NC POST LICENSING – 303 REAL EXAM COMPLETE QUESTIONS WITH
100% RATED CORRECT ANSWERS 2025 LATEST UPDATED 100%
(ACCURATE ) GET A+!!
Question 1
Under what circumstances is it illegal for a licensee to earn compensation for brokerage
activities?
A) When their license is on provisional status.
B) When their license is inactive or expired.
C) When they are affiliated with more than one BIC.
D) When they are working as a sole proprietor.
Correct Answer: B) When their license is inactive or expired.
Rationale: A fundamental rule is that a license must be both current and active at the time
the brokerage service is provided to legally earn a commission or fee.
Question 2
A broker's license was active when they procured a buyer, but it expired before the closing. Can
the broker be legally paid the commission they earned?
A) No, the license must be active at the time of closing to receive payment.
B) Yes, they can be paid for compensation that was earned when the license was current and
active.
C) No, any commission earned with an expired license must be forfeited to the NCREC.
D) Yes, but only if they renew their license within 10 days of the closing.
Correct Answer: B) Yes, they can be paid for compensation that was earned when the
license was current and active.
Rationale: The key is the license status at the time the service was rendered and the
commission was earned. Payment can be legally received later, even if the license status has
since changed.
Question 3
A licensee has formed an S-Corporation for tax purposes. Under what condition may their BIC
pay commission directly to this S-Corporation?
A) If the licensee is a full broker, not a provisional broker.
B) If the S-Corporation has obtained a North Carolina firm license.
,C) If the S-Corporation is registered with the NC Secretary of State.
D) A BIC can never pay a licensee's entity.
Correct Answer: B) If the S-Corporation has obtained a North Carolina firm license.
Rationale: NCREC rules state that for a BIC to pay an entity (like an LLC or S-Corp), that
entity must hold its own separate firm license.
Question 4
A broker wants to give a portion of their commission to their buyer client as a closing gift. Which
of the following is NOT a requirement for this to be legal?
A) It must be disclosed on the Closing Disclosure.
B) The gift must be less than $500 in value.
C) It must be subject to lender approval if there is a loan.
D) The agreement to share the commission must be in writing.
Correct Answer: B) The gift must be less than $500 in value.
Rationale: There is no specific dollar limit on sharing a commission with a principal. The
key requirements are that it must be in writing, disclosed on the CD, and approved by the
lender.
Question 5
How must all compensation to a broker affiliated with a firm be handled?
A) The client can pay the broker directly if authorized by the BIC.
B) The closing attorney can pay the broker directly.
C) All compensation must flow through the firm and be paid by the BIC.
D) Brokers affiliated with the same firm can pay each other directly.
Correct Answer: C) All compensation must flow through the firm and be paid by the BIC.
Rationale: NCREC rules are strict that compensation for brokerage services must be paid
to the firm/BIC, who then disburses it to the affiliated broker. Direct payments are
prohibited.
Question 6
A North Carolina broker wants to pay a referral fee to an agent in Florida. What is required to
make this payment legally?
A) The Florida agent must have a limited non-resident commercial license.
,B) The referral fee must be less than 25% of the total commission.
C) The NC broker must verify the Florida agent has a current and active license in Florida.
D) The NC broker must have a written referral agreement on a NCREC-approved form.
Correct Answer: C) The NC broker must verify the Florida agent has a current and active
license in Florida.
Rationale: You can pay a referral fee to a licensee in any state, provided you can document
that their license was current and active at the time the referral was made.
Question 7
What is required before a licensee can accept a bonus or incentive offered by their client?
A) The bonus must be in the form of cash only.
B) The bonus must be paid directly to the licensee, not the firm.
C) The licensee must obtain disclosure and consent from their principal (client).
D) The bonus must be approved by the NCREC.
Correct Answer: C) The licensee must obtain disclosure and consent from their principal
(client).
Rationale: To avoid conflicts of interest, any bonus or incentive must be fully disclosed to
the client, and the client must give their consent, preferably in writing.
Question 8
The Real Estate Settlement Procedures Act (RESPA) prohibits kickbacks between settlement
service providers. Which of the following would be a RESPA violation?
