North Carolina Real Estate (State Only
Exam Review) And All Correct
Answers Graded A+(2025-2026).
Which of the following statements is true regarding Ad Valorem taxation in North Carolina?
1. Real property is taxed according to its most recent sale price.
2. The Machinery Act requires reassessment tax purposes every 4 years.
3. Real property taxes and special assessments constitute an involuntary lien against property
on January 1st of the next year.
4. Tax rates are effective until the next revaluation year. - Answer 3. Real property taxes and
special assessments constitute an involuntary lien against property on January 1st of the text
year
Explanation
Real property is taxed according to its assessed value, not sale price. The Machinery Act
requires that properties be assessed at least once every 8 years (octennial appraisal). Tax rates
can be changed every year and not set by the Machinery Act, rather by budget of the
municipality.
John recently retired and moved to a coastal community located in North Carolina. He decided
to seek opportunities to supplement his retirement income by responding to an advertisement
to become a timeshare salesman. John is told by the developer no license is required to sell a
timeshare as he will be paid a flat fee for each timeshare sold is the developer correct?
1. No. In order to sell time shares an individual will need to obtain a timeshare sales license.
2. No. In order to sell timeshares an individual will need to obtain a North Carolina real estate
license.
3. Yes. So long as an individual is not paid a percentage based commission there is no
requirement to obtain a time share salesman license.
4. Yes. Timeshare sales fall under vacation property sales and therefore are exempt from the
typical licensing requirements. - Answer 2. No. In order to sell timeshares an individual will
need to obtain a North Carolina real estate license.
Explanation
,1. A provisional broker acting as the seller's agent is required to safeguard an option money
check until effective and they must deliver it directly to the seller.
2. An agent representing a buyer must submit an offer to purchase to the seller or sellers agent
immediately or no later than 7 days.
3. When earnest money is paid with an effective contract it must be deposited within 5 banking
days of receipt.
4. A broker is not permitted to accept an earnest money deposit if it is tender in cash. - Answer
1. Option fee and due diligence fee checks are made payable to the seller and delivered once
the contract becomes effective. Offers and contracts must be delivered within five days. Earnest
money must be deposited the later of three banking days from the effective date of the contract
or receipt. While it is not recommended that a broker accept cash, it is permitted. When cash is
tendered for earnest money or due diligence, it must be deposited immediately but no later
than three banking days.
Explanation
Option fee and due diligence fee checks are made payable to the seller and delivered once the
contract becomes effective. Offers and contracts mut be delivered within 5 days. Earnest money
must be deposited the later of 3 banking days from the effective date of the contract or receipt.
While it is not recommended that a broker accept cash, it is permitted. When cash is tendered
for earnest money r due diligence, it must be deposited immediately but no later than 3
banking days.
All of the following statements are true regarding a broker-in-charge, EXCEPT:
1. A brokerage operating as a sole proprietorship must appoint a broker-in-charge in order to
handle trust funds and advertise property.
2. A broker-in-charge must notify the Commission when a change in his or her status occurs.
3. A broker-in-charge is responsible for maintaining transaction records and notification of a
change in address of the firm to the Commission.
4. A broker-in-charge has a duty to supervise all brokers affiliated with the firm with regard to
violations of license law. - Answer 4. A broker-in-charge has a duty to supervise all brokers
affiliated with the firm with regard to violations of license law.
, A buyer's agent is responsible for which of the following in regard to the Closing Disclosure?
1. The accuracy of all items on the Closing Disclosure.
2. The accuracy of all items the buyer which they are reasonably aware.
3. The correct distribution of proceeds of sale
4. To ensure that buyer has title insurance coverage. - Answer 2. The accuracy of all items the
buyer which they are reasonably aware.
Explanation
Accuracy of all items for the buyer of which he has knowledge. The agent would not be
responsible for calculating the seller payoff or aggregate accounting adjustments (set by RESPA).
A residential tenant in North Carolina complains of a defect with the heating system and his unit
is heating system is not working and the February temperatures are falling into the low 20's
what are the following statements is most accurate?
1. The tenant may vacate after providing written notice to the landlord and waiting a reasonable
period of time.
2. The tenant can make the repair and reduce rent by that amount.
3. The tenant may remove himself from the property have a more continue to pay the rent until
the court order is the tank
4. The tenant may withhold work in a designated account into work is done. - Answer 1. The
tenant may vacate after providing written notice to the landlord and waiting a reasonable
period of time.
Explanation
The tenant may remove himself from the property and then stop paying rent. Remember that a
tenant may never withhold rent while in possession of the property tenant cannot make repairs
and seek compensation from the landlord or reduce rental payment by the amount.
A Landlord hired a broker to manage his residential rentals. The landlord request that several
provisions be added to the standard lease provided by the Realtor Association. Which of the
following is NOT an acceptable suggestion by the agent?
