Maryland Real Estate Broker Exam — All Questions

A new environmental ordinance leaves a landowner with no economically viable use of a parcel, although the government takes no title to it. The owner's strongest constitutional claim is:

• a.The ordinance is void because zoning cannot restrict use
• b.A regulatory taking entitling the owner to payment✓
• c.Escheat has occurred and the state now owns the parcel
• d.Spot zoning, since only this parcel lost its value

Regulation that goes so far it denies an owner all economically viable use is treated as a regulatory taking, and just compensation is owed even though the government never took title. Arguing that zoning simply cannot restrict use fails, because regulating land is a valid exercise of the police power and owners have no right to the most profitable use. Escheat moves property to the state only when an owner dies with no will and no heirs, which has nothing to do with an ordinance. Spot zoning describes singling out one parcel for a different classification, not a general environmental rule applied to a class of land.

Reviewing a title report, a broker finds an old recorded covenant, written decades ago, that bars resale of the lot to members of a specified race. Its legal effect today is:

• a.It binds the buyer because it was recorded before purchase
• b.It is void, so a court will never enforce it or enjoin it✓
• c.It stays valid until the homeowners association removes it
• d.It is enforceable by the association but not by an owner

A private restriction that discriminates on a protected basis is void and unenforceable under the federal Fair Housing Act and the Civil Rights Act of 1866, so no court will order compliance or enjoin a violation, and the association has no power the courts would back. Recording rescues nothing, because an illegal restriction gains no force from sitting in the public record. No association vote is required to strip it of effect, although many states let an owner have the language formally struck. Valid CC&Rs, by contrast, are enforced privately by injunction brought by an owner or the association. A broker must never repeat or give effect to such language.

A grantor signs and notarizes a deed naming a nephew as grantee, locks it in a safe deposit box, and tells no one. The grantor later dies. What is the deed's effect?

• a.Title passed when the grantor signed the deed
• b.Title passed because the deed was acknowledged
• c.No title passed, because delivery never occurred✓
• d.Title passes when the estate later records it

A deed operates only when the grantor delivers it with the present intent to pass title and the grantee accepts, and both must happen while the grantor is alive. Signing accomplishes nothing while the instrument stays under the grantor's control in a box no one knows about. Acknowledgment before a notary serves recording, not validity, so notarizing it changes nothing here. An estate representative cannot supply the delivery the grantor failed to make, and recording an undelivered deed does not revive it. The nephew takes only through the will or the intestacy statute, which is why closings hand over the executed deed rather than merely signing it.

A deed is signed by a competent grantor and handed to a grantee who accepts it, but the grantor's signature was never notarized. As between those two parties, the deed is:

• a.Void, since notarizing is a validity requirement
• b.Valid, though it cannot be recorded as it stands✓
• c.Valid only if the grantee later pays a recording fee
• d.Voidable at the option of the grantor's creditors

Acknowledgment is a recording requirement, not an element of a valid deed. Delivered and accepted, the deed transfers title between grantor and grantee even with no notary, but the recorder will reject it, leaving the grantee exposed to later purchasers and lienholders who record first. Calling it void confuses the two ideas: validity turns on a competent grantor, an identifiable grantee, words of conveyance, an adequate legal description, the grantor's signature, and delivery and acceptance. Paying a fee cannot cure a missing acknowledgment, because the recorder cannot accept the instrument at all. Creditors of the grantor gain no power to undo a completed conveyance.

In a deed, which clause opens with the words 'to have and to hold' and defines the extent of the estate the grantee is receiving?

• a.The granting clause containing the words of conveyance
• b.The habendum clause, following the granting clause✓
• c.The acknowledgment taken before a notary public officer
• d.The legal description identifying the land conveyed

The habendum clause follows the granting clause, begins with the traditional phrase 'to have and to hold,' and spells out the estate conveyed, for example a fee simple absolute or a life estate. The granting clause holds the words of conveyance that actually transfer the interest and names the grantee. The acknowledgment is the notary's certificate that the signature is genuine, which the recorder requires but the transfer does not. The legal description identifies the land by metes and bounds, lot and block, or government survey, and it fixes what is conveyed rather than how much of an estate. Reading both clauses tells a broker exactly what the buyer is getting.

