303 NC POST LICENSING EXAM ACTUAL EXAM QUESTIONS AND CORRECT ANSWERS (ALREADY GRADED A+), Exams of Real Estate Management

Download 303 NC POST LICENSING EXAM ACTUAL EXAM QUESTIONS AND CORRECT ANSWERS (ALREADY GRADED A+) and more Exams Real Estate Management in PDF only on Docsity! 303 NC POST LICENSING EXAM ACTUAL EXAM QUESTIONS AND CORRECT ANSWERS (ALREADY GRADED A+) | LATEST EDITION 2024 (JUST RELEASED) North Carolina broker Karyn has accepted compensation from a vendor for recommending its services to a client. Under what circumstances would Karyn NOT be required to disclose her acceptance? -----CORRECT ANSWER---------------If what Karyn accepted is a token of insignificant or symbolic worth, she needn't disclose it to anyone. Which of the following terms refers to the relationship between the landlord and the tenant in which both parties have obligations to one another? -----CORRECT ANSWER- --------------Mutuality of obligations All of the following are requirements for manufactured housing EXCEPT for which one? -----CORRECT ANSWER---------------Does not include a permanently attached chassis -Manufactured homes are transportable structures that are eight or more feet in width and 40 or more feet in length, or at least 320 square feet. They're constructed with a permanent, non-removable steel chassis and wheels, and they are designed to be used as dwellings with or without a permanent foundation when connected to plumbing, heating, cooling, and/or electrical systems. Which of the following situations would NOT require a North Carolina licensee to notify NCREC? -----CORRECT ANSWER---------------The licensee takes out a sizable personal loan to complete some office renovations. Jessica is a timeshare interest purchaser who noticed that the public offering statement includes a statement that she has a right to cancel the purchase contract within a certain number of days after executing the purchase contract. This cancellation statement is known as the purchaser's ______. -----CORRECT ANSWER--------------- Right to cancel A North Carolina licensee has been found guilty of improper conduct. Which of the following is an example of that violation? -----CORRECT ANSWER---------------Violation of the State Fair Housing Act What advantage does the 1031 tax-deferred exchange offer? -----CORRECT ANSWER- --------------It allows investors to defer capital gains taxes when selling a property, provided they buy another property. North Carolina broker Dustin moved, changing his permanent address. To comply with real estate license law, who or what entity must Dustin notify? -----CORRECT ANSWER---------------The North Carolina Real Estate Commission Samson needs to get insurance for his new condo. What type of insurance will cover his unit and all personal property within the unit? -----CORRECT ANSWER---------------An HO6 policy BIC Sydney is planning to attend broker Alyssa's closing on July 1 because Alyssa's license became inactive on June 30. Alyssa's done all the work on this transaction but simply forgot to take her CE. Which of the following statements is true? -----CORRECT ANSWER---------------Alyssa is still entitled to the commission for performing brokerage services she earned prior to the date her license became inactive. North Carolina broker Kelly has been convicted of a misdemeanor. She has _____ days to notify NCREC. -----CORRECT ANSWER---------------60 North Carolina broker-in-charge Caleb has let his broker's license expire. What does that mean for his BIC status? -----CORRECT ANSWER---------------His BIC-eligible status terminates, and he'll need to start the process of gaining eligibility over again. When it comes to preparing commercial purchase contracts, which of the following is a true statement? -----CORRECT ANSWER---------------Licensees can only use standard forms. North Carolina property manager Raquel has a tenant whose lease has expired, but who won't leave. The property owner wants Raquel to begin the eviction process. Is Raquel allowed to comply with this request? -----CORRECT ANSWER----------------Yes. The property owner or an agent, like Raquel, who's working on behalf of the property owner may initiate legal action for the eviction process. Which of the following are North Carolina agents NOT required to identify as potential areas of concern for potential buyers? -----CORRECT ANSWER---------------HVAC efficiency Rebecca is a trustee in a bankruptcy case, and is performing real estate activities under a court order as part of her trustee duties. She'll be compensated for her role in these activities. Does Rebecca need a North Carolina real estate license? -----CORRECT ANSWER----------------No. Rebecca qualifies for the exemption for persons acting under a court order, and therefore doesn't need a license Listing agents