Nova Scotia RAS flashcards

33 cards. Read the term and the definition here. The deck at the top of this page is optional.

Real Estate Trading Act

Nova Scotia statute governing licensing, trading, trust accounts, and discipline of real estate licensees, administered by the Nova Scotia Real Estate Commission through bylaws and a code of ethics.

Trust account reconciliation

Monthly process comparing brokerage trust account records with bank statements and individual client ledgers to confirm that pooled funds equal the sum of all client balances held.

Designated agency

Representation model in which the brokerage acts for a client through a named licensee, allowing other licensees of the same brokerage to represent other parties without dual agency.

Dual agency

A brokerage representing both buyer and seller in the same transaction, permitted only with the informed written consent of all parties and requiring even-handed treatment of both.

Material fact

Information that could affect a reasonable person's decision to buy, sell, or lease, such as latent defects, stigma, or environmental hazards, which must be disclosed to the client.

Fiduciary duty of loyalty

A licensee's obligation to act solely in the client's best interest, avoid conflicts, and not acquire a personal interest in the transaction without written disclosure and consent.

Condition precedent

A contract term making the agreement conditional on an event such as financing or inspection, which must be satisfied or waived in writing by the stated deadline.

Statement of adjustments

Closing document allocating prepaid items such as taxes, utilities, and rents between buyer and seller as of the closing date, producing a credit or debit to each.

Joint tenancy

Form of co-ownership with equal undivided interests and a right of survivorship, so a deceased owner's share passes automatically to the surviving owners.

Tenancy in common

Co-ownership in which each owner holds a distinct share with no right of survivorship, so the share passes to the owner's estate on death.

Easement

A registered right to use another person's land for a specific purpose, such as access or utilities, which generally runs with the land and binds later owners.

Land Registration Act

Nova Scotia legislation establishing the parcel register system, under which registered title and interests are recorded and confirmed through a Torrens-style process.

Loan-to-value ratio

Loan amount divided by property value, expressed as a percentage; ratios above 80 percent generally require mortgage default insurance in Canada.

Gross debt service ratio

Annual housing costs including mortgage principal and interest, property taxes, heating, and half of condominium fees, divided by gross annual income; guideline maximum 32 percent.

Total debt service ratio

Annual housing costs plus all other debt payments divided by gross annual income; lenders typically use a guideline maximum of 40 to 44 percent.

Blended payment formula

P = L times i(1+i)^n divided by (1+i)^n minus 1, where L is loan amount, i is the periodic rate, and n is the number of payments.

Semi-annual compounding

Canadian mortgage convention in which interest compounds twice yearly; the per-payment rate equals (1 + annual rate/2) raised to 2 divided by payments per year, minus 1.

Mortgage stress test

Qualification rule requiring borrowers to be assessed at the greater of the contract rate plus two percent or the published benchmark rate.

Capitalization approach

Income valuation method where property value equals net operating income divided by a capitalization rate derived from comparable sales.

Gross rent multiplier

A quick income-property comparison tool calculated as sale price divided by gross annual rent, applied to the subject's rent to estimate value.

Market value

The most probable price in a competitive open market between informed, willing parties acting without undue pressure and with reasonable exposure time.

Absorption rate

Number of properties sold in a period divided by active listings; a low rate signals a seller's market with upward price pressure.

Exclusive right to sell

Listing agreement entitling the brokerage to commission regardless of who procures the buyer during the listing term, including the seller.

Buyer service agreement

Written contract establishing agency between a buyer and brokerage, stating the term, services, geographic area, and remuneration before representation begins.

Listing presentation

Meeting in which a licensee presents pricing analysis, marketing plan, and service terms to a seller, forming the basis of the written listing agreement.

Material defect disclosure

Licensee's obligation to inform buyers of known latent defects and material facts about a property, regardless of which party the licensee represents.

Commingling

Mixing client trust funds with the brokerage's operating money or using trust funds for unauthorized purposes, which is prohibited under the Real Estate Trading Act.

Errors and omissions insurance

Professional liability coverage protecting licensees and brokerages against claims of negligence or error arising from real estate services.

Conflict of interest

A situation where a licensee's personal or financial interest could influence their duty to a client, requiring written disclosure and informed consent.

Privacy consent

Client authorization for the collection, use, and disclosure of personal information, required under privacy legislation and limited to stated purposes.

Urea-formaldehyde foam insulation

A legacy insulation material installed in some homes that can emit formaldehyde; its presence is a material fact affecting buyer decisions and financing.

Well and septic inspection

Evaluation of private water supply quality and on-site sewage system condition, commonly a condition of purchase for rural Nova Scotia properties.

Reserve fund study

Engineer-prepared analysis estimating future common-element repair costs and required condominium reserve contributions, reviewed by buyers before purchase.