Humber/Ontario Real Estate Course 3 Exam Practice

What should happen if an electrical inspection reveals a wiring issue in a property with a conditional sale?

1. The buyer must cancel the agreement immediately and notify the seller.

2. The buyer would need a second inspection at their cost if the seller contests the findings.

3. The parties would sign an amendment to fix the issue before closing.

4. The seller is responsible for immediately fixing the problem.

5. The buyer must proceed without rectifying the issue.

6. The sale must be renegotiated entirely.

The correct answer is: The parties would sign an amendment to fix the issue before closing.

The option indicating that the parties would sign an amendment to fix the issue before closing is correct because it aligns with standard practices in real estate transactions involving conditional sales. When an inspection reveals problems such as wiring issues, the buyer typically has the right to negotiate repairs with the seller instead of canceling the sale or proceeding without rectifying the problem. In most cases, the buyer will present the inspection findings to the seller, who can then agree to make the necessary repairs, provide a credit towards the repairs at closing, or negotiate other terms that fit both parties. Drafting an amendment allows for legal clarity and assurance that the agreed-upon repairs will take place prior to the closing of the sale. This approach maintains the interest of both the buyer and seller, ensuring the transaction can move forward amicably and with the necessary safety guarantees for the buyer.