Nc license law Flashcards
What is the first point at which a provisional broker may begin practicing real estate in North Carolina?
when the NCREC receives notification of the provisional broker’s activation with a BIC
An unlicensed assistant may do all of the following activities, EXCEPT:
a.Assist the licensee with administrative duties and tasks
b.exhibit units for rent and provide tenants with information about the lease agreement
C.exhibit homes that are for sale and show the buyer around the home
D.fill in preprinted lease agreements and collect monies from prospective tenants, as long as the employee does not negotiate rents
C.exhibit homes that are for sale and show the buyer around the home
Unlicensed property management assistants are permitted to show rental properties to prospective tenants, however, we do not allow unlicensed assistants to show homes or conduct open houses in residential sales.
With regard to timeshares, all of the following are true, EXCEPT:
A.A timeshare developer and broker must maintain records of sales, rentals or exchange transactions for a minimum of three years.
B.All monies received by a timeshare developer or broker must be deposited within three banking days of receipt and remain in the trust account for ten days from the date of sale or until cancellation by the purchaser, whichever occurs first.
C. Timeshares are not considered real estate and no license is required to sell time shares in North Carolina.
D.Any refunds due to a cancellation of a timeshare purchase will be refunded within 30 days following the date of execution of the contract.
C. Timeshares are not considered real estate and no license is required to sell time shares in North Carolina.
You must be licensed to sell timeshares in North Carolina. All of the other answers are correct regarding the handling of funds and monies concerning timeshares.
Which of the following statements is true about timeshares?
They do not have to be registered with the NC Real Estate Commission.
They may be transferred prior to registering with the NC Real Estate Commission.
They must be registered with the NC Real Estate Commission prior to sale.
The timeshare broker may be fined by the NC Real Estate Commission.
They must be registered with the NC Real Estate Commission prior to sale.
All of the following statements are correct regarding the NCREC, EXCEPT:
They shall be entitled to the services of the Attorney General of North Carolina.
They shall not make rules or regulations regulating commissions, salaries, or fees to be charged by licensees.
They shall make rules to allow a licensee to pay a travel agent who does not have a real estate license a referral fee.
They shall have the power to make reasonable bylaws, rules and regulations that are inconsistent with the provisions of the general statutes.
They shall have the power to make reasonable bylaws, rules and regulations that are inconsistent with the provisions of the general statutes.
Their bylaws, rules and regulations must be “consistent” with the general statutes. It is true that the NCREC can use the services of the Attorney General. It is also true that they do not regulate the commissions or fees charged by licensees. Though referral fees generally cannot be paid to unlicensed people, the payment of a referral fee to a travel agent is the exception to the rule and is permitted.
It is correct to say that the NC Real Estate Commission may not fine a real estate licensee. However, the NC Real Estate Commission may do which of the following?
fine a timeshare developer up to $500 per violation of the Timeshare Act
General Statute 93A-2 states, in part, that a real estate broker is any person who, for compensation or valuable consideration or the promise thereof, lists or offers to list property. All of the following would constitute valuable consideration, EXCEPT:
a listing agent is promised a weekend trip to Myrtle Beach if the agent puts the home under contract before the end of the year
the owner of a jewelry store gives his buyer’s agent a diamond bracelet as a way of saying thank you for the agent’s hard work
a butcher offers a year’s supply of top sirloin to his agent if they can purchase an investment property for 50% off the asking price
the neighbor brings fresh tomatoes from their garden and bakes their agent a fresh apple pie as a way of saying thank you
the neighbor brings fresh tomatoes from their garden and bakes their agent a fresh apple pie as a way of saying thank you
Brokerage activities are defined as acting on behalf of another for compensation. These nominal items would not be considered compensation or valuable consideration. However, vacations, trips, expensive jewelry and expensive food would all be considered valuable.
All of the following could result in disciplinary action by the NC Real Estate Commission for unworthiness or incompetence, EXCEPT:
making any willful or negligent misrepresentation
pursuing a course of making false promises
accepting commissions or valuable consideration as a provisional broker from any person other than your Broker In Charge
Attempting to take all of the post licensing courses in a single year
Attempting to take all of the post licensing courses in a single year
There is a list of reasons why a licensee can be disciplined in Statute 93A-6. A provisional broker may always elect to complete post licensing classes on an earlier schedule than that required by the Commission
A provisional broker is subject to two separate education requirements. They must complete postlicensing education of 90 hours within 18 months from the date of licensure. When must a provisional broker complete their first 8 hour CE requirement?
Prior to the 2nd renewal of their real estate license
A nonprovisional real estate licensee is on inactive status. They are NOT holding themselves out to be available to help others buy, sell, rent or auction property. A friend asks for their help in a real estate transaction. Which of the following is TRUE?