A) A lender paying a broker a fee for referring a mortgage client.
B) A broker sharing their commission with their buyer client.
C) A home inspector giving a discount to a first-time homebuyer.
D) A broker recommending three different attorneys to their client.
Correct Answer: A) A lender paying a broker a fee for referring a mortgage client.
Rationale: RESPA prohibits receiving any "thing of value" for the referral of settlement
service business. A fee paid by a lender to a broker for a referral is a classic example of an
illegal kickback.
Question 9
RESPA applies to which of the following transactions?
, A) The purchase of a commercial office building with a federally related loan.
B) An all-cash purchase of a residential duplex.
C) A seller-financed sale of a single-family home.
D) The purchase of a single-family home using a new FHA loan.
Correct Answer: D) The purchase of a single-family home using a new FHA loan.
Rationale: RESPA applies to 1-4 unit residential properties with a federally related loan.
An FHA loan is a federally related loan.
Question 10
Which of the following transactions is EXEMPT from RESPA?
A) The purchase of a 3-unit residential property with a VA loan.
B) The refinance of a primary residence with a conventional loan.
C) The purchase of a 10-acre parcel of vacant land with a bank loan.
D) The purchase of a condominium with a federally insured mortgage.
Correct Answer: C) The purchase of a 10-acre parcel of vacant land with a bank loan.
Rationale: The text explicitly lists vacant land transactions as being exempt from RESPA
requirements.
Question 11
A real estate firm that also owns a mortgage company has an Affiliated Business Arrangement
(ABA). Which of the following is a requirement to comply with RESPA?
A) The firm must offer a discount if the client uses their mortgage company.
B) The firm cannot force the client to use their affiliated mortgage company.
C) The affiliated mortgage company must have the lowest fees in the market.
D) The firm can only have an ABA with one type of settlement service provider.
Correct Answer: B) The firm cannot force the client to use their affiliated mortgage
company.
Rationale: A key requirement of a legal ABA is that the use of the affiliated service cannot
be required or forced. The consumer must be free to shop for other providers.
Question 12
According to RESPA, a real estate licensee is prohibited from:
A) Recommending a preferred settlement service provider.
100% RATED CORRECT ANSWERS 2025 LATEST UPDATED 100%
(ACCURATE ) GET A+!!
Question 1
Under what circumstances is it illegal for a licensee to earn compensation for brokerage
activities?
A) When their license is on provisional status.
B) When their license is inactive or expired.
C) When they are affiliated with more than one BIC.
D) When they are working as a sole proprietor.
Correct Answer: B) When their license is inactive or expired.
Rationale: A fundamental rule is that a license must be both current and active at the time
the brokerage service is provided to legally earn a commission or fee.
Question 2
A broker's license was active when they procured a buyer, but it expired before the closing. Can
the broker be legally paid the commission they earned?
A) No, the license must be active at the time of closing to receive payment.
B) Yes, they can be paid for compensation that was earned when the license was current and
active.
C) No, any commission earned with an expired license must be forfeited to the NCREC.
D) Yes, but only if they renew their license within 10 days of the closing.
Correct Answer: B) Yes, they can be paid for compensation that was earned when the
license was current and active.
Rationale: The key is the license status at the time the service was rendered and the
commission was earned. Payment can be legally received later, even if the license status has
since changed.
Question 3
A licensee has formed an S-Corporation for tax purposes. Under what condition may their BIC
pay commission directly to this S-Corporation?
A) If the licensee is a full broker, not a provisional broker.
B) If the S-Corporation has obtained a North Carolina firm license.
,C) If the S-Corporation is registered with the NC Secretary of State.
D) A BIC can never pay a licensee's entity.
Correct Answer: B) If the S-Corporation has obtained a North Carolina firm license.
Rationale: NCREC rules state that for a BIC to pay an entity (like an LLC or S-Corp), that
entity must hold its own separate firm license.
Question 4
A broker wants to give a portion of their commission to their buyer client as a closing gift. Which
of the following is NOT a requirement for this to be legal?
A) It must be disclosed on the Closing Disclosure.
B) The gift must be less than $500 in value.
C) It must be subject to lender approval if there is a loan.
