Ontario Mortgage Agent Practice Exam

What must be included in the borrower disclosure document?

1. The nature of the relationship between the brokerage and the borrower must be included

2. A brokerage fee must be disclosed to the borrower and included in the cost of borrowing

3. Comply with law and codes of conduct

4. Lawyer's fees including disbursements must also be included

The correct answer is: A brokerage fee must be disclosed to the borrower and included in the cost of borrowing

The borrower disclosure document is a vital component in the process of borrowing money. It is a legal document that outlines the terms and conditions of the loan agreement between the borrower and the brokerage. Each section of the document serves a specific purpose, and thus, it is essential to include all necessary details to avoid any confusion or misunderstandings. Option A may seem like a potential answer since it mentions the relationship between the brokerage and the borrower. However, while this information may be relevant, it is not considered a crucial component in the borrower disclosure document. Similarly, option C, which states to comply with laws and codes of conduct, is a necessary practice for all businesses, including brokerages. However, it is not exclusive to the borrower disclosure document and thus does not answer the question appropriately. Option D mentions the inclusion of lawyer's fees, which may also be a relevant piece of information. However, it pertains to a specific aspect of the borrowing process and is not a requirement for the borrower disclosure document. The correct answer, option B, emphasizes the importance of disclosing the brokerage fee to the borrower. It is a key element that must be included in the document as it directly impacts the cost of borrowing for the borrower. Therefore, this choice provides the