Free North Carolina State Law Practice Test — LicenseIQ

Question 1

Complaints under the North Carolina State Fair Housing Act are filed with the:

Accepted Answer

The NC Human Relations Commission receives, investigates, and conciliates fair housing complaints under G.S. 41A-7. NCREC can discipline a broker separately but does not enforce Chapter 41A.

Question 2

A broker wants to pay $250 to an unlicensed friend for every buyer the friend refers who closes on a home. This is:

Accepted Answer

Paying unlicensed persons for brokerage acts, including referrals tied to transactions, is prohibited. Disclosure does not cure it.

Question 3

A Raleigh broker's buyer asks whether sexual orientation is a protected class under the NC State Fair Housing Act. The best answer is:

Accepted Answer

Chapter 41A lists race, color, religion, sex, national origin, handicapping condition, and familial status. Some local governments have adopted ordinances adding protections, but those are local, not state law.

Question 4

A provisional broker must complete 90 hours of postlicensing education:

Accepted Answer

The postlicensing clock runs 18 months from issuance, whether or not the license was ever activated, and no extensions are allowed. The one-course-per-year schedule is an obsolete system, which makes it a tempting distractor.

Question 5

In a lease, the tenant holds a ____ estate and the landlord holds a ____.

Accepted Answer

The lessee has a leasehold (non-freehold) estate; the lessor retains the leased fee interest plus the reversion.

Question 6

A licensee's advertising must generally:

Accepted Answer

Ads must identify the licensed broker/brokerage; salespersons cannot advertise under only their own name.

Question 7

A licensee representing the seller who learns the buyer will pay more than the offer must:

Accepted Answer

Loyalty and disclosure require the seller's agent to share material information that benefits the client. The agent owes the buyer-customer no confidentiality.

Question 8

On the buyer's side of the closing statement, the earnest money deposit and the new mortgage loan are both:

Accepted Answer

Earnest money and loan proceeds are sources of funds that reduce what the buyer must bring, so they are buyer credits.

Question 9

A home sells for $400,000 with a 5% total commission. What is the total commission?

Accepted Answer

$400,000 x 0.05 = $20,000.

Question 10

In a sales transaction, the Working with Real Estate Agents disclosure must be provided and reviewed:

Accepted Answer

Rule 58A .0104 requires WWREA at first substantial contact. The time of the offer is the deadline for a written buyer agency agreement, which is why that choice is tempting.

Question 11

A broker moves to a new residence address. She must notify the Commission:

Accepted Answer

Commission rules require brokers to report changes of name and residence or business address within 10 days.

Question 12

How did the 2024 NAR settlement affect North Carolina Real Estate Commission rules on buyer agency?

Accepted Answer

NCREC stated that the NAR changes apply only to NAR members and do not alter the License Law or Commission rules.

Question 13

A 55-and-older community meets the statutory occupancy and policy requirements. It is exempt from the NC State Fair Housing Act's protections for:

Accepted Answer

Qualifying housing for older persons is exempt only from familial status provisions. It may not discriminate on any other protected basis.

Question 14

The federal law that prohibits price fixing, group boycotts, market allocation and tie-in agreements is the:

Accepted Answer

The Sherman Antitrust Act of 1890 prohibits conspiracies in restraint of trade, including these practices.

Question 15

A home sells for $520,000 with a 5% commission. The listing broker pays 2.5% to the buyer's broker and splits the listing side 60/40 with the listing salesperson (salesperson gets 60%). How much does the listing salesperson earn?

Accepted Answer

Total = $520,000 x 0.05 = $26,000. Buyer broker gets 2.5% = $13,000, leaving $13,000 for the listing side. Salesperson = $13,000 x 0.60 = $7,800.

Question 16

Through the administrative process, the maximum civil penalty for a first violation of the NC State Fair Housing Act is:

Accepted Answer

G.S. 41A-7(l) allows up to $10,000 for a first violation, up to $25,000 with one prior violation within five years, and up to $50,000 with two or more prior violations within seven years.

Question 17

Which action may a life tenant take WITHOUT the remainderman's consent?

Accepted Answer

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.

Question 18

Which statement about the voluntary license cancellation option that took effect April 1, 2026 is correct?

Accepted Answer

New Rule 58A .0513 allows voluntary cancellation only when nothing is pending, and cancellation is permanent. It is not a way to escape a pending complaint.

Question 19

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 20

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?

Accepted Answer

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.

Question 21

The deed clause that defines the extent of the estate granted, often beginning 'to have and to hold,' is the:

Accepted Answer

The habendum clause defines the estate conveyed; the granting clause contains the words of conveyance.

Question 22

A salesperson earns $6,000 on a $150,000 sale. What was the commission rate?

Accepted Answer

Rate = commission / sale price = $6,000 / $150,000 = 0.04 = 4%.

Question 23

A property manager receives a tenant's security deposit and advance rent. These funds must be deposited in the:

Accepted Answer

Money belonging to others goes into a trust account; depositing it in an operating account is commingling.

Question 24

A seller says, 'I will pay any broker a 5% commission if they bring me a buyer.' This promise creates a(n):

Accepted Answer

In a unilateral contract only one party is bound (to pay if the act is performed); the other party has no obligation to act. Most real estate contracts are bilateral.

Question 25

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.

North Carolina real estate state law practice test

1. Complaints under the North Carolina State Fair Housing Act are filed with the:

2. A broker wants to pay $250 to an unlicensed friend for every buyer the friend refers who closes on a home. This is:

3. A Raleigh broker's buyer asks whether sexual orientation is a protected class under the NC State Fair Housing Act. The best answer is:

4. A provisional broker must complete 90 hours of postlicensing education:

5. In a lease, the tenant holds a estate and the landlord holds a .

6. A licensee's advertising must generally:

7. A licensee representing the seller who learns the buyer will pay more than the offer must:

8. On the buyer's side of the closing statement, the earnest money deposit and the new mortgage loan are both:

9. A home sells for $400,000 with a 5% total commission. What is the total commission?

10. In a sales transaction, the Working with Real Estate Agents disclosure must be provided and reviewed:

11. A broker moves to a new residence address. She must notify the Commission:

12. How did the 2024 NAR settlement affect North Carolina Real Estate Commission rules on buyer agency?

13. A 55-and-older community meets the statutory occupancy and policy requirements. It is exempt from the NC State Fair Housing Act's protections for:

14. The federal law that prohibits price fixing, group boycotts, market allocation and tie-in agreements is the:

15. A home sells for $520,000 with a 5% commission. The listing broker pays 2.5% to the buyer's broker and splits the listing side 60/40 with the listing salesperson (salesperson gets 60%). How much does the listing salesperson earn?

16. Through the administrative process, the maximum civil penalty for a first violation of the NC State Fair Housing Act is:

17. Which action may a life tenant take WITHOUT the remainderman's consent?

18. Which statement about the voluntary license cancellation option that took effect April 1, 2026 is correct?

19. Which statement about dual agency is correct?

20. 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?

21. The deed clause that defines the extent of the estate granted, often beginning 'to have and to hold,' is the:

22. A salesperson earns $6,000 on a $150,000 sale. What was the commission rate?

23. A property manager receives a tenant's security deposit and advance rent. These funds must be deposited in the:

24. A seller says, 'I will pay any broker a 5% commission if they bring me a buyer.' This promise creates a(n):

25. 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:

Sources