Ontario RE Essentials Exam key terms

Ontario's current statute for real estate brokerage, in force since December 1, 2023. It replaced REBBA 2002 and sets registration, disclosure, and ethical conduct rules enforced by RECO.

The delegated administrative authority that registers salespersons and brokerages, administers the code of ethics, investigates complaints, and imposes discipline under Ontario law.

The ethical standards set out in regulation under Ontario real estate law, covering honesty, fairness, disclosure of material facts, handling conflicts, and protecting client property and information.

A licensed business entity through which salespersons and brokers trade in real estate. It is accountable for supervision, trust funds, records, and compliance with Ontario law.

In Ontario, a service model where one named salesperson within a brokerage represents the client, and confidential information is kept from other salespersons in that brokerage.

Arises when one brokerage represents two or more clients with conflicting interests in the same trade. Ontario requires written disclosure and consent, and fair treatment of both clients.

A buyer or seller who has a written representation agreement with a brokerage and therefore receives fiduciary duties, including loyalty, confidentiality, full disclosure, and obedience to lawful instructions.

A transaction party who is not represented by a brokerage. The brokerage must still deal fairly and honestly and disclose material facts, but owes no fiduciary duties to that party.

The legal obligation to act in a client's best interest, including loyalty, confidentiality, full disclosure, obeying lawful instructions, and accounting for money or property handled.

A written contract that authorizes a brokerage to act for a buyer, setting the term, geographic area, services, and commission payable. It establishes client status.

A written contract authorizing a brokerage to market a seller's property on stated terms, including price, listing period, commission, and the services the brokerage will provide.

The fee a brokerage charges for its services, negotiated in the representation agreement. It is often shared with a cooperating brokerage that brings the buyer.

The contract setting out price, deposit, conditions, closing date, and inclusions for a property trade. Once signed and accepted, it legally binds buyer and seller.

Money given by the buyer with an offer as evidence of good faith. It is held in trust by the brokerage and normally credited toward the purchase price at closing.

The period stated in an offer during which the buyer cannot withdraw it. If the seller does not accept before it expires, the offer lapses.

A reply to an offer that changes one or more terms. In law it rejects the original offer and creates a new offer that the other party may accept or reject.

A contract term making the deal depend on a future event, such as financing approval or a home inspection. The buyer can waive it or terminate if it fails.

A buyer's written notice giving up a condition and confirming the transaction will proceed. The agreement becomes firm once conditions are waived or fulfilled.

The date when the sale is finalized: purchase funds are paid, title transfers, and the buyer receives keys. It is stated in the agreement of purchase and sale.

The legal ownership interest in a property, recorded in Ontario's land registration system. A title search reveals the owner and any registered encumbrances.

A registered claim or right affecting a property, such as a mortgage, lien, easement, or restrictive covenant, that limits the owner's use or may affect value.

A registered right to use part of another person's land for a specific purpose, such as a driveway, utility line, or pedestrian access. It runs with the land.

A municipal law controlling permitted land uses, building height, density, setbacks, and parking for each zone. Existing uses that no longer comply may be legal non-conforming.

A municipality's long-range land use policy approved under Ontario's Planning Act. It guides growth, densities, and where zoning and development may occur.

An approval from a municipality's Committee of Adjustment allowing a small relief from a zoning by-law, such as a reduced setback, without a full amendment.

Latin for 'let the buyer beware': the common-law rule that buyers must assess a property themselves, subject to seller disclosure of latent defects and material facts.

A hidden physical problem not found by reasonable inspection, such as defective wiring or a leak. Sellers must disclose defects that make a property dangerous or unfit.

Information that could affect a reasonable buyer's or seller's decision, such as a death on the property, a planned development, or a known defect. It must be disclosed.

A voluntary seller questionnaire about known property conditions and improvements. If used, inaccurate answers can create liability, so many Ontario brokerages advise against relying on it.

A condominium corporation's disclosure package summarizing the budget, reserve fund, rules, and legal proceedings. Buyers usually make an offer conditional on reviewing it.

A pricing estimate built from recent sales, active listings, and adjustments for differences in location, size, condition, and features. It is not a formal appraisal.

The price a willing buyer would pay a willing seller in an open market, both informed and not pressured, after reasonable exposure. It is the standard valuation premise.

A lender's conditional commitment to lend a set amount at a quoted rate for a period, subject to income verification and a satisfactory property appraisal.

The mortgage amount divided by the property's purchase price or appraised value. In Canada, ratios above 80 percent require mortgage default insurance.

Insurance protecting the lender if a high-ratio borrower defaults, required when the down payment is under 20 percent. Providers include CMHC, Sagen, and Canada Guaranty.

An Ontario tax on property transfers, calculated on a graduated scale. Toronto adds a municipal tax, and eligible first-time buyers may claim rebates.

Expenses beyond the purchase price, including land transfer tax, legal fees, title insurance, adjustments, and lender fees; typically 1.5 to 4 percent of the price.

Canada's anti-money-laundering regulator. Brokerages must identify clients, verify funds, keep records, and report suspicious or large cash transactions.

A shared database operated by a real estate board where member brokerages post listings and cooperating brokers search properties. Board rules govern data and cooperation.

Canada's anti-spam law. It requires consent, sender identification, and an unsubscribe mechanism for commercial electronic messages used in real estate marketing.