Chapter 21 - Quiz - Part 1

Which of the following is a scenario that requires a non-resident commercial broker's license?

A licensed South Carolina broker wishes to sell a commercial listing in North Carolina.

Which of the following is NOT a proper reference for specific information regarding North Carolina Real Estate License Law?

A licensed mortgage broker. A mortgage broker may be knowledgeable about real estate, but that doesn't make them a reliable reference for specific information about license law. Chapter 93A and subchapter 58A both define license law in North Carolina and the official Commission website is also a reliable reference.

When is a provisional broker allowed to go against a decision made by the BIC?

A provisional broker must respect the BIC's authority at all times or affiliate elsewhere.

What is the difference between a trust and a will?

A trust goes into effect immediately after signing while a will goes into effect when a person dies.

Which of the following would result in a canceled application?

An applicant fails to complete the educational requirements.

Which of the following would constitute a character issue?

An applicant was previously convicted of insider trading and fails to disclose this information in the application. Criminal convictions, especially those that involve finance, must be disclosed to the Commission. A character issue is not necessarily a judgment of an applicant's past behavior, it's an indication of current dishonesty. Minor convictions would not constitute a character issue if they are properly disclosed.

Which of the following statements about an assistant showing properties is true?

An assistant is permitted to show properties at the direction of a broker in charge. Non-licensed assistants are allowed to show properties at the direction of the broker in charge. However, the assistant must refrain from providing any insight or analysis regarding the property or the deal without a license.

Which real estate professional is not required to hold a license?

An auction crier. Auction criers are merely the parties hired to run the auction and accept bids. They do not perform any brokerage activities and, therefore, are not required to be licensed. However, any party responsible for acquiring listings to sell at auction must be licensed.

What's the difference between an inactive license and a revoked license?

An inactive license is the result of a failure to renew; a revoked license is the result of disciplinary action.

Which of the following is true about referral fees?

An individual must be licensed to accept a fee for referring a client to a real estate broker. Real estate brokers are permitted to receive a referral fee as long as both parties are licensed and the appropriate parties consent. Non-licensed parties are never permitted to receive a fee for a real estate transaction.

When must a broker have access to proof of licensure?

At all times when conducting business.

Which of the following are brokers required to report to the Commission?

Change of name or address.

Which of the following activities is NOT a violation of license law?

Cold calling.

What is a broker required to do annually?

Complete 8 hours of continuing education and submit a license renewal form.

Which of the following activities is a violation of license law?

False advertising. Willing misrepresentation of facts. Failing to properly handle money.

Which of the following is considered fraudulent behavior?

Falsifying tax returns.

How can a broker get his or her license back if it has been revoked?

Follow any instructions imparted by the Commission and reapply for licensure when instructed. It is up to the Commission when and if they permit a broker to be reinstated after having his or her license revoked. A broker must wait for any length of time required by the Commission and fulfill any necessary continuing education or other requirements. Then he or she must reapply for licensure to be reinstated.

Which of the following activities CAN be conducted by a non-licensed assistant?

Handling and recording money to be put in escrow. Fielding phone calls and emails from prospective buyers who contact the firm. Provide general information about brokerage properties to an interested party.

When must a broker apply to reinstate his or her license?

If it has been suspended, canceled, revoked, or it has expired.

Why might the Commission deny an application for reinstatement?

If the broker was subjected to disciplinary action and the Commission doesn't feel he or she is adequately reformed. In the case of a simple expiration, the Commission is unlikely to deny an application for reinstatement, if the broker has fulfilled all the necessary requirements. However, if the broker had to be disciplined for violating license law, the Commission reserves the right to deny an application based on any continued patterns of behavior.

Where must a certificate of licensure be displayed?

In a prominent location at the brokerage.

How much does a criminal record check cost?

It depends on the amount of work required to retrieve the records. Every applicant must pay for a criminal record check conducted by the Commission-approved source. Criminal record checks are priced based on the amount of labor required to pull records. If a broker has always lived in North Carolina, it will be cheaper to pull records than it will for a broker who has lived in several states.

What happens if a broker fails to renew his or her license?

It's an identification card a broker can use to verify licensure outside the brokerage.

What is a pocket card?

It's an identification card a broker can use to verify licensure outside the brokerage.

Which of the following responsibilities at a brokerage would likely be handled by a non-licensed assistant?

Keeping records of deposits made in escrow and ensuring all contracts are properly retained and organized. Non-licensed assistants are typically hired to take care of clerical or administrative tasks, like bookkeeping and organizing files. An assistant may help with the other activities listed, but the responsibility ultimately falls on the broker-in-charge.

A BIC is swamped with work and needs an assistant to take care of some of the responsibilities. Which of the following tasks is the assistant permitted to undertake?

Meet with a superintendent to supervise the repair of a broken light fixture.

How many members of the North Carolina Real Estate Commission are there in total?

Nine

Which of the following statements about non-licensed assistants is true?

Non-licensed assistants are usually W-2 employees because they cannot earn any commissions.

How often must a broker's license be renewed?

Once a year. A broker's license must be renewed once a year, along with completing 8 hours of continuing education. Renewal forms must be sent in by June 30th or an applicant's license will expire on July 1st.

Which of the following is the correct, chronological sequence of license statuses?

Provisional broker, broker, broker in charge. The correct order is provisional broker, broker, broker in charge, listed in terms of the experience required to obtain the status. A non-resident commercial broker is a separate license altogether. Rental or sales brokers are not official statuses.

