Chapter 1.3: Real Estate Services Act Flashcards by Kale Blakely

Reverse pyramid order for a brokerage (top to bottom)

1) brokerage
2) managing broker
3) associate broker (optional)
4) representative (aka me)

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The __________ provides services on behalf of the brokerage

Licensee

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The managing broker is responsible for the ________, and has control and conducts and __________ agents

Brokerage

Supervise

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Cancellation / suspension of _________________ impacts all licensees within the brokerage

Brokerage license

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Managing broker is responsible for 3 things, what are they?

1) a brokerage exercising the rights conferred on the brokerage
2) control and conduct of the brokerage’s real estate business
3) supervision of its licensees

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What are the 3 qualifications that must be met for an individual to become a realtor

1) be at least 19 years old
2) be of good reputation
3) meet educational requirements

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Qualification for managing broker

1) 2 years licensed experience during the 5 years before the date of application
2) be at least 19 years old (so 21 lol?)
3) be of good reputation
4) just meet educational and experience required by the Rules

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The managing broker could be nicknamed the

Zookeeper

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Managing broker responsibilities (4 things)

1) May employ agents
2) maintain brokerages books, accounts, and records (for 7 years)
3) responsible for the agents actions
4) must have a managing broker, whose license will determine the services the brokerage is permitted to offer

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How is the managing broker liable?

The brokerage will held vicariously liable for the fraud committed by the brokerage’s employees.

It may also be disciplined by the BCFSA

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How long is a realtor license good for?

2 years

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Can a realtor work at multiple brokerages at once?

You can only work for 1 brokerage at a time

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All contracts with clients will be in the name of _____________________

Your brokerage (not the realtors clients)

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A realtor can only accept ____________ from their brokerage (such as bonuses and gifts)

Remunerations

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When you take a listing, it is your _______________ listing

And when you help a buyer, it is your ____________ buyer’s

Brokerages!!!

Nothing is yours

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Three “real estate services” under RESA

1) trading services
2) rental property management
3) strata management services

Services are provided on behalf of your brokerage

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Trading services under RESA includes

Selling / buying
Open houses
Finding properties

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Rental property management services under RESA includes what?

Collecting rents
Making payments
Collecting strata fees
Negotiating

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Strata management services under RESA includes what?

Managing on behalf of the owner
Making payments 
Negotiating 
Supervising contractors 
Managing tenant matters

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Exceptions to the Real Estate License (no need to have a real estate license if:)

1) for sale by owner
2) collection agents
3) notaries
4) accountants
5) appraisers
6) persons acting on developers behalf

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Personal Real Estate Corporation (PREC) can be licensed as a:

A personal real estate corporation can be licensed as a managing broker, associate broker, or representative

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Personal real estate corporation (PREC) primary objective

Better planning of income and tax streams

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Personal real estate corporation (PREC) disadvantage

Does not shield controlling individual from liability from third parties

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An unlicensed assistant can do what?

1) unlock property in order to let prospective buyers and their representatives enter
2) perform office filings and bookkeeping
3) draft documents and correspondence for approval and signature by the licensee
4) place or remove signs
5) witness signatures
6) arrange for repairs on rental property

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An unlicensed assistant cannot

1) host an open house 2) renew a listing contract on behalf of licensed realtor 3) present an offer to purchase real estate 4) negotiate lease agreements

The Real Estate Services Act aims to | RESA

1) to ensure that real estate licensees are reasonably competent 2) to ensure that real estate licensees are of good reputation 3) to discipline and, where necessary, re-educate real estate licensees if they breach the act

The Real Estate Services Act (RESA) created 3 organizations, what are they?

1) real estate foundation (law reform) 2) real estate errors and omissions insurance (indemnity plan) 3) real estate compensation fund corporation

BCFSA stands for what?

British Columbia financial services act

_________ is a crown regulatory agency of the BC government

BCFSA

Does the BCFSA have a law reform, no code of ethics / realtor (no relation)

No sir

What is the main objective of BCFSA

Strengthen consumer protection and ensure public can have confidence in the standards of practice provided by real estate professionals

One aspect of the BCFSA is that it enforces the Act, what does this entail!

It ensures that agents meet the requirements outlined in RESA

Another aspect of the BCFSA is education, what does this mean?

Supervising and advancing the educational qualifications and programs of licensees

The BCFSA is in charge of the licenses, what powers do they have?

They have the power to issue, renew, suspend, reprimand, and CANCEL licenses

BCFSA has the right to investigate realtors, what does this entail?

The right to investigate you before or after becoming licensed There is no complaint or permission required to start an investigation

The BCFSA may apply to the court for what?

In order to seize records (to which your permission is NOT required)

The BCFSA is responsible for fees and expenses associated with being a realtor, what is included in this?

Levying fees on all licensees to meet BCFSA expenses They may require the licensee to pay part or all of the expense associated to investigations and discipline hearings

BCFSA makes various bylaws, such as?

Information required on a license application, it’s business and affairs, hearing procedures, bylaw creation procedures

BCFSA can hold disciplinary hearings (by discipline committee) and the decision to discipline a licensee will be heard by the ________________

Financial services tribunal NOT THE SUPREME COURT OF BC

The superintendent of real estate is appointed by the ______________________

The BCFSA board of directors

The superintendent of real estate is the ________________ of the BCFSA who posses certain powers, and must fulfil specific duties, under the ________________

Chief executive officer (CEO) Real estate services act (RESA)

What are 2 examples of things the superintendent does?

1) all licensing application must be made through the superintendent 2) superintendent will carry out investigations and disciplinary functions in relation to licensees

The Real Estate Foundation focuses on what?

