What Happens When Seller Amari Discharges the Mortgage at Closing?

When it comes to real estate transactions, understanding the ins and outs of mortgage discharges can feel like navigating a maze. One crucial aspect is knowing what happens when Seller Amari discharges the existing mortgage at closing. This issue often comes up in the Humber/Ontario Real Estate Course 2 Exam, so let's break it down together.

Picture this: it’s closing day, and Seller Amari has an existing mortgage on the property. By discharging this mortgage, Amari is essentially saying goodbye to that old financial obligation. But what does this mean for the transaction? Well, the existing mortgage is typically discharged after closing. This means that Amari is responsible for settling the mortgage debt either on or just after the closing date. Why is this so vital? Because it ensures that the property being sold will be free and clear of any encumbrances, allowing for a smooth transfer of ownership to the buyer.

Now, you’ve got options on the table—six, to be exact. Options like A suggest that the mortgage gets paid off before funds change hands, or C, which implies the responsibility shifts to the buyer. Spoiler alert: these options are incorrect. In reality, the responsibility of paying off the mortgage lies squarely with the seller. This is standard practice in the realm of real estate, designed to protect both parties involved.

Here’s the thing: upon closing, once that mortgage is discharged, any potential for the new owner to deal with seller liabilities evaporates. Isn’t that comforting to know? It’s all about ensuring a seamless transition, no strings attached. After all, no one wants to inherit a pile of debt along with their new home.

Now, what if you’re wondering about the specifics? Maybe you want to know about potential clauses that could come into play? While Option D suggests a special clause must be added for the mortgage discharge, that’s not the case here. The standard procedure fulfills all necessary legal requirements without needing any special arrangements—now that's worth noting for anyone gearing up for the exam, isn’t it?

Let’s take a quick tangent here: have you noticed how understanding these technicalities can empower you as a future real estate professional? It’s about more than just passing an exam; you’re gearing up for real-world scenarios where knowledge is key. When you’re faced with clients, you want to be the trusted expert they need, not someone fumbling through the fine print.

To sum up: by discharging the existing mortgage after closing, Seller Amari is ensuring that their property is free of any encumbrances, making it a clear slate for the buyer. The seller holds all responsibility for paying off the mortgage, which is a typical procedure within real estate transactions. So as you prepare for your exams, keep this piece of knowledge in your back pocket—it might just be the one that sets you apart!

And remember, mastering these concepts not only positions you as a capable agent but also arms you with the confidence to handle transactions smoothly. Knowledge is power, and you’re well on your way to becoming a seasoned pro in the real estate field!