An Ontario mortgage broker, Sarah, is arranging a first mortgage for a client buying an unzoned 50-acre rural property in Northern Ontario that has no current municipal services (water, sewer) and is only accessible via a private road. The client intends to build a self-sustainable cabin. Which of the following risks is most pronounced for a potential lender considering this property?

Question: An Ontario mortgage broker, Sarah, is arranging a first mortgage for a client buying an unzoned 50-acre rural property in Northern Ontario that has no current municipal services (water, sewer) and is only accessible via a private road. The client intends to build a self-sustainable cabin. Which of the following risks is most pronounced for a potential lender considering this property?

Answer options: ✅ The property's low marketability and potential difficulty in resale.

• The client’s credit score and employment history.
• The potential for cost overruns during cabin construction.
• The risk of the client defaulting due to personal illness.

Correct answer: The property's low marketability and potential difficulty in resale.

Explanation: Properties lacking essential services, clear zoning, and easy access typically have a very limited buyer pool, significantly impacting their marketability and liquidity, making them harder for a lender to dispose of in case of default.