Humber/Ontario Real Estate Course 4 Exam Practice

What is the balance due on closing if Buyer Dudek submits an offer for $252,000 with a $10,000 deposit and arranges a $172,000 first mortgage?

1. $252,000

2. $242,000

3. $70,000

4. Cannot be determined based on the facts provided

5. $172,000

6. $262,000

The correct answer is: $242,000

To determine the balance due on closing when Buyer Dudek submits an offer for $252,000, we need to consider the total purchase price, the deposit made, and the mortgage arranged. The total purchase price is $252,000. Buyer Dudek made a deposit of $10,000, which reduces the amount that needs to be paid at closing. After accounting for the deposit, the remaining balance would initially be calculated as: $252,000 (purchase price) - $10,000 (deposit) = $242,000. Additionally, Buyer Dudek has arranged for a first mortgage of $172,000. However, the mortgage would not adjust the balance due at closing directly; instead, it indicates the amount the buyer will finance. Therefore, at closing, Buyer Dudek still needs to pay the remaining amount after the deposit, confirming that the balance due at closing remains $242,000. Considering these components, the correct amount that Buyer Dudek will have to pay at closing is $242,000.