Who Must Make this Disclosure?

If you are licensed for...When the form must be provided
Trading servicesMake this disclosure to a consumer each time you present an offer to your seller client. This includes all counter-offers coming from a potential buyer to your seller client.
Rental property management services You do not need to make this disclosure.
Strata management servicesYou do not need to make this disclosure

NOTE: This form does not replace the existing Disclosure of Remuneration.

Overview

This guide is intended to help real estate professionals (licensees) use the Disclosure to Sellers of Expected Remuneration form with consumers.

The Disclosure to Sellers of Expected Remuneration form is a mandatory Council-approved form and may not be modified or altered.

Each time a trading services licensee presents an offer to their seller client, they must include a completed disclosure form that informs the client about the remuneration the licensee's brokerage will receive.

The form explains to the seller:

  • the total payment that the listing brokerage would receive if the offer is accepted;
  • how the payment would be shared with any cooperating brokerage;
  • the payment that would be kept by the listing brokerage; and
  • any other payment the licensee will receive, or expects to receive, as a result of the trade.

This information helps ensure that sellers are fully informed of the expected remuneration that the brokerage(s) will receive if they accept an offer.

The new Disclosure to Sellers of Expected Remuneration Form is in addition to the existing obligation to present a Disclosure of Remuneration form. Learn more about those existing obligations in the Report From Council or Professional Standards Manual.

Understanding the Form

The form contains three key sections:

Section 1: An information piece for consumers called “Payment for Real Estate Services – What Sellers Need to Know.”

The section informs the consumers that real estate professionals are required to disclose to their clients how they will be paid for their services. It also explains that commissions are paid by the sellers to the real estate professional’s brokerage, and that real estate professionals receive payment from the brokerage.

It explains to your seller the total commission that the listing brokerage would receive if the offer is accepted, and how it will be split with any cooperating brokerage. It also informs the seller of any other payment you will receive, or expect to receive, as a result of the trade.

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This is intended to ensure that sellers clearly understand how their licensee would be compensated and how remuneration could vary on different offers.

While consumers are under no obligation to accept any offer, real estate professionals are required by law to bring all written offers to their clients for consideration, unless otherwise instructed by their clients.

Section 2: Details of the Offer

This section includes information on the specific details of the offer that they will be reviewing, including:

  • The address of the property
  • Name of the real estate professional (you)
  • Listing brokerage (your brokerage)
  • Name of potential buyer(s)
  • Potential buyer’s brokerage (the cooperating brokerage)
  • Date of the offer
  • Purchase price

It then includes the following sections:

“You will pay your real estate professional’s brokerage this amount”This is the total commission.
“This amount will be shared with the potential buyer’s brokerage (the co-operating brokerage)"This is how much will be shared with the buyer’s brokerage. Note: If the potential buyer’s brokerage is also your own brokerage, you should treat them as the co-operating brokerage.
“This amount will be kept by your real estate professional’s brokerage”This is the total commission minus the amount that would be shared with the potential buyer’s/co-operating brokerage.
“Your real estate professional has received or will receive this amount from someone other than you, as a result of providing real estate services to you, or on your behalf."If you disclose an amount in this section, you must provide the consumer with a separate Disclosure of Remuneration that sets out the source of the remuneration, the amount or likely amount or method of calculation of the remuneration and all other relevant facts relating to the remuneration.

The remuneration that is being disclosed to the consumer must be expressed as a dollar amount and may not be made as a percentage.

Section 3: Checklists and signature sections for the licensee (mandatory) and signature section for the consumer (optional).

The purpose of this section is to document that the disclosure has been made to the consumer.

Definitions of Terms in the Disclosure Form

Client: the principal who has engaged the licensee to provide real estate services to or on behalf of the principal.

Cooperating brokerage: a brokerage that provides trading services to or on behalf of a buyer in respect of a trade in real estate. Note: under designated agency, this could be the same brokerage as the listing brokerage.

Remuneration: any form of remuneration, including any commission, fee, gain or reward, whether the remuneration is received, or is to be received, directly or indirectly.

Using the Form

Step 1: Fill out the Details of the Offer Complete the Details of the Offer section before presenting the disclosure to your seller client. Remember that you must fill out a separate disclosure for each offer (including counter-offers) coming from the buyer to your seller client.

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Step 2: Discuss the Form with the Consumer

Take time to review the form with the consumer and discuss any questions or concerns the consumer may have. Explain any unfamiliar terms using the definitions included in this guide.

Step 3: Complete the Mandatory Real Estate Professional Confirmation

The form contains a mandatory checklist that licensees must complete, plus a mandatory signature section.

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Step 4: Invite the Consumer to Complete the Optional Consumer Confirmation

It is optional for consumers to complete the checklist or sign their name.

If a consumer chooses not to complete and sign the disclosure, you can make a note at the bottom of the Mandatory Real Estate Professional Confirmation to document that you presented the consumer with the form.

Step 5: Submit the form (or a copy of the form) to your brokerage promptly

A copy of the form is not required to be provided to RECBC unless it is specifically requested.

How to Complete the Disclosure Form when the Buyer’s Agent is another Licensee at Your Brokerage

By requiring licensees to disclose remuneration, the Superintendent’s intention is to ensure that home sellers are fully informed about

  • The amount of remuneration to be paid by the seller to the listing brokerage
  • The remuneration to be paid by the listing brokerage to a cooperating brokerage, if applicable;
  • The remuneration to be retained by the listing brokerage.

A cooperating brokerage is defined in the Rules as “a brokerage that provides trading services to or on behalf of a buyer.” When buyers and sellers are represented by separate designated agents at the same brokerage, that brokerage is by definition both the listing brokerage and the cooperating brokerage. So the form should be filled out just as it would be if the buyer was represented by a licensee from a different brokerage.

Step 1: Enter your brokerage name in the line provided for the listing brokerage and in the line for the cooperating brokerage (see Step 1 example below).

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Step 2: Continue to fill out the form, separating the amounts for the listing brokerage and the cooperating brokerage (see Step 2 example below).

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Line #1: Enter the total amount of remuneration to be paid by the seller.

Line #2: Calculate the amount that would be shared with a cooperating brokerage. Enter it here.

Line #3: Deduct the amount that would be shared with a cooperating brokerage from the total amount.