Humber/Ontario Real Estate Course 4 Exam Practice

Which statement is accurate about deposit disclosures according to REBBA?

1. Interest rate details on a deposit must be given to the buyer

2. Ontario brokerages need both interest and non-interest accounts

3. Deposit placed in a variable interest account discloses the current rate

4. The deposit's placement date must be shown in the commission trust account

5. Account interest bearing details need not be in the sale agreement

6. All brokerages must disclose both buyer and seller's deposit details

The correct answer is: Deposit placed in a variable interest account discloses the current rate

The assertion that deposit placed in a variable interest account discloses the current rate is accurate because it aligns with the principles of transparency and best practices in real estate transactions governed by the Real Estate and Business Brokers Act (REBBA). When a deposit is placed in a variable interest account, it is essential for the buyer and relevant parties to be informed of the current interest rate applicable to that deposit. This information enables the buyer to have a clear understanding of how their funds are being managed, especially in contexts where the interest could affect the total amount potentially returned to them upon completion of the transaction or if there were any applicable interest penalties. This emphasis on disclosure helps uphold trust and accountability within real estate practices, enabling all parties to make informed decisions. Other aspects of deposit disclosures under REBBA focus on different requirements, but the clarity regarding the current rate in variable accounts particularly highlights the importance of ongoing communication about the financial aspects of a real estate deal.