in North Carolina who use the standard NCAR agency agreement form should be sure to clearly disclose any compensation-sharing limitations if their firm restricts with whom they share brokerage fees. Why is this? -----CORRECT ANSWER--- -------------The agency agreement language gives permission to share compensation with any licensed buyer or seller agent Ben and Jerri pay $200 to their HOA every quarter. This money is likely used for all of the following EXCEPT for which one? -----CORRECT ANSWER---------------Pay off fines for HOA rule violations. A cooperative listing service, like the MLS, requires its members to cooperate. It also requires them to ______. -----CORRECT ANSWER---------------Offer compensation to the cooperating broker Which of the following obligations must tenants fulfill as part of their statutory duties? ---- -CORRECT ANSWER---------------Not removing the fridge or dishwasher that comes with the unit Which of the following statements is true about septic systems? -----CORRECT ANSWER---------------They differ in the way they are installed. North Carolina's waterway zoning standards apply mostly to _______. -----CORRECT ANSWER---------------Land within 30 to 50 feet of the water's edge Velma is a timeshare developer with flexible morals, and is found guilty of four separate license law violations. The commission reprimanded and fined her. What's the maximum fine she can expect to receive from the commission for her violations? ----- CORRECT ANSWER---------------$2,000 Jasmine is the landlord for several rental homes in Boiling Spring Lakes. When she receives the security deposit from one of her tenants, how long must it be held in a trust account? -----CORRECT ANSWER---------------At least until the end of tenancy Mary, a woman of color, has filed a fair housing complaint after suspecting her real estate agent was only showing her homes in communities that were primarily made up of minorities. After completing its investigation, HUD found reasonable cause to believe that discrimination occurred. What will happen next? -----CORRECT ANSWER------------ ---HUD will issue a charge of discrimination and will notify Mary, the complainant, of its determination. How can North Carolina landlords remove tenants who engage in illegal activities like drug manufacturing on the premises? -----CORRECT ANSWER---------------Send the tenant a notice of immediate lease termination Which aspect of highest and best use is concerned with land use restrictions and zoning? -----CORRECT ANSWER---------------Is it legally allowable or permissible? In North Carolina, the Vacation Rental Act provides what kind of exception regarding compensation for real estate brokerage activities? -----CORRECT ANSWER--------------- Under this act, a travel agent who does not hold an active real estate license may accept a referral fee for referring a tenant to a broker for a vacation rental if certain provisions are met. Tenant A is leasing commercial property from the landlord. Tenant A then sublets to Tenant B. Which of the following parties have a sandwich lease? -----CORRECT ANSWER---------------The original tenant and the landlord Mike relocated for work and learned that the region in which he planned to buy a home had many old underground mines. In fact, Mike might even need to purchase mine subsidence insurance. What might a home inspector flag for Mike if there are any concerns about undermining? -----CORRECT ANSWER---------------A sinkhole on the property An underground storage tank has been in place for 15 years. What is its remaining useful life, on average? -----CORRECT ANSWER---------------Zero years Which of the following is described as an area that is protected by the Clean Water Act where standing water that supports aquatic plants and animals is located and groundwater is filtered? -----CORRECT ANSWER---------------Wetland Before becoming a broker-in-charge, a North Carolina broker must first apply for _______ with the NCREC. -----CORRECT ANSWER---------------Eligibility Dave is an employee of a housing authority in his North Carolina county. He's been asked to lease one of the properties that the housing authority owns to a new tenant. Does Dave need a real estate license for this? -----CORRECT ANSWER---------------No. and renew their licenses yearly. However, only provisional brokers must be supervised by a broker-in-charge, and while Simon can choose to do so, it's not true that he MUST be supervised. Reese is a Virginia licensee with a North Carolina limited nonresidential commercial license. She's affiliated with North Carolina resident broker Nicky for a commercial real estate transaction. Whose job is it to handle any trust funds relating to the transaction? - ----CORRECT ANSWER---------------Nicky is responsible for handling the trust funds