NC REAL ESTATE EXAM QUESTIONS
AND ANSWERS (ALL CORRECT)
An agent learns that a builder is offering a bonus as they are writing an offer for the
agent's buyer. The offer is being written immediately using the standard offer to
purchase as is typical in most residential sales. Upon learning of the bonus, the agent
suggests that he create an addendum addressing the additional compensation to be
included in the offer. What is true about this situation? - Answer- The agent would be
entitled to the compensation by disclosing it to the buyer, but the written
acknowledgment could not be in the offer to purchase.
Which of the following duties would fall under the responsibility of a property manager? -
Answer- Maintain the property according to the owner's goals and to the highest
profitability within those goals
Melissa is the broker for a buyer client. The buyer wants to make an offer on a property,
so Melissa filled out a form 2-T and the buyer signed it. Melissa then submitted the offer
to the seller's agent, who rejected it. Melissa let her client know the offer was rejected
and kept a copy of the offer in her files. What error did Melissa make in this transaction?
- Answer- She should have delivered a copy of the signed offer to her client within three
calendar days
A broker in charge is responsible for all advertisement done in the name of the firm.
Which of the following would be an acceptable advertisement by an agent? - Answer-
"offered for sale, stunning beach condo with best views of sunrise from your deck. Cal
Joe Smith, ABC Reality, 919.555.1212"
When listing a property to sell, which of the following would be accurate regarding NC
Real Estate Commission guidance? - Answer- When measuring a property for living
area, any floor of the house that has earth adjacent to one wall above floor level is
considered below grade and should be represented as such.
Government ownership of land is the role of government to own and maintain: - Answer-
Public land such as streets, highways, parks, schools, government buildings, roads, and
military bases
Alicia's home was assessed at $712,300. Her tax rate is 11 mills. What is her property
tax bill for this year? - Answer- 7,835.30
One thousands method = 712,300 is 712.3. 712.3 x 11 = 7,825.30
,Broker Lucinda and Seller Jonathon sign an agency agreement. A week later, Seller
Jonathon asks Broker Lucinda to consider ending the relationship, and they jointly
decide to terminate the agreement early. Evaluate their actions. - Answer- They have
decided to end the agency relationship via mutual agreement and are released from
liability for breach of contract
Virginia leases a property through a percentage lease.
Her base rent is $1,200.
In June her property earns $5,000.
Last month her rent was $3,000.
3% of her monthly sales go towards rent.
Her operating expenses are $450.
How much did Virginia pay for rent in June? - Answer- 1,290
1,200 + (5,000 x 0.03) = 1,350
Darla works at a lending office. She is in talks with a borrower when a coworker tells her
the company doesn't make loans to that area because of "the kind of people who live
there." The coworker shows a map with the area blacked out. Darla doesn't want to be
fired, so she tells the borrower that the company cannot loan to them. Did Darla do
anything wrong? - Answer- Yes, Darla is guilty of the practice of redlining
In North Carolina, townhouses are subject to the provisions of what piece of legislation?
