Humber/Ontario Real Estate Course 2 Exam Practice

Which of the following is true about the financing statement on a listing agreement?

1. It confirms there are no liens against the property

2. It describes the grade and quality of properties around it

3. It indicates all existing mortgages and balances

4. It provides the history of property tax payment

5. It verifies the seller's income details

The correct answer is: It indicates all existing mortgages and balances

The correct answer is C, as the financing statement on a listing agreement indicates all existing mortgages and balances. This is crucial information for both the seller and the potential buyer as it provides clarity on the financial obligations tied to the property. It helps interested parties understand the current financial standing of the property and any existing financial encumbrances that need to be addressed during the transaction process. Options A, B, D, and E are incorrect: A. It confirms there are no liens against the property - This statement is not accurate as the financing statement typically discloses existing mortgages and not the absence of liens. B. It describes the grade and quality of properties around it - This information is not typically included in the financing statement, as it is more focused on the property's financial aspects. D. It provides the history of property tax payment - While important, the history of property tax payments is usually documented separately and not within the financing statement. E. It verifies the seller's income details - The verification of the seller's income details is not typically part of the financing statement on a listing agreement, as it primarily deals with mortgage information.