as she would with trust funds in any other North Carolina transaction. Condominiums built during or after 1987 are regulated by ______. -----CORRECT ANSWER---------------The North Carolina Condominium Act Which one of the following people would be exempt from the real estate licensure requirement in North Carolina? -----CORRECT ANSWER---------------An attorney who's selling a property for a client, for compensation, using a power of attorney Which of the following statements about transaction records retention in North Carolina is true? -----CORRECT ANSWER---------------Records for all transactions, including offers and marketing records, must be retained for three years. Cory is a non-provisional broker in North Carolina. In order for him to receive compensation, he's required to complete ______ hours of continuing education every year -----CORRECT ANSWER---------------Eight Which of the following have studies shown to reduce access to employment opportunities? -----CORRECT ANSWER---------------Housing discrimination North Carolina broker Timothy's buyer client just signed an offer for her potential dream house. How long does Timothy have to get the offer delivered to the seller and his listing agent? -----CORRECT ANSWER---------------Three days Which of the following defines a subdivision? -----CORRECT ANSWER---------------A tract of land divided into lots or plots and used for building purposes A certified septic inspector looks at the septic tank, the distribution box, and the _______ for code compliance. -----CORRECT ANSWER---------------Absorption field Laura's property is subject to a special assessment. Which of the following is true? ----- CORRECT ANSWER---------------The special assessment must benefit Laura's property. One advantage to a modular home is that ______. -----CORRECT ANSWER--------------- They're built off site Nathan assisted with the sale of a commercial building. He doesn't hold a real estate license, yet his actions didn't violate any license laws. What must be true about Nathan's situation? -----CORRECT ANSWER---------------Nathan is an officer or employee of the company that owned the building he sold. Mary's broker is completing a vacation rental agreement for new clients who will be renting her beach villa in Kure Beach. Should he include a statement in the vacation rental agreement that details the penalties if the clients cancel? -----CORRECT ANSWER---------------Yes. It's not a required element of a North Carolina vacation rental agreement, but it's a good idea. Tabitha is a North Carolina broker who has just left her previous brokerage to join Diamond Realty. How long does she have to notify NCREC of this change in firm affiliation? -----CORRECT ANSWER---------------She has 10 days. -Any change in firm affiliation or personal information requires NCREC be notified in writing within 10 days of the change. Alison works for Sellerman Law Services, and listed one of the company's properties for sale as a part of her regular paid work. Does Alison need a North Carolina real estate license? -----CORRECT ANSWER---------------No. Alison qualifies for the business entity exemption, wherein business entities along with their officers and employees may sell owned properties in the same way that individual owners may sell their own properties. Listing agent Jim receives calls from Chylynn and Drew, whose respective clients are interested in seeing Jim's listing. He later receives another call from Bob, who represents yet another interested buyer. Who are the cooperating agents? ----- CORRECT ANSWER---------------Jim, Chylynn, Drew, and Bob Your investor client is interested in purchasing a commercial office building with at least five but no more than eight floors. What type of office space is this client interested in? - ----CORRECT ANSWER---------------Mid-rise building North Carolina broker Jane just signed an agency agreement with a new buyer client, Toby. How quickly will Jane need to a get copy of the agreement to her broker-in- charge, Nathan, so Nathan can keep it in his records? -----CORRECT ANSWER---------- -----Within three days Eliot's project broker, Marlene, just turned in her resignation. Fortunately, Eliot's friend Daniella is willing to step in as Marlene's replacement. When does Eliot need to provide notice to the commission? -----CORRECT ANSWER---------------Eliot needs to file a new designation form with the commission within 10 days of the change. When a group of teenagers spray painted graffiti on the common area playground, the residents asked the landlord to have it cleaned up. In North Carolina, is this one of the landlord's duties? -----CORRECT ANSWER---------------Yes. It is a landlord's duty to keep all common areas clean and safe. Simone is a North Carolina broker who has been approached