A relocation company that has owned a home for three months conveys it, warranting title only against defects that arose during its own ownership. The deed it delivers is a:

• a.Bargain and sale deed implying ownership without covenants
• b.General warranty deed covering the entire chain of title
• c.Quitclaim deed conveying only the interest actually held
• d.Special (limited) warranty deed covering the grantor's period✓

Warranting only against defects created or suffered while the grantor held title describes the special or limited warranty deed, the customary instrument for corporate, relocation, and fiduciary sellers who cannot vouch for what earlier owners did. A general warranty deed reaches back through the whole history of the property and offers the broadest protection, which is more than this seller is giving. A quitclaim carries no warranties at all and passes only whatever interest the signer happens to hold. A bargain and sale deed implies that the grantor owns the property but adds few or no covenants. A buyer taking narrower covenants should lean on an owner's title policy.

A title search shows that a seller's former spouse may still hold a possible interest in the property. What is the usual instrument used to release that interest and clear the record?

• a.A quitclaim deed from the former spouse✓
• b.A general warranty deed from the former spouse
• c.A trustee's deed issued after a foreclosure
• d.A correction deed fixing the legal description

A quitclaim releases whatever interest the signer may hold, with no warranties attached, which makes it the standard tool for removing a cloud such as a possible marital interest, a stale easement claim, or a name discrepancy. Demanding a general warranty deed asks the former spouse to guarantee title he or she may never have owned, and it is normally refused. A trustee's deed is what the trustee under a deed of trust issues to the purchaser at a foreclosure sale. A correction deed reforms a mistake in an earlier deed between the same parties and cannot release an outsider's claim.

A court-appointed personal representative sells a decedent's home during probate, and the buyer's broker asks what instrument will convey title. The answer is:

• a.A trustee's deed given after a nonjudicial foreclosure
• b.A sheriff's deed issued following a judicial sale
• c.A general warranty deed with full title covenants
• d.An executor's or personal representative's deed✓

Estate property is conveyed by an executor's deed when a will names the executor, or by a personal representative's or administrator's deed when the court makes the appointment; these deeds recite the court authority and give only limited covenants. A trustee's deed comes from the trustee under a deed of trust after a nonjudicial foreclosure sale. A sheriff's deed, called a referee's deed in some states, follows a judicial sale ordered by a court. A general warranty deed is not used, because a fiduciary will not personally guarantee title against the acts of the decedent or of owners further back in the chain.

After closing under a general warranty deed, a buyer discovers a recorded utility easement that the deed never disclosed. Which covenant did the grantor breach?

• a.Quiet enjoyment, a promise against eviction by better title
• b.Seisin, a promise that the grantor owns the estate conveyed
• c.Against encumbrances, a promise of no undisclosed burdens✓
• d.Further assurance, a promise to sign curative papers

The covenant against encumbrances promises that no liens, easements, or similar burdens exist beyond those the deed discloses, so a recorded easement left unmentioned breaches it at the moment of delivery. Seisin promises the grantor actually owns the estate being conveyed, which is not the trouble when ownership is sound but burdened. Quiet enjoyment shields the grantee from later eviction by someone holding superior title, and an easement holder's use is not an eviction. Further assurance obliges the grantor to sign additional documents needed to perfect title. A general warranty deed carries all of these along with the right to convey and warranty forever.

A neighbor has openly farmed and fenced a strip of an absentee owner's land, excluding others and never asking permission. To take title by adverse possession the neighbor must prove:

• a.Payment of the owner's property taxes for every year
• b.Open, notorious, continuous, hostile, and exclusive possession✓
• c.A written agreement signed by the record title owner
• d.A recorded deed describing the disputed strip of land

Adverse possession requires possession that is open and notorious, continuous, hostile in the sense of being without permission, and exclusive, held for the statutory period set by state law. Some states add payment of taxes or color of title, but those elements are not universal, so a broker should never assume them from another state's rule. A written agreement from the record owner would destroy the claim outright, since permission defeats hostility. Recording a deed creates no possession and cannot manufacture the required years of use. Adverse possession is one form of involuntary alienation, alongside descent, escheat, foreclosure, eminent domain, and accretion.

