Humber/Ontario Real Estate Course 2 Exam Practice

Mr. and Mrs. James are struggling financially and the balance on their first mortgage is close to their home's value. What legal option allows them to transfer the title to the lender to release them from the mortgage?

1. Foreclosure

2. Power Of Sale

3. Quit Claim Deed

4. Judicial Sale

5. Equitable Redemption

6. Deed in Lieu of Foreclosure

The correct answer is: Quit Claim Deed

A Quit Claim Deed allows Mr. and Mrs. James to transfer the title to the lender and release them from the mortgage. A Quit Claim Deed is a legal document used to transfer interest in real property. It effectively transfers any interest the grantor has in the property, but it does not provide any guarantees about the extent of that interest or whether there are any other claims against the property. The other options are incorrect because: - Foreclosure is a legal process where the lender takes possession of the property due to a default on the mortgage. - Power of Sale is a clause in the mortgage contract that allows the lender to sell the property if the borrower defaults on the mortgage. - Judicial Sale is a court-supervised process where the property is sold to repay a debt. - Equitable Redemption allows the borrower to pay off the debt and prevent foreclosure. - Deed in Lieu of Foreclosure is a voluntary transfer of the property to the lender to avoid foreclosure.