- Answer- North Carolina Planned Community Act
What is a purchase contract in which the buyer pays the seller for the property in
multiple installments for a predetermined length of time, and the seller holds the deed
and title until the property has been fully paid for called? - Answer- Contract for deed
A buyer is purchasing a house that currently has a tenant. The tenant pays the rent in
advance on the first of the month. A closing takes palace on August 20th, how would
the rent proration appear on the settlement statement or closing disclosure? - Answer-
Debit seller, credit buyer in equal amounts
Which of these is the cash flow after debt service? - Answer- a property's annual
income, minus operating expenses and debt service
After estimating the value of the property using the applicable approaches to appraisal,
an appraiser will usually: - Answer- reconcile the final value estimate
Which of the following is true regarding property insurance? - Answer- HO-3 is a
common form of homeowner policy and is a package policy that includes coverage for
property and liability claims
Clara is a tenant who is signing a one year lease for $1000 per month. According to the
North Carolina Tenant Security Deposit Act, what is the maximum security deposit
amount that Clara's landlord can require? - Answer- 2,000
, A city has decided it would be a public good and benefit the local homeowners to add
some more streetlights. What is the most likely way they would fund this intiative? -
Answer- with special assessment
A tenant chooses to withhold rent because his air conditioner has been acting up. The
landlord disagrees with the tenant regarding the air conditioning and seeks to terminate
the tenancy. What term describes the landlord's option in this case? - Answer- summary
ejectment
A firm has a policy of designated agency when dual agency arises as long as the
agents are in a position to follow the rules of designated agency. Under which of the
following circumstances would designated agency not be allowed? - Answer- broker,
seeking to represent a buyer, knows the seller, listed with his firm, is going through a
nasty divorce and would sell cheaply for a quick close
Grandpa Bobby conveys his property to his granddaughter Pamela. The deed contains
(1) Pamela's name; (2) an accurate and precise description of the property to be
conveyed; and (3) Grandpa Bobby's signed name. Identify, in order, these elements of
the deed? - Answer- grantee's name, legal description; grantor's signature
If there is a dispute regarding whether an item is a fixture, courts apply the Total
Circumstances Test. Which of the following considerations would the court use in
determining whether the property conveys with the property or could be removed by the
seller? - Answer- the intention of the person who attached it
Valeria has not been very lucky lately. In the past month, she's discovered that her
home:
Has been located within a flood zone since she purchased it
Could be taken by the state against her consent to extend the highway
Will be taxed higher this year than it was last year
Could be turned over to the state since she doesn't have a will
Which of the above is the best example of eminent domain? - Answer- Valeria's home
could be taken by the state without her consent to extend the highway
Which of the following statements is TRUE about a broker's responsibility regarding
land use? A broker: - Answer- must disclose to their potential client that ordinances or
convenants could affect their use and enjoyment of the property, but they are not
required to discover and diclose exactly what the ordinances or convenants are
What is a purchase contract in which the buyer pays the seller for the property in
multiple installments for a predetermined length of time, and the seller holds the deed
and title until the property has been fully paid for called? - Answer- contract for deed
Which of the following would be considered a private land-use control? - Answer-
protective convenant
AND ANSWERS (ALL CORRECT)
An agent learns that a builder is offering a bonus as they are writing an offer for the
agent's buyer. The offer is being written immediately using the standard offer to
purchase as is typical in most residential sales. Upon learning of the bonus, the agent
suggests that he create an addendum addressing the additional compensation to be
included in the offer. What is true about this situation? - Answer- The agent would be
entitled to the compensation by disclosing it to the buyer, but the written
acknowledgment could not be in the offer to purchase.
Which of the following duties would fall under the responsibility of a property manager? -
Answer- Maintain the property according to the owner's goals and to the highest
profitability within those goals
Melissa is the broker for a buyer client. The buyer wants to make an offer on a property,
so Melissa filled out a form 2-T and the buyer signed it. Melissa then submitted the offer
to the seller's agent, who rejected it. Melissa let her client know the offer was rejected
and kept a copy of the offer in her files. What error did Melissa make in this transaction?
- Answer- She should have delivered a copy of the signed offer to her client within three
calendar days
A broker in charge is responsible for all advertisement done in the name of the firm.
Which of the following would be an acceptable advertisement by an agent? - Answer-
"offered for sale, stunning beach condo with best views of sunrise from your deck. Cal
Joe Smith, ABC Reality, 919.555.1212"
When listing a property to sell, which of the following would be accurate regarding NC
Real Estate Commission guidance? - Answer- When measuring a property for living
area, any floor of the house that has earth adjacent to one wall above floor level is
considered below grade and should be represented as such.
Government ownership of land is the role of government to own and maintain: - Answer-
Public land such as streets, highways, parks, schools, government buildings, roads, and
military bases
Alicia's home was assessed at $712,300. Her tax rate is 11 mills. What is her property
tax bill for this year? - Answer- 7,835.30
One thousands method = 712,300 is 712.3. 712.3 x 11 = 7,825.30
,Broker Lucinda and Seller Jonathon sign an agency agreement. A week later, Seller
Jonathon asks Broker Lucinda to consider ending the relationship, and they jointly
decide to terminate the agreement early. Evaluate their actions. - Answer- They have
decided to end the agency relationship via mutual agreement and are released from
liability for breach of contract
Virginia leases a property through a percentage lease.
