OREA Residential Transactions 2

Question 1

In Ontario, what is the typical deposit amount in a residential transaction?

Accepted Answer

There is no standard — it is negotiable, but typically 5% of the purchase price

Answer

Exactly 20% of the purchase price

Answer

A flat fee of $1,000 regardless of purchase price

Answer

10% is required by law

Question 2

What is a 'seller's disclosure statement' in Ontario residential real estate?

Accepted Answer

A voluntary form (SPIS — Seller Property Information Statement) where the seller provides information about the property's condition and history

Answer

A mandatory government form required for all sales

Answer

A financial statement showing the seller's income

Answer

A document disclosing the seller's reason for selling

Question 3

In Ontario, what is the significance of the 'closing date' in a residential transaction?

Accepted Answer

It is the date when ownership is transferred, the purchase price is paid, and the buyer receives possession of the property

Answer

It is the date the listing expires

Answer

It is the date the offer was accepted

Answer

It is the date the conditions must be waived

Question 4

What is the 'Toronto Municipal Land Transfer Tax' and who pays it?

Accepted Answer

An additional land transfer tax imposed by the City of Toronto on the buyer, in addition to the provincial land transfer tax

Answer

An annual tax paid by all Toronto property owners

Answer

A tax paid by the seller when selling in Toronto

Answer

A federal tax on Toronto properties

Question 5

In Ontario, what is a 'pre-approval' for a mortgage?

Accepted Answer

A preliminary assessment by a lender indicating the amount a buyer can likely borrow, subject to property appraisal and final approval

Answer

A binding commitment from a lender to provide a mortgage

Answer

A government guarantee of mortgage financing

Answer

A pre-payment of the down payment

Question 6

What is the purpose of a 'holdback' in an Ontario residential transaction?

Accepted Answer

A portion of the purchase price retained by the buyer's lawyer to ensure specific conditions or repairs are completed

Answer

Money held by the real estate agent as commission

Answer

The seller's down payment on a new property

Answer

Government taxes withheld at closing