Humber/Ontario Real Estate Course 2 Exam Practice

For a counter offer to be valid, what minimum changes should be made to the original offer?

1. Changing the deposit amount and closing date.

2. Updating terms and seller's name.

3. Change price and irrevocable clause.

4. Change any two terms.

5. Seller contacts buyer with new terms.

6. Only price adjustment is required.

The correct answer is: Change price and irrevocable clause.

To have a valid counter offer, changes must be made to the original offer that constitute a clear rejection of the original terms and a proposal of new terms. In this case, changing the price and including an expiration clause (irrevocable clause) in the counter offer clearly distinguishes it from the original offer, making it a valid counter offer. Option A is incorrect as only changing the deposit amount and closing date may not be substantial enough to constitute a valid counter offer. Option B is not correct because updating the terms and the seller's name alone may not be enough to show a clear rejection of the original offer. Option D is incorrect because simply changing any two terms may not be sufficient to clearly distinguish the counter offer from the original offer. Option E is incorrect because the seller contacting the buyer with new terms does not fulfill the requirement of a counter offer, which necessitates a response from the buyer rejecting the original offer. Option F is also incorrect because only adjusting the price is not enough to make the counter offer valid; it must include changes to other terms as well.