41 What licensees must do

Licensees must be honest, competent, up front with consumers, and must fulfill their obligations to clients.

• honesty means telling the truth, and it means not leaving out information.
• competent service means licensees have the necessary education and experience to provide the services a consumer needs
• being upfront means telling the client how they are paid, making sure the client understands on whose behalf the licensee is working, and disclosing any conflicts of interest that come up
• fulfilling obligations means licensees must act in their client’s best interest, keep information confidential, tell their client anything that may affect the client’s decision,
• obey the client’s lawful instructions, act with reasonable care and skill, and account for any of the client’s money or property in their possession

Licensees must not work with a client if the client asks them to withhold information that they are legally required to disclose.

Licensees have to comply with all applicable legislation and RECA rules, cooperate with RECA investigators, and obey any restrictions on their licence.

Additional Resources

Section Link: Real Estate Act Rules, Sec 41

Professional Responsibilities
Information Bulletin: Competent Service
Information Bulletin: Comply with Legislation
Information Bulletin: Disclose Cost of Service
Information Bulletin: Ensure Role is Understood

42 What licensees can’t do

Licensees can’t:

• mislead or deceive anyone in ways that are intentional or reckless.
• act recklessly. Licensees cannot recklessly make decisions or give advice or information without performing due diligence. Performing due diligence may require them to do a bit more work (i.e. a seller’s agent says a home is not in the flood plain, and the buyer’s agent takes their word for it without doing anything to verify). This activity may be reckless.
• commit fraud or otherwise act illegally
• use confidential information beyond the reason for its intended use (e.g. a real estate licensee can’t tell a potential buyer a seller’s reasons for selling)
• give you advice or information they are not qualified to give. They also can’t discourage you from obtaining expert advice elsewhere (e.g. an engineer, accountant, tax specialist, surveyor, lawyer)
• deny services to or discriminate against anyone for reasons of race, creed, colour, gender, sexual orientation, family status, marital status, age, national origin, or physical ability
• abuse anyone involved in a transaction

Additional Resources

Section Link: Real Estate Act Rules, Sec 42

Professional Responsibilities
Information Bulletin: Competent Service

Prohibition
Information Bulletin: Prohibition – Fraudulent Unlawful Activity

43 Written Service Agreements

All mortgage brokers, property managers, and residential real estate licensees must outline their relationship with you using a written service agreement. RECA recommends commercial real estate licensees use written service agreements, but it’s not a requirement.

Written service agreements communicate:

• the working relationship between you and the licensee
• the services of the licensee
• the obligations and responsibilities of you and the licensee
• how the licensee is going to collect, use, maintain, and distribute your personal information (e.g. to obtain a credit report, bank information, income, etc)
• the compensation payable to your licensee and who pays the compensation
• the length of the agreement
• how you or the licensee can end your agreement

All of these are negotiable.

Agreements must:

• be signed
• include all terms and conditions
• contain names, and the address of property in question, if the agreement is with a seller

Any changes made to a written agreement must be in writing and signed by all parties.

Your licensee must give you a copy of agreements and amendments immediately after signing.

Additional Resources

Section Link: Real Estate Act Rules, Sec 43

Written Service Agreements
Consumer Information: Written Service Agreements
Information Bulletin: Written Service Agreements (Designated Brokerage)
Information Bulletin: Written Service Agreements (Brokerages)

44 Protecting client information

Your licensee can’t share your personal information with anyone unless you give them permission, or they are required by law. This includes your personal information (address, age, marital status, health, financial situation, etc.), and your transaction information (e.g. reasons for buying, selling, or getting a mortgage).

All brokerages must have policies for protecting client’s personal information. Everyone at the brokerage needs to be aware of the policies and follow them.

Licensees must keep your information confidential even after a transaction ends.

Additional Resources

Section Link: Real Estate Act Rules, Sec 44

Information & Privacy
Information Bulletin: Protection of Client Information
Government Act: Personal Information and Privacy Act (PIPA)
Government Act: Personal Information Protection and Electronic Documents Ac (PIPEDA)

45 Letting you know if they are benefiting by referring you to a service provider

Sometimes licensees refer consumers to other real estate licensees (e.g. a real estate licensee refers you to a mortgage broker) or other service providers (e.g. a lawyer, home inspector, home stager, etc.). If a real estate licensee refers you to someone, they must tell you, in writing, and have your permission to share your personal information. If they may receive a benefit of some sort (referral fee, business in kind, or some other benefit) as a result of the referral, they also need to tell you that in writing.

