lena having failed to include the financing condition in the real estate offer? (Select ALL that apply) Lena’s client may file a complaint with the Real Estate Council of Alberta. Lena’s client may lose the home she wanted to purchase. Carl may file litigation for damages against Lena Lena’s client may be sued for breach of contract. Lena’s reputation may be damaged. Carl may be sued for breach of his contract to purchase the new home

Lena’s client may file a complaint with the Real Estate Council of Alberta. Lena’s client may lose the home she wanted to purchase. Carl may file litigation for damages against Lena Lena’s client may be sued for breach of contract. Lena’s reputation may be damaged. Carl may be sued for breach of his contract to purchase the new home

True or False: Mortgage fraud is intentionally providing misinformation or misrepresenting a situation to an underwriter, lender, or real estate professional to fund, purchase, or insure a loan secured by a property. TRUE FALSE

True

Real estate professionals, especially mortgage brokers and mortgage agents, need to be aware of applicable provincial and federal legislation and how this impacts the consumer, the lender, their brokerage, and mortgage documents. Which of the following developments in legislation have affected mortgage financing in Canada? (Select ALL that apply) Interest Act. Law of Property Act. National Housing Act (NHA). Office of the Superintendent of Financial Institutions (OFSI)

Interest Act. Law of Property Act. National Housing Act (NHA).

Which type of mortgage fraud uses a homeowner’s identity to take out financing against the property? (Select one) Foreclosure fraud. Fraud for housing. Fraud for profit. Fraud for title.

Fraud for title.

True or False: The Statute of Frauds is a common law statute requiring that real estate contracts be in writing and be signed by all parties who will be bound by that contract. TRUE FALSE

True

True or False: The Statute of Frauds is a common law statute requiring that real estate contracts be in writing and be signed by all parties who will be bound by that contract. TRUE FALSE

True

Jacob is reviewing a title of a property he is interested in purchasing. He notices there are three incumbrances on the title, including two mortgages and a lien. The listing on the title is as follows: Lien, Mortgage from Bank of the Mountains, and then a mortgage from Lenders4U. What does this indicate? (Select one) At the sale of the home, all three encumbrances have equal claim on the proceeds, and will be paid evenly until all funds are distributed. At the sale of the home, the Lenders4U is paid first, then Bank of the Mountains, then the lien. At the sale of the home, the lien must be paid off before the mortgages have claim on the proceeds. Mortgage from Bank of the Mountains must be paid before Mortgage from Lenders4U. It only indicates there are three encumbrances. If the sale of the property doesn’t cover the amounts of the encumbrances, the three items must go to court and have a judge issue percentage funds.

At the sale of the home, the lien must be paid off before the mortgages have claim on the proceeds. Mortgage from Bank of the Mountains must be paid before Mortgage from Lenders4U.

Which method of control allows each proposed development to be considered according to its own merits? (Select one) Development control. Permitting. Principal Title. Regulatory commission. Zoning control.

Development control.

The records, books, accounts and supporting documentation in relation to each trade should identify each trade or potential trade by a coding system and must contain which of the following? (Select ALL that apply) A description of the real estate. All handwritten notes taken about the transaction. The names of the parties to the trade or potential trade The nature of the trade or potential trade. The true consideration for the trade or potential trade The value of the commissions projected and the estimated taxes to be paid.

A description of the real estate. The names of the parties to the trade or potential trade The nature of the trade or potential trade. The true consideration for the trade or potential trade

In which of the following types of ownership, does the property belong to each of the owners entirely but together? (Select one) Conjoined ownership. Investor deemed. Joint tenants. Survival ownership. Tenants in common.

Joint tenants.

Carol is representing a buyer client, Frank. Frank has a written service agreement with Carol which makes Carol Frank’s agent. Frank tells Carol to make an offer of $40,000 over the asking price on a property. Carol knows the seller’s agent and knows this property has been on the market for some time, without any interest. Carol suggests to Frank that he lower his price offer. Frank tells Carol to make the offer as he requested. What is Carol’s obligation under the service agreement? (Select one) Frank is in breach of contract, and Carol must drop him as a client. Make the offer at $40,000 over, as it is a lawful request by the client. Make the offer at the asking price, as Carol has both a fiduciary responsibility and must act in the best interest of the client. Refuse to offer at $40,000 over, as Carol must act in the best interest of the client.

