CE SHOP FINAL EXAM QUESTIONS
WITH CORRECT ANSWERS
Which of the following is NOT a penalty that the Maryland Real Estate Commission may
impose upon a licensee who violated the Maryland Code of Ethics? - Answer-Jail time
For sale signs on ground rent properties that show the price of the property must also
state which of the following? - Answer-Annual ground rent plus the full cost of
capitalization
Shelby listed her seller client's condo on April 4. It went under contract May 16. That
contract fell through on May 29. The listing agreement expired on July 4, with no other
offers or contracts. On what date does the five-year record-retention clock start ticking?
- Answer-July 4
Jerry is a new licensee and he's excited to be creating some advertising. When he does
this, what must he remember about including his brokerage's designated name in his
advertising? - Answer-The brokerage's designated business name must be
meaningfully and conspicuously present.
Fresh out of community college and newly licensed as a real estate salesperson, Ben
just took on a short sale as his first listing. Ben told his broker, Janine, that he could
handle the transaction and had just advised his seller client that he could do it with
minimal damage to the client's credit rating. Janine immediately took Ben off the listing
and assigned it to a more experienced licensee. Why? - Answer-By predicting the
seller's credit rating outcome, Ben crossed the line into giving advice that requires
additional licensure.
You're a real estate licensee in Maryland. You're walking through a property with a new
seller client. The seller tells you that the property is serviced by the public sewer
system, but when walking up the drive you noticed the access hatch for a septic system.
What should you do? - Answer-Inquire about the homeowner's claim to ensure the
property really is on public sewer.
Jason has completed 60 hours of Maryland pre-licensing real estate education, met the
minimum requirements, and passed his licensing examination. What else does he need
in order to receive an active license when applying for licensure? - Answer-Affiliation
with a supervising broker
Which of these payment structures is illegal in Maryland? - Answer-Dean, an unlicensed
assistant, is paid an extra $50 each time he takes clients on a showing on a licensee's
behalf.
,The Guaranty Fund paid a consumer's $15,000 claim because of licensee Ben's
negligence. Ben is breaking the news to his broker. How's his broker likely to respond? -
Answer-"Well, since this means your license is suspended, we'll see you back at the
office when you reimburse the fund."
Which of the following statements about counter-offers is true? - Answer-Once a
counter-offer has been made, the prior offer is cancelled.
Ned is a Maryland listing agent who has learned of a material fact related to the
transaction. To whom and when must he disclose this information? - Answer-To all
parties as soon as possible
Salesperson Katie represents seller Suzie in a transaction. Bob and Janine are buying
Suzie's home, and they're not represented. To whom does Katie need to disclose her
agency relationship using the Understanding Whom Real Estate Agents Represent
form? - Answer-Bob and Janine only
In Maryland, you could be fined up to $1,000 per solicitation if you use this method to
advertise and a prior business relationship does not exist. - Answer-Fax machine
Jim's had one heck of a time getting his latest listing sold. His seller client nitpicked
every single item that the buyers asked her to repair after the home inspection. She was
about to let the deal fall through over it until Jim offered to rebate 0.5% of his
commission back to the seller. Does Maryland license law permit Jim to do this? -
Answer-Yes, as long as he documents the commission reduction in writing and
discloses it to all parties.
Which of the following statements about latent defects is true? - Answer-Any party to a
real estate sales transaction who has knowledge of latent defects must disclose them.
LaTonya represents the seller of a property that's got an interested buyer. She's
emailing the buyer, who's unrepresented, some documentation based on some
questions he had and has included the Understanding Whom Real Estate Agents
Represent form so she can disclose her agency relationship with the seller. Is this
permissible? - Answer-Yes, LaTonya may disclose her agency relationship through
whatever medium is used when first contacting the unrepresented party.
