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Real Estate Exam > 1.3 - Real Estate Services Act > Flashcards

1.3 - Real Estate Services Act Flashcards

1
Q

what is the managing broker responsible for?

A

making sure brokerage is following rules and licensees following rules
employing, maintaining books, agent’s actions

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2
Q

What is the qualification for licensing (& managing broker)?

A

19 years old
good reputation
educational requirements
(2 years licensed in 5 years before application)

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3
Q

What are the rules for a licensee?

A

term of license is 2 years
can only work for 1 brokerage
can only do services permitted by brokerage
can only accept renumeration from brokerage
all contracts in name of brokerage

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4
Q

What are the 3 real estate services under RESA?

A
  1. trading (selling/buying, open houses, finding properties)
  2. rental property management services (collecting rents, making payments, collecting strata fees, negotiating)
  3. strata managing services (managing on behalf of owner, making payments, negotiating, supervising contractors, managing tenant matters)
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5
Q

What are exceptions to having real estate license?

A

owner selling
collection agents
notaries
accountants
appraisers
developer employees

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6
Q

What can an unlicensed assistant do?

A

unlock property
filing, bookkeeping
draft documents
place/remove signs
arrange for repairs
witness signatures

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7
Q

what can’t an unlicensed assistant do?

A

host an open house
renew listing contract on behalf of licensee
present offer to purchase
negotiate lease agreements

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7
Q

what is a PREC and why would someone want one?

A

can be licensed as managing broker, associate broker, representative
helps with income and tax stream planning
BUT increases liability of individual

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8
Q

What are the 3 things RESA (real estate services act) aims to do?

A

ensure licensees are competent
ensure licensees have good reputation
discipline and re-educate licensees if they break the rules

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9
Q

what are the 4 organizations RESA creates?

A

BCFSA (financial services authority)
Real Estate Foundation (law)
Real Estate Errors and Omissions Insurance
Real Estate Compensation Fund Corp.

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10
Q

What is the BCFSA?

A

crown regulatory agency of BC government
strengthens consumer protection, ensures public can have confidence in standards of practice by licensees

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11
Q

What are some things that BCFSA does?

A

enforces act (agents meet RESA requirements)
education
licenses - issues, renews, suspends, cancels
levying fees
investigating
make bylaws

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12
Q

who hears disciplinary hearings for BCFSA?

A

Financial Services Tribunal

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13
Q

who is the superintendent of Real Estate?

A

CEO of real estate. all licensing applications must be made to them and they carry out investigations and disciplinary functions.
no law reform, no code of ethics/realtor code

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14
Q

what is the real estate foundation?

A

real estate law reform organization
gets interest earned on brokerage trust to pay for their expenses and research

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15
Q

what is the real estate errors and omissions insurance corp?

A

protects against negligence
doesn’t protect for fines or penalties imposed on a licensee by BCFSA

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16
Q

how much does the errors and omissions insurance corp cover up to?

A

$2 million

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17
Q

what doesn’t the E&O insurance corp protect for

A

dishonesty, fraud, criminal matters
commission/fee disputes
self-sale by real estate agents
claims for discrimination from complaints
bodily injury, sickness, disease, death

18
Q

what does the real estate compensation fund do?

A

provide compensation in relation to a real estate transaction for funds that were misappropriated (i.e. deposit stolen)

19
Q

what is the Canadian real estate association?

A

national organization of licensees and real estate boards, and provincial real estate association

20
Q

what is the REALTOR code and who developed it?

A

code of ethics & guiding principle for all REALTORS, by the CREA. BCREA enforces it

21
Q

what does BCREA do?

A

communications
education
government relations
standard forms

22
Q

what do real estate boards (ran by BCREA) do?

A

run MLS
enforce realtor code

23
Q

what is the real estate institute of BC?

A

advanced education, awards professional designation “RI”
NOT AFFILIATED W/ BCREA

24
Q

how many people need to be on real estate team & how many licensed?

A

at least 2 people on team, at least 1 person licensed

25
Q

can people on 1 real estate team be on different brokerage?

A

no, one team one brokerage

26
Q

do you have to register real estate team with BCFSA?

A

yes, and have to advice BCFSA when member leaves or joins

27
Q

is a team the agent for a client?

A

yes, team is a collective agent (no separation)

28
Q

3 developer requirements from REDMA?

A
  • meet requirements/approvals of the property
  • assure purchaser’s title
  • file disclosure in the form required by Superintendent of Real Estate
29
Q

What is considered a “development property”? (type and count)

A

Subdivisions (5 or more)
Bare Land Strata Lots (5 or more)
Strata lots in a Strata building (5 or more)
Time Shares (5 or more)
Cooperative Interests (2 or more)

30
Q

What is a subdivision?

A

land divided into lots/parcels, other than under the Strata property act

31
Q

what are 3 exemptions to REDMA?

A
  • marketing of development units zoned and used for industrial/commercial properties
  • leases for 3 years or less
  • markets development property in a single transaction
32
Q

what is a cooperative interest?

A

an interest held in a cooperative association, either as a shareholder, partner, or member (corporation, LLC, Partnership)
shares instead of strata lots

33
Q

when is a disclosure statement required?

A

when units are sold individually, must be provided to buyer before an offer is made

34
Q

who does the disclosure statement have to be prepared and filed with?

A

superintendent of real estate (has to have a copy of it)

35
Q

main 2 contents of disclosure statement?

A

material changes (has to be refiled)
recession rights

36
Q

what can licensees be disciplined for in relation to REDMA?

A
  • accepting renumeration directly from developer (not brokerage)
  • allowing developer to breach REDMA
  • marketing without filed disclosure
37
Q

what is a trust account?

A

where money is deposited by one for the benefit of another, in which the money is devoted to a particular purpose and should not be diverted to other purposes

38
Q

how many trust accounts must a brokerage have

A

at least one

39
Q

what are the 3 reasons you can withdraw from trust accounts?

A
  • interest to real estate foundation
  • renumeration for a licensee if earned
  • accordance with the instructions of principal
  • NOT FOR BROKERAGE BUSINESS OR AGENT’S PERSONAL EXPENSES
40
Q

why were administrative penalties introduced?

A

provides a more progressive discipline system, meant for offences less serious than those dealt with by a notice of disciplinary hearing doesn’t apply for fraud

41
Q

what is a licensee required to do if in an investigation? (3 things)

A
  • respond promptly to BCFSA inquiries
  • respond in writing, within the time limit
  • notify managing broker
42
Q

what must BCFSA do when you have an order against you?

A
  • publish & provide copies to anyone upon request
  • post orders on website

Real Estate Exam (16 decks)

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