Humber/Ontario Real Estate Course 1 Exam Practice

What are a bank's options when foreclosing on a residential property?

1. Selling must be done by a registered brokerage.

2. It can sell the property itself or use a real estate brokerage.

3. The property must be sold directly to a buyer without brokerage marketing.

4. It needs to hire a mortgage broker to sell the foreclosed property.

5. It is required to list the property in a public auction.

6. Selling must be done through the government property auction platform.

The correct answer is: It can sell the property itself or use a real estate brokerage.

The correct choice highlights that a bank has the flexibility to sell a foreclosed property either on its own or by engaging a real estate brokerage. This option reflects the practical approach that lenders can take following foreclosure; banks often have the resources, market knowledge, and capability to handle property sales independently. However, enlisting a real estate brokerage can also maximize exposure and streamline the sales process. Other options introduce limitations or requirements that are not typically true regarding the bank's options. For example, a bank is not mandated to sell through a registered brokerage or directly to a buyer without marketing efforts. Additionally, there is no requirement for the bank to conduct a public auction or use government platforms for property sales. Therefore, the correct choice acknowledges the autonomy banks have in deciding how to handle the sale of foreclosed residential properties.