Humber/Ontario Real Estate Course 2 Exam Practice

What specific privilege would Owner Meziti seek to replace the first mortgage without disrupting the second?

1. Deferral privilege

2. Non-disruption privilege

3. Postponement privilege

4. Renewal privilege

The correct answer is: Postponement privilege

Owner Meziti would seek to replace the first mortgage without disrupting the second by utilizing a "Postponement privilege." This privilege allows the owner to replace the existing first mortgage with a new one without affecting the position of the second mortgage on the property. This means that the second mortgage would still retain its priority on the property, ensuring that its position remains unchanged even after the first mortgage is replaced. It is important to understand the different privileges associated with mortgages to navigate complex real estate transactions effectively. In this scenario, a postponement privilege would be the most suitable option for Owner Meziti to maintain the status quo of the second mortgage while refinancing the first. The other options are not correct in this context: A. Deferral privilege typically refers to the ability to postpone payment of a debt or obligation to a later date. B. Non-disruption privilege is not a common term in real estate and does not specifically address the situation described. D. Renewal privilege pertains to the option to renew a mortgage at the end of its term, which is not directly related to replacing a first mortgage without affecting the second.