Humber/Ontario Real Estate Course 4 Exam Practice

Which of the following is accurate regarding an offer with a $575,000 purchase price, $25,000 deposit upon acceptance, a $50,000 supplementary deposit upon removal of conditions, and a home inspection conditional clause?

1. The balance due on closing in this offer is $500,000

2. The deposits must be kept in an interest-bearing account

3. The home inspection clause is unnecessary because of preprinted clauses

4. The included chattels are not properly described

5. Both deposits must be paid within 48 hours

6. The offer must be revised to include additional terms

The correct answer is: The balance due on closing in this offer is $500,000

The accurate statement regarding the offer in question is that the balance due on closing is indeed $500,000. This conclusion is reached by assessing the total purchase price of $575,000 and deducting the total deposits made, which consist of the initial deposit of $25,000 and the supplementary deposit of $50,000. When these deposits are summed up, they total $75,000. To find the balance due on closing, you subtract this total deposit amount from the purchase price: $575,000 (purchase price) - $75,000 (total deposits) = $500,000 (balance due on closing). This calculation demonstrates the core financial transaction aspect in real estate purchases, highlighting the importance of understanding how deposits affect the final amount owed at closing. Other options do not accurately describe the terms related to deposits, conditions, chattels, or necessary revisions to the offer.