OREA Ontario Real Estate Law 3

Question 1

In Ontario, what is the 'Land Transfer Tax' and when is it payable?

Accepted Answer

A tax payable by the buyer upon registration of the transfer of property

Answer

The Ontario Land Transfer Tax is a provincial tax payable by the buyer at the time of registration of the property transfer. The amount is calculated based on the purchase price using a graduated rate structure.

Question 2

Under Ontario law, what is the effect of a 'right of first refusal' on a property?

Accepted Answer

It gives the holder the right to match any third-party offer before the property is sold to someone else

Answer

A right of first refusal gives the holder the opportunity to match a bona fide third-party offer before the property owner can sell to that third party. It does not set the price — it simply gives the holder a matching right.

Question 3

What is the 'Growth Plan for the Greater Golden Horseshoe' and how does it affect real estate?

Accepted Answer

It is a provincial plan that directs growth, density, and land use patterns in the Greater Golden Horseshoe region

Answer

The Growth Plan is a provincial policy framework that guides land use planning and development in the Greater Golden Horseshoe region, directing growth to built-up areas, setting density targets, and protecting agricultural and natural areas.

Question 4

Under Ontario's Mortgages Act, what is the difference between 'foreclosure' and 'power of sale'?

Accepted Answer

Foreclosure requires a court process and the lender takes title; power of sale is a contractual remedy allowing sale without full court proceedings

Answer

Foreclosure is a court-supervised process where the lender obtains ownership of the property. Power of sale is a contractual right in the mortgage that allows the lender to sell the property without going through full court proceedings, which is more common in Ontario.

Question 5

In Ontario, what is the significance of the 'Escheats Act' in real estate?

Accepted Answer

It provides that property of a person who dies without heirs reverts to the Crown

Answer

The Escheats Act provides that when a person dies without a will and without any heirs, their property reverts (escheats) to the Crown (provincial government). This ensures property is never truly ownerless.

Ontario Real Estate Practice Test

Ontario Real Estate Practice Test

OREA Ontario Real Estate Law 3