1. A home sells for $389,000. The seller pays a 5% commission, a $212,600 mortgage payoff, $1,200 attorney fee, $1,950 transfer tax and $600 in other costs. What are the seller's net proceeds?
Answer & explanation
Answer: D. Commission = $389,000 x 0.05 = $19,450. Total costs = $19,450 + $212,600 + $1,200 + $1,950 + $600 = $235,800. Net = $389,000 - $235,800 = $153,200.
2. Absent a lease provision extending it, a Colorado landlord must return a security deposit or provide a written statement within:
Answer & explanation
Answer: D. C.R.S. 38-12-103(1) sets one month, extendable by lease to no more than 60 days.
3. Under Commission Rule 6.7, which arrangement is prohibited for a single broker in one transaction?
Answer & explanation
Answer: B. Rule 6.7 bars a broker or team from being a single agent for one party and a single agent or transaction-broker for the other. Transaction-brokerage for both is permitted, and separate designated brokers are allowed.
4. Which statement about a Colorado transaction-broker's duty to investigate is correct?
Answer & explanation
Answer: B. C.R.S. 12-10-407(4)-(5) relieves a transaction-broker of any duty to independently inspect the property, verify statements by parties or inspectors, or investigate the buyer's finances. The disclosure duty reaches only facts the broker actually knows.
5. Absent a written agreement, interest earned on a Colorado brokerage's trust account:
Answer & explanation
Answer: A. Commission Position 5 states that without a written agreement, interest on trust funds does not belong to the firm.
6. On the $20,000 commission above, the listing broker keeps 50% and pays 50% to the buyer's broker. How much does the buyer's broker receive?
Answer & explanation
Answer: D. $20,000 x 0.50 = $10,000 to the buyer's broker.
7. A salesperson wants to buy a FSBO home for his own investment. He must:
Answer & explanation
Answer: D. A licensee acting as a principal must disclose licensed status, because the licensee has superior knowledge and expertise.
8. Which person may perform the described activity in Colorado WITHOUT a real estate license?
Answer & explanation
Answer: C. C.R.S. 12-10-201(6)(b) exempts on-site salaried apartment or condominium managers acting within their customary duties. The finder's fee and the paid manager are performing brokerage for others with compensation, which requires a license.
9. A broker's license expired four months ago. What is required to reinstate it?
Answer & explanation
Answer: C. Under Rule 3.15, reinstatement from 31 days to one year after expiration costs the renewal fee plus half the renewal fee. Only the renewal fee applies within 31 days; reapplication is required after three years.
10. A salesperson receives an earnest money check from a buyer. The salesperson should:
Answer & explanation
Answer: C. The broker manages the trust account; licensees must promptly deliver trust funds to the broker.
11. A broker produces a buyer under a written, enforceable contract. The buyer refuses to close because the title commitment reveals a defect, and the seller fails to cure it within a reasonable time. Under C.R.S. 12-10-301, the commission:
Answer & explanation
Answer: C. Section 12-10-301 provides that when a buyer refuses to complete because of title defects, no commission is owed unless the owner corrects the defects within a reasonable time.
12. A broker earned a $15,750 commission on a $450,000 sale. What was the commission rate?
Answer & explanation
Answer: A. Rate = commission / sale price = $15,750 / $450,000 = 0.035 = 3.5%.
13. In real estate, the accessibility requirements of the Americans with Disabilities Act apply mainly to:
Answer & explanation
Answer: A. The ADA's accessibility rules primarily cover public accommodations and commercial facilities; housing accessibility is governed mainly by the Fair Housing Act.
14. A salesperson earns $6,000 on a $150,000 sale. What was the commission rate?
Answer & explanation
Answer: B. Rate = commission / sale price = $6,000 / $150,000 = 0.04 = 4%.
15. In a life estate, the person who receives the property when the life tenant dies is the:
Answer & explanation
Answer: A. The life tenant has a present interest; the remainderman holds a future interest. If the property returns to the grantor, it is a reversion.
16. According to Commission Position 19, if a Colorado broker prepares and records closing documents and disburses funds, the broker:
Answer & explanation
Answer: C. Commission Position 19 says the broker becomes the Closing Company in that situation and must ensure the parties complete the Commission-approved Closing Instructions when they sign the contract.
17. Under an open listing, the seller owes a commission to:
Answer & explanation
Answer: C. Open listings are non-exclusive; only the procuring broker is paid, and the owner owes nothing for a self-sale.
18. A listing where the seller may sell themselves without owing commission, but only the listing broker among agents is protected, is:
Answer & explanation
Answer: B. In an exclusive agency listing, the seller pays no commission on a self-sale, but the listing broker is protected if any broker sells it. (Reclassified to section 6 / CORE.)
19. A title company prepares the settlement statement in a broker-assisted Colorado sale. Responsibility for confirming that the statement is accurate and consistent with the contract rests with:
Answer & explanation
Answer: C. Failing to furnish accurate closing statements is a ground for discipline under 12-10-217(1)(j); the broker must review the statement against the contract even when a title company drafts it.
20. A seller wants to net $250,000 after paying a 6% commission and $6,000 in other closing costs. To the nearest dollar, what must the sale price be?
Answer & explanation
Answer: B. Net + other costs = $256,000, which equals 94% of the price (100% - 6%). Price = $256,000 / 0.94 = $272,340.43, about $272,340. Adding 6% to $256,000 ($271,360) understates the price.
21. An agent tells a buyer he will show homes only if the buyer uses the agent's brother as mortgage broker. This is an illegal:
Answer & explanation
Answer: A. Conditioning one service on the purchase of another is a tying arrangement prohibited by antitrust law.
22. A candidate passed both portions of the Colorado exam 13 months ago and has not applied for a license. What is the result?
Answer & explanation
Answer: A. The application must be filed within one year of passing; otherwise the exam and passing score are cancelled and the candidate must retest. There is no late-fee option.
23. Two brokers agree not to cooperate with a discount brokerage in order to drive it out of business. This is:
Answer & explanation
Answer: D. Agreeing with competitors to refuse to deal with another business is an illegal group boycott.
24. On a closing statement, the purchase price is a:
Answer & explanation
Answer: B. The seller receives the price (credit); the buyer owes it (debit).
25. Which statement about dual agency is correct?
Answer & explanation
Answer: D. Dual agency creates an inherent conflict; with informed written consent, the agent provides limited representation and must keep each party's confidences.
Sources
Source verification pending. Confirm current requirements with your state regulator.