Additional Resources
Section Link: Real Estate Act Rules, Sec 45

Referrals & Recommendations
Information Bulletin: Referrals – Industry Licensee Requirements
Information Bulletin: Recommending Service Providers

46 Brokerage administrative employees and assistants

Real estate licensees may have support personal and assistants to complete tasks that do not require a licence. The unlicensed individual must be competent, and the real estate licensee must supervise them.

For example, unlicensed assistants or brokerage employees can file documents, set up meetings or showings, or prepare promotional material for the broker’s approval.

There cannot be any suggestion that an unlicensed individual is licensed.

Additional Resources

Section Link: Real Estate Act Rules, Sec 46

Assistants & Employees
Information Bulletin: Assistants – Real Estate Brokerage
Information Bulletin: Assistants – Mortgage Brokerage
Information Bulletin: Employees

Sections 47-63:  Real Estate Brokerage Licensees

48 Working with a real estate licensee

Consumers establish an agency relationship with a real estate brokerage when they agree that the brokerage and the licensee will work on the consumer’s behalf. This is a client relationship. If the brokerage and the licensee are not working on behalf of the consumer through an agency relationship, the consumer is a customer, and the brokerage and the licensee have reduced responsibilities.

Real estate licensees need to work through a licensed brokerage. One real estate broker manages each brokerage and most brokerages have real estate associate brokers and real estate associates.

Additional Resources

Section Link: Real Estate Act Rules, Sec 48

Consumer Information: Working with an Industry Licensee
Consumer Information: Consumer Relationships with Real Estate Licensees
Guide: Consumer Relationships with Real Estate Licensees

49-54 Responsibilities and prohibitions of all real estate licensees

• use the personal and brokerage name that appears on their licence. Licensees have to use their licensed name, and work only on behalf of their brokerage. They cannot advertise using only a nickname. Licensees who work for a team must not advertise or act in a way that makes them appear separate from their brokerage.
• ensure their brokerage name is in all advertising. This helps ensure real estate licensees properly identify who they work for.
• ensure all written agreements comply with legislation
• only pay a service provider or referral fee through the brokerage.  Licensees cannot personally pay referral fees or service providers.
• accept payment or referral fees through their brokerage. Licensees can only receive compensation through their brokerage. This means a consumer can’t pay an individual real estate licensee directly.
• only a brokerage can offer incentives to consumers. Incentives are anything to attract business to the brokerage, such as offers to enter a prize draw, gift cards, or anything of value. Individuals cannot offer their own incentives.
• real estate licensees can’t provide inducements to consumers except through their brokerage and with their brokerage’s written permission. An inducement is a one-time offer of something of value to close a particular deal, such as a commission reduction or an offer to pay legal fees. Individual licensees cannot offer their own inducements.
• disclose any conflicts of interest they may have in writing, and not proceed unless they have the consumer’s written acknowledgement and permission to continue. Examples of conflicts include a real estate licensee representing two buyers who are interested in the same property, or the licensee is representing a buyer and seller in the same transaction.

Additional responsibilities

Real Estate Brokerages

Must have a licensed broker.

Real Estate Brokers Must:

• manage the brokerage’s business and its licensees. The broker is responsible for the brokerage’s licensees and its employees.
• provide the brokerage’s licensees and its employees with policies and procedures to help them understand the brokerage’s expectations of them.
• hold consumer deposit money (trust money) in accordance with the law, and control access to the trust account. A real estate broker cannot use trust money for any purpose other than the reason it’s held in trust (usually as part of a deposit on a purchase)
• review all agreements and offers to purchase in a timely manner
• maintain all documents related to relationships with and services provided to consumers (relationship agreements, offers, purchase contracts, property information, and consumer information). Brokers need to keep records, even records for deals that didn’t go through and offers that weren’t accepted.
• notify all parties in writing if the brokerage does not receive a deposit, receives a deposit late, or a deposit cheque bounces

Real Estate Associate Brokers and Associates Must:

• provide their broker with all documents
• be responsible for any assistants or other employees they hire directly, and ensure they adequately supervise them
• keep the broker informed of their activities, respond promptly to broker inquiries, and notify the broker as soon as possible if they learn of another associate or employee violating legislation.

