Humber/Ontario Real Estate Course 2 Exam Practice

If a buyer wants an option to purchase a property but not the obligation, which document might they use?

1. Right of first refusal

2. Exclusive agency agreement

3. Leasehold agreement

4. Option to purchase

5. Exclusive right to sell

6. Listing agreement

The correct answer is: Option to purchase

An option to purchase gives the buyer the right, but not the obligation, to purchase a property within a certain period of time at a predetermined price. The other options listed are not the appropriate documents for this scenario. A right of first refusal is when the property owner grants someone the opportunity to purchase the property before it is offered to another party. An exclusive agency agreement is an agreement between a seller and a real estate agent, where the agent has the exclusive right to sell the property but the seller retains the right to sell it on their own without paying commission to the agent. A leasehold agreement is a contract between a property owner and a tenant, specifying the terms and conditions of the tenant's use of the property. An exclusive right to sell is similar to an exclusive agency agreement, where the agent has the exclusive right to sell the property and is entitled to commission regardless of who finds the buyer. A listing agreement is a contract between a property owner and a real estate agent, outlining the terms and conditions for marketing and selling the property. It does not give the buyer any option to purchase the property. Therefore, the correct choice for a buyer looking for an option to purchase a property but not the obligation is a document specifically titled "Option to