2025 Residential Exam Prep | Comprehensive Questions, Verified Answers, and Rationales | Achieve A+ Success with Confidence!
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Course
2025| RECA
Institution
2025| RECA
2025 Residential Exam Prep | Comprehensive Questions, Verified Answers, and Rationales | Achieve A+ Success with Confidence!
Mortgage penalties - ANS if borrower repays mortgage before end of term, lender is entitled to compensation.
Three month interest penalty
= outstanding Balance x (annua...
2025 Residential exam PReP |
ComPRehensive Questions, veRified
answeRs, and Rationales | aChieve a+
suCCess with ConfidenCe!
Mortgage penalties - ANS if borrower repays mortgage before end of term, lender is entitled to
compensation.
Three month interest penalty
= outstanding Balance x (annual int. rate/12 month) x 3 months
interest rate differential (IRD)
IRD=(annual int. rate - current int. rate)/12 X months remaining in Mortgage term
Lenders uses whichever method is higher
High ratio Mortgage vs Conventional - ANS Loan to value - determines whether a mortgage is
conventional or high ratio
LTV = Mortgage amount/Value of Property
- if less than 80% its a conventional mortgage
-If 80% + high ratio, higher risk, loan insurance required
Loan insurance protects lenders from losses related to payment default by borrowers (CMHC,
Genworth, Canada Guaranty)
- allows borrows to purchase a property with a minimum down payment of 5%
,Borrower vs Lender - ANS Borrower obligations
- repay mortgage and loan interest
- keep property adequately insured
- maintain the condition of the property
- pay any charges against the title
Rights
- possession of property
- redeem or further mortgage the property
- receive a discharge of the mortgage
Lender Obligations
- discharge the mortgage upon payment
- Not interfere with borrowers use of property
- Provide annual statement of principal, interest and taxes
Rights
- assign the mortgage
- be paid under terms of mortgage
Dower Act - ANS - Is the owner of the property the only name on the Certificate of Title
- Is the owner of the property legally married
- Has either spouse lived in the property since the time of marriage
Mortgages on Title - ANS Postponement - altering the priority of a mortgage
Transfer - current lender allocates mortgage to another party who than holds mortgage
,Assignment of Mortgage - sells an interest and the security in the property to a new lender in
return for money
Assumption- process of acquiring title and access to a property that has existing mortgage and
agreeing to fulfil terms/conditions and payments
Rural real estate - ANS - cannot be comprised of more than four residential premises (would
need commercial license for more)
Specialized Municipalities in Alberta - ANS - municipalities of Crowsnest, Jasper, Wood
Buffalo and counties of Strathcona and Mackenzie
The council structure of Municipal districts include one councilor per ward, one of whom is
elected by council as the "Reeve" or administrator
Rural utility association has five or more people
- main purpose to supply its members utility services for electricity, gas, or water
Population numbers - ANS - 18 Cities must have 10,000 people (mayor + even number of
councilors)
- 108 towns must have 1,000 (6 councilors + mayor)
- 87 Villages must have 300 (3 councilors including mayor)
- 51 summer villages, can no longer be created
natural water sources (6) - ANS Surface water, rivers, river basins and watersheds, lakes,
wetlands, and springs
confined vs unconfined aquifer - ANS confined - lies between layers of impermeable materials,
fully saturated with ground water
unconfined - also called water table, upper water surface is at atmospheric pressure
, water - ANS - be used in best manner
- support eco system
- ensure supplies are naturally replenished
- maintained and withdrawals do not exceed replenish rate
- Water Act governs
- need a water license, runs with land
- can use 1250 cubic meters or 275,000 gallons
during times of shortages
- older license holders are entitled to allocation first
- households receive the highest priority
- First in Time, First in Right
Septic Disposal - ANS Septic Tanks (size requirements relate to # of beds)
Disposal Fields (most common) - lawn is only appropriate cover
Treatment Mounds
Sewage Lagoon
Open Discharge (only for remote rural areas)
typical septic systems should be pumped out 1-3 years
Do not put Bleach, Septic Tank Additives, Garbage, and Disinfectants in septic tanks
soil tests determine if septic disposal is at risk of failure
- percolation test - rate water moves through soil
- saturation percentage test - high percentage of clay in soil increases risk of system failure
- sodium absorption - high sodium increases risk of failure
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