An owner dies leaving no will, and after a diligent search no heirs can be located. A broker asked to list the property should understand that title:

• a.Passes by devise to the beneficiaries named in a will
• b.Descends to the decedent's nearest surviving creditors
• c.Vests permanently in the administrator the court appoints
• d.Escheats to the state, an involuntary transfer of title✓

Escheat is the state's claim to property when an owner dies intestate and no heirs can be found, and it is a classic involuntary transfer rather than a voluntary one by deed or will. Devise is a gift of real property by will, so it cannot operate where there is no will and no named beneficiary. Descent carries property to heirs under the intestacy statute, but creditors are paid as claimants out of the estate and never inherit the land itself. An administrator has authority to manage and convey estate property during probate, not to own it permanently. Each state sets its own escheat procedure and waiting period.

A search reveals an old mortgage of record that was paid off but never released, and the lender no longer exists. Which step clears that cloud so title is marketable?

• a.Ordering an abstract of title with an attorney's opinion
• b.Buying an owner's title policy that insures over it
• c.Filing a quiet title action asking a court to clear it✓
• d.Recording a correction deed signed by the current seller

A quiet title action asks a court to determine ownership and extinguish a stale or unreleasable claim, which is the practical cure when the mortgagee has vanished and no release can be obtained. An abstract of title with an attorney's opinion summarizes and evaluates the recorded chain; it reports the cloud rather than removing it, and it offers no indemnity. An owner's policy may insure over a known risk, but insurance pays for loss and leaves the defect on the record for the next buyer to confront. A correction deed fixes a drafting error between the original parties and cannot release a third party's lien.

A seller deeds a parcel to one buyer and later deeds the same parcel to a second buyer, who records first. Which framework decides who owns the land?

• a.A federal recording statute applied in all fifty states
• b.The state's recording act, race, notice, or race-notice✓
• c.The order in which the two deeds were signed and dated
• d.The county recorder's discretion over competing claims

Priority between competing grantees is governed by the recording act of the state where the land lies, and the schemes differ: a pure race state protects whoever records first, a notice state protects a later purchaser who took without notice of the earlier deed, and a race-notice state protects one who took without notice and recorded first. No federal statute governs land recording. Signing dates do not decide the contest, which is precisely why a public recording system exists. Recorders act ministerially and have no power to resolve claims. Because the gap between closing and recording is the danger zone, a broker should press for prompt recording.

A buyer pays for a lender's title policy at closing and asks the broker whether it also protects the buyer's equity in the home. The correct answer is that the policy:

• a.Protects both parties equally up to the full purchase price
• b.Protects the buyer once the mortgage has been fully repaid
• c.Protects the buyer against defects arising after closing
• d.Protects only the lender, declining with the balance✓

A lender's, or mortgagee's, policy insures only the lender's security interest, and its coverage shrinks as the principal is paid down, ending altogether when the loan is satisfied. It never covers the buyer's equity, which is why a separate owner's policy is offered at closing for a one-time premium and lasts as long as the insured holds an interest. Repaying the mortgage does not convert the lender's coverage into the buyer's; it extinguishes it. And no title policy insures defects that first arise after its date. Brokers should explain this plainly before a buyer waives owner's coverage to save money.

Six months after closing, a contractor the buyer hired records a mechanic's lien against the home. The buyer files a claim under the owner's title policy. The insurer will most likely:

• a.Deny, because the defect arose after the policy was issued✓
• b.Pay, because owner's policies cover all future liens
• c.Pay, because the standard exceptions were removed
• d.Deny, because only a lender may file a title claim

Title insurance looks backward: it covers defects that already existed when the policy was issued but were not discovered or excepted, not events that happen later. A lien for work the buyer ordered after closing is a new problem the buyer must resolve directly. Buying extended coverage removes standard exceptions and broadens what is insured as of the policy date, but it does not push coverage forward in time. Owners plainly may claim under their own policies; the lender's policy is the one limited to the lender. Extended coverage typically depends on a current survey, which reveals encroachments and boundary issues a records search alone cannot.

A buyer tours a house and finds an occupant who is not the seller living there under an unrecorded lease. What kind of notice does that occupancy give the buyer?

• a.Actual notice, given by the seller's written disclosure
• b.Constructive notice, given by the public record
• c.No notice at all, since the lease was not recorded
• d.Inquiry notice, requiring the buyer to ask about it✓

Someone in possession who is not the seller puts a buyer on inquiry notice: the buyer is charged with whatever a reasonable investigation of that occupancy would have turned up, including an unrecorded lease or an option to purchase. Actual notice is what a party genuinely knows, typically from a disclosure or a conversation, and no one has told this buyer anything. Constructive notice comes from the public record, which by definition cannot reveal an unrecorded lease. Treating an unrecorded interest as invisible is the classic error, because possession is itself notice. A broker should always ask who occupies a property and on what terms.

