Humber/Ontario Real Estate Course 4 Exam Practice

When Seller Norris signs a seller representation agreement, which of the following is true?

1. Is responsible for remuneration for selling the property plus any additional expenses incurred by the brokerage.

2. Gives an implied authority to the listing brokerage to permit other brokerages to participate in selling the property.

3. Agrees that the listing brokerage or its representative can sign an agreement of purchase and sale on his behalf.

4. Gives the brokerage the authority to receive a deposit relating to an agreement of purchase and sale.

5. Allows the brokerage to decide the final selling price of the property.

6. Permits the brokerage to schedule open houses at their discretion.

The correct answer is: Gives the brokerage the authority to receive a deposit relating to an agreement of purchase and sale.

The selection of the correct answer indicates that when Seller Norris signs a seller representation agreement, he grants the brokerage the authority to receive a deposit related to an agreement of purchase and sale. This is significant because it reflects the brokerage’s role in facilitating the transaction and signifies that the brokerage has the authority to handle funds in connection with the sale process. This authority is vital for practical transaction processes as it builds trust and confidence in the real estate dealings between the seller, the purchaser, and the brokerage. In the context of real estate transactions, the brokerage must be equipped to manage deposits so that the transaction proceeds smoothly, ensuring compliance with regulations and protecting the interests of all parties involved. The other options present aspects of the agreement that do not necessarily fall under the standard authority granted through a seller representation agreement. For instance, while the brokerage might work collaboratively with other brokerages to sell the property, this does not imply they have the authority to decide on all participation aspects without the seller's consent. Similarly, the brokerage can provide guidance on price decisions and schedule open houses, but the ultimate authority rests with the seller rather than the brokerage independently deciding these terms.