Kansas Real Estate Broker Exam — All Questions

What does a Kansas seller's agent owe a buyer who is a customer, not a client?

• a.The same loyalty that is owed to the seller client
• b.An independent inspection of the property's condition
• c.Verification of all the seller says about the house
• d.Disclosure of adverse material facts actually known✓

K.S.A. 58-30,106(d)(1) says a seller's or landlord's agent owes no duty or obligation to a customer except that the licensee shall disclose to any customer all adverse material facts actually known by the licensee, and then names examples: environmental hazards required by law to be disclosed, the physical condition of the property, material defects in the property, material defects in the title, and any material limitation on the client's ability to perform under the contract. Paragraph (d)(2) disposes of the other two active options by saying the agent owes no duty to conduct an independent inspection for the customer's benefit and no duty to independently verify the accuracy or completeness of statements made by the client or by a qualified third party. Loyalty is reserved to the client under subsection (a)(2), which requires the agent to promote the client's interests with the utmost good faith, loyalty and fidelity. Two qualifications matter in practice: paragraph (d)(5) still requires the care of a reasonably prudent licensee in any inspection or disclosure the agent actually makes, and subsection (e) lets the agent perform ministerial acts for the customer without breaching the agency or creating a new one.

A Kansas seller's agent learns the buyer already has an exclusive agreement with another broker. Direct negotiation with that buyer is allowed only after:

• a.Notifying the buyer's own broker of the intended contact
• b.The buyer's broker is offered a share of the commission
• c.The seller instructs the agent in writing to make contact
• d.The buyer signs the consent to direct negotiation form✓

K.S.A. 58-30,103(o) says that where a licensee knows a buyer or tenant has an agency agreement or written transaction brokerage agreement granting an exclusive brokerage relationship to another broker, the licensee shall not contact that buyer and shall not initiate negotiations, and may negotiate directly only with the informed consent of the buyer, evidenced by a consent agreement signed by the buyer before any such negotiation. The consent agreement must acknowledge the existing agreement and that the buyer may be liable for compensation under it, and K.A.R. 86-3-28 adopts the Commission's 'buyer's or tenant's consent to direct negotiation' form for the purpose. The consent has to come from the buyer, so notice to the other broker, an offer of compensation to that broker, and an instruction from the seller are all beside the point. Subsection (n) adds that a licensee shall not induce any party to break an agency or transaction brokerage agreement, and subsection (p) states the seller-side mirror: a licensee shall not contact or negotiate directly with a seller or landlord who has an exclusive agency or exclusive right to sell agreement with another broker, though an offer may be presented if that broker or transaction broker is present.

Which of these Kansas activities requires no real estate license?

• a.Managing apartments for an unrelated owner
• b.Auctioning a house for its owner for a fee
• c.Leasing farm ground for agricultural purposes✓
• d.Procuring prospects for a listed subdivision

K.S.A. 58-3037(k) exempts the lease of real estate for agricultural purposes from the act altogether, and the definition of 'lease' in K.S.A. 58-3035(j) is itself confined to rent or lease for nonresidential use. The other three are licensed activity under K.S.A. 58-3035(f): auctioning real estate, or assisting an auctioneer by procuring bids at a real estate auction, is paragraph (f)(5); leasing real estate on behalf of an owner is (f)(1); and assisting or directing in the procuring of prospects calculated to result in the sale, exchange or lease of real estate is (f)(7). The rest of K.S.A. 58-3037 is worth memorizing for the broker portion, because it is the list the Commission applies when deciding whether to pursue an unlicensed person: an owner dealing directly with the owner's own property, a person acting under a power of attorney who takes no compensation, an attorney performing professional duties, a receiver, trustee in bankruptcy, administrator, executor or guardian acting under a court order or a will or trust, a government officer or employee performing official duties, a nonprofit multiple listing service or broker referral organization, regulated public utilities, an employee who owns 5% or more of the entity that owns the property, and a builder selling or leasing new homes it constructed.

