Pass the New York State Exam Chapter 2
Exam ACTUAL QUESTIONS AND
CORRECT ANSWERS
General Agent - CORRECT ANSWER Someone authorized to transact every kind of
business for the principal.Example: Property Manager
Special Agent - CORRECT ANSWER An agent with limited authority to act on behalf
of the principal, such as created by a listing.Example: Real Estate Agent / Real Estate Broker
Universal Agent - CORRECT ANSWER A universal agent has complete authority over
any activity of the principal.Example: Power of Attorney
Principal or Client. - CORRECT ANSWER The buyer and/or seller is known as the
Agent - CORRECT ANSWER The broker is known
Sub-agent - CORRECT ANSWER The salesperson is a ___ of their broker.
Buyer Agency / Buyer Brokerage - CORRECT ANSWER Buyer agency occurs when a
purchaser/renter hires a broker to represent them.
The purchaser/renter employs a broker to locate a property.
In this relationship, the buyer is the principal and the broker is the agent.A Buyer
Representation Form should be signed between the buyer and broker.
Fiduciary Duties - CORRECT ANSWER The real estate agent serves as a fiduciary to
the client.
, A fiduciary relationship implies great confidence and trust.As a fiduciary, the agent is in a
position of great trust by the client.Use the acronym OLD CAR to remember the agent's
fiduciary duties to their client.
Obedience - CORRECT ANSWER Agent shall follow the legal instructions of their
client.
Loyalty - CORRECT ANSWER Agent shall work in the best interests of their client
Disclosure of Information (Full Disclosure) - CORRECT ANSWER Agent shall
promptly communicate all information about the transaction to their client. This includes
presenting all offers to the client.
Confidentiality - CORRECT ANSWER Agent shall not reveal confidential information
about the client to prospective buyers, without the express consent from the client. Such
confidential information may harm the client.
Accountability - CORRECT ANSWER (refers to financial accountability) the agent
must account for and promptly remit all money or property entrusted to the agent.
Reasonable Care and Duty to Account - CORRECT ANSWER Agent shall possess the
necessary skills and training to perform their requested services.
Property Condition Disclosure Statement - CORRECT ANSWER The Property
Condition Disclosure Act requires the seller to submit to the buyer, a Property Condition
Disclosure Statement, prior to signing the contract of sale. If the statement is not signed, the
buyer shall receive a $500 credit against the purchase price of the property.
Most seller attorneys advise their clients NOT to sign the statement, as it opens them up to a
vast amount of liability.
Misrepresentation - CORRECT ANSWER Misrepresentation means making an
intentionally false statement to induce someone to contract.Misrepresentation consists of:
Exam ACTUAL QUESTIONS AND
CORRECT ANSWERS
General Agent - CORRECT ANSWER Someone authorized to transact every kind of
business for the principal.Example: Property Manager
Special Agent - CORRECT ANSWER An agent with limited authority to act on behalf
of the principal, such as created by a listing.Example: Real Estate Agent / Real Estate Broker
Universal Agent - CORRECT ANSWER A universal agent has complete authority over
any activity of the principal.Example: Power of Attorney
Principal or Client. - CORRECT ANSWER The buyer and/or seller is known as the
Agent - CORRECT ANSWER The broker is known
Sub-agent - CORRECT ANSWER The salesperson is a ___ of their broker.
Buyer Agency / Buyer Brokerage - CORRECT ANSWER Buyer agency occurs when a
purchaser/renter hires a broker to represent them.
The purchaser/renter employs a broker to locate a property.
In this relationship, the buyer is the principal and the broker is the agent.A Buyer
Representation Form should be signed between the buyer and broker.
Fiduciary Duties - CORRECT ANSWER The real estate agent serves as a fiduciary to
the client.
, A fiduciary relationship implies great confidence and trust.As a fiduciary, the agent is in a
position of great trust by the client.Use the acronym OLD CAR to remember the agent's
fiduciary duties to their client.
Obedience - CORRECT ANSWER Agent shall follow the legal instructions of their
client.
Loyalty - CORRECT ANSWER Agent shall work in the best interests of their client
Disclosure of Information (Full Disclosure) - CORRECT ANSWER Agent shall
promptly communicate all information about the transaction to their client. This includes
presenting all offers to the client.
Confidentiality - CORRECT ANSWER Agent shall not reveal confidential information
about the client to prospective buyers, without the express consent from the client. Such
confidential information may harm the client.
Accountability - CORRECT ANSWER (refers to financial accountability) the agent
must account for and promptly remit all money or property entrusted to the agent.
Reasonable Care and Duty to Account - CORRECT ANSWER Agent shall possess the
necessary skills and training to perform their requested services.
Property Condition Disclosure Statement - CORRECT ANSWER The Property
Condition Disclosure Act requires the seller to submit to the buyer, a Property Condition
Disclosure Statement, prior to signing the contract of sale. If the statement is not signed, the
buyer shall receive a $500 credit against the purchase price of the property.
Most seller attorneys advise their clients NOT to sign the statement, as it opens them up to a
vast amount of liability.
Misrepresentation - CORRECT ANSWER Misrepresentation means making an
intentionally false statement to induce someone to contract.Misrepresentation consists of:
