Humber/Ontario Real Estate Course 3 Exam Practice

What is true about a customer in relation to a brokerage?

1. A customer is always also a client

2. A customer may be a client of another brokerage

3. A customer holds an agency relationship with their brokerage

4. A customer receives fiduciary duties from their brokerage

5. A customer has no obligation to pay commission

6. A customer can enter into multiple exclusive agreements

The correct answer is: A customer may be a client of another brokerage

A customer may indeed be a client of another brokerage, which highlights the distinction between a customer and a client in real estate. In this context, a customer refers to someone who engages with a brokerage for services but does not necessarily have a formal agency relationship. This means they may seek assistance or information from the brokerage without being committed to a contractual relationship. Consequently, it is entirely possible for a customer to maintain a business relationship with a different brokerage, thus classifying them as a client of that brokerage while still interacting with another one for different services or properties. The other options do not hold true for a customer. For instance, not every customer is considered a client, and they do not hold an agency relationship with their brokerage. Additionally, fiduciary duties, which involve a higher level of care and loyalty, are not typically extended to customers since these duties are established through formal client relationships. Lastly, while customers generally do not pay commission in the same way clients do, there may be particular circumstances that alter this, but that is not a universal truth. As such, acknowledging that customers may be clients of another brokerage underscores the diverse relationships within the real estate industry.