Because they did not actively advertise or solicit the business the licensee may assist their friend, but they will have to be paid directly, not through the brokerage firm.
The agent may assist their friend so long as they activate their license before the transaction closes and they are paid.
an agent who’s license is inactive may not earn any fees or represent others in a real estate transaction.
Because the agent is a full broker they are not required to affiliate with a BIC and therefore the licensee may represent their friend and collect a fee.
an agent who’s license is inactive may not earn any fees or represent others in a real estate transaction.
A licensee on inactive status may not earn any fees or be involved in brokerage activities. The commission is concerned with the status of the license at the time the money was earned, not when it was received.
In the event that a licensee’s annual renewal fee is returned unpaid, the North Carolina Real Estate Commission may take all of the following actions, EXCEPT:
deny licensure renewal
suspend the agent’s license
revoke the agent’s license
fine the agent
fine the agent
All of the following would constitute an illegal action by an inactive licensee who is not affiliated with a firm, EXCEPT:
telling members of a networking club that they are a broker and offering members of the club their services
handing out business cards at a social gathering
telling a new acquaintance that they are a broker, but they are on inactive status
hosting an open house for another agent
telling a new acquaintance that they are a broker, but they are on inactive status
Which of the following do not need a real estate license to sell property?
corporation that owns property and is using an employee to sell the property
an auction house that deals in the sale of real property
an attorney who regularly and routinely assists others in the buying and selling of real property
an unlicensed assistant sitting in an open house
corporation that owns property and is using an employee to sell the property
A real estate license is never needed when handling your own property. A corporation’s W2 salaried employees who are not paid on a commission basis are considered as dealing with the corporation’s own property, therefore do not need a license.
Which of the following is INCORRECT about the post licensing requirement of a provisional broker?
the due date of the post licensing education is the anniversary date of licensure
post licensing consists of three 30 hour courses which may be taken in any order and must be completed within 18 months of obtaining license
post licensing courses end on June 10th and must be completed for the provisional broker to renew their license on June 30th
if a provisional broker does not complete post licensing by the deadlines their license will become inactive
post licensing courses end on June 10th and must be completed for the provisional broker to renew their license on June 30th
This is the rule for continuing education courses, not post licensing.
If a provisional broker fails to complete all three postlicensing courses within 18 months of obtaining license, what is their license status once the anniversary date passes?
inactive
If a licensee does not pay their renewal fee on or before June 30 of the year, what is the time period for the licensee to reinstate their license without the imposition of additional educational requirements?
6 months
If an active provisional broker pays their renewal fee before their second renewal, but does not take their 8 hours of continuing education before their second renewal, what is their license status on July 1st?
inactive
A corporation selling its own properties through the actions of its own salaried W2 employees:
is not required to have a firm license, but may not use its own employees
can use its own unlicensed employees, but must have a firm license
needs neither a firm license nor do its employees need to be licensed
need not have a license, but must affiliate with an NC broker-in-charge
needs neither a firm license nor do its employees need to be licensed
In regard to real estate fees and commissions between brokerages and clients what is the role of the North Carolina Real Estate Commission:
only sets maximum limits on the fees and commissions
has no role in fees or commissions
only becomes involved when a complaint if filed
regulates the commissions exchanged between brokers, but not those exchanged with clients
has no role in fees or commissions
All of the following are correct statements about the composition of the NCREC, EXCEPT:
there are 9 appointed members of the NC Real Estate Commission
the chairman of the Commission is elected by the Commission members
commission members serve 5 year terms
there are at least three licensees and at least two laypeople serving on the commission
commission members serve 5 year terms
All of the following are required in order to obtain a NC real estate license, EXCEPT:
high school diploma
age of at least 18
completing an application
successfully completing a 75 hour course and passing a school final examination
high school diploma
All of the following are true when a real estate license is inactive due to a CE deficiency, EXCEPT:
the licensee must cease all real estate activity as of July 1st
the licensee may not earn any commissions or referral fees while inactive
if the inactivity is for longer than 5 years the license will be considered expired
a licensee who is inactive due to CE deficiency more than
2 years must complete current year’s CE and 2 postlicensing courses
if the inactivity is for longer than 5 years the license will be considered expired
Which of the following must have a NC real estate license?
The executor of an estate selling their parent’s property and receiving a fee as the executor
An investor who is purchasing rental properties and placing them back on the market for sale
auctioneer
A crier of sales
auctioneer
All of the following are requirements of licensure for a NC Real Estate license, EXCEPT:
Possess a social security number
Be a United States citizen or possess proper documentation
File a complete application and fee
Be a resident of North Carolina
Be a resident of North Carolina
An unlicensed individual who transacts real estate for another or participates in the sale, lease or exchange of another for compensation is subject to which of the following penalties?
