NC Test Prep Unit XII - Financing & Settlement (N)

In a residential property disclosure, if the homeseller elects to make no representation regarding the condition of a given property item, then

• the homeseller is absolved of the duty to disclose a defect of that item.

• the homeseller is assumed to be concealing a defect.

• the homeseller is nonetheless required to disclose a defect if it exists.

• none of the above.

A real estate broker and a condominium property owners' association agree that the broker will handle leasing in the condominium complex. At what point may the broker begin representing the owners' association?

• Immediately; condominium property owners may give oral authorization for brokers to represent them.

• When the broker has obtained a written agreement.

• Immediately, provided the broker limits activities to management as opposed to leasing.

• As soon as the listing agreement is recorded.

In order for a provisional broker to advertise, the provisional broker must

• identify herself in the ad and correctly state the name of the owner.

• Have their broker's and the principal's consent and identify the name of the broker or firm in the ad.

• have the broker review and approve the ad copy.

• obtain the principal's consent to advertise without mentioning the broker's or firm's name in the ad.

A broker represents a sophisticated international investor who is often difficult to reach. To accommodate the client, the broker provides for an automatic renewal of the listing agreement when it expires, unless the investor specifically cancels it. The arrangement ensures that interruptions and delays will not get in the way of a potential sales transaction. The investor likes the idea. Is this arrangement acceptable for a North Carolina broker?

• No, the agreement must terminate at a specific time without prior notice to the seller.

• No, the listing agreement as a revolving service contract may only expire upon the broker's written consent.

• Yes, the agreement is perfectly acceptable.

• It is acceptable provided the agreement is in writing.

A broker is employed by a property owner association to handle all the business affairs of the association, including handling of funds. Which of the following is true?

• All trust monies must be maintained in the association's trust account exclusively.

• The broker must deposit association funds in his agency's trust account.

• The association's funds may be commingled with third party escrow funds.

• The funds need not be placed in a trust account.

A buyer representative recommends a mortgage lender to his client following the execution of a sale contract. The lender pays the licensee a referral fee, unbeknownst to the buyer. In this case, the licensee

• has not violated state regulation, since the referral is from a licensed mortgage lender.

• has violated state regulations by obtaining a secret profit from the buyer.

• must inform the buyer of the commission within three days of receipt from the lender.

• is required to share the commission with the buyer.

A residential provisional broker receives a $5,000 deposit from a prospective buyer in connection with an offer. In this case, the provisional broker

• must give the deposit to their broker immediately.

• must deposit the funds immediately.

• must deliver the funds to the Commission immediately upon acceptance of the offer.

• must deposit the funds within three banking days of the date of the offer.

Becky, a cooperating provisional broker, places a standard company 'for sale' sign on a remote piece of land that listing agent Allen had just listed. Has Becky done anything wrong?

• No, since she is a cooperating selling agent working as Allen's subagent.

• No, provided the company sign indicates the name of Becky's company.

• Yes, since the law does not allow signage by provisional brokers.

• Yes, if neither the principal nor the listing agent has granted her permission.

A large brokerage office employs over 50 provisional brokers and brokers. In this case, this office

• may employ one broker-in-charge for every 10 provisional brokers.

• may employ an assistant broker-in-charge with prior written approval by NCREC.

• may only employ one broker-in-charge regardless of the number of provisional brokers employed.

• none of the above.

Sarah, a prospective buyer, enjoys working with buyer broker Ethan, but she is reluctant to sign a representation agreement. Ethan continues to show Sarah properties, and at one point, she wants to make an offer but still refuses to sign an agreement. Which of the following represents Ethan's situation at this point?

• He will be owed a commission because of an implied agency.

• He must cease representing Sarah and become a subagent of the seller if allowed.

• He must become a dual agent and obtain the seller's permission.

• He automatically becomes the seller's subagent.