Humber/Ontario Real Estate Course 2 Exam Practice

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Prepare for the Ontario Real Estate Exam with our comprehensive Humber Course 2 Exam Practice quiz. Engage with multiple choice questions and detailed explanations, designed to help you excel.

Each practice test/flash card set has 50 randomly selected questions from a bank of over 500. You'll get a new set of questions each time!

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When does seller financing typically occur in real estate transactions?

When the buyer needs additional funds to cover the purchase price and the seller provides a loan.
When the buyer has secured a mortgage for the full purchase price.
When the property is purchased purely with cash.
When the property is in a highly competitive market.
When the buyer and seller cannot agree on the purchase price.
When the buyer has more funds than required for the purchase.

The correct answer is: When the buyer needs additional funds to cover the purchase price and the seller provides a loan.

Seller financing typically occurs in real estate transactions when the buyer needs additional funds to cover the purchase price, and the seller provides a loan. This option is correct because seller financing involves the seller acting as a lender and providing financing to the buyer, allowing the buyer to purchase the property without the need for a traditional mortgage from a financial institution. This option aligns with the definition and common occurrence of seller financing in real estate transactions. The other options are incorrect: - Option B, when the buyer has secured a mortgage for the full purchase price, does not involve seller financing as the buyer is obtaining financing from a financial institution, not the seller. - Option C, when the property is purchased purely with cash, does not involve seller financing as there is no financing provided by the seller to the buyer. - Option D, when the property is in a highly competitive market, does not necessarily dictate the presence of seller financing in the transaction. - Option E, when the buyer and seller cannot agree on the purchase price, does not specifically address the aspect of financing in the transaction. - Option F, when the buyer has more funds than required for the purchase, also does not involve seller financing as the buyer has sufficient funds without the need for additional financing from the seller.