How the Real Estate and Mortgage Brokerage Industries Operate

The Real Estate Act of Alberta requires individuals that represent consumers in a real estate transaction or assist consumers with obtaining a mortgage through a mortgage brokerage to hold a licence with the Real Estate Council of Alberta (RECA).

Individuals that buy or sell property on their own behalf do not need a licence.

After obtaining a licence from RECA, these licensed real estate agents and mortgage brokers need to register with a brokerage.


Brokering is arranging or negotiating a deal on behalf of someone else. The brokerage is the company licensed by RECA to broker for you. They are the fundamental entity the public enters into a contract with to represent their interests and to broker a deal for them.

CONSUMER TIP: Even though you may see flashy advertising for a specific individual, it is that individual’s brokerage that you are actually hiring, with that individual representing that brokerage.

It can be confusing, so let’s simplify things.


Every day you probably see advertisements from a particular real estate or mortgage franchise, such Re/Max, Royal LePage, Invis, or Dominion Lending Centres. These are not brokerages. Brokerages are individual companies holding individual licences with RECA. If you look closely at these advertisements, they will all have different names. Re/Max 123 Realty has no affiliation with Re/Max ABC Realty, even though they share nearly identical branding and have Re/Max in their name. Your city may have several Re/Max-branded brokerages, but they are individual companies who pay Re/Max a franchise fee and are franchises within the Re/Max brand. This can often confuse the public. RECA licenses brokerages in Alberta, and does not regulate the parent franchise company.


Brokerages are companies licensed with RECA to trade in real estate or deal in mortgages on behalf of consumers. These companies can be sole proprietorships, partnerships, or corporations.

Brokers are individuals, licensed by RECA, who manage a brokerage. No matter how big a brokerage gets, there is always only one broker per brokerage. They are responsible for all brokerage activity, even if they don’t own the brokerage. In small brokerages, the broker often directly works with consumers in addition to management duties. In larger brokerages, brokers tend to focus on the management role.

CONSUMER TIP: Broker is a specific class of licence. Many mortgage professionals may call themselves a “mortgage broker,” but this does not necessarily mean they are the licensed broker for their brokerage; it simply means they “broker” mortgages.

Associates are individuals who hold a licence from RECA to trade in real estate or deal in mortgages. They have completed the pre-licensing education and registered with a brokerage, These are typically the people you will work with through your real estate transaction or mortgage deal. They do not have the management responsibilities that brokers have.

Associate brokers are associates who completed the necessary education to become brokers, but do not operate a brokerage. In larger brokerages, brokers sometimes delegate some of their management duties to associate brokers. Associate broker is a licensing class that is only available to real estate professionals.


In real estate, there are two types of brokerages: common law brokerages and designated agency brokerages.

In a common law brokerage, you hire the brokerage, and every single associate, associate broker, and even the broker works for you. In a common law brokerage, it is assumed that everyone registered with that brokerage knows what everyone else within the brokerage knows. In these brokerages, any licensed professional from the brokerage can step in and represent you in a transaction without amending your agreement.

In a designated agency brokerage, you hire the brokerage, but the agreement designates a single individual, or a team of individuals from the brokerage, to be your designated agent. In these brokerages, only your designated agent(s) will work with you on behalf of the brokerage. Other licensed professionals in the brokerage cannot step in and represent you without adding them as a designated agent on your agreement. In these brokerages, only the named designated agent(s) has access to information about your transaction; there isn’t an assumption that everyone within the brokerage knows what everyone else knows.


When you sign a contract with a real estate or mortgage professional, you are actually hiring their brokerage. The individual you meet or speak to will sign the agreement on behalf of the brokerage, but ultimately, you are hiring the brokerage and not that individual. This is true even of designated agency brokerages. Your agency relationship is with the brokerage.

CONSUMER TIP: Be wary of advertisements saying you hire “the whole team for the price of a single agent.” This can be misleading. Every time you enter into an agreement with a licensed professional who works at a standard common law brokerage, you are hiring the brokerage, not that individual or their “team.”


When you hire a licensed professional and are their client, they represent your interests in a transaction. They owe you undivided loyalty, confidentiality, and obedience. They will help you every step of the way with advice, document preparation, and through negotiations, and will carry out your lawful instructions, even if those instructions go against their advice to you.

Among other things, a real estate professional will:

  • draft agreements and offers to purchase
  • show properties to buyers
  • hold open houses
  • give advice
  • act honestly
  • maintain confidentiality

Among other things, a mortgage brokerage professional will:

  • take mortgage applications on behalf of the brokerage
  • discuss financing options
  • quote interest rates
  • give advice
  • act honestly
  • maintain confidentiality

RECA protects the interests of Alberta consumers by setting standards of behaviour and enforcing those standards. RECA administers provincial real estate legislation on behalf of the government. All real estate and mortgage brokerage professionals in Alberta must hold a licence with RECA and follow RECA’s standards.

Industry trade associations protect the interests of their membership. These trade associations include local real estate boards and provincial real estate associations. Membership in these associations is voluntary, and has nothing to do with RECA’s standards. These associations may have their own standards that their members must follow. The term REALTOR® is a trademark owned by the Canadian Real Estate Association, which is the national trade association for real estate professionals. Only CREA members can use this designation. All CREA members are REALTORS®, but not all licensed Alberta real estate professionals are REALTORS®.


The public can check their industry professional’s licence status using the Find a Professional tool on RECA’s website.



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