New licensee Joey is reconciling his bank statement and identifies a $20 deficit that he
can't account for. Which initial licensing fee has he likely forgotten about? - Answer-The
$20 Guaranty Fund fee
Unless the real estate licensee who posts the ad is otherwise properly licensed, which
of these ads violates PHIFA rules in Maryland? - Answer-An ad that targets
homeowners in danger of foreclosure and indicates the licensee can offer guidance
, When should a prospective buyer receive a copy of the Maryland Residential Property
Disclosure and Disclaimer Statement? - Answer-Before or at the time the buyer makes
a written offer to the seller
After 15 years of building her business as a salesperson, Estrella has gotten her
broker's license and is striking out on her own. She's creating new business cards, and
it's been so long since she had to do them on her own, she's double-checking that they
comply with Maryland real estate advertising law. What does she need to be sure to
include? - Answer-The cards must include her name as it appears on her license
Beverly's broker, Marquis, has assigned her to represent the seller in an in-house
transaction. Beverly's colleague, Tyrone, will be representing the buyer. What's
Beverly's role in this transaction? - Answer-Intra-company agent
Antonio feels that his agent did not act in his best interests when she waited nearly a
week to present an offer to him. His agent argues that she held onto the offer because it
was $15,000 less than list price and she wanted to see if a better offer came in before
the weekend. Which section of the Maryland Code of Ethics did Antonio's agent
possibly violate? - Answer-Relations to the client
Sam is an independent contractor Maryland licensee working for B & L Realty. Since
Sam is an independent contractor, what supervisory responsibility does Sam's broker
have? - Answer-Sam is considered an employee for licensing law purposes, but he's
still an independent contractor for IRS purposes.
Beverly was so proud of the comparative market analysis (CMA) she'd put together for
her seller client, Jonathon. The first page was simple: a large photo of his property with
the address printed underneath. The rest of the CMA was spotless: She'd found four
excellent comparable properties, included plenty of information about them, and was
confident that Jonathon would love the suggested list price she arrived at. What did
Beverly do wrong? - Answer-She didn't include a written statement on the CMA's first
page that clarified that it wasn't an appraisal.
Carmelita is a licensee selling a condo. She has the owner's permission to place a for
sale sign in front of the unit. As she pounds the sign into the ground, a condo board
representative approaches her and informs her that condo regulations forbid signage.
Can Carmelita come back later and place the sign anyway? - Answer-No, she must
conform to condo regulations.
Whose responsibility is it to ensure that a prospective buyer receives a copy of the
Maryland Residential Property Disclosure and Disclaimer Statement prior to the buyer
making a written offer to the seller? - Answer-The buyer's broker and the seller's broker
Paul is hoping to purchase a townhouse in Locust Point in Baltimore, and Shelly, a
salesperson, is helping him fill in the blanks on the contract form before he makes his
offer. Though Shelly doesn't have an agency agreement with Paul, she knows she'll still
WITH CORRECT ANSWERS
Which of the following is NOT a penalty that the Maryland Real Estate Commission may
impose upon a licensee who violated the Maryland Code of Ethics? - Answer-Jail time
For sale signs on ground rent properties that show the price of the property must also
state which of the following? - Answer-Annual ground rent plus the full cost of
capitalization
Shelby listed her seller client's condo on April 4. It went under contract May 16. That
contract fell through on May 29. The listing agreement expired on July 4, with no other
offers or contracts. On what date does the five-year record-retention clock start ticking?
- Answer-July 4
Jerry is a new licensee and he's excited to be creating some advertising. When he does
this, what must he remember about including his brokerage's designated name in his
advertising? - Answer-The brokerage's designated business name must be
meaningfully and conspicuously present.
Fresh out of community college and newly licensed as a real estate salesperson, Ben
just took on a short sale as his first listing. Ben told his broker, Janine, that he could
handle the transaction and had just advised his seller client that he could do it with
minimal damage to the client's credit rating. Janine immediately took Ben off the listing
and assigned it to a more experienced licensee. Why? - Answer-By predicting the
seller's credit rating outcome, Ben crossed the line into giving advice that requires
additional licensure.
You're a real estate licensee in Maryland. You're walking through a property with a new
seller client. The seller tells you that the property is serviced by the public sewer
system, but when walking up the drive you noticed the access hatch for a septic system.
What should you do? - Answer-Inquire about the homeowner's claim to ensure the
property really is on public sewer.
Jason has completed 60 hours of Maryland pre-licensing real estate education, met the
minimum requirements, and passed his licensing examination. What else does he need
in order to receive an active license when applying for licensure? - Answer-Affiliation
with a supervising broker
Which of these payment structures is illegal in Maryland? - Answer-Dean, an unlicensed
assistant, is paid an extra $50 each time he takes clients on a showing on a licensee's
behalf.
,The Guaranty Fund paid a consumer's $15,000 claim because of licensee Ben's
negligence. Ben is breaking the news to his broker. How's his broker likely to respond? -
Answer-"Well, since this means your license is suspended, we'll see you back at the
office when you reimburse the fund."
