Free Montana Agency Practice Test — LicenseIQ

Question 1

An agency relationship can be terminated by all of the following EXCEPT:

Accepted Answer

Agency ends by performance, expiration, mutual agreement, operation of law, death or incapacity, or destruction of the property - not by the wish of an unrepresented customer.

Question 2

When must a Montana seller agent give the seller the initial relationship disclosure?

Accepted Answer

MCA 37-51-314(2)(a) requires the initial disclosure to the seller at the time the listing agreement is entered into.

Question 3

When a broker appoints one salesperson to represent the seller and another salesperson in the same office to represent the buyer, this is:

Accepted Answer

Designated agency assigns separate agents within one brokerage; the broker is still a dual agent and written consent is required.

Question 4

A property manager owes fiduciary duties primarily to the:

Accepted Answer

The property manager is the owner's (general) agent and owes fiduciary duties to the owner, while dealing honestly with tenants.

Question 5

The best way to create an agency relationship is a(n):

Accepted Answer

A written express agreement clearly defines parties, duties and compensation and is enforceable.

Question 6

Which duty does a seller's agent owe to a buyer who is a customer, not a client?

Accepted Answer

Customers are owed HARD duties - Honesty, Accounting, Reasonable skill and care, and Disclosure of material facts - but not loyalty, obedience or confidentiality.

Question 7

An agent advertises a home as having a 'new roof' without verifying it; the roof is actually 18 years old. This is:

Accepted Answer

Stating unverified facts that prove false is negligent misrepresentation; knowingly false statements are fraud. Puffing is opinion, not a verifiable fact.

Question 8

A seller agent knows the home's basement floods every spring. The seller asks the agent not to mention it. The agent must:

Accepted Answer

MCA 37-51-313(3)(a) requires a seller agent to disclose known adverse material facts to buyers. The duty to obey covers only lawful instructions, and concealing a known defect is not lawful.

Question 9

A seller instructs her listing agent not to show the home to buyers of a certain national origin. The agent should:

Accepted Answer

Obedience requires following lawful instructions only. Discriminatory instructions violate fair housing laws and must be refused.

Question 10

A buyer agent calls a seller directly to negotiate, knowing the seller has an exclusive listing with another broker and without the listing broker's agreement. This is:

Accepted Answer

MCA 37-51-321(1)(l) prohibits negotiating directly with a party the licensee knows is bound by an exclusive listing with another broker. Board rules require any agreement allowing direct negotiation to be documented.

Question 11

A buyer agent recommends a home inspector who is her husband. Under Board rules she must:

Accepted Answer

ARM 24.210.641 makes it unprofessional conduct to recommend a provider such as an inspector without disclosing any family or financial relationship or interest.

Question 12

A buyer agent must give the seller or seller agent a disclosure of the relationship:

Accepted Answer

MCA 37-51-314(3)(c) requires the subsequent disclosure to the seller or seller agent at the beginning of negotiations. The initial disclosure at signing goes to the buyer, not the seller.

Question 13

A Montana listing agreement expires on August 31 without a sale. When did the seller agent relationship end?

Accepted Answer

MCA 37-51-313(11)(a) ends the relationship at the earliest of performance, the expiration date in the agreement, or an authorized termination. Expiration came first here.

Question 14

Without written consent, a Montana dual agent may NOT disclose:

Accepted Answer

MCA 37-51-313(8) bars a dual agent from disclosing, without consent, that the seller will accept less, that the buyer will pay more, motivating factors, or information marked confidential in writing. Leaks, failed septic, and the buyer's inability to perform are adverse material facts the dual agent must disclose.

Question 15

Which statement about dual agency is correct?

Accepted Answer

Dual agency creates an inherent conflict; with informed written consent, the agent provides limited representation and must keep each party's confidences.

Question 16

Which statement correctly describes a Montana seller agent's duty to a buyer regarding property condition?

