RECA Exam key terms

Alberta statute that establishes the Real Estate Council of Alberta, sets out licensing and conduct requirements for industry members, and authorizes the Rules and bylaws that govern practice.

The delegated administrative organization, created under the Real Estate Act, that licenses, educates and disciplines real estate, mortgage brokerage and property management industry members in Alberta.

Detailed requirements made under the Real Estate Act covering brokerage operations, trust accounts, records, advertising and disclosure; breaching a Rule can lead to discipline enforced by RECA.

An individual licensed under the Real Estate Act to trade in real estate, such as a broker, associate broker or associate, who must comply with the Act, the Rules and the bylaws.

The licensed business entity through which industry members trade in real estate; its designated broker is responsible for supervising staff and for the firm's compliance with the Act.

A brokerage bank account holding client money such as deposits and rents, kept separate from the brokerage's own funds and subject to strict record keeping and reconciliation requirements.

An agency model in which the brokerage represents a client through one named industry member, so other licensees in the same brokerage are not in an agency relationship with that client.

The party a brokerage has agreed to represent in an agency relationship, and to whom the brokerage owes agency duties such as loyalty, confidentiality and full disclosure of relevant information.

A party who receives services from a brokerage but is not represented by it, so the brokerage owes fairness and honest dealing rather than the full set of agency duties.

The legal obligation of an agent to put the client's interests ahead of the agent's own, including loyalty, confidentiality, disclosure, obedience to lawful instructions and careful accounting for money handled.

A situation where an industry member's personal, financial or other interest could improperly influence their duty to a client, requiring prompt disclosure and careful management.

A situation where one brokerage represents both the buyer and the seller in the same transaction, which requires the informed written consent of both clients and careful management of confidential information.

A written agreement, commonly exclusive, in which a seller hires a brokerage to market the property and sets out the services provided and how and when commission is earned.

A written agreement that creates an agency relationship between a buyer and a brokerage and sets out the services to be provided, the term and how the brokerage will be paid.

A hidden physical problem with a property that a reasonable inspection would not reveal and that would likely affect a reasonable buyer's decision, so it must be disclosed to buyers.

A written form in which a seller answers questions about a property's condition, renovations and known problems, giving buyers reliable information to assess the property before they commit.

A plan prepared by an Alberta land surveyor showing a property's boundaries and the location of buildings, fences and other improvements, used to check for encroachments and bylaw compliance.

A municipal stamp or letter, usually placed on a real property report, confirming that the improvements comply with current land use bylaws or listing the deviations the municipality permits.

A situation where a building, fence or other improvement extends beyond a property line onto a neighbouring property or public land, or a neighbour's improvement extends onto the subject property.

A registered right allowing a person or utility to use part of another owner's land for a specific purpose, such as access or running services, without owning that land.

A registered restriction that limits how a property may be used or built on, frequently imposed by a developer or municipality to preserve the character of a subdivision.

A document registered on title giving notice that someone claims an interest in the land; it warns buyers and lenders but does not by itself prove the claim is valid.

A form of co-ownership in which owners hold undivided interests in the whole property and, when one dies, that interest passes to the survivors by right of survivorship.

A form of co-ownership in which each owner holds a separate, transferable share with no right of survivorship, so a deceased owner's share passes through their estate.

A statutory protection under Alberta's Dower Act requiring a spouse's written consent before the homestead is sold or mortgaged; without that consent the spouse may claim a life estate.

An item that was once personal property but has become part of the land through attachment and the intention of the parties, so it is included when the property is sold.

Personal property that is not attached to land, such as appliances or furniture, and does not pass with a sale of real property unless the contract expressly says so.

Alberta's official record of land ownership under the Torrens system, naming the registered owner and listing the charges and interests registered against the property.

The legal entity created when a condominium plan is registered; it owns and manages common property, collects condominium contributions and enforces the condominium's bylaws.

Money a condominium corporation sets aside from the contributions it collects in order to pay for major repairs and replacement of common property over time.

Money a buyer pays when an offer is accepted to show good faith, held in trust and applied to the purchase price on completion or dealt with as the contract directs.

A closing document that divides prepaid and unpaid property costs, such as taxes and utilities, between buyer and seller as of the agreed adjustment date.

The date the sale is finalized: the purchase funds are paid, the transfer is registered and title passes to the buyer, who then owns the property.

The date the buyer may take physical occupancy of the property, which may differ from completion day if the contract sets a different date for handing over keys.

A contract term that keeps the agreement from becoming fully binding until a stated event occurs, such as financing approval or a satisfactory home inspection.

A written proposal to buy property on stated terms that becomes a binding contract when accepted and any conditions are satisfied or waived by the parties.

The fee a brokerage charges for its services; it is negotiated in the contract rather than set by law and is paid to the brokerage, not directly to the industry member.

A cooperative system run by a real estate board that lets participating brokerages share listing information and offer compensation to other brokerages that bring a buyer.