by non-MLS broker member Ash regarding one of Simone's MLS listings. Before Simone can agree to pay Ash a portion of the compensation derived from the transaction in question, what should RESPA does not apply to (VIP) ----CORRECT ANSWER---------------1) Vacant Land Transactions 2) Cash Transactions 3) Seller Financed Transactions ) Commercial Transactions RESPA CO-OWNERSHIP with different settlement service providers ----CORRECT ANSWER---------------Also known as: - Affiliated Business Arrangements (ABAs) - Controlled Business Arrangements (CBAs) These are permitted but 3 requirements: 1) Disclosure of the relationship 2) Use of the service provider cannot be forced 3) must disclose fees RESPA PROHIBITS ----CORRECT ANSWER---------------Real Estate Licenses from forcing client or customer to use a particular settlement service provider Commercial Real Estate Lien Act says ----CORRECT ANSWER---------------Lien May be placed on Commercial properties for commercial service rendered in a sales or lease transaction Commercial Real Estate Lien Requirements ----CORRECT ANSWER---------------1) Written Agreement specifying services and compensation 2) Must be a listing agent to file 3) Must be limited to THE subject property Commercial Real Estate Lien Tim Requirements ----CORRECT ANSWER---------------1) Not until 30 days of closing or possesion 2) For Leases - 90 days or written 60 days of non payment 3) Broker has 18 months to enforce 4) Lien priority is as of the date of recordation. NO SPECIAL PRIORITY 5) Mechanics Liens ALWAYS have superiority over the broker's regardless of when they are filed The Basics of Condominiums ----CORRECT ANSWER---------------The formal legal definition of a condominium is when owners 1) have a separate Fee simple AND 2) share ownership of common area 3) title to the common area is Tenants in Common Regarding Condominiums: What must be disclosed to prospective buyers prior to sale - VIP ----CORRECT ANSWER---------------Public Offering Statement Regarding condominiums: When must the disclosure of POS happen ----CORRECT ANSWER---------------Prior to purchase contract How many days do prospective buyers have to rescind from contract ----CORRECT ANSWER---------------A MANDATORY 7 day right of rescission Regarding condominiums: ----CORRECT ANSWER---------------There must be a unit owner's association formed prior to transfer of first unit Regarding condominiums: there may be a special class of common areas that is reserved for use by one or more units. These areas are called ----CORRECT ANSWER- --------------Limited Common Areas Regarding condominium insurance coverage ----CORRECT ANSWER---------------Policy H06 owner's "walls" in coverage is covered What typically covers the common areas of a condominium ----CORRECT ANSWER---- -----------the Condo Master Policy To sell timeshare in North Carolina one MUST have ----CORRECT ANSWER-------------- -a real estate license Definition of TIMESHARE in NC ----CORRECT ANSWER---------------the sale or lease with a right to occupy the property or unit at least 1) 5 or more separate time periods 2) over a period of at least 5 years When must a POS be provided to prospective buyers when selling a TIMESHARE interest VIP ----CORRECT ANSWER---------------prior to contract What must be obtained prior to the sale or offer to sell or lease a TIMESHARE interest - VIP ----CORRECT ANSWER---------------Certificate of Registration TIMESHARE developer must designate ----CORRECT ANSWER---------------a licensee who is NOT on provisional status to act as PROJECT BROKER Definition of Core area in a commercial building - VIP ----CORRECT ANSWER------------ ---area used for building functions. For Example Lobbies, stair, mechanical rooms, elevators, restrooms Definition of Rentable area or square footage - VIP ----CORRECT ANSWER--------------- Core area plus Usable area Definition of Floor Plate ----CORRECT ANSWER---------------Area of the floor determined by measuring the exterior walls Definition of Useable area - VIP ----CORRECT ANSWER---------------The floor plate minus the core area Office rental rates are usually calculated - VIP ----CORRECT ANSWER---------------per square foot for the rentable area Tenant Improvements ----CORRECT ANSWER---------------Commercial lease or sale in which TENANT makes and pays for repairs or improvement Upfits ----CORRECT ANSWER---------------Commercial lease or sale in which OWNER makes and pays for repairs or improvement Passthrough provisions in commercial real estate are ----CORRECT ANSWER------------ ---Taxes, Insurance, and Maintenance Net lease with Base Years Stop (BYS) ----CORRECT ANSWER---------------Means the owner pays on the pass through provisions the first year and the tenant pays in the subsequent years that is over the base year amount Absorption Study - VIP ----CORRECT ANSWER---------------analyzing the amount of space leased and vacant over a particular period of time Key factors that affect commercial real estate ----CORRECT ANSWER--------------- Location Area demographics Traffic patterns Income levels Growth Trends Retail spaces are usually leased ----CORRECT ANSWER---------------square foot as an annual dollar amount In a Commercial Purchase a common practice is to ----CORRECT ANSWER--------------- Use Letters of Intent before a final purchase contract is created by parties Inspection period in a commercial purchase is ----CORRECT ANSWER---------------10 day free look period Property used in a trade or business may qualify for tax ----CORRECT ANSWER--------- ------depreciation Capital gains ----CORRECT ANSWER---------------if real estate has not been an owner occupied for 2 out of the last 5 years is subject to Capital GAINS TAX 1031 Tax Deferred Exchange ----CORRECT ANSWER---------------Referred to as "like- kind" properties, can defer capital gains tax Boot ----CORRECT ANSWER---------------Funds an investor/owner retains and does not reinvest after sale of property An Active Real Estate License is required when - VIP ----CORRECT ANSWER------------ ---Assisting another for compensation in the providing of brokerage services including referral of business An unlicensed person may engage in real estate activity (EXEMPTIONS) if - VIP ---- CORRECT ANSWER---------------1) Owns the subject property 2) Is an Attorney-in-Fact (POA) 3) Trustees in a foreclosure 4) Court ordered sales (bankruptcy, executors, guardians) 5) Housing Authorities Power of Attorney exemption exists ----CORRECT ANSWER---------------to complete the sale in a performance contract Entities and those working for companies who are EXEMPT from needing a license when handling OWNED properties - VIP ----CORRECT ANSWER---------------1) CORPORATION - Officers, Directors, and W2 Employees 2) LLC: Managers and W2 Employees 3) Partnerships: General Partners and W2 Employees How many Real Licenses are required in NC ----CORRECT ANSWER---------------ONE. North Carolina is a SINGLE license state 4) Retention of records 5) Notify NCREC of changes in location of licensees A provisional broker must deliver all monies to their ----CORRECT ANSWER--------------- BIC IMMEDIATELY All deposits must be made to the trust account within ----CORRECT ANSWER------------- --3 banking days/3 days of acceptance of receipt or contract acceptance, whichever is later Licensees can accept for delivery ----CORRECT ANSWER---------------1) Due Diligence fees 2) Ernest Money deposits Licensees cannot accept or deliver ----CORRECT ANSWER---------------1) Inspection fees 2) Survey fees 3) Closing disbursements to clients repairs 4) survey payments Trust accounts may earn interest so long as ----CORRECT ANSWER---------------The broker has written consent of client and a written agreement specific who gets the interest BICS may transfer earnest money for closing - VIP ----CORRECT ANSWER--------------- No more than 10 days prior to settlement Trust Accounts must be balanced ----CORRECT ANSWER---------------Every 30 days AND records retained for 3 years Every entity created except Sole Prop must have ----CORRECT ANSWER---------------A firm license A full broker may gain tax benefits and liability protection by ----CORRECT ANSWER---- -----------forming and entity for the purposes of receipt of compensation only Person who obtains a firm license is a - VIP ----CORRECT ANSWER--------------- Qualifying Broker To be a Qualifying Broker the licensee must be ----CORRECT ANSWER---------------1) A full broker 2) Principal of the entity seeking the firm license Qualifying Brokers must - VIP ----CORRECT ANSWER---------------1) Renew firm license 2) Appoint a BIC in each location 3) Maintain firm certificate 4) Notify NCREC within 10 days of location change 5) Notify NCREC within 10 days of a name change 6) Notify NCREC fo registration of assumed name All licenses expire on ----CORRECT ANSWER---------------June 30th Qualifying broker fails to have a BIC in each office location ----CORRECT ANSWER----- ----------the firm license becomes Inactive Unlicensed assistants CAN ----CORRECT ANSWER---------------1) Receive and forward phone calls 2) Submit listing data 3) Search public records 4) Place signs and lockboxes 5) Order and Supervise repairs 6) Act as Courier 7) Gather factual data 8) Schedule appointments 9) Coordinate and confirm appointments 10) Complete basic forms Unlicensed Assistants CANNOT ----CORRECT ANSWER---------------1) Assist others in the sale or lease 2) Hold open houses without a licensee 3) Cold call or prospect 4) Make referrals for a fee 5) Create and publish advertisements Provisional Brokers may NEVER BE ----CORRECT ANSWER---------------DUALLY Affiliated