A mortgage brokerage receives a prospective client's mortgage application fee of $750. The client subsequently withdraws their application within 24 hours of submission, as permitted by the brokerage's written fee agreement. If the brokerage's policy states that administrative costs incurred for initial processing are $150, what amount, if any, must be returned to the client from the trust account, assuming the $750 was properly deposited?

Question: A mortgage brokerage receives a prospective client's mortgage application fee of $750. The client subsequently withdraws their application within 24 hours of submission, as permitted by the brokerage's written fee agreement. If the brokerage's policy states that administrative costs incurred for initial processing are $150, what amount, if any, must be returned to the client from the trust account, assuming the $750 was properly deposited?

Answer options: ✅ $600

• $0
• $750
• $150

Correct answer: $600

Explanation: If the client withdraws as per the fee agreement and administrative costs are $150, the brokerage is entitled to collect only the $150 from the trust account for services rendered. The remaining balance ($750 - $150 = $600) must be returned to the client from the trust account. This adheres to the rules for handling client funds and fee agreements under provincial regulations.