Her base rent is $1,200.
In June her property earns $5,000.
Last month her rent was $3,000.
3% of her monthly sales go towards rent.
Her operating expenses are $450.
How much did Virginia pay for rent in June? - Answer- 1,290
1,200 + (5,000 x 0.03) = 1,350
Darla works at a lending office. She is in talks with a borrower when a coworker tells her
the company doesn't make loans to that area because of "the kind of people who live
there." The coworker shows a map with the area blacked out. Darla doesn't want to be
fired, so she tells the borrower that the company cannot loan to them. Did Darla do
anything wrong? - Answer- Yes, Darla is guilty of the practice of redlining
In North Carolina, townhouses are subject to the provisions of what piece of legislation?
- Answer- North Carolina Planned Community Act
What is a purchase contract in which the buyer pays the seller for the property in
multiple installments for a predetermined length of time, and the seller holds the deed
and title until the property has been fully paid for called? - Answer- Contract for deed
A buyer is purchasing a house that currently has a tenant. The tenant pays the rent in
advance on the first of the month. A closing takes palace on August 20th, how would
the rent proration appear on the settlement statement or closing disclosure? - Answer-
Debit seller, credit buyer in equal amounts
Which of these is the cash flow after debt service? - Answer- a property's annual
income, minus operating expenses and debt service
After estimating the value of the property using the applicable approaches to appraisal,
an appraiser will usually: - Answer- reconcile the final value estimate
Which of the following is true regarding property insurance? - Answer- HO-3 is a
common form of homeowner policy and is a package policy that includes coverage for
property and liability claims
Clara is a tenant who is signing a one year lease for $1000 per month. According to the
North Carolina Tenant Security Deposit Act, what is the maximum security deposit
amount that Clara's landlord can require? - Answer- 2,000
, A city has decided it would be a public good and benefit the local homeowners to add
some more streetlights. What is the most likely way they would fund this intiative? -
Answer- with special assessment
A tenant chooses to withhold rent because his air conditioner has been acting up. The
landlord disagrees with the tenant regarding the air conditioning and seeks to terminate
the tenancy. What term describes the landlord's option in this case? - Answer- summary
ejectment
A firm has a policy of designated agency when dual agency arises as long as the
agents are in a position to follow the rules of designated agency. Under which of the
following circumstances would designated agency not be allowed? - Answer- broker,
seeking to represent a buyer, knows the seller, listed with his firm, is going through a
nasty divorce and would sell cheaply for a quick close
Grandpa Bobby conveys his property to his granddaughter Pamela. The deed contains
(1) Pamela's name; (2) an accurate and precise description of the property to be
conveyed; and (3) Grandpa Bobby's signed name. Identify, in order, these elements of
the deed? - Answer- grantee's name, legal description; grantor's signature
If there is a dispute regarding whether an item is a fixture, courts apply the Total
Circumstances Test. Which of the following considerations would the court use in
determining whether the property conveys with the property or could be removed by the
seller? - Answer- the intention of the person who attached it
Valeria has not been very lucky lately. In the past month, she's discovered that her
home:
Has been located within a flood zone since she purchased it
Could be taken by the state against her consent to extend the highway
Will be taxed higher this year than it was last year
Could be turned over to the state since she doesn't have a will
Which of the above is the best example of eminent domain? - Answer- Valeria's home
could be taken by the state without her consent to extend the highway
Which of the following statements is TRUE about a broker's responsibility regarding
land use? A broker: - Answer- must disclose to their potential client that ordinances or
convenants could affect their use and enjoyment of the property, but they are not
required to discover and diclose exactly what the ordinances or convenants are
What is a purchase contract in which the buyer pays the seller for the property in
multiple installments for a predetermined length of time, and the seller holds the deed
and title until the property has been fully paid for called? - Answer- contract for deed
Which of the following would be considered a private land-use control? - Answer-
protective convenant
