Humber/Ontario Real Estate Course 2 Exam Practice

How does a holdover provision affect remuneration if a property is re-listed and sold?

1. Previous brokerage is owed remuneration if sold within the holdover period.

2. Only new listing brokerage is entitled to remuneration.

3. No remuneration owed if property is re-listed at a higher rate.

4. Holdover provision waived if new listing is signed.

5. Both brokerages share the remuneration equally.

6. No remuneration is due to any party if re-listed.

The correct answer is: Previous brokerage is owed remuneration if sold within the holdover period.

A holdover provision affects remuneration by stipulating that the previous brokerage is owed remuneration if the property is sold within the holdover period, even if a new listing agreement is signed with a different brokerage. This means that if the property is re-listed and sold within the specified holdover period, the original brokerage is entitled to their agreed-upon remuneration. This provision ensures that the original brokerage is compensated for their efforts in initially finding the buyer, even if another brokerage is involved in the final sale. On the other hand, the other options are incorrect because: - Option B: Only stating that the new listing brokerage is entitled to remuneration is not accurate under a holdover provision. - Option C: The holdover provision does not necessarily relate to the rate at which the property is re-listed. - Option D: The holdover provision does not necessarily get waived if a new listing is signed. - Option E: The remuneration entitlement is typically not shared equally between both brokerages under a holdover provision. - Option F: In most cases, remuneration is due to either the previous or the new brokerage involved, depending on the terms of the holdover provision and the sale of the property.