A buyer submits an offer with a condition for financing approval within 5 business days. What happens if the buyer cannot secure financing by the deadline?
Correct Answer
C) The buyer can withdraw from the agreement without penalty
When a condition is not satisfied or waived by the specified deadline, the buyer can typically withdraw from the agreement without penalty and receive their deposit back. Conditions are designed to protect buyers from circumstances beyond their control.
Why This Is the Correct Answer
When a financing condition is not satisfied by the specified deadline, the buyer has the legal right to withdraw from the purchase agreement without penalty. This is the fundamental purpose of conditions - to protect buyers from circumstances beyond their control. The buyer can terminate the contract and receive their full deposit back, as the condition was not fulfilled within the agreed timeframe.
Why the Other Options Are Wrong
Memory Technique
Exam Tip for Residential Trading
Common Mistakes to Avoid on Residential Trading Questions
More Residential Trading Questions
What does a condition precedent in an offer to purchase allow the buyer to do?
What is the primary purpose of a buyer representation agreement in residential real estate transactions?
Which residential property type typically offers individual ownership of the unit plus a share in common elements?
What is the primary benefit of title insurance for residential property buyers?
In an Ontario resale offer, how long is the period for fulfilling or waiving a financing or inspection condition?
- → A buyer's lawyer requests a status certificate and pays the fee on May 1. The corporation never delivers it. After closing, the corporation claims the seller owed $3,000 in common expense arrears and demands it from the buyer, who relied on the silence. What is the effect under s. 76 of the Condominium Act, 1998?
- → A status certificate delivered to a buyer omits a $4,000 special assessment that the board levied against the unit after the current budget date to increase the reserve fund. The buyer relied on the certificate and closed. Under the Condominium Act, 1998, what is the result?
- → A seller's salesperson is estimating the buyer's costs of reviewing an Ontario condominium unit's status certificate. What is the most the corporation may charge for providing the certificate?
- → A listing salesperson expects offers next week on a resale condominium unit and knows buyers will want the status certificate. By when must the corporation give a status certificate once it is requested?
- → An investor buyer wants to know how many units in a condominium building were rented last year before making an offer. Which document must state the number of units for which the corporation received lease notices during the preceding fiscal year?
- → What is the most common type of residential property ownership in Canada?
- → A buyer reviewing a status certificate asks what the condominium's reserve fund may be spent on. Under the Condominium Act, 1998, what is the permitted purpose?
- → An established Ontario condominium corporation completed its most recent reserve fund study in 2024. Under O. Reg. 48/01, when must it complete its next reserve fund study?
- → A buyer's status certificate shows that the corporation received a new reserve fund study two months ago, and the board has not yet sent owners anything about it. What does the Condominium Act, 1998 require of the board?
- → The seller of a condominium unit got board approval and signed a registered s. 98 agreement with the corporation to install a hot tub on her exclusive-use terrace, taking on its repair and insurance costs. How does that agreement affect the buyer?
People Also Study
Real Property Law
60 questions
Contracts & Agreements
60 questions
Agency & Professional Ethics
60 questions
Mortgage & Real Estate Finance
60 questions
Related Study Resources
Helpful Resources
Previous Question
A buyer's offer contains a financing condition to be fulfilled or waived within five business days after acceptance. The seller accepts on a Tuesday, and there are no holidays that week or the next. Counting from the day after acceptance, what is the last day to fulfill or waive the condition?
Next Question
A buyer submits an offer with a financing condition that expires in 5 business days. On day 3, they receive mortgage approval. What should happen next?