Humber/Ontario Real Estate Course 1 Exam Practice

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According to REBBA, what forms of remuneration can be included in a seller representation agreement?

  1. Only a percentage of the sale price.

  2. Only a flat fee.

  3. Both a percentage and a flat fee if the client agrees.

  4. Both, but only for commercial agreements.

  5. A percentage, with a flat fee paid to the listing brokerage.

  6. A flat fee, excluding any percentage-based commission.

The correct answer is: Both a percentage and a flat fee if the client agrees.

According to REBBA (Real Estate and Business Brokers Act), both a percentage of the sale price and a flat fee can be included in a seller representation agreement if the client agrees. This provides flexibility for real estate agents and clients to negotiate and agree upon the most suitable forms of remuneration for their specific situation. Option A, which states "Only a percentage of the sale price," and Option B, which states "Only a flat fee," are not entirely accurate as REBBA allows for both forms of remuneration to be included. Option D, stating "Both, but only for commercial agreements," is incorrect as this flexibility is not limited to commercial agreements only. Option E, mentioning "A percentage, with a flat fee paid to the listing brokerage," is partially accurate but does not include the crucial point that client agreement is also necessary. Option F, stating "A flat fee, excluding any percentage-based commission," is incorrect as REBBA does allow for a percentage of the sale price to be part of the remuneration if agreed upon by the client.

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