1. A broker's license expired seven months ago. What may the broker do?
Answer & explanation
Answer: B. Within one year of expiration, OAR 863-014-0050 allows late renewal with the renewal fee, a late fee, and CE certification for active status. 'Lapsed' applies only after more than one year.
2. 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.
3. A deed conveys Oregon land to two siblings 'as joint tenants' with no other survivorship language. What estate do they take?
Answer & explanation
Answer: B. ORS 93.180 abolished joint tenancy in real property (except for trustees and personal representatives) and says 'joint tenants' alone creates a tenancy in common.
4. An offer says the earnest money check will be held undeposited until acceptance. After the seller accepts, when must the check be deposited into the trust account or with a licensed Oregon neutral escrow?
Answer & explanation
Answer: A. OAR 863-015-0255(5) requires deposit before the close of the third banking day after acceptance. Five banking days applies to other funds belonging to others.
5. From whom may an Oregon broker accept compensation for professional real estate activity?
Answer & explanation
Answer: A. ORS 696.290(2) limits an associated broker to compensation from their own principal broker. A direct payment from the seller is a violation.
6. A seller says, 'I will pay any broker a 5% commission if they bring me a buyer.' This promise creates a(n):
Answer & explanation
Answer: D. 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.
7. The federal law that prohibits price fixing, group boycotts, market allocation and tie-in agreements is the:
Answer & explanation
Answer: A. The Sherman Antitrust Act of 1890 prohibits conspiracies in restraint of trade, including these practices.
8. 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.
9. Which statement about FHA-insured loans is correct?
Answer & explanation
Answer: C. FHA loans are made by approved lenders and insured by FHA, with down payments as low as 3.5% and mortgage insurance premium (MIP) required on all FHA loans, for 1-4 family homes.
10. May a principal broker use a debit card on a clients' trust account?
Answer & explanation
Answer: B. OAR 863-015-0255(15) prohibits any debit card on a clients' trust account.
11. Within how many business days must a principal broker notify the bank and the Agency after opening a clients' trust account?
Answer & explanation
Answer: C. ORS 696.245 sets 10 business days to notify the bank and the Agency of opening or closing a trust account.
12. 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.
13. The deed clause that defines the extent of the estate granted, often beginning 'to have and to hold,' is the:
Answer & explanation
Answer: D. The habendum clause defines the estate conveyed; the granting clause contains the words of conveyance.
14. A managing principal broker's license is revoked. What happens to the licenses of brokers associated with that principal broker?
Answer & explanation
Answer: D. ORS 696.320 makes the associated licenses inactive pending transfer and requires the Agency to transfer them on request within 30 days. Associated brokers are not punished by revocation for the principal broker's misconduct.
15. A broker renews an expired license 40 days late. What is the status of the professional real estate activity she performed during those 40 days?
Answer & explanation
Answer: D. OAR 863-014-0050(10) says a late renewal takes effect when the requirements are met and is not retroactive. ORS 696.990(9) treats each 30-day period of such activity as one offense.
16. 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.
17. 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.
18. What experience must a licensee member of the Real Estate Board have before appointment?
Answer & explanation
Answer: D. Licensee members must have been actively engaged for five years in Oregon professional real estate activity (ORS 696.405). Three years is the principal broker licensing requirement, a different rule.
19. On the buyer's side of the closing statement, the earnest money deposit and the new mortgage loan are both:
Answer & explanation
Answer: A. Earnest money and loan proceeds are sources of funds that reduce what the buyer must bring, so they are buyer credits.
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. May an Oregon property manager manage rental real estate without a written management agreement?
Answer & explanation
Answer: B. OAR 863-025-0020(1) bars managing rental real estate without a written, unexpired agreement.
22. 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.
23. Mixing client trust funds with the broker's own business funds is:
Answer & explanation
Answer: B. Commingling client/escrow funds with the broker's operating funds is prohibited and grounds for discipline. Using those funds for personal purposes is conversion.
24. 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.
25. A broker received a 4.2% commission totaling $12,600. What was the sale price?
Answer & explanation
Answer: C. Sale price = commission / rate = $12,600 / 0.042 = $300,000.
Sources
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