Humber/Ontario Real Estate Course 2 Exam Practice

If Salesperson Jordan contacts a property owner selling independently and secures a $5,000 bonus for their client if the client buys the property, what must be disclosed?

1. No disclosure to the buyer is necessary as there is no conflict of interest.

2. Only the fact that a bonus is being received, not the amount.

3. The entire bonus amount must be disclosed to the buyer client.

4. This arrangement must be withheld from the buyer to avoid confusion.

5. The buyer’s agreement should be amended to include provisions for the bonus.

6. Disclosure is only required if negotiated with the brokerage's approval.

The correct answer is: No disclosure to the buyer is necessary as there is no conflict of interest.

In this scenario, Salesperson Jordan secured a $5,000 bonus for their client if the client purchases a property from a property owner selling independently. The correct answer is, therefore, "No disclosure to the buyer is necessary as there is no conflict of interest." The reason for this is that in this situation, the bonus is being provided by the property owner to Salesperson Jordan's client as an incentive to purchase the property, and it does not create a conflict of interest between the buyer and the salesperson. Since the bonus is a benefit for the client and does not impact the buyer's decision-making process or introduce any conflicts, there is no need to disclose the bonus amount to the buyer. It is important to note that transparency and disclosure are essential in real estate transactions, especially when conflicts of interest may arise. However, in this case, since the bonus is a benefit to the client and does not affect the buyer's position or decision-making process, disclosure to the buyer is not required.