Education Research Real estate law reform

The _____________________ receives interest earned on monies in brokerage ________________ in BC to pay for their expenses and research

Real estate foundation Trust accounts

In 3 simple words, what does the Real Estate Errors and Omissions Insurance Corp do?

Protects against negligence!!

The Real Estate Errors and Omissions Insurance Corp has an __________________

Indemnity plan

What is the Real Estate Errors and Omissions Insurance Corp Indemnity Plan?

Insurance coverage and exclusions for real estate licensees in BC

What are three things the Indemnity Plan does?

1) Protects against negligently performing or failing to perform real estate duties 2) levies different assessments on licensees 3) the indemnity plan will cover the licensee up to $1 million for negligence but not for any fines, penalties imposed on a licensee by BCFSA

The indemnity plan will cover the licensee up to $_______________ for negligence, but not for _______ or _________ imposed on the licensee by the BCFSA

$1,000,000 Fines or penalties

The Real Estate Errors and Omissions Insurance Corp does not protect you from:

* dishonest, fraud, criminal matters (aka on-purpose things) * disputes concerning commission or fees * The real estate agent is selling their personal home (For sale by owners (FISBO) is not covered) * Claims for discrimination arising from the complains (human rights issues) * bodily injuries, sickness, disease, or death (accident insurance covers this)

The ________________________ provides compensation in relation to a real estate transaction for funds that were misappropriated

Real Estate Compensation Fund Example: money is collected, deal falls through, go to these guys to get money back

CREA stands for what?

Canadian Real Estate Association

The ________________________ is a national organization comprised of licensees and real estate boards across the country, as well as all of the provincial real estate associations

Canadian Real Estate Association (CREA)

Who developed the Code of Ethics (Realtor Code)

Canadian Real Estate Association (CREA)

What is the golden rule

Do unto others as you would have them do unto you

What does BCREA stand for?

British Columbia Real Estate Association

The British Columbia Real Estate Association has _____ real estate boards, they run the _____, and they are the ones who enforce the __________________

10 MLS Realtor Code of Ethics

What does MLS stand for?

Multiple Listing Service

What does BCREA do!

1) communications network 2) government relations 3) economics forecasts 4) standard forms 5) ongoing education (PDP, newsletter) 6) advancing the interests of real estate licensees

Real Estate Institute of BC

Awards the professional designation “RI” Advances education

What does REDMA stand for?

Real Estate Development Marketing Act

Real Estate Development Marketing Act covers 4 topics, which are

1) subdivisions 2) strata properties 3) cooperatives 4) Time Shares

Real Estate teams must consist of at least _____ people, and minimally one of them must be _______

2 Licensed

To work on a real estate team, all licensed members must be licensed with the ______________

Same brokerage

A licensee can only be on _________ real estate team at a time

One Uno 1

Real estate team members and team name must be registered with ______

BCFSA It is the obligation to advice BCFSA in writing if any team members leave or join too

All advertising from a real estate team that includes the name of ___________ team members must identify that member as being ___________

Unlicensed Unlicensed

A real estate team is collectively one agent for the client and cannnot separate agency relationships, meaning

That one team member cannot represent the buyer and another member of the same team represents the seller

The ________________________________ was created to impose disclosure requirements on ___________ with the superintendent of Real Estate

Real Estate Development Act Developers

What is considered a “Development Property” 1) subdivisions - ______ or more 2) bare land strata lord - _____or more 3) cooperative interests - ____ or more

1) 5 or more 2) 5 or more 3) 2 or more

Purchasers are required by REDMA requiring developers to:

1) meet requirements or approvals of the property 2) to assure the purchasers title 3) file disclosure statements in the form required by the superintendent

A ________________ discloses material interest about property

Disclosure statement

When is a disclosure statement required?

When sold Individually

When must a disclosure statement be provided to a buyer:

Before the offer is made NOT AFTER

A disclosure statement must indicate the right to rescind the purchase within _________

7 days 1 weeks bitch

The disclosure statement must be in the prescribed form by the __________________

Superintendent of Real Estate

A disclosure statement must be prepared and filed with the ______________

Superintendent of real estate

A _____________ is a document prepared by the developer to ensure the purchasers have adequate information upon which to base a purchasing decision

Disclosure statement

BCFSA Discipline Matters include (for development related matters)

1) accepting remunerations directly from the developer and not from the brokerage in relation to which the licensee was licensed 2) failing to recommend legal advice to purchasers

______________: 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 for other purposes

Trust Account

A brokerage must have at least one ____________ in a bank and not one trust account for _______________

Trust account Each client

The agent / brokerage collects the deposit as a ___________

Stakeholder 🐮 🥩 🐄

Withdrawals from trust accounts can only happen for certain occasions, which are:

1) by mistake 2) interest paid to the Real Estate Foundation 3) Remuneration for a licensee if earned 4) Accordance with the instructions of the principal

You can not take money out of a trust account for 2 things:

1) brokerage business expenses | 2) Agents personal expenses

_____________________: providing measured and proportionate response to particular instances of non-compliance and adds to a progressive discipline system

Administrative Penalties

Administrative Penalties are meant for offences that are ____________ than offences dealt with by a Notice of Disciplinary Hearing

Less serious

Administrative penalties do not apply to ____

Fraud

The _______ can conduct an investigation to determine whether a licensee has committed _____________________ or _________________

BCFSA Professional Misconduct Unbecoming a licensee

If an investigation is started against a licensee, they are required to:

1) respond promptly to any inquiry addressed to the licensee by the BCFSA 2) Licensee response must be in writing and within the time limit set for response 3) promptly notify their managing broker of their own misconduct 3. 5) even misconduct observed outside one’s brokerage should be reported, but isn’t required

Under section 47 of RESA, BCFSA must publish all orders (consent orders, discipline orders, urgent orders) and provide copies to any person under request The order must be posted where

On the BCFSA website