RECA Fundamentals of Mortgage Brokerage Exam
Questions And Answers 2024/2025
Which of the following is NOT a RECA educational resource for industry
... [Show More] professionals?
- answers Spatial Information System (Spin 2)
Who is responsible for producing the "Real Property Report"? - answers Alberta Land
Surveyor
Benefits of RECAS trust assurance and practice review program - answers - effective
record keeping and administrative procedures
- education and advice in relation to brokerage trust accounting
- identifies and resolves potential problems regarding brokerage trust accounting
requirements
Responsibilities of RECA - answers - Handling professional conduct review
- establishing industry standards of practice
- issuing authorization to trade in real estate
Four factors of production - answers land, labor, capital, entrepreneurship
RECA provides the following annual reports - answers - financial reports
- industry statistics
- reports for the previous year
Who has the power to amend the Rules of the RE Act? - answers Council (not the
Provincial Legislature, their job is to amend the RE Act itself - two very different things)
Who has the power to suspend / revoke a license? - answers The Executive Director
- determines the length of suspension
- serves the decision on the industry professional
- will consider the evidence when making the decision
What's included in written service agreements? - answers - the services to be provided
by the brokerage
- the responsibilities of each party to the agreement (i.e. remuneration from client to
brokerage)
- the names of the parties to the agreement
Failure to immediately notify Executive Director of changes to information provided in
support of license results in: - answers - Exec. Director may refer the matter for a
professional conduct review
- Exec. Director may suspend industry professionals license
- Exec. director may cancel the industry professionals license
Length of time a license is valid for if NOT registered w a brokerage - answers 36
months
Level of Disclosure: Other party represented by another brokerage - answers Level 1
Level of Disclosure: Other party not represented - answers Level 2
Level of Disclosure: Other party represented by same brokerage - answers Level 3
Inducement vs incentives - answers - Inducement is client specific
- Incentive is offered by the brokerage to any potential client
Records must be: - answers - kept in Alberta
- maintained in electronic form
- kept by brokerage for 3 years
- accessible to RECA for inspection
- they can be held in multiple locations, provided they're all in Alberta
Personal Ethics - answers Morals - held by individual
Ethics - Standard of Conduct (values/beliefs that guide actions)
Professional Standards - Rules and Regulations
Real Estate Insurance Exchange (REIX) - answers - provides financial protection
- compensates consumers up to $35,000
- mandatory errors & omissions insurance + negligence
- excludes injuries or death, transfers of title, commission/fees
- $3,500 is the first deductible
- $7,000 if second claim.
- RECA collects premiums with licensing fees
Tort Law - answers Compensation for civil wrongs that result in harm
- Negligent Tort
- carelessness, failure to exercise reasonable care
- Intentional Tort
- assault, fraud, theft, defamation
- strict liability Tort
- the act itself, producting defective products, using hazardous materials
Ethical Decision Making - answers 1. Recognize
2. Analyze
3. Test
3A. Seek assistance if needed
4. Implement
Duty based approach to ethical decision making - answers - individuals intentions or
motives
- belief in universal moral system of ethical reasoning
- individuals should do the right thing because its the right thing to do
Benefits of REIX - answers - enhances the image of the profession
- has the potential to save on insurance costs
- The profession is active in managing the program and its risks
Errors and Omissions Insurance - answers real estate equivalent of malpractice
coverage
Comprehensive General Liability Insurance - answers - broad coverage for claims
against injury/damage
- civil liability (a fall)
- any damages or injuries
- legal defense costs
- does not cover issues related to real estate transactions
Voluntary Broker Resolution Process (VBRP) - answers - enables broker to take the
lead in resolving complaints and disputes
- prior to RECA + Formal courts
- brokers confer with REIX before proceeding
Benefits of Voluntary Broker Resolution Process - answers - avoids time and intrusion
involved with RECA investigation
- identifies deficient brokerage practices that need improvement
- allows participation in the process to achieve acceptable resolution
- opportunity to mend relationship with consumer
Privacy Law - answers - Brokerages must designate a privacy officer to be
accountable for compliance
- must be consistent with the applicable privacy legislation
Three components of broker leadership - answers Authority, responsibility, and
accountability
Financial Transactions and Reports Analysis Center of Canada (FINTRAC) - answers -
responsible for collection, analysis and disclosure of information
- identifies lists of groups under their watch
- brokers must report suspicious transactions
Safeguards to protect personal information - answers Administrative, Technological,
Physical [Show Less]