Additional Resources

Sections Link: Real Estate Act Rules, Sec 49-54

Professional Responsibilities
Information Bulletin: Responsibilities – Real Estate Broker
Information Bulletin: Responsibilities – Real Estate Assoc. Brokers and Associates
Information Bulletin: Responsibilities and Prohibitions – Real Estate Brokerage
Information Bulletin: Trust Money Disputes and Disbursements
Information Bulletin: Brokers – Accountability
Information Bulletin: Brokers – Active in Management
Information Bulletin: Disclose – Conflicts of Interest

Prohibitions
Information Bulletin: Prohibitions – Real Estate Licensees
Information Bulletin: Prohibition – Discourage Legal Advice
Information Bulletin: Prohibition – Fraudulent Unlawful Activity

Assistants & Employees
Information Bulletin: Assistants – Real Estate Brokerage
Information Bulletin: Employees

Information & Privacy
Information Bulletin: Protection of Client Information
Government Act: Personal Information and Privacy Act (PIPA)
Government Act: Personal Information Protection and Electronic Documents Act (PIPEDA)

Referrals & Recommendations
Information Bulletin: Referrals – Industry Member Requirements
Information Bulletin: Recommending Service Providers

Advertising
Information Bulletin: Advertising – Licensed Name
Information Bulletin: Advertising – False and Misleading
Information Bulletin: Advertising – Clearly Indicated
Information Bulletin: Incentives
Information Bulletin: Inducements

55 Disclosing information to you

As soon as possible, and in writing, real estate licensees must, disclose to consumers they are representing:

• what services they will provide (e.g. advertising, open houses, signs, lockboxes, negotiating, photos etc.)
• any conflicts of interest (i.e. they have a personal stake in a transaction, or a family member, friend, or existing client has a stake in a transaction)

They must ask you to acknowledge in writing that they gave you this information.

Real estate licensees do not have to disclose these things to you if they are merely hosting an open house you choose to attend, if you are in preliminary discussions about possibly working with them, or if they are responding to general questions from you as a potential client. They only need to make these disclosures when you begin formally working with them, typically through signing a written service agreement.

Additional Resources
Section Link: Real Estate Act Rules, Sec 55

Professional Responsibilities
Information Bulletin: Disclose – Conflicts of Interest

Written Service Agreements
Information Bulletin: Service Agreements – Real Estate Brokerage

Sections 57-60: Types of Real Estate Representation

57, 58 Sole agency – real estate professional’s obligations to clients

Your real estate licensee must use their best efforts to market your property if you’re a seller, and to find a property that meets your requirements if you’re a buyer. This includes showing a buyer properties listed by other brokerages and for-sale-by-owner properties

• they must promote your interests
• they must identify themselves immediately to potential buyers/sellers as your agent
• they must obey all your lawful instructions. If you ask your agent to do something illegal, they cannot obey that instruction.
• a fiduciary relationship is one in which someone places special trust, confidence, and reliance in the work of another. A buyer or seller places their trust in the hands of the real estate licensee. The real estate licensee owes fiduciary duties, which include loyalty, confidentiality, and full disclosure of all conflicts of interest.
• your brokerage cannot appoint another brokerage to act on your behalf unless you give them your written consent.
• your real estate licensee must competently and carefully perform duties for you. That means they must have the enough education and experience, and they can’t be negligent
• your real estate licensee must assist you in negotiating favourable terms and conditions
• real estate licensees representing sellers must inform all potential buyers of material latent defects in the property known to the agent. Material latent defects are defects that are not reasonably determined by an inspection of the property and that could affect the use and value of the property
• real estate licensees representing buyers must try to discover information about any property the buyer is considering. This may include asking the seller’s agent additional questions or doing their own research (for example, reviewing flood plain maps)
• real estate licensees representing buyers must tell their clients if they find out about any competing offers
• real estate licensees must inform you of any relevant facts or information they learn during a transaction as soon as they can. This might include facts that could seriously affect the transaction, such as the discovery of easements or utility right of ways on a property title, or the fact a buyer has lost their job or plans to immediately sell the property to someone else at a higher price.
• your real estate licensee must give you all offers and counter-offers as soon as they can
• your agent must keep you fully informed of the progress of your purchase or sale. Your agent must suggest you consult with other experts if those matters are outside of your agent’s area of expertise (e.g. tax lawyer, structural engineer, septic or well water specialists, or electricians and plumbers).
• real estate licensees must comply with legislation and the standards of conduct