The experience an original Kansas broker applicant must show is:

• a.Five years of continuous licensure in any jurisdiction
• b.Two years of activity within the preceding three years✓
• c.Three years as a supervising broker in another state
• d.One year of licensure plus a degree in real estate

K.S.A. 58-3039(d)(1) requires each applicant for an original broker's license, over and above the age and education floor in subsection (c) of being 18 or more with a high school diploma or its equivalent, to have been licensed as a salesperson in Kansas or as a salesperson or broker in another state, and to have been actively engaged in the activities described in K.S.A. 58-3035(f) for a period of at least two years during the three years immediately preceding the date of the application. The three-year window is what the second option captures and what candidates most often drop: old experience does not count. Subsection (e) then lets the Commission accept proof of experience in the real estate or a related business, or a combination of experience and education, as equivalent to all or part of that requirement, which is why a degree alone is not the rule but may be considered. No five-year term and no prior supervising-broker service appear in the statute. Two adjacent limits go with this on the broker exam: under K.S.A. 58-3039(f)(3) no license issues on an examination administered more than six months before the Commission receives the application, and under K.S.A. 58-3039(b)(1) fingerprints and a state and national criminal history record check are required for an original license.

K.S.A. 58-3061 excuses from the trust-account duty a broker who:

• a.Keeps a separate trust account for a branch office
• b.Holds earnest money only on residential transactions
• c.Is not the supervising broker of an office of the firm✓
• d.Has no closings pending in the current calendar quarter

K.S.A. 58-3061(a) requires each broker to maintain a separate trust account, in the broker's name or the firm's name and designated as such, at an insured bank, savings and loan association or credit union in Kansas or, with the Commission's written permission, in an adjoining state. Subsection (f) then exempts four categories, and the third option is one of them: a broker who is an officer, member, partner, shareholder or employee of an entity and who is not the supervising broker of an office of that entity. The others are a broker whose license is on deactivated status, a broker who acts as an associate broker, and a broker whose activities in the Commission's opinion do not necessitate holding trust funds. The line the exemption draws is the same one K.S.A. 58-3035(p) draws for supervision: the duty attaches to the broker running an office rather than to every broker's license. A branch broker who keeps a separate branch account is inside the duty, not outside it, since subsection (b) requires that broker to maintain the trust account records and all transaction files for the branch account. The duty is not limited to residential work, because the account holds all down payments, earnest money deposits and advance listing fees, and it does not switch off in a quiet quarter.

A Kansas supervising broker may share a commission with an out-of-state licensee where the deal involves:

• a.Any listing the out-of-state licensee brought to the firm
• b.A single-family home bought by a corporate relocation client
• c.Residential property where the buyer lives in the other state
• d.Commercial real estate under a broker cooperation agreement✓

K.S.A. 58-3077(b) lets a branch broker or supervising broker cooperate with and share commissions with a foreign licensee for services related to commercial real estate, and lets that foreign licensee perform services here that would otherwise require a Kansas license, provided the real estate is not improved with a single family residence and the parties execute and comply with a broker cooperation agreement. Subsection (a)(1) defines commercial real estate as real estate whose present use is other than one to four residential units or agricultural purposes, so the buyer's residence and the buyer's employer are irrelevant and the second and third options fall outside the section however the deal is arranged. The agreement itself is prescriptive: it must require the foreign licensee to comply with Kansas law, submit to the jurisdiction of the Kansas courts and the Commission, give irrevocable written consent to service of process through the secretary of state, keep all escrow and earnest money in Kansas in a Kansas broker's trust account or with a Kansas escrow agent, describe how compensation will be shared, and require each broker to keep the other informed of showings, negotiations and documents. Subsection (c) requires a copy to reach the Commission within five business days of execution. Outside that route K.S.A. 58-3062(a)(10) still forbids paying an unlicensed person for licensed activity.