MD REAL ESTATE ASSESSMENT EXAM
QUESTIONS AND ANSWERS
When must an agent disclose an agency relationship to an unrepresented transaction
party? - Answer- At first substantive contact
What must sellers provide prospective buyers of homes built prior to 1978, in addition to
the federally required disclosure form? - Answer- EPA lead safety pamphlet
Seller Jamison is closing on his property with buyer Conrad. Jamison paid the current
year's property taxes already. Is this a prepaid or accrued expense, and how will it be
represented on the settlement statement? - Answer- The taxes are a prepaid expense,
and will appear as a buyer debit and a seller credit.
In a real estate transaction in which you represent the seller, what are your duties to
other parties in the transaction? - Answer- Treat them honestly and fairly.
Related to reasonable accommodation of being allowed to have an assistance animal,
which statement is true? - Answer- If the disability for which the tenant is making the
request is obvious, the landlord may not ask why it is needed.
Damon lives in Frederick but is affiliated with a broker in downtown Baltimore. He'd like
to affiliate with a broker closer to home but doesn't want to sever his relationship with
his current broker. What needs to happen in order for Damon to be able to work for both
brokerages? - Answer- Both brokers need to send a letter to the commission stating that
their approval of the arrangement and that there is no conflict of interest
Stan and Margo want to redevelop an old industrial site in order to create a
microbrewery and event space. However, an environmental review found that
hazardous chemicals were once used on site, and there is a possibility they will be
released during redevelopment. Stan and Margo may not be liable for cleanup, under
what federal law? - Answer- SARA
Which of the following statements about earnest money deposits is true? - Answer-
Earnest money must be placed in an escrow account within no more than seven
business days after the formation of the contract of sale.
Which of these situations represents the illegal practice of blockbusting? - Answer-
Corbin tells homeowners in Five Points that an impending influx of Asian immigrants will
reduce property values.
, Alice listed a three-bedroom home for her client, but before she finds a buyer, the home
burns to the ground. What happens to the agency agreement that Alice has with her
client? - Answer- The agency agreement is terminated if the property is destroyed.
Which of these licensees is correctly following MREC guidelines for hosting an open
house? - Answer- Shawna displays the MREC notice informing consumers that she
represents the seller.
According to Article 7 of the NAR Code of Ethics, which of these statements is most
accurate when accepting compensation from parties to a transaction? - Answer- A
licensee shall not accept compensation from more than one party to a transaction
without the full knowledge and consent of all parties.
Which of the following is a promise from the borrower to repay a certain sum of money
to another party (the lender or holder of the note) under specified terms? - Answer-
Promissory note
Often called a note, is the borrower's documented promise to repay the loan
Janice is the victim of misrepresentation in the sale of her home. Her listing agent gave
her poor advice that cost her $62,000. She has tried to recover the cost through several
other means, but to no avail. If she files a claim against the Guaranty Fund, what is the
maximum amount she could hope to recoup? - Answer- $50,000
Lorena and Julio purchased a home for $205,950. Their loan amount was $164,760,
and the assessed value is now $200,500. Their tax rate is 1.5%. How much will their
monthly taxes be? - Answer- $250.62 = (assessed value x tax rate)/ 12 months
$250.62 = ($200,500 x 0.015)/12
Which of the following features is most likely to be the cause of an adjustment to a
comparable when preparing a CMA?
Busy street, color, demographics? - Answer- Busy street
Maryland licensee Clint operates as an independent contractor associated with Red Hat
Properties and its broker, Margaret. Which of these statements is true about Margaret's
supervisory responsibility and liability for Clint's actions? - Answer- Margaret is
responsible for and can be disciplined based on Clint's actions.
