1. Two Maryland salespersons want to form an LLC to receive their commissions. Which statement is correct?
Answer & explanation
Answer: A. §17-512 permits licensees to form an entity with the broker's consent. Every owner must be a licensed salesperson or associate broker, and commissions may be paid to the entity. It does not become a brokerage.
2. A Maryland salesperson receives an earnest money check from a buyer. The salesperson must:
Answer & explanation
Answer: D. §17-502(a) requires associate brokers and salespersons to promptly submit trust money to their broker. Only the broker maintains trust accounts.
3. A licensee urges homeowners to 'sell now before property values drop' because people of a particular national origin are moving into the neighborhood. This is:
Answer & explanation
Answer: B. §17-322(b)(16) and State Gov't §20-705 prohibit inducing sales with representations about protected-class residents and claims that values will fall. Whether the facts are true is irrelevant.
4. A Maryland broker must deposit trust money from a sales contract no later than:
Answer & explanation
Answer: B. §17-502(b) requires deposit promptly but not more than 7 business days after both parties accept the contract. The clock runs from mutual acceptance, not from receipt of the check.
5. A real estate licensee who is not an attorney may:
Answer & explanation
Answer: B. Licensees may complete attorney-prepared forms but may not draft contracts, amendments or addenda or give legal advice - that is the unauthorized practice of law.
6. A buyer refuses to sign the acknowledgment on the 'Understanding Whom Real Estate Agents Represent' form. What should the licensee do?
Answer & explanation
Answer: A. The form includes a certification for consumers unable or unwilling to acknowledge receipt. The licensee records it there. Signing for the buyer would be dishonest, and refusing to sign creates no agency.
7. A salesperson first licensed in February 2024 is approaching a first renewal. Which course is part of the required first-renewal CE?
Answer & explanation
Answer: B. For salespersons licensed on or after October 1, 2023, the first renewal requires Contracts, Brokerage Relationships, Real Estate Practice, Property Management/Landlord-Tenant (3 hours each), and Professionalism and Financing (1.5 each). No electives or substitutions are allowed. Supervision is for brokers, managers, and team leaders.
8. Which action by a Maryland buyer's agent is NOT a breach of duty to the buyer client?
Answer & explanation
Answer: D. §17-532 says representing other clients seeking similar properties is not a breach. Disclosing confidential negotiating information or failing to present a counteroffer breaches the statutory duties.
9. When must a Maryland licensee give the 'Understanding Whom Real Estate Agents Represent' disclosure to a buyer who is not yet a client?
Answer & explanation
Answer: B. §17-530(b) requires the disclosure no later than the first scheduled face-to-face contact. Waiting until the offer stage is the most common wrong answer.
10. A life estate is measured by:
Answer & explanation
Answer: D. A life estate lasts for the duration of a specified person's life, then passes to the remainderman or reverts to the grantor. A fixed term describes an estate for years (a leasehold).
11. Under the Maryland Code of Ethics, a licensee may accept compensation from more than one party to a transaction only:
Answer & explanation
Answer: C. COMAR 09.11.02.02C permits compensation from more than one party only with the full knowledge of all parties.
12. 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.
13. 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.
14. A home sells for $425,000 to a buyer who is not a first-time Maryland homebuyer. What is the State transfer tax?
Answer & explanation
Answer: D. $425,000 × 0.005 = $2,125. Using the 0.25% first-time rate gives $1,062.50.
15. In a lease, the tenant holds a ____ estate and the landlord holds a ____.
Answer & explanation
Answer: D. The lessee has a leasehold (non-freehold) estate; the lessor retains the leased fee interest plus the reversion.
16. 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.
17. 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.)
18. Which activity may an unlicensed assistant generally perform?
Answer & explanation
Answer: D. Unlicensed staff may perform clerical tasks like typing licensee-prepared ads, but may not compose ads, negotiate or show property.
19. A licensee may manage property for an owner for a fee only if there is:
Answer & explanation
Answer: D. Property management agreements must be written and signed; they make the manager a general agent and define duties, authority and fees.
20. When competing brokerages agree to charge the same commission rate, they commit:
Answer & explanation
Answer: D. Agreeing on commissions among competitors is illegal price fixing under the Sherman Antitrust Act; commissions must be set independently and are always negotiable.
21. A listing agreement in which the broker earns a commission regardless of who sells the property is a(n):
Answer & explanation
Answer: B. In an exclusive right-to-sell listing, the listing broker earns a commission no matter who procures the buyer, even the owner. (Reclassified to section 6 / CORE.)
22. Which action may a life tenant take WITHOUT the remainderman's consent?
Answer & explanation
Answer: D. A life tenant may occupy or lease the property for the duration of the life estate but cannot sell, mortgage or commit waste that harms the remainderman's future interest.
23. Which is the most common and desirable way a real estate sales contract terminates?
Answer & explanation
Answer: C. Contracts ideally end by performance. They can also end by mutual agreement, impossibility, operation of law, or breach.
24. A licensee representing the seller who learns the buyer will pay more than the offer must:
Answer & explanation
Answer: C. Loyalty and disclosure require the seller's agent to share material information that benefits the client. The agent owes the buyer-customer no confidentiality.
25. On a closing statement, the purchase price is a:
Answer & explanation
Answer: B. The seller receives the price (credit); the buyer owes it (debit).
Sources
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