D) The agreement to share the commission must be in writing.
Correct Answer: B) The gift must be less than $500 in value.
Rationale: There is no specific dollar limit on sharing a commission with a principal. The
key requirements are that it must be in writing, disclosed on the CD, and approved by the
lender.
Question 5
How must all compensation to a broker affiliated with a firm be handled?
A) The client can pay the broker directly if authorized by the BIC.
B) The closing attorney can pay the broker directly.
C) All compensation must flow through the firm and be paid by the BIC.
D) Brokers affiliated with the same firm can pay each other directly.
Correct Answer: C) All compensation must flow through the firm and be paid by the BIC.
Rationale: NCREC rules are strict that compensation for brokerage services must be paid
to the firm/BIC, who then disburses it to the affiliated broker. Direct payments are
prohibited.
Question 6
A North Carolina broker wants to pay a referral fee to an agent in Florida. What is required to
make this payment legally?
A) The Florida agent must have a limited non-resident commercial license.
,B) The referral fee must be less than 25% of the total commission.
C) The NC broker must verify the Florida agent has a current and active license in Florida.
D) The NC broker must have a written referral agreement on a NCREC-approved form.
Correct Answer: C) The NC broker must verify the Florida agent has a current and active
license in Florida.
Rationale: You can pay a referral fee to a licensee in any state, provided you can document
that their license was current and active at the time the referral was made.
Question 7
What is required before a licensee can accept a bonus or incentive offered by their client?
A) The bonus must be in the form of cash only.
B) The bonus must be paid directly to the licensee, not the firm.
C) The licensee must obtain disclosure and consent from their principal (client).
D) The bonus must be approved by the NCREC.
Correct Answer: C) The licensee must obtain disclosure and consent from their principal
(client).
Rationale: To avoid conflicts of interest, any bonus or incentive must be fully disclosed to
the client, and the client must give their consent, preferably in writing.
Question 8
The Real Estate Settlement Procedures Act (RESPA) prohibits kickbacks between settlement
service providers. Which of the following would be a RESPA violation?
A) A lender paying a broker a fee for referring a mortgage client.
B) A broker sharing their commission with their buyer client.
C) A home inspector giving a discount to a first-time homebuyer.
D) A broker recommending three different attorneys to their client.
Correct Answer: A) A lender paying a broker a fee for referring a mortgage client.
Rationale: RESPA prohibits receiving any "thing of value" for the referral of settlement
service business. A fee paid by a lender to a broker for a referral is a classic example of an
illegal kickback.
Question 9
RESPA applies to which of the following transactions?
, A) The purchase of a commercial office building with a federally related loan.
B) An all-cash purchase of a residential duplex.
C) A seller-financed sale of a single-family home.
D) The purchase of a single-family home using a new FHA loan.
Correct Answer: D) The purchase of a single-family home using a new FHA loan.
Rationale: RESPA applies to 1-4 unit residential properties with a federally related loan.
An FHA loan is a federally related loan.
Question 10
Which of the following transactions is EXEMPT from RESPA?
A) The purchase of a 3-unit residential property with a VA loan.
B) The refinance of a primary residence with a conventional loan.
C) The purchase of a 10-acre parcel of vacant land with a bank loan.
D) The purchase of a condominium with a federally insured mortgage.
Correct Answer: C) The purchase of a 10-acre parcel of vacant land with a bank loan.
Rationale: The text explicitly lists vacant land transactions as being exempt from RESPA
requirements.
Question 11
A real estate firm that also owns a mortgage company has an Affiliated Business Arrangement
(ABA). Which of the following is a requirement to comply with RESPA?
A) The firm must offer a discount if the client uses their mortgage company.
B) The firm cannot force the client to use their affiliated mortgage company.
C) The affiliated mortgage company must have the lowest fees in the market.
D) The firm can only have an ABA with one type of settlement service provider.
Correct Answer: B) The firm cannot force the client to use their affiliated mortgage
company.
Rationale: A key requirement of a legal ABA is that the use of the affiliated service cannot
be required or forced. The consumer must be free to shop for other providers.
Question 12
According to RESPA, a real estate licensee is prohibited from:
A) Recommending a preferred settlement service provider.