Additional Resources

Section Link: Real Estate Act Rules, Sec 57-58

Professional Responsibilities
Consumer Information: Material Latent Defects
Information Bulletin: Material Latent Defects
Sample Form: Property Defects Due Diligence Checklist (Buyer)
Sample Form: Property Defects Due Diligence Checklist (Seller)

Industry Roles
Consumer Information: Industry Members and Their Roles

Relationships & Representation
Guide: Consumer Relationships with Real Estate Licensees
Consumer Information: Consumer Relationship Forms
Consumer Information: Consumer Relationships with Real Estate Licensees
Consumer Information: Working with a Licensee

58.1 Designated agency brokerages

In designated agency, the brokerage designates an individual real estate licensee (or multiple licensees) to act as the designated agent for a consumer. The assumption is the rest of the brokerage has no knowledge of the consumer’s confidential information, and other licensees from the brokerage don’t represent them. The basic obligations of designated agents are the same as in sole agency (see above).

Designated agency brokerages must have policies and procedures to ensure protection of confidential information and policies that govern the brokerage’s operations. They must communicate these policies to clients.

Agreements between consumers and designated agency brokerages must be in writing, and must contain the following details:

• name(s) of the designated agent
• what happens if the designated agent leaves the brokerage and the brokerage has to appoint a new agent
• client acknowledgement that their agency relationship is with the designated agent, and not the brokerage
• that the brokerage’s role will be limited to supporting the designated agent and ensuring your information is kept confidential

Additional Resources

Section Link: Real Estate Act Rules, Sec 58.1

Relationships & Representation
Sample Forms: Consumer Relationship Forms
Consumer Information: Working with an Industry Licensee
Consumer Information: Consumer Relationships with Real Estate Licensees
Guide: Consumer Relationships with Real Estate Licensees
Guide: Designated Agency Practice Guide for Licensees

Industry Roles
Consumer Information: Licensees and Their Roles

59, 59.1 When a common law brokerage represents the buyer and the seller (transaction brokerage)

If a buyer and seller are both represented by the same brokerage, it’s a conflict of interest. The brokerage cannot work in the best interests of both sides in the same deal, but the transaction can continue if the buyer and seller agree with transaction brokerage. In transaction brokerage, the brokerage treats each party like a customer, not a client.

In transaction brokerage, the brokerage must treat both parties in an even-handed, objective, and impartial manner. The brokerage cannot advocate for either party, nor can it use discretion or judgement to advance the interests of one party over the other.

Before agreeing to transaction brokerage, the buyer and seller both need to have a chance to review the transaction brokerage agreement and request any additional information if they need it.

If one of the parties does not agree to transaction brokerage, the brokerage will continue to represent the consumer that first had a written agreement with the brokerage. The other party can be a customer of the brokerage, or the brokerage can refer that party to another brokerage or to another designated agent within the same brokerage in the case of designated agency brokerages

Transaction brokerage agreements must outline:

• how the brokerage or licensee will get paid
• how the licensee will treat the interests of both parties objectively and impartially (advice given to one side will be disclosed to the other)
• that they will perform their duties competently
• that they will obey instructions from both sides
• that they will not act in a way that benefits one side over the other

The services they will provide to each side include:

• providing real estate statistics and information on similar properties
• providing the necessary documents to complete the transaction, and prepare the documents according to the buyer’s/seller’s instructions
• providing the names of other licensees who may help during the transaction (mortgage brokers, surveyors, building inspectors, lenders, insurance agents, architects, engineers)
• present offers and counter-offers, and relay information between the parties as soon as possible
• keep both sides fully informed of the transaction’s progress

In transaction brokerage, the brokerage or designated agent has to disclose all known defects with a property to the buyer, and all material facts related to the buyer’s ability to purchase the property to the seller.

