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NC - POST LICENSING 301- EXAM REVIEW
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NC - POST LICENSING 301- EXAM REVIEW
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NC - POST LICENSING 301- EXAM REVIEWWho must disclose material facts and to whom? - Answers- Only real estate brokers
must discover and disclose material facts to everyone.
All of the following are true EXCEPT:
a) a listing agent has a higher duty to discover and disclose material facts because they
have greater access to the property and information from the seller
b) a broker who relies solely on what their client tells them does so at their peril.
c) buyer agents can rely on the listing company's representations and have no duty to
discover and disclose
d) buyer agents can rely on the listing company's representations and have - Answers-
c) buyer agents can rely on the listing company's representations and have no duty to
discover and disclose
Minimally, how many parties are there in an agency relationship and what are they
called under agency law? - Answers- There must be at least two parties, one is the
agent and the other is the principal
Real estate companies may work with consumers under which of the following agency
options?
a) representing only the property owner
b) representing only the buyer or tenant
c) representing both parties as a dual agent
d) all of the above - Answers- d) all of the above
A buyer asks the listing agent whether all the appliances are in good working order. The
listing agent says yes, although he hasn't personally checked any of the appliances.
The buyer later discovers the dishwasher doesn't work. Which of the following is true?
a) the broker is guilty of negligent omission
b) the broker is guilty of willful misrepresentation
c) the broker is guilty of negligent misrepresentation
d) the broker isn't liable for an innocent, casual statement and the burden was on the
buyer to verify the property condition during his due diligence. - Answers- c) the broker
is guilty of negligent misrepresentation
A broker acting as a buyer agent under a written buyer agency agreement knows the
following about their buyer-client which is a material fact?
a) the buyer is willing to offer $10,000 more than list price
b) the buyer appears to have significant assets, but is highly leveraged
c) the buyer must purchase and close within 45 days
d) the buyer loses their job two weeks before settlement - Answers- d) the buyer loses
their job two weeks before settlement
Seller hires listing company and on the property disclosure statement says that the
property is connected to city water and sewer. The seller knows that she has city water
,and that city sewer is available, but she never connected and is still on septic. Listing
agent makes no attempt to verify and advertises the property as having city water and
sewer. Who is guilty of misrepresentation? - Answers- The seller is guilty of willful
misrepresentation and the listing agent is guilty of negligent misrepresentation
The Unfair and Deceptive Practices Act prohibits misrepresentations, omissions of
material fact, and misleading advertising in a trade or business and applies to: -
Answers- Real Estate Brokers
Before a broker may represent a seller, the broker must have all of the following to
comply with REC rules EXCEPT:
a) the broker must have provided and reviewed the WWREA Disclosure and obtained
the seller's signature, if possible
b) the broker may have an oral listing agreement with the seller for not more than 10
days
c) the agency agreement with the seller must be in writing before the broker may
provide any brokerage services
d) the written agency agreement should be signed by both the seller and the agent -
Answers- b) the broker may have an oral listing agreement with the seller for not more
than 10 days
A broker has a current buyer-client who wants to see a property formerly listed by the
broker, but now listed by a different company. According to the NCREC, what should the
broker disclose to their buyer-client about the seller? - Answers- The broker should tell
their buyer-client what they know about the seller that may influence or affect the
buyer's decision
A real estate company whose policy is that it represents only the buyer or seller in a
transaction is acting as: - Answers- An exclusive agent
A provisional broker at her first listing presentation notices some cracks in the
foundation wall during the walk-through, but doesn't ask her seller about them and says
nothing in agent remarks. Seller checks "no representation" on the property disclosure
form. Who may be guilty of omission? - Answers- The listing agent was aware of a
potential problem, yet failed to inquire further or say anything to prospective buyers.
Which of the following statements is FALSE?
a) a company may be civilly liable for the actions of its affiliated licensees' actions under
agency law
b) a company has no civil liability for its affiliated licensees' actions because they are
paid as independent contractors
c) a BIC will be included in a Letter of Inquiry filed against a provisional broker
d) a BIC may not be involved in a Letter of Inquiry filed against an affiliated full broker -
Answers- b) a company has no civil liability for its affiliated licensees' actions because
they are paid as independent contractors
, A listing agent knows that there is a significant problem with water damage in the crawl
space during heavy rains. The seller checks "no representation" as to drainage issues.
A prospective buyer asks whether or not there are any drainage issues. Of the following,
who may be guilty of misrepresentation? - Answers- The listing agent who replies that
there are no drainage issues
A broker-listing agent is conducting an open house for her seller-client. A former buyer-
client with whom the broker had worked for previously attends. Later that afternoon the
listing agent receives a written offer from that buyer. When presenting the offer to the
seller, the listing agent should: - Answers- Share any information she has about the
buyer with the seller, including the buyer's financial ability or resources and needs or
desires
Which of the following statements is FALSE?
a) a buyer agent may reasonably rely on the representations a listing agent makes
when marketing the property unless there is a "red flag"
b) a listing agent has a heavier burden/duty to discover and disclose latent (hidden)
property defects than a buyer's agent does
c) a buyer agent need not discover and disclose material facts and instead may rely on
the listing agent's representations
d) both listing agents and buyer agents should discover and disclose patent (obvious)
property defects - Answers- c) a buyer agent need not discover and disclose material
facts and instead may rely on the listing agent's representations
Which of the following is a material fact?
a) that the streets in the neighborhood are privately maintained by the owner's
association
b) that the seller replaced the roof 8 years ago using architectural shingles
c) that the dual HVAC system was installed 3 years ago and is still under warranty
d) that the exterior or siding is hardiplank - Answers- a) that the streets in the
neighborhood are privately maintained by the owner's association
All of the following may lead to an express or implied agency agreement EXCEPT:
a) an express agreement between the principal and agent authorizing the agent to act
on the principal's behalf
b) the agent begins to advise the consumer and negotiate on their behalf
c) compensation to the agent must be paid by the principal
d) the broker begins gathering confidential information about the consumer - Answers-
c) compensation to the agent must be paid by the principal
An actively licensed real estate broker has a written contract with a company stating
that he will not be treated as an employee for federal income tax purposes. The
licensee's entire income is from sales commissions rather than an hourly wage. While
the licensee probably will be treated by the IRS much like an independent contractor,
technically the licensee is: - Answers- a statutory non-employee
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