Humber/Ontario Real Estate Course 2 Exam Practice

Under a buyer representation agreement, when is a brokerage entitled to remuneration?

1. When the buyer enters into an agreement to purchase or lease a property, which generally meets their needs.

2. When the buyer closes a sale related to a property that meets their requirements.

3. When the buyer is introduced to a property that fits their specifications.

4. When the buyer enters into an agreement to purchase a property, but not lease it.

The correct answer is: When the buyer enters into an agreement to purchase or lease a property, which generally meets their needs.

A buyer representation agreement is a legal contract between a buyer and a real estate brokerage, outlining the terms and conditions of their working relationship. In this agreement, the buyer agrees to work exclusively with the brokerage to find and purchase a property. In return, the brokerage is entitled to receive remuneration for their services. The correct answer is A because the buyer representation agreement states that the brokerage will receive payment when the buyer enters into an agreement to purchase or lease a property, which generally meets their needs. This means that the brokerage will receive payment when the buyer has successfully found and secured a property. Options B, C, and D may seem like valid options, but they do not fully encompass the conditions outlined in the buyer representation agreement. Option B only mentions closing a sale, which may not include the full scope of services provided by the brokerage. Option C only mentions introducing the buyer to a property, which may not necessarily result in a successful sale. And option D only mentions purchasing a property, leaving out the possibility of a lease, which is also covered in the buyer representation agreement. Therefore, these options do not accurately describe when the brokerage is entitled to remuneration under a buyer representation agreement.