Minnesota real Estate Principles Exam Prep Questions With 100% Verified Correct Answers.

False; The Department of Commerce and the commissioner of commerce do not arbitrate disputes between licensees. - correct answer True or False: The Department of Commerce and the commissioner of commerce arbitrate disputes between licensees. True; Only court-appointed trustees are exempt. - correct answer True or False: Private trustees managing or selling trust-owned properties are not exempt from licensure. False; A person may only sell four or fewer properties without a license. After that, the person must either be licensed or be represented by a licensee. - correct answer True or False: A person who sells 10 properties in a 12-month period without licensee representation does not require a real estate license. True; This means that a person could take the education before turning 18, but that person would not be able to apply for a license until she turns 18. - correct answer True or False: A person wishing to become licensed as a real estate salesperson must be 18 years of age or older at the time of application. True; Licensees may operate under only one Minnesota brokerage firm. - correct answer True or False: Real estate salesperson licenses are held and renewed by the brokerage. True; All licenses expire on June 30 at the end of each two-year license period. Timely renewal deadline is June 15. - correct answer True or False: All licenses expire on June 30. True; The salesperson's license is ineffective unless associated with a brokerage. - correct answer True or False: Primary brokers must notify the commissioner within 10 days when they wish to terminate a salesperson's license. False; The commissioner must be notified in writing within 10 days. - correct answer True or False: If a licensee receives a civil judgment involving fraud, the licensee must notify the commissioner of commerce in writing within five days. False; Advertising must clearly and conspicuously display the name of the brokerage. Advertising may include the salesperson's name if approved by the primary broker. - correct answer True or False: Advertising must clearly and conspicuously display the name of the salesperson. True; For example, if a licensee commits commingling and the primary broker had no knowledge of that violation of law, the primary broker could still be charged with failure to supervise - correct answer True or False: Primary broker may be charged with failure to supervise for licensee violations. True; Only trust funds may be deposited in the trust account. - correct answer True or False: A brokerage must maintain an interest-bearing trust account. False; Only the brokerage may receive commissions or fees from buyers, sellers, landlords, or tenants. - correct answer True or False: Only the salesperson may receive commissions or fees from buyers, sellers, landlords, or tenants. False; A licensee may discuss terms of future representation only if the discussion was initiated by the consumer. - correct answer True or False: A licensee may approach a consumer who is already represented by another brokerage and discuss terms of future representation. True; Filing an incomplete, false, or misleading application may result in denial of the application. - correct answer True or False: The commissioner may deny a license application if a person files a misleading application. True; The total per licensee, regardless of the number of claims is $250,000 - correct answer True or False: The real estate education, research, and recovery fund has a recovery maximum of $150,000 per transaction. True; The form is intended for information and disclosure. It is not a contract. - correct answer True or False: Agency Relationships in Real Estate Transactions disclosure form is not a contract. False; The agent does not sign the dual agency and consent provision in the purchase agreement. The agent only signs off on dual agency in the representation agreement. - correct answer True or False: The agent must sign the dual agency and consent provision in the purchase agreement. False; A written Facilitator Services Agreement is not required but is recommended. - correct answer True or False: A written Facilitator Services Agreement is required by Minnesota law. False; The buyer representation agreement must be signed before writing an offer to purchase. - correct answer True or False: The buyer representation agreement can be signed at any time during the transaction. False; The broker must give a protective list to the client within 72 hours after the expiration of the representation agreement. - correct answer True or False: The broker must give a protective list to the client within 24 hours after the expiration of the representation agreement. True; Earnest money must be deposited in a trust account when selling agent-owned property. - correct answer True or False: Before showing a property a licensee must disclose any ownership interest in the property offered for sale. False; Occupation by a person with HIV or AIDS is not a material fact and therefore does not require disclosure. - correct