1. A licensee never signs a buyer agreement but repeatedly gives a buyer negotiating advice and acts on his behalf. An agency relationship may have been created by:
Answer & explanation
Answer: A. Implied agency arises from conduct; the agent then owes full fiduciary duties. Express agency is created by stated agreement, ideally in writing.
2. A material defect that a seller/agent must disclose is one that:
Answer & explanation
Answer: C. Material defects significantly affect value or would influence a buyer's decision and must be disclosed.
3. On the Illinois radon disclosure form, the real estate agent must:
Answer & explanation
Answer: B. Section 10(b) includes an agent acknowledgment that the agent informed the seller of the seller's obligations. Agents do not test or guarantee results.
4. 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.)
5. The fiduciary duty that requires an agent to safeguard and account for all money and property received on behalf of the client is:
Answer & explanation
Answer: A. The duty of accounting requires the agent to track, report on and properly handle all funds and documents belonging to the client.
6. The client a broker represents is the:
Answer & explanation
Answer: A. The principal is the client to whom the agent owes fiduciary duties; a customer is a party the agent works with but does not represent.
7. The best way to create an agency relationship is a(n):
Answer & explanation
Answer: C. A written express agreement clearly defines parties, duties and compensation and is enforceable.
8. A seller instructs her listing agent not to show the home to buyers of a certain national origin. The agent should:
Answer & explanation
Answer: A. Obedience requires following lawful instructions only. Discriminatory instructions violate fair housing laws and must be refused.
9. An Illinois broker may transfer earnest money to the closing agent:
Answer & explanation
Answer: B. The rule allows escrow moneys to be transferred to the closing agent up to 2 business days before a scheduled closing.
10. Which of the following is a fiduciary duty an agent owes the principal?
Answer & explanation
Answer: A. Fiduciary duties are Confidentiality, Obedience, Accounting, Loyalty and Disclosure (COALD), plus reasonable care.
11. 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.
12. A cooperating broker shows an MLS-listed home to a buyer with whom she has no written agreement. Whom does she represent?
Answer & explanation
Answer: C. Section 15-10 makes the licensee the designated agent of the consumer she works with, Section 15-55 says MLS participation does not create subagency, and Section 15-40 says payment of compensation does not determine agency.
13. At what point must Illinois clients who previously consented to dual agency confirm that consent in writing?
Answer & explanation
Answer: C. Section 15-45(c) requires written confirmation of the prior dual agency consent at the time the clients sign the offer or contract.
14. During a listing walk-through, the agent notices fresh paint on one ceiling area and a musty odor. The agent should:
Answer & explanation
Answer: C. Agents are not inspectors, but must recognize red flags (stains, odors, cracks) and disclose them for further investigation.
15. An agent advertises a home as having a 'new roof' without verifying it; the roof is actually 18 years old. This is:
Answer & explanation
Answer: C. Stating unverified facts that prove false is negligent misrepresentation; knowingly false statements are fraud. Puffing is opinion, not a verifiable fact.
16. A broker wants to buy a home that she has listed for her own client. Which statement is correct?
Answer & explanation
Answer: B. Section 15-45 prohibits a licensee from acting as a dual agent when the licensee, or an entity in which the licensee has an ownership interest, is a party. She must also disclose her license status in writing under Section 10-27. Nothing requires transferring the listing or waiting for expiration.
17. Which duty does a seller's agent owe to a buyer who is a customer, not a client?
Answer & explanation
Answer: D. Customers are owed HARD duties - Honesty, Accounting, Reasonable skill and care, and Disclosure of material facts - but not loyalty, obedience or confidentiality.
18. Which fiduciary duty continues even after the agency relationship has ended?
Answer & explanation
Answer: D. Most fiduciary duties end with the agency, but the agent must continue to keep the former client's confidential information private.
19. When a broker appoints one salesperson to represent the seller and another salesperson in the same office to represent the buyer, this is:
Answer & explanation
Answer: B. Designated agency assigns separate agents within one brokerage; the broker is still a dual agent and written consent is required.
20. 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.
21. According to the Illinois License Act, payment of compensation by a seller to a buyer's broker:
Answer & explanation
Answer: C. Section 15-40 states that payment or promise of payment of compensation does not determine whether an agency relationship has been created.
22. Before an Illinois licensee may act as a dual agent, the licensee must obtain:
Answer & explanation
Answer: D. Section 15-45 requires the informed written consent of all clients. A signed form containing the statutory dual agency language creates a presumption of informed consent.
23. Under Article 15, a consumer who sues a licensee for breach of statutory agency duties may recover:
Answer & explanation
Answer: B. Section 15-70 limits recovery to actual damages and court costs, or injunctive relief, and requires suit within 2 years of knowledge and 5 years of the act.
24. An Illinois listing agent must disclose to a buyer-customer:
Answer & explanation
Answer: A. Section 15-25 requires a seller's licensee to disclose known latent material physical defects to customers. Section 15-20 protects licensees from liability for not disclosing non-physical events like a suicide, and there is no duty to disclose unknown defects or the seller's motivation.
25. When must a licensee acting as a designated agent give the client written disclosure of the designated agency relationship?
Answer & explanation
Answer: B. Section 15-35(a) requires written disclosure of the designated agency relationship and the names of the designated agents no later than when the licensee begins working as a designated agent.
Sources
Source verification pending. Confirm current requirements with your state regulator.