Accepted Answer

MCA 37-51-313(3)(a) requires disclosure of known adverse material facts and states the agent need not inspect the property or verify the seller's statements. A seller agent does owe the buyer limited duties, so 'disclose nothing' is wrong.

Question 17

Which fiduciary duty continues even after the agency relationship has ended?

Accepted Answer

Most fiduciary duties end with the agency, but the agent must continue to keep the former client's confidential information private.

Question 18

After a Montana agency relationship ends, the licensee still owes the former principal a duty to:

Accepted Answer

MCA 37-51-313(12) leaves two duties after termination: accounting for money and property, and keeping confidential information confidential (with exceptions). Obedience, best interests, and marketing end with the relationship.

Question 19

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:

Accepted Answer

Implied agency arises from conduct; the agent then owes full fiduciary duties. Express agency is created by stated agreement, ideally in writing.

Question 20

A listing agent arranges a cleaning service for the seller and secretly receives $150 from the cleaner. This violates the prohibition on:

Accepted Answer

MCA 37-51-321(1)(f) prohibits accepting, giving, or charging an undisclosed commission, rebate, or profit on expenditures made for a principal.

Question 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:

Accepted Answer

Conditioning one service on the purchase of another is a tying arrangement prohibited by antitrust law.

Question 22

A buyer's agent's brother owns a home that fits the buyer's needs. Before showing it, the agent must:

Accepted Answer

Any personal or financial interest of the agent or family must be disclosed up front so the client can make an informed decision.

Question 23

A seller knows that the basement flooded last spring, but the damage was repaired and is not visible. The seller and listing agent must:

Accepted Answer

Latent (hidden) defects known to the seller or agent must be disclosed; failing to do so can create liability for both.

Question 24

During a listing walk-through, the agent notices fresh paint on one ceiling area and a musty odor. The agent should:

Accepted Answer

Agents are not inspectors, but must recognize red flags (stains, odors, cracks) and disclose them for further investigation.

Question 25

The client a broker represents is the:

Accepted Answer

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.

Montana real estate agency practice test

1. An agency relationship can be terminated by all of the following EXCEPT:

2. When must a Montana seller agent give the seller the initial relationship disclosure?

3. When a broker appoints one salesperson to represent the seller and another salesperson in the same office to represent the buyer, this is:

4. A property manager owes fiduciary duties primarily to the:

5. The best way to create an agency relationship is a(n):

6. Which duty does a seller's agent owe to a buyer who is a customer, not a client?

7. An agent advertises a home as having a 'new roof' without verifying it; the roof is actually 18 years old. This is:

8. A seller agent knows the home's basement floods every spring. The seller asks the agent not to mention it. The agent must:

9. A seller instructs her listing agent not to show the home to buyers of a certain national origin. The agent should:

10. A buyer agent calls a seller directly to negotiate, knowing the seller has an exclusive listing with another broker and without the listing broker's agreement. This is:

11. A buyer agent recommends a home inspector who is her husband. Under Board rules she must:

12. A buyer agent must give the seller or seller agent a disclosure of the relationship:

13. A Montana listing agreement expires on August 31 without a sale. When did the seller agent relationship end?

14. Without written consent, a Montana dual agent may NOT disclose:

15. Which statement about dual agency is correct?

16. Which statement correctly describes a Montana seller agent's duty to a buyer regarding property condition?

17. Which fiduciary duty continues even after the agency relationship has ended?

18. After a Montana agency relationship ends, the licensee still owes the former principal a duty to:

19. 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:

20. A listing agent arranges a cleaning service for the seller and secretly receives $150 from the cleaner. This violates the prohibition on:

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:

22. A buyer's agent's brother owns a home that fits the buyer's needs. Before showing it, the agent must:

23. A seller knows that the basement flooded last spring, but the damage was repaired and is not visible. The seller and listing agent must:

24. During a listing walk-through, the agent notices fresh paint on one ceiling area and a musty odor. The agent should:

25. The client a broker represents is the:

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