They will likely be issued a cease and desist order
They are guilty of a misdemeanor
They are subject to a fine of up to $10,000
They are subject to civil sanctions and a civil lawsuit
They will likely be issued a cease and desist order
Practicing real estate and operating as a real estate agent without a license is a felony.
An individual licensed in another state may receive a waiver of the NC education requirement to complete the 75 hour Broker Prelicense course if they meet which of the following criteria:
Successful completion of another state’s prelicense course of at least 75 hours within the last 3 years.
Judy is an unlicensed individual. Her parents are selling their own home as For Sale by Owner without the representation of a real estate licensee. While her parents are on vacation, Judy shows the home to some interested potential buyers and has long conversations with them about the conditions under which they may purchase her parent’s home. Judy’s parents do not pay her in cash but instead offer to send on an upcoming vacation. Is Judy in violation of NC Licensing Law?
No because the home is her parent’s own property and it is therefore exempt from the licensure requirement.
No, because Judy did not receive any cash payment for her activity.
Yes, Judy is engaged in the business of real estate without a license
Yes because Judy is legally required to obtain a power of attorney from her parents in this instance.
Yes, Judy is engaged in the business of real estate without a license
Henri is the manager and owner of his own LLC. He has a full time salaried staff person, Sheila, that he employs to work for his LLC. Henri’s company is buying homes, renovating them and putting them back on the market. He has Sheila show the properties to prospective buyers. Who is in violation of NC Licensing Law?
Neither Henri nor Sheila
There is no license law violation. Both the managers of the LLC and the W2 employees are exempt when dealing with property in the name of the LLC
All of the following are TRUE about the character issue of an applicant for a NC Real Estate License, EXCEPT:
an applicant must possess honesty, integrity and good moral character
a mandatory criminal background check is required
the Commission makes a character determination before an applicant is permitted to take the NC Licensing Examination
an applicant has 60 days to request a hearing if the Commission determines that they do not possess satisfactory character
the Commission makes a character determination before an applicant is permitted to take the NC Licensing Examination
How long is an applicant’s Examination Eligibility Period to take the NC Real Estate Examination once the Commission has approved their application
180 days
All of the following require the refiling of an applicant’s application for a NC Real Estate license, EXCEPT:
If the applicant delays taking the examination until after the 180 expiration of their examination eligibility period
If the license was expired for a period of more than 6 months
If the license was surrendered or revoked for any period of time
If the license was inactive for more than 2 years
If the license was inactive for more than 2 years
An applicant will forfeit both their examination and license application fees and their license will be canceled for all of the following, EXCEPT:
Failure to take the examination within the 180 day period
Failure to appear for an examination appointment as scheduled
Attempting to reschedule an examination appointment
Appearing more than 15 minutes late for a scheduled examination appointment
Attempting to reschedule an examination appointment
A NC provisional broker’s real estate license is initially issued on what type of status?
inactive
So long as it is part of his or her duties, is it legal for an unlicensed assistant to solicit listings for the broker?
No, active participation in soliciting real estate business requires a real estate license
Cold calling, prospecting and soliciting of real estate business requires a license. An unlicensed assistant may schedule appointments, but they cannot solicit or cold call for business.
When a corporation is involved in the sale or leasing of property that is owned by the corporation, who is exempt from the requirement to possess a real estate license?
The corporation’s officers, directors and all W2 salaried employees are exempt from licensure
All of the following are considered exempt from licensure and considered to be dealing with their own property, EXCEPT?
the general partners of a partnership
the managers of an LLC
the officers, directors and W2 salaried employees of a corporation
a sole proprietor and their W2 salaried employees
a sole proprietor and their W2 salaried employees
Only the sole proprietor would be exempt. No exemption would apply to the W2 salaried employees of a sole proprietorship, an LLC or a partnership
A provisional real estate broker must remove the provisional status of their license by taking 90 hours of post licensing courses. The 90 hour courses are divided into three 30 hour courses. When must these courses be complete?
within 18 months of initial licensing
A provisional broker obtains their NC real estate license on April 15th and joins a real estate firm. In order to remain active, the broker must pay the renewal fee to the NC Real Estate Commission on or before:
June 30 of the current year
Although provisional brokers are not required to complete any CE until the 2nd renewal of their license, they must still renew the license on June 30th. This is accomplished by going to the NCREC website, filing the form and paying the renewal fee.