The brokerage will continue to follow the rules for sole agency, including:

• holding all deposit money in a trust account
• not giving false or misleading information
• not giving either side confidential information known to the agent or designated agent, including:
• that the buyer may pay a higher price
• the seller may accept a lower price
• either side’s motivation for buying or selling
• any other personal information

Additional Resources

Section Link: Real Estate Act Rules, Sec 59-59.1

Professional Responsibilities
Information Bulletin: Transaction Brokerage – Not Always Appropriate
Information Bulletin: Transaction Brokerage – Parties Do Not Agree
Information Bulletin: Conflict – Representing Seller and Buyer

Industry Roles
Consumer Information: Licensees and Their Roles

Relationships & Representation
Guide: Consumer Relationships with Real Estate Licensees
Sample Forms: Consumer Relationship Forms
Consumer Information: Working with a Licensee
Consumer Information: Consumer Relationships with Real Estate Licensees
Guide: Transaction Brokerage Practice Guide for Licensees
Information Bulletin: Facilitation Services

60 Being treated as a customer and not a client

You can choose customer status with a brokerage or designated agent, and you will sign a Customer Acknowledgement Form.

When you are a customer, a brokerage or designated agent will give you reasonable care and skill, they will not knowingly mislead you, they will hold any deposit money in a trust account, and otherwise comply with the legislation. A customer acknowledgement outlines that you understand what it means to be a customer, and that you had the opportunity to get more information or advice before signing it. When you are a customer, the brokerage or designated agent does not work in your best interests, and will not give you any advice or advocate on your behalf.

The brokerage or designated agent will:

• provide real estate statistics and information on comparable properties provide the necessary documents to complete a deal, and prepare them according to your instructions
• provide the names of other licensees who may assist during the transaction (mortgage brokers, surveyors, building inspectors, lenders, insurance agents, architects, engineers)
• present offers and counter-offers, and relay information between the parties as soon as possible
• keep you fully informed of the transaction’s progress

Additional Resources

Section Link: Real Estate Act Rules, Sec 60

Industry Roles
Consumer Information: Licensees and Their Roles

Relationships & Representation
Sample Forms: Consumer Relationship Forms
Guide: Consumer Relationships with Real Estate Licensee
Consumer Information: Working with a Licensee
Consumer Information: Consumer Relationships with Real Estate Licensees
Information Bulletin: Customer – Real Estate Brokerage

60.1, 61 Forms when you agree to work with a real estate licensee

Real estate licensees have to use certain forms. The list of forms are in the Rules, and contain some mandatory content. Real estate licensees can use forms that contain additional content, but that additional content can’t affect the content that is mandatory. Real estate licensees can’t change the mandatory content unless a client asks them to change it and all parties agree.

Real estate licensees must provide and discuss the Consumer Relationships Guide with residential buyers and sellers they’re working with. By signing this document, you are acknowledging that you received and understand it. It is not a contract and it does not obligate you to anything.

When a real estate licensee receives an offer or an accepted offer in writing, they have to give their client and the other party a true copy of it as soon as possible.

Additional Resources

Section Link:  Real Estate Act Rules, Sec 60.1-61

Professional Responsibilities
Information Bulletin: Delivery of Documents – Real Estate Brokerage

Relationships & Representation
Sample Forms: Consumer Relationship Forms

Written Service Agreements
Consumer Information: Written Service Agreements
Information Bulletin: Service Agreements – Real Estate Brokerage

62 When a real estate licensee wants to buy your property, or sell you theirs

Real estate licensees, when buying or selling property on their own behalf, must disclose the following in writing, if the other party to the transaction is unrepresented:

• that they are the buyer or seller
• that they are a licensed real estate licensee
• the name of their brokerage
• if they’ve made a future deal for the property (i.e. they’re buying a home, and they already have an agreement to resell the property to someone else)
• any information that may affect the property’s value

Disclosure rules also apply when an individual who works for a brokerage or who is associated with a brokerage (for example, a family member of the brokerage’s broker) wants to buy a property that is listed with the brokerage, the brokerage must immediately disclose, in writing, to the seller:

• the fact there is a conflict of interest
• the name of the person
• their relationship with the brokerage
• any confidential information of yours they may have

The real estate licensee must also provide you the opportunity to obtain legal advice before proceeding.

