Humber/Ontario Real Estate Course 3 Exam Practice

Which clause is designed to give a buyer the ability to waive a specified condition in the contract?

1. Acceleration clause

2. Arbitration clause

3. Contingency clause

4. Expiration clause

5. Finance clause

6. Waiver clause

The correct answer is: Waiver clause

The waiver clause allows a buyer to forgo or eliminate a specific condition or requirement stipulated in the contract, thereby providing flexibility in the transaction. For example, if a buyer has an inspection contingency in place but is satisfied with the property's condition, they can use the waiver clause to move forward without needing to fulfill that condition. This provision facilitates a smoother transaction process by empowering buyers to take decisive action while providing clarity and mutual understanding in the terms of the agreement. In this context, the other options do not serve the same purpose. An acceleration clause typically pertains to loans, allowing lenders to demand full repayment under certain conditions. An arbitration clause outlines how disputes will be resolved, rather than addressing conditions within the contract. A contingency clause introduces specific conditions that must be met for the contract to proceed, while an expiration clause specifies when the contract becomes void. Lastly, a finance clause covers the conditions related to financing but does not allow for waiving such conditions, making the waiver clause the most suitable choice for enabling a buyer to forgo a specified condition.