answer True or False: The fact that a property was occupied by a person with AIDS is a material fact that must be disclosed. In Minnesota, which agency relationship does not require a written contract between the consumer and the brokerage? - correct answer A) Facilitator B) Buyer's broker C) Seller's broker D) Dual agent The answer is facilitator. Although the law does not require a facilitator to have a facilitator services agreement with the buyer or seller, the brokerage would need a written agreement to enforce their right to be compensated. A prudent business practice would be to obtain a signed buyer or seller facilitator services agreement before performing any services. Sam signs a listing contract with agent Andy of ABC Realty. The listing contract is legally between A) Sam and the realtors. B) Sam and ABC Realty. C) Sam and Andy. D) Andy and the MLS. - correct answer B; The answer is Sam and ABC Realty. The brokerage is the agent and Andy is the subagent of Sam. All of the following individuals may produce a broker price opinion (BPO) for a consumer, EXCEPT A) a licensed broker. B) a licensed salesperson. C) a licensed appraiser. D) a licensed closing agent. - correct answer The answer is a licensed closing agent. Minnesota licensing law allows licensed salespeople, brokers, and appraisers to perform a BPO. What must a licensee obtain to engage in a dual agency transaction? A) Verbal consent to engage in a dual agency from his client B) Verbal disclosure to engage in a dual agency from his client C) Written disclosure and consent to engage in a dual agency from his client D) Written consent from the Commissioner of Commerce - correct answer The answer is written disclosure and consent to engage in a dual agency from his client. This must occur in the listing contract or buyer representation contract to comply with license law standards of conduct. Betty Johnson is a real estate salesperson with ABC Realty. Betty is also a co-owner with Carla Curry in a business that manufactures women's clothing. Carla enters into a buyer representation contract with Betty. What must Betty disclose to Carla's prospective homeseller? A) She is Carla's business associate. B) Carla has enough cash in the bank to pay twice the asking price of the home. C) Carla just won a $500,000 lottery. D) Carla really has to find a home fast because she has just gone through a divorce - correct answer The answer is she is Carla's business associate. License law standards of conduct require licensees to disclose whether their client is a relative or business associate. ABC Realty signed a lease to occupy space in a small office suite. The company has grown and is moving to a larger office 3 floors above the current space. ABC Realty must give written notice to the Commissioner of Commerce within how many days of the move? A) 10 days B) 45 days C) 15 days D) 20 days - correct answer The answer is 10 days. The Commissioner of Commerce requires a 10-day written notice of changes. A licensed broker must retain copies of representation contracts, facilitation agreements, and trust account transaction records for at least A) 6 years. B) 5 years. C) 3 years. D) 7 years. - correct answer The answer is 6 years. A broker's responsibilities include keeping transaction records for 6 years. When must a real estate licensee provide the Agency Relationships in Real Estate Transactions form to a consumer? A) After signing a listing contract B) At first substantive contact C) After signing papers at a closing D) Before showing a home to a buyer - correct answer The answer is at first substantive contact. A licensee must provide an Agency Relationships in Real Estate Transactions form to a consumer before having substantive conversation with them, where price, terms, motivations, or any confidential information may be revealed. A salesperson working with a buyer for the first time must give the buyer a disclosure that includes A) a consent of agency representation. B) a statement regarding dual agency. C) a disclosure of affiliated business arrangements. D) a notice of dual agency including seller, buyer, and broker signatures. - correct answer The answer is a statement regarding dual agency. A licensee may not act on behalf of both the buyer and the seller in a transaction unless both of the parties have consented to that arrangement. A person acting on behalf of a real estate broker in performing acts authorized by Minnesota real estate license law must be licensed as A) a limited broker. B) a salesperson. C) an agent. D) a real estate agent. - correct answer The answer is a salesperson. In Minnesota, anyone who lists, sells, exchanges, manages, buys, rents, auctions, or negotiates options on real estate, a business opportunity, or a business (or the goodwill, inventory, or fixtures of a business) must have a real estate license if the action is taken for someone else and for a fee or commission. Which of the following is a real estate broker allowed to do? A) Encourage the breach of a listing contract B) Discourage the use of an attorney C) Demand commissions without a signed agency contract D)