Additional Resources

Section Link: Real Estate Act Rules, Sec 62

Professional Responsibilities
Information Bulletin: Personal Trades in Real Estate
Information Bulletin: Conflict of Interest
Information Bulletin: Conflict – Buying Client’s Property
Information Bulletin: Disclose – Conflicts of Interest

63 Guaranteeing they will sell your property

Some licensees offer guaranteed sales to sellers, but they can only make that offer on behalf of their brokerage. They can’t personally offer you that guarantee.

Additional Resources

Section Link: Real Estate Act Rules, Sec 63

Advertising
Information Bulletin: Guaranteed Sales Representations
Information Bulletin: Incentives

Sections 64-75: Mortgage Brokerage

Working with a mortgage brokerage licensee

Borrowers enter into an agency relationship with a mortgage brokerage when they agree that the brokerage and the licensee will represent their interests in trying to get a mortgage. If the brokerage and the licensee are not representing the borrower, but instead are working as a go-between between a lender and the borrower or are working on behalf of the lender, the brokerage and the licensee have different responsibilities to the borrower.

Licensed mortgage brokerage licensees need to work through a licensed brokerage. One broker manages each brokerage, and most brokerages also have mortgage associates.

65, 66, 67, 69, 70 Responsibilities and Prohibitions of all mortgage brokerage professionals

• use the personal and brokerage name that appears on their licence. Licensees have to use their licensed name, and work only on behalf of their brokerage. They
• cannot advertise using only a nickname. Licensees who work for a team must not advertise or act in a way that makes them appear separate from their brokerage
• ensure their brokerage name is in all advertising. This helps ensure mortgage brokerage licensees properly identify who they work for
• ensure all written agreements comply with legislation
• only pay a service provider or referral fee through the brokerage. Licensees cannot personally pay referral fees or service providers, and they cannot pay someone if the referral resulted from activities that require a licence
• accept payment or referral fees through their brokerage. Individual licensees can only receive compensation through their brokerage. This means a consumer can’t pay an individual real estate licensee directly
• only a brokerage can offer incentives to consumers. Incentives are anything to attract business to the brokerage, such as offers to enter a prize draw, gift cards, or anything of value. Individuals cannot offer their own incentives
• mortgage licensees can’t provide inducements to consumers except through their brokerage and with their brokerage’s written permission. An inducement is a one-time offer of something of value to close a particular deal, such as an offer to pay legal fees. Individual licensees cannot offer their own inducements; they need to provide them through the brokerage

Additional responsibilities and prohibitions

Mortgage Brokerages

When starting to work with a borrower, mortgage brokerages must disclose:

• the nature of their relationship with the brokerage
• the nature of the brokerage’s relationship with lenders
• the range of lenders the brokerage deals with
• how the brokerage gets paid from the transaction, including any other benefits from lenders
• any additional fees the borrower might have to pay

Mortgage brokerages must disclose to you and to a lender, in writing, what steps they’ve taken to verify the information you and a lender give them, including your identity, your income, your debts, and the lender’s rates, mortgage products, and details. They need to keep copies of supporting documents on file at the brokerage.

A mortgage brokerage cannot offer a lender or investor a guarantee of a mortgage loan.

Mortgage Brokers Must

• manage the brokerage’s business and its licensees. The broker is responsible for the brokerage’s licensees and its employees
• provide the brokerage’s licensees and its employees with policies and procedures to help them understand the brokerage expectations of them
• review all agreements and mortgage agreements in a timely manner
• maintain all documents related to relationships with and services provided to consumers (service agreements, mortgage disclosures, emails, credit reports, mortgage applications, etc.). Brokers need to keep records, even records for unsuccessful mortgage applications and deals that didn’t go through
• hold consumer deposit money (trust money) in accordance with the law, and control access to the trust account. A mortgage broker cannot use trust money for any purpose other than the reason it’s held in trust

Mortgage Associates Must

• provide their broker with all documents
• be responsible for any assistants or other employees they hire directly, and ensure they adequately supervise them
• keep the broker informed of their activities, respond promptly to broker inquiries, and notify the broker as soon as possible if they learn of another associate or employee violating legislation

Additional Resources

Sections Link: Real Estate Act Rules, Sec 64-70

Professional Responsibilities
Information Bulletin: Responsibilities – Mortgage Broker
Information Bulletin: Responsibilities – Mortgage Associate
Information Bulletin: Responsibilities and Prohibitions – Mortgage Brokerage
Information Bulletin: Brokers – Accountability
Information Bulletin: Brokers – Active in Management
Information Bulletin: Trust Money Disputes and Disbursements
Information Bulletin: Disclose – Conflicts of Interest
Information Bulletin: Cost of Credit Disclosure – Mortgage Brokerage