All of the following are powers of the NC Real Estate Commission, EXCEPT:
to conduct announced or unannounced audits of licensees
to subpoena the books, records and bank statements and accounts of a licensee
to seek injunctive orders in court
to order licensees to make restitution to clients and levy fines
to order licensees to make restitution to clients and levy fines
In North Carolina under the Residential Property Disclosure Act, sellers of 1-4 unit residential properties must complete a MOG (Mineral, Oil & Gas Disclosure). The purposes of this law include all of the following, EXCEPT:
to require sellers to disclose to buyers if mineral, oil and gas rights have been severed from the property.
to prevent sellers from severing mineral, oil and gas rights from a property
to require sellers to disclose to buyers if mineral, oil and gas rights have been leased separately.
to inform buyers if the seller does not intend to transfer mineral, oil and gas rights.
to prevent sellers from severing mineral, oil and gas rights from a property
Mineral, oil and gas rights to real estate can always be sold or leased separately from a real estate transfer. The requirement is one of disclosure and does not prevent the seller from severing such rights.
All of the following are true under the NC Condominium Act, EXCEPT:
the units are usually separately taxed and assessed
there must be a unit owner’s association prior to the transfer of the first unit
a unit owner is prohibited from ownership of land and must take only title to their individual unit.
if the buyer cancels within the 7 day rescission period all money must be returned promptly with no penalty
a unit owner is prohibited from ownership of land and must take only title to their individual unit.
In a NC condominium project, only certain owners have reserved parking spaces and garages. Under the NC Condominium Act, these areas would be known as:
Limited condominium areas
All of the following are true of a project broker within a NC Time Share, EXCEPT:
the project broker is designated by the developer or owner of the time share
the project broker must be an actively licensed broker
a provisional broker may serve as a project broker
the project broker is responsible for supervision and management of the time share project and all licensees that are associated with the project
a provisional broker may serve as a project broker
All of the following are TRUE if a time share is not properly registered in NC and a public offering statement is not provided to a buyer prior to contract under the NC Time Share Act, EXCEPT:
the purchaser has a five day rescission period to cancel their purchase without penalty
it is a felony to not register the units
the purchaser may be entitled to a penalty of 10% of their purchase price or $3,000 whichever is greater
the buyer and the developer may agree to waive both the 5 day cancellation period and the providing of a public offering statement.
the buyer and the developer may agree to waive both the 5 day cancellation period and the providing of a public offering statement.
How long does a provisional broker have to activate their license from the date of licensure?
there is no required time period for license activation
There is no required time frame for a provisional broker to activate their license. A licensee may remain on inactive status indefinitely.
Can a real estate licensee renew an inactive license?
Yes, because that will prevent the license from being expired
Under the NC Mechanic’s Lien statute an owner of property must designate a mechanic’s lien agent (MLA) under which of the following situations?
an owner who is making improvements to public buildings
the improvements are less than $30,0000
the improvements are to a primary residence
a new roof is being placed on a vacation rental unit that costs $42,000
a new roof is being placed on a vacation rental unit that costs $42,000
An mechanic’s lien agent is designate by the owner of the property to receive notice of the lien. This is not required for improvements to a primary residence or when the improvements are less than $30,000. Because these improvements are not to a primary residence and exceed $30,000 a lien agent must be designated under the statute
The NC Homestead Exemption would be of importance and have the greatest impact on:
a borrower who is in default on their property and facing foreclosure
an individual who filed bankruptcy due to excessive medical bills and judgment liens
an investor who must engage in the short sale of an investment property
a married couple who is selling their primary residence to a buyer
an individual who filed bankruptcy due to excessive medical bills and judgment liens
The NC homestead exemption applies to personal residences and provides protection against judgment creditors
Jack is a licensed real estate professional in Illinois. He has been a broker for many years, but is not licensed in NC. Jack has a friend who wants to purchase a home in Charlotte, NC. In regard to the representation of this buyer all of the following are TRUE, EXCEPT:
Jack may refer the buyer to a licensed NC broker and receive a referral fee even though he is not licensed in NC.
Jack may meet with the buyer in Illinois and explain the purchase process and answer questions about the NC transaction.
So long as Jack affiliates with a NC broker he may accompany the buyer to North Carolina and assist in showing the buyer property
The NC real estate commission does not have jurisdiction over Jack unless Jack conducts illegal brokerage activities in NC
So long as Jack affiliates with a NC broker he may accompany the buyer to North Carolina and assist in showing the buyer property
An out of state licensee cannot set foot in NC and participate in the real estate transaction without having a NC real estate license
Sherry is a provisional broker who works for a residential sales BIC and firm in North Carolina. Sherry has a couple of clients who want her to manage their rental properties. What are Sherry’s options?
Sherry can manage the properties on her own outside of her existing firm
With the permission of her BIC Sherry can also affiliate with another firm that engages in property management.
Sherry can manage the rental properties only if she obtains a power of attorney from the owners.
Sherry can refer the clients to a property management firm and earn a referral fee that is paid to her through her BIC
Sherry can refer the clients to a property management firm and earn a referral fee that is paid to her through her BIC