Make the offer at $40,000 over, as it is a lawful request by the client.

True or False: Real estate professionals have an obligation to ensure final signed copies of all agreements are provided to all parties to a transaction in a timely manner. TRUE FALSE

True

Which of the following remedies means the injured party is seeking to have the terms and conditions of the contract completed, notwithstanding a contractual breach? (Select one) Injunction. Monetary damages. Negotiation. Quantum meruit. Rescission. Specific performance.

Specific performance.

In a contract where the parties have privity of contract, but one of the parties wishes to assign rights outside of the contract, what method is used to assign the rights to another party? (Select one) Dower application. Establishment Clause. Fiduciary responsibility. Power of Attorney. Rights and Powers Disclosure.

Power of Attorney.

Which of the following methods to end or discharge a contract occurs when neither party owes the other party any further obligations because they fulfilled their end of the agreement? (Select one) Breach. Frustration. Operation of law. Performance. Mutual agreement.

Performance.

Which of the following remedies is a form of relief granted by the court, and is a way for the court to assess a claim for damages when it cannot be determined by specific receipts or defined calculations? (Select one) Injunction. Monetary damages. Negotiation. Quantum meruit. Rescission. Specific performance.

Quantum meruit.

The Alberta Real Estate Association's (AREA) standard purchase contract establishes which of the following with regard to the deposit? (Select ALL that apply) Amount of the deposit. Bullion equivalency of the payment (in gold or silver standard). Date and time which the deposit must be paid. Method of payment. The deposit trustee to whom the amount is payable. Commission split of the brokerage handling the deposit. Terms of trust that the trustee must follow

Amount of the deposit. Date and time which the deposit must be paid. Method of payment The deposit trustee to whom the amount is payable. Terms of trust that the trustee must follow

The purchase contract must outline the client's property being considered. Which of the following are required to define the client property? (Select ALL that apply) A spreadsheet or document listing all the items currently on the property that belong to the client or the client’s family. Identify the exact municipal address of the property. Pictures showing the front, back and sides of the property. Provide a clear legal description.

Identify the exact municipal address of the property. Provide a clear legal description.

Which of the following are required to constitute a valid contractual agreement? (Select ALL that apply) Initialed by all relevant parties. Proceedings validated by a court representative in front of a judge. Signed by all relevant parties. Witnessed by both buyer and seller agents at signing. Final agreement (signed and all changes initialed by all parties) must be communicated to all parties before legal obligations begin

Initialed by all relevant parties. Signed by all relevant parties. Final agreement (signed and all changes initialed by all parties) must be communicated to all parties before legal obligations begin

True or False: The brokerage will have a policy as to which documents must be submitted with each transaction. TRUE FALSE

TRUE

Which of the following type of land estate runs for a fixed period of time and grants the holder the rights of ownership with the exception to the right to sell the physical property itself? (Select one) Fee simple. Leasehold. Life estate. Life mortgage.

Leasehold.

A property manager is being told by a client to to provide vague information the client is legally required to disclose to purposely mislead. The property manager must not follow the requirement, because it is not legal, and would represent what type of misrepresentation? (Select one) Fraudulent misrepresentation. Innocent misrepresentation. Negligent misrepresentation. Material latent defect.

Fraudulent misrepresentation.

True or False: Clients who are informed of conflicts of interest do NOT need to be given the opportunity to obtain independent legal advice concerning the conflict. TRUE FALSE

False

True or False: Land zoning classification codes such as R-4 (Residential type 4), and C-1 (Commercial type-1) are standardized across municipalities for ease of reference. TRUE FALSE

FALSE

Ibrahim is selling properties on behalf of a client. Several agents have requested information from the seller about whether or not he has other offers, if the sale can be conditional, and the reason for the sale. The seller has directed Ibrahim to not reveal any of this information. What are some likely reasons why the seller doesn’t want this information revealed? (Select ALL that apply) Sellers are never allowed to reveal that information. It’s against the law. The seller believes that each buyer should bid independently on the property. The seller believes the information is personal and none of the buyer’s business. The seller is interested in very limited engagement with buyers. The seller wants the property to be listed on MLS®

The seller believes that each buyer should bid independently on the property. The seller believes the information is personal and none of the buyer’s business. The seller is interested in very limited engagement with buyers.