Humber/Ontario Real Estate Course 4 Exam Practice

What should occur if a buyer cannot get financing and wants a deposit back?

1. Broker of record's approval is needed

2. Mutual consent from both parties is required

3. No written authorization is needed from parties

4. Only the seller's consent is needed

5. Salesperson can return the deposit directly

6. Written authorization is unimportant

The correct answer is: Mutual consent from both parties is required

In the context of real estate transactions, if a buyer is unable to secure financing and requests the return of their deposit, mutual consent from both parties is necessary to process the return of funds. This requirement is in place to protect the interests of both the buyer and the seller, ensuring that the seller agrees to the return of the deposit. The principle behind mutual consent is that the deposit is an integral part of the contract, and without both parties' agreement, it cannot simply be returned to the buyer. This prevents any potential disputes over the deposit and maintains the integrity of the transaction process. Even if a buyer is unable to obtain financing, it does not automatically entitle them to a return of their deposit without the seller's approval. Thus, both parties must agree to the return of the deposit based on the terms outlined in their contract. In contrast, other options imply a different process or necessity that does not align with the requirement for mutual agreement, making them incorrect in this context.