Humber/Ontario Real Estate Course 4 Exam Practice

When is a brokerage entitled to remuneration according to the buyer representation agreement?

1. Upon closing of a property that meets the conditions specified

2. When the buyer finds a property that meets their needs and signs a new agreement

3. When the buyer is introduced to a property that meets their needs

4. On signing of an agreement to lease or purchase a property meeting specified needs

5. Upon closing if it is a purchase; leases do not apply

6. When the buyer signs an agreement, excluding properties not suitable to their needs

The correct answer is: Upon closing of a property that meets the conditions specified

The correct answer highlights that a brokerage is entitled to remuneration only upon the successful closing of a property that fulfills the conditions outlined in the buyer representation agreement. This principle is rooted in the nature of real estate transactions, where the brokerage's efforts culminate in a transaction that is finalized with the transfer of ownership. Remuneration is typically contingent upon a successful closing because this is when a legal obligation is fulfilled, and the commission is usually predetermined based on this final transaction. Thus, it aligns with the standard practices and expectations within real estate brokerage agreements that the entitlement to compensation occurs when the transaction is completed satisfactorily. The other options either imply conditions that do not constitute a binding agreement or completion of a transaction, such as simply introducing a buyer to a property or signing preliminary agreements that do not lead to an actual purchase or lease. These scenarios do not meet the necessary criteria for triggering remuneration under a buyer representation agreement.