Prohibitions
Information Bulletin: Prohibitions – Mortgage Brokers and Associates
Information Bulletin: Prohibition – Discourage Legal Advice
Information Bulletin: Prohibition – Fraudulent Unlawful Activity

Information & Privacy
Information Bulletin: Protection of Client Information

Relationships & Representation
Consumer Information: Mortgage Brokerage Relationship Options
Sample Form: Consumer Relationship Forms

Assistants & Employees
Information Bulletin: Assistants – Mortgage Brokerage
Information Bulletin: Employees
Government Act: Personal Information and Privacy Act (PIPA)
Government Act: Personal Information Protection and Electronic Documents Act (PIPEDA)

Referrals & Recommendations
Information Bulletin: Referrals – Industry Member Requirements
Information Bulletin: Recommending Service Providers

Advertising
Information Bulletin: Advertising – Licensed Name
Information Bulletin: Advertising – False and Misleading
Information Bulletin: Advertising – Clearly Indicated
Information Bulletin: Incentives
Information Bulletin: Inducements

71 Charging fees

In residential and farming operation mortgage deals, a brokerage can only:

• charge, collect, or attempt to collect a fee after a lender gives written approval they will fund the mortgage
• the lender has provided a Cost of Credit disclosure document (a document that outlines the details of the mortgage: amount, rate, term, payments, dates, etc.)
• the borrower accepts the agreements

A borrower can agree in writing to reimburse a brokerage for costs related to third-party fees, such as for credit reports, land title searches, couriers, or appraisal services.

Additional Resources

Section Link: Real Estate Act Rules, Sec 71

Professional Responsibilities
Information Bulletin: Cost of Credit Disclosure – Mortgage Brokerage

Relationships & Representation
Consumer Information: Mortgage Brokerage Relationship Options
Sample Forms: Consumer Relationship Forms

73, 74 When a mortgage licensee has a client who is a lender

Mortgage brokerages need to have a written service agreement when working with a lender client, unless the lender asks to waive this requirement, and the parties agree to waive it in writing.

The agreements must

• be signed by both parties
• clearly show the names and responsibilities of each party
• list the services the brokerage will provide
• include how long the agreement will last
• include any loan terms and property descriptions
• indicate how the agreement can end
• indicate the risk tolerances of the lender (spelled out clearly in terms of lending amount, types of properties, etc.)
• the compensation payable to the brokerage and who pays the compensation
• detail how confidential information will be collected, kept, and distributed
• indicate if the brokerage holds money in trust for the lender
• indicate the role of the mortgage broker, if any, if the borrower defaults on the mortgage
• show the method of communicating any changes (i.e. changes to the lender’s risk tolerance) during an ongoing agreement

Mortgage brokerages must ensure lender clients have a copy of the registered mortgage, a copy of the title for the mortgaged property, a copy of any reports from the lawyer

The above responsibilities in this section do not apply if the client is a bank, other financial institution, or a person who is in the business of providing loans secured with mortgages.

When a mortgage brokerage represents a lender, it is still responsible for ensuring the borrower receives a copy of the Cost of Credit Disclosure statement (containing mortgage term, amount, rate, etc.); a copy of the mortgage; a copy of the property title showing the mortgage; any reports from a lawyer; and, a copy of any title insurance or real property report.

Additional Resources

Section Link: Real Estate Act Rules, Sec 73-74

Relationships & Representation
Consumer Information: Mortgage Brokerage Relationship Options
Sample Forms: Consumer Relationship Forms

75 A mortgage licensee acting as a lender or a borrower

Mortgage licensees can act as lenders or borrowers. They can also represent family members, close friends, and associates, but they must disclose, in writing:

• any interest they have in the transaction (such as being related to the borrower)
• that they are a licensed mortgage licensee
  their brokerage
• if there are any negotiations to dispose of the mortgage or their interest in it
• any information that may affect the completion of a mortgage deal

Additional Resources

Section Link: Real Estate Act Rules, Sec 75

Information Bulletin: Personal Mortgage Deals
Information Bulletin: Disclose – Conflicts of Interest