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Brokers How-To

Brokers did you know that the interest earned on deposits is paid to the Alberta Real Estate Foundation (AREF) and is then reinvested into the community of Alberta? This is mandated in The Real Estate Act and it is important that you ensure your compliance and understand where the money goes.

The Real Estate Act states that all licensed brokers are required to maintain a general trust account to hold deposits on behalf of their client(s). Section 25(1)(b) requires general trust accounts to be interest bearing and section 69(2) directs any interest earned on these trust accounts to be paid to the Alberta Real Estate Foundation . For the complete Real Estate Act visit Service Alberta’s Website.

All the projects AREF distributes grants to benefit the real estate in some way and are encompassed by five main areas of interest: Education and research, housing, land stewardship and environment, and industry leadership. AREF does not fund personal real estate licensing or capital builds. In over 25 years, AREF has granted over $17.5 million to 550 projects. For a list of all our grant recipients visit our Projects Page, and for useful resources visit our Resource Library.

To be compliant you must follow three easy steps to direct interest earned on deposits to the AREF: First, download the broker form from our website. Second, get the form signed by your bank. Third and finally, send the form to AREF (make sure your bank has a copy and that you have a copy). For more detailed information about when to remit funds and how to remit to AREF visit our Broker Page.

 

 

Top 5 Questions by Brokers

Where do I find this form?

You will find this form on the Alberta Real Estate Foundation website www.aref.ab.ca. Click on the Brokers heading and you fill find the form on this page under Step 1: Download Broker Form.

Why do I have to fill this form out?

In accordance to the Real Estate Act, Section 25(1)(b) requires general trust accounts to be interest bearing and section 69(2) directs any interest earned on these trust accounts to be paid to the Alberta Real Estate Foundation.

Who signs the bottom of the form?

Your bank contact will sign the bottom of the page highlighted in blue and will also fill out the top section with the banking information.

What do I do with an unclaimed security deposits?

Unclaimed deposits, or unclaimed interest on deposits, must be remitted to the Foundation after:

a)      at least two (2) years have passed since your client was entitled to receive the funds back.

b)      reasonable efforts have been made to locate the beneficial owner of the funds.

There must be some type of letter or memo as to why these funds are being sent.

What if I am only a rental property brokerage?

If you are a rental property you do not remit interest to the Alberta Real Estate Foundation. The interest collected on security deposits should be given back to the tenants upon termination of their lease agreement.