Exam Review) And All Correct
Answers Graded A+(2025-2026).
Which of the following statements is true regarding Ad Valorem taxation in North Carolina?
1. Real property is taxed according to its most recent sale price.
2. The Machinery Act requires reassessment tax purposes every 4 years.
3. Real property taxes and special assessments constitute an involuntary lien against property
on January 1st of the next year.
4. Tax rates are effective until the next revaluation year. - Answer 3. Real property taxes and
special assessments constitute an involuntary lien against property on January 1st of the text
year
Explanation
Real property is taxed according to its assessed value, not sale price. The Machinery Act
requires that properties be assessed at least once every 8 years (octennial appraisal). Tax rates
can be changed every year and not set by the Machinery Act, rather by budget of the
municipality.
John recently retired and moved to a coastal community located in North Carolina. He decided
to seek opportunities to supplement his retirement income by responding to an advertisement
to become a timeshare salesman. John is told by the developer no license is required to sell a
timeshare as he will be paid a flat fee for each timeshare sold is the developer correct?
1. No. In order to sell time shares an individual will need to obtain a timeshare sales license.
2. No. In order to sell timeshares an individual will need to obtain a North Carolina real estate
license.
3. Yes. So long as an individual is not paid a percentage based commission there is no
requirement to obtain a time share salesman license.
4. Yes. Timeshare sales fall under vacation property sales and therefore are exempt from the
typical licensing requirements. - Answer 2. No. In order to sell timeshares an individual will
need to obtain a North Carolina real estate license.
Explanation
,1. A provisional broker acting as the seller's agent is required to safeguard an option money
check until effective and they must deliver it directly to the seller.
2. An agent representing a buyer must submit an offer to purchase to the seller or sellers agent
immediately or no later than 7 days.
3. When earnest money is paid with an effective contract it must be deposited within 5 banking
days of receipt.
4. A broker is not permitted to accept an earnest money deposit if it is tender in cash. - Answer
1. Option fee and due diligence fee checks are made payable to the seller and delivered once
the contract becomes effective. Offers and contracts must be delivered within five days. Earnest
money must be deposited the later of three banking days from the effective date of the contract
or receipt. While it is not recommended that a broker accept cash, it is permitted. When cash is
tendered for earnest money or due diligence, it must be deposited immediately but no later
than three banking days.
Explanation
Option fee and due diligence fee checks are made payable to the seller and delivered once the
contract becomes effective. Offers and contracts mut be delivered within 5 days. Earnest money
must be deposited the later of 3 banking days from the effective date of the contract or receipt.
While it is not recommended that a broker accept cash, it is permitted. When cash is tendered
for earnest money r due diligence, it must be deposited immediately but no later than 3
banking days.
All of the following statements are true regarding a broker-in-charge, EXCEPT:
1. A brokerage operating as a sole proprietorship must appoint a broker-in-charge in order to
handle trust funds and advertise property.
2. A broker-in-charge must notify the Commission when a change in his or her status occurs.
3. A broker-in-charge is responsible for maintaining transaction records and notification of a
change in address of the firm to the Commission.
4. A broker-in-charge has a duty to supervise all brokers affiliated with the firm with regard to
violations of license law. - Answer 4. A broker-in-charge has a duty to supervise all brokers
affiliated with the firm with regard to violations of license law.
, A buyer's agent is responsible for which of the following in regard to the Closing Disclosure?
1. The accuracy of all items on the Closing Disclosure.
2. The accuracy of all items the buyer which they are reasonably aware.
3. The correct distribution of proceeds of sale
4. To ensure that buyer has title insurance coverage. - Answer 2. The accuracy of all items the
buyer which they are reasonably aware.
Explanation
Accuracy of all items for the buyer of which he has knowledge. The agent would not be
responsible for calculating the seller payoff or aggregate accounting adjustments (set by RESPA).
A residential tenant in North Carolina complains of a defect with the heating system and his unit
is heating system is not working and the February temperatures are falling into the low 20's
what are the following statements is most accurate?
1. The tenant may vacate after providing written notice to the landlord and waiting a reasonable
period of time.
2. The tenant can make the repair and reduce rent by that amount.
3. The tenant may remove himself from the property have a more continue to pay the rent until
the court order is the tank
4. The tenant may withhold work in a designated account into work is done. - Answer 1. The
tenant may vacate after providing written notice to the landlord and waiting a reasonable
period of time.
Explanation
The tenant may remove himself from the property and then stop paying rent. Remember that a
tenant may never withhold rent while in possession of the property tenant cannot make repairs
and seek compensation from the landlord or reduce rental payment by the amount.
A Landlord hired a broker to manage his residential rentals. The landlord request that several
provisions be added to the standard lease provided by the Realtor Association. Which of the
following is NOT an acceptable suggestion by the agent?
