Humber/Ontario Real Estate Course 2 Exam Practice

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When a buyer submits a deposit with an agreement of purchase and sale, it:

  1. Ultimately forms part of the downpayment.

  2. Can be made by electronic funds transfer, but not by bank draft.

  3. Can be submitted 'herewith' or 'as otherwise described in the agreement,' but not 'upon acceptance.'

  4. Must be in the form of a certified cheque.

The correct answer is: Ultimately forms part of the downpayment.

When a buyer submits a deposit with an agreement of purchase and sale, it ultimately forms part of the downpayment. This means that the deposit will go towards the total downpayment amount that the buyer needs to pay for the property. The deposit shows the buyer's serious intent to purchase the property and is a sign of commitment in the transaction. It is commonly held in trust by a brokerage or lawyer until the completion of the sale.

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