Eva, Stella, and Lynn owned a vacation home two blocks from the beach. Sadly, Stella
passed away over the winter, so when summer arrived, Eva and Lynn shared the home
with Stella's nephew Drew, to whom Stella willed her share of the property. What type of
ownership is this? - Answer- Tenancy in common
QUESTIONS AND ANSWERS
When must an agent disclose an agency relationship to an unrepresented transaction
party? - Answer- At first substantive contact
What must sellers provide prospective buyers of homes built prior to 1978, in addition to
the federally required disclosure form? - Answer- EPA lead safety pamphlet
Seller Jamison is closing on his property with buyer Conrad. Jamison paid the current
year's property taxes already. Is this a prepaid or accrued expense, and how will it be
represented on the settlement statement? - Answer- The taxes are a prepaid expense,
and will appear as a buyer debit and a seller credit.
In a real estate transaction in which you represent the seller, what are your duties to
other parties in the transaction? - Answer- Treat them honestly and fairly.
Related to reasonable accommodation of being allowed to have an assistance animal,
which statement is true? - Answer- If the disability for which the tenant is making the
request is obvious, the landlord may not ask why it is needed.
Damon lives in Frederick but is affiliated with a broker in downtown Baltimore. He'd like
to affiliate with a broker closer to home but doesn't want to sever his relationship with
his current broker. What needs to happen in order for Damon to be able to work for both
brokerages? - Answer- Both brokers need to send a letter to the commission stating that
their approval of the arrangement and that there is no conflict of interest
Stan and Margo want to redevelop an old industrial site in order to create a
microbrewery and event space. However, an environmental review found that
hazardous chemicals were once used on site, and there is a possibility they will be
released during redevelopment. Stan and Margo may not be liable for cleanup, under
what federal law? - Answer- SARA
Which of the following statements about earnest money deposits is true? - Answer-
Earnest money must be placed in an escrow account within no more than seven
business days after the formation of the contract of sale.
Which of these situations represents the illegal practice of blockbusting? - Answer-
Corbin tells homeowners in Five Points that an impending influx of Asian immigrants will
reduce property values.
, Alice listed a three-bedroom home for her client, but before she finds a buyer, the home
burns to the ground. What happens to the agency agreement that Alice has with her
client? - Answer- The agency agreement is terminated if the property is destroyed.
Which of these licensees is correctly following MREC guidelines for hosting an open
house? - Answer- Shawna displays the MREC notice informing consumers that she
represents the seller.
According to Article 7 of the NAR Code of Ethics, which of these statements is most
accurate when accepting compensation from parties to a transaction? - Answer- A
licensee shall not accept compensation from more than one party to a transaction
without the full knowledge and consent of all parties.
Which of the following is a promise from the borrower to repay a certain sum of money
to another party (the lender or holder of the note) under specified terms? - Answer-
Promissory note
Often called a note, is the borrower's documented promise to repay the loan
Janice is the victim of misrepresentation in the sale of her home. Her listing agent gave
her poor advice that cost her $62,000. She has tried to recover the cost through several
other means, but to no avail. If she files a claim against the Guaranty Fund, what is the
maximum amount she could hope to recoup? - Answer- $50,000
Lorena and Julio purchased a home for $205,950. Their loan amount was $164,760,
and the assessed value is now $200,500. Their tax rate is 1.5%. How much will their
monthly taxes be? - Answer- $250.62 = (assessed value x tax rate)/ 12 months
$250.62 = ($200,500 x 0.015)/12
Which of the following features is most likely to be the cause of an adjustment to a
comparable when preparing a CMA?
Busy street, color, demographics? - Answer- Busy street
Maryland licensee Clint operates as an independent contractor associated with Red Hat
Properties and its broker, Margaret. Which of these statements is true about Margaret's
supervisory responsibility and liability for Clint's actions? - Answer- Margaret is
responsible for and can be disciplined based on Clint's actions.
Eva, Stella, and Lynn owned a vacation home two blocks from the beach. Sadly, Stella
passed away over the winter, so when summer arrived, Eva and Lynn shared the home
with Stella's nephew Drew, to whom Stella willed her share of the property. What type of
ownership is this? - Answer- Tenancy in common
