Humber/Ontario Real Estate Course 2 Exam Practice

How should remuneration be handled between Brokerages A and B when there is an existing holdover provision?

1. Referral fee is required between brokerages

2. Holdover provision negates any due remuneration

3. Both brokerages share remuneration

4. Remuneration paid to Brokerage B only

5. Buyer must cover any deficiency for Brokerage A

6. Brokerages negotiate terms independently

The correct answer is: Referral fee is required between brokerages

When there is an existing holdover provision between Brokerages A and B, remuneration is typically handled through a referral fee between the brokerages. This means that if a transaction occurs during the holdover period due to the efforts of Brokerage A, they are entitled to a referral fee from Brokerage B for the services provided. This helps ensure that the efforts of the original brokerage, Brokerage A, are compensated appropriately and recognized in the transaction. Therefore, the correct answer is A. In contrast, the other options are incorrect because they do not adequately address the typical industry practice of a referral fee between brokerages in the presence of a holdover provision. This is why options B, C, D, E, and F are not the best choices in this scenario.