POST 301- NC Real Estate Exam Review
Questions with Answers
Who must disclose material facts and to whom? - -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 -
-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? - -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 - -d) all of the above
- The Unfair and Deceptive Practices Act prohibits misrepresentations,
omissions of material fact, and misleading advertising in a trade or business
and applies to: - -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 - -b) the broker may have an oral listing agreement with the seller for
not more than 10 days
, - 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. -
-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 - -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? - -The seller is guilty of willful misrepresentation and the
listing agent is guilty of negligent misrepresentation
- 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? - -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: - -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? - -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 - -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? - -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: - -
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 - -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 - -a) that the streets in the
neighborhood are privately maintained by the owner's association
Questions with Answers
Who must disclose material facts and to whom? - -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 -
-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? - -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 - -d) all of the above
- The Unfair and Deceptive Practices Act prohibits misrepresentations,
omissions of material fact, and misleading advertising in a trade or business
and applies to: - -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 - -b) the broker may have an oral listing agreement with the seller for
not more than 10 days
, - 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. -
-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 - -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? - -The seller is guilty of willful misrepresentation and the
listing agent is guilty of negligent misrepresentation
- 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? - -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: - -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? - -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 - -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? - -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: - -
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 - -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 - -a) that the streets in the
neighborhood are privately maintained by the owner's association