Which of the following statements about counter-offers is true? - Answer-Once a
counter-offer has been made, the prior offer is cancelled.
Ned is a Maryland listing agent who has learned of a material fact related to the
transaction. To whom and when must he disclose this information? - Answer-To all
parties as soon as possible
Salesperson Katie represents seller Suzie in a transaction. Bob and Janine are buying
Suzie's home, and they're not represented. To whom does Katie need to disclose her
agency relationship using the Understanding Whom Real Estate Agents Represent
form? - Answer-Bob and Janine only
In Maryland, you could be fined up to $1,000 per solicitation if you use this method to
advertise and a prior business relationship does not exist. - Answer-Fax machine
Jim's had one heck of a time getting his latest listing sold. His seller client nitpicked
every single item that the buyers asked her to repair after the home inspection. She was
about to let the deal fall through over it until Jim offered to rebate 0.5% of his
commission back to the seller. Does Maryland license law permit Jim to do this? -
Answer-Yes, as long as he documents the commission reduction in writing and
discloses it to all parties.
Which of the following statements about latent defects is true? - Answer-Any party to a
real estate sales transaction who has knowledge of latent defects must disclose them.
LaTonya represents the seller of a property that's got an interested buyer. She's
emailing the buyer, who's unrepresented, some documentation based on some
questions he had and has included the Understanding Whom Real Estate Agents
Represent form so she can disclose her agency relationship with the seller. Is this
permissible? - Answer-Yes, LaTonya may disclose her agency relationship through
whatever medium is used when first contacting the unrepresented party.
New licensee Joey is reconciling his bank statement and identifies a $20 deficit that he
can't account for. Which initial licensing fee has he likely forgotten about? - Answer-The
$20 Guaranty Fund fee
Unless the real estate licensee who posts the ad is otherwise properly licensed, which
of these ads violates PHIFA rules in Maryland? - Answer-An ad that targets
homeowners in danger of foreclosure and indicates the licensee can offer guidance
, When should a prospective buyer receive a copy of the Maryland Residential Property
Disclosure and Disclaimer Statement? - Answer-Before or at the time the buyer makes
a written offer to the seller
After 15 years of building her business as a salesperson, Estrella has gotten her
broker's license and is striking out on her own. She's creating new business cards, and
it's been so long since she had to do them on her own, she's double-checking that they
comply with Maryland real estate advertising law. What does she need to be sure to
include? - Answer-The cards must include her name as it appears on her license
Beverly's broker, Marquis, has assigned her to represent the seller in an in-house
transaction. Beverly's colleague, Tyrone, will be representing the buyer. What's
Beverly's role in this transaction? - Answer-Intra-company agent
Antonio feels that his agent did not act in his best interests when she waited nearly a
week to present an offer to him. His agent argues that she held onto the offer because it
was $15,000 less than list price and she wanted to see if a better offer came in before
the weekend. Which section of the Maryland Code of Ethics did Antonio's agent
possibly violate? - Answer-Relations to the client
Sam is an independent contractor Maryland licensee working for B & L Realty. Since
Sam is an independent contractor, what supervisory responsibility does Sam's broker
have? - Answer-Sam is considered an employee for licensing law purposes, but he's
still an independent contractor for IRS purposes.
Beverly was so proud of the comparative market analysis (CMA) she'd put together for
her seller client, Jonathon. The first page was simple: a large photo of his property with
the address printed underneath. The rest of the CMA was spotless: She'd found four
excellent comparable properties, included plenty of information about them, and was
confident that Jonathon would love the suggested list price she arrived at. What did
Beverly do wrong? - Answer-She didn't include a written statement on the CMA's first
page that clarified that it wasn't an appraisal.
Carmelita is a licensee selling a condo. She has the owner's permission to place a for
sale sign in front of the unit. As she pounds the sign into the ground, a condo board
representative approaches her and informs her that condo regulations forbid signage.
Can Carmelita come back later and place the sign anyway? - Answer-No, she must
conform to condo regulations.
Whose responsibility is it to ensure that a prospective buyer receives a copy of the
Maryland Residential Property Disclosure and Disclaimer Statement prior to the buyer
making a written offer to the seller? - Answer-The buyer's broker and the seller's broker
Paul is hoping to purchase a townhouse in Locust Point in Baltimore, and Shelly, a
salesperson, is helping him fill in the blanks on the contract form before he makes his
offer. Though Shelly doesn't have an agency agreement with Paul, she knows she'll still