Which of the following activities may be performed by a non-licensed individual?

Purchasing an investment property. Nonlicensed persons are free to purchase real estate even for investment purposes. The activities that require a license involve conducting real estate transactions on behalf of someone else or accepting a fee as part of a real estate transaction.

Which of the following is true about Realtors?

Realtor is a term used to designate real estate professionals who are members of the National Association of Realtors.

Which of the following activities does NOT require a real estate license?

Renting out a room in your home to earn extra money.

Which of the following disciplinary actions is the least serious?

Reprimand.

Which of the following activities CANNOT be conducted by a non-licensed assistant?

Soliciting sellers to list their properties with the brokerage. Non-licensed assistants are not permitted to solicit business from any clients. He or she may take pictures or acquire general information from a seller at the request of a broker in charge. But actively pursuing a listing is a task that only a licensed broker can perform.

What course is a BIC required to take to satisfy CE requirements in place of the General Updates Course?

The Broker-in-Charge Update Course. Brokers in Charge are required to take a special BIC General Updates Course in place of the General Updates course brokers are required to take.

Which of the following statements describe the primary responsibilities of the Commission?

The Commission is responsible for creating bylaws, rules and regulations governing the practice of real estate in North Carolina.

Which of the following is true about provisional brokers?

they have 18 months to complete their continuing education or apply for an extension. Provisional brokers are required to complete an additional 90 hours of CE to become regular brokers. They may apply for an extension, if necessary, but it is typically only granted in extreme circumstances.

What happens if a broker does not receive a renewal reminder from the Commission?

The broker is still responsible for renewing his or her license by June 30th.

What is the penalty for failing to report a criminal conviction?

The broker may have his or her license suspended or revoked.

What happens if a broker fails to renew his or her license, and more than six months have passed?

The broker must complete any deficient educational requirements and apply for reinstatement.

What happens if a broker's license has been expired for more than three years?

The broker must retake the 75-hour prelicensing course, pass the exam, apply for reinstatement, and become a provisional broker.

Which of the following accurately describes the provisional broker - broker-in-charge relationship?

The broker-in-charge is responsible for mentoring and supervising the provisional broker.

Which of the following groups is exempt from license requirements when practicing real estate?

The housing authority. Salaried employees of the state housing authority are allowed to conduct certain brokerage activities without a license, like transferring property. All the other groups listed must be licensed to perform any real estate services that require it.

Whose responsibility is it to renew the firm's license?

The qualifying broker. The responsibility to renew the firm's license falls on the qualifying broker. The owner of the brokerage may be the qualifying broker or may ensure it's taken care of ‒ but it's ultimately the responsibility of whoever is designated to manage these matters.

Who is permitted to negotiate according to broker-approved pricing packages without a license?

The salaried employees of vacation rental companies. State law makes a specific exception for salaried employees of vacation rental companies. They are permitted to negotiate with clients without a license according to scripted pricing plans. These plans must be approved by a licensed broker.

What position must be appointed when a new business entity is formed to open a real estate brokerage?

a qualifying broker

What should a provisional broker do if he or she doesn't agree with the BIC's management style?

affiliate elsewhere

Which of the following services could not be conducted under the same business entity as the other three?

architecture. Multiple services can be performed under business entity as long as none of them are known as a professional service. Architecture is considered one of the 22 professional services that require a professional business entity to be created. The other three are not professional services and therefore may be conducted under one business entity.

Which of the following is true of a broker in charge?

A broker in charge is a licensed broker who has completed an additional 12 hours of education and is responsible for managing the office.

Which of the following is NOT a valid form of ID to prove a broker's licensure?

A business card.

In which situation is a property owner required to hire a real estate broker?

A business owner wants to sell the business along with the property it's on. Normally, a seller is not compelled to hire a real estate agent to sell their own property. But in the case of a business owner who is transferring real estate along with a business, the expertise of a licensed broker is required by law.

Which of the following describes a real estate broker?

A contractor who advertises property and negotiates the sale, lease, or auction of said property on behalf of another party.

Which of the following documents is required to be submitted alongside a broker's license application?

A criminal record report. Applicants must submit a criminal record report from the state-recommended source when applying for a broker's license in North Carolina. A credit report, tax return, and resume are not necessary.

What is a deed in trust?

A legal instrument that vests interest in a property from a borrower to a lender to secure a loan. A deed in trust is a legal instrument that grants a lender interest in a property to secure a loan. If the owner of the property cannot pay the loan back, the lender can recoup the loss by selling the property.

How much is the renewal fee?

$45 (Dollars)

What is the fee to reinstate a license?

$90 (Dollars)

Which of the following statements about continuing education is true?

Brokers are required to complete 8 hours of continuing education per year. All brokers are required to complete 8 hours of CE per year to renew their licenses: 4 hours of elective coursework and 4 hours of state-approved general updates coursework.

Which of the following statements is true about offering brokerage services to potential clients?

Brokers must be licensed to offer any brokerage services to prospective clients.

When is an attorney at law allowed to transfer property without a license?

When it pertains to their general duties to practice law.

In which situation is a property manager required to be licensed?

When renting out units and charging tenants a fee at closing.

When is a broker's provisional status terminated?

When the broker completes the 90-hour post-licensing course.

Which of the following business entities does not require a separate brokerage firm license for the purpose of conducting brokerage activities?

sole proprietor. A broker doing business as a sole proprietor needs only a personal broker's license to conduct brokerage activities. However, the broker is personally liable if something goes wrong with the business as a sole proprietor.