In a disciplinary case under Business Occupations and Professions § 17-322, instead of or in addition to a reprimand, suspension, or revocation, the Commission may impose a monetary penalty of up to:

• a.$1,000 for each violation
• b.$10,000 for each violation
• c.$5,000 for each violation✓
• d.$25,000 for each violation

Section 17-322(c)(1) says the Commission may impose 'a penalty not exceeding $5,000 for each violation,' and (c)(2) tells it to weigh the seriousness of the violation, the harm caused, the licensee's good faith, and any history of previous violations in setting the figure. The per-violation wording matters: a licensee who commits several violations in one transaction can be fined for each. The $25,000 number is real but belongs elsewhere — § 17-613(c) uses a rising scale, and $25,000 is the ceiling there for a third or subsequent violation, not for a first one under § 17-322. The $10,000 and $1,000 figures appear nowhere in the disciplinary provisions of Title 17.

Before the Commission takes final disciplinary action, § 17-324 requires that notice of the hearing reach the licensee:

• a.At least 10 days before, in person or by certified mail✓
• b.At least 30 days before, by ordinary first-class mail
• c.At least 60 days before, by advertisement in a newspaper
• d.At any time before, by telephone call or electronic mail

Section 17-324(d)(1) sets both the interval and the method: at least 10 days before the hearing the notice must be 'served personally on the individual' or 'sent by certified mail to the last known business address of the individual.' Certified mail is what makes the service provable, which is why ordinary first-class mail will not do, and why a telephone call or an e-mail — leaving no record that the licensee was reached — is not service at all. The 10-day figure is short by design; the Commission is a licensing body running an administrative hearing, not a court, so 30 or 60 days is longer than the statute asks. Section 17-324(d)(2) adds a parallel notice to every broker with whom an associate broker or salesperson is affiliated.

The Commission orders the Guaranty Fund to pay a claim caused by a licensee's misrepresentation. Under § 17-412, that licensee's license is:

• a.Suspended at once, until the Fund is repaid in full with interest✓
• b.Revoked permanently, with no route back to a Maryland license
• c.Transferred to another broker, who assumes the repayment debt
• d.Unaffected, because the Fund absorbs the loss for the licensee

Section 17-412(a) is automatic and immediate: on ordering payment, the Commission 'immediately and without further proceedings shall suspend the license of the licensee.' Subsection (b) then blocks reinstatement until the licensee repays the amount paid out plus the interest due under § 17-411(a)(2), and applies for reinstatement. So the Fund advances the money to the injured member of the public and then looks to the licensee for it — treating the license as unaffected inverts that. It is a suspension, not a revocation, precisely because repayment reopens the door; nothing here is permanent. And a license is personal to the licensee, so moving to another broker changes who supervises the licensee and nothing about the debt. Section 17-412(c) adds that repaying the Fund does not undo any separate disciplinary sanction.

A Maryland buyer discovers that a salesperson stole her deposit. To recover from the Real Estate Guaranty Fund she must:

• a.Obtain a final judgment against the licensee in circuit court
• b.Show that the responsible licensee carries no E&O insurance
• c.File a claim with the Commission within 3 years of discovery✓
• d.Wait until the Commission has revoked the licensee's license

Maryland's Guaranty Fund is administrative, not a collection remedy of last resort after litigation. Section 17-404(d) requires only that 'a claim under this subtitle shall be submitted to the Commission within 3 years after the claimant discovers or, by the exercise of ordinary diligence, should have discovered the loss or damage.' The claim is made in writing and under oath (§ 17-406), the Commission reviews it and either proposes an award, sets a hearing, or dismisses it (§ 17-407), and § 17-410(a) has the Commission order payment when the claimant proves a valid claim at the hearing — with the burden of proof on the claimant and a ceiling of $50,000 per claim. No court judgment is required anywhere in the subtitle, which is why the judgment answer is the trap. Discipline runs on its own track: § 17-409 joins the two proceedings, but an award does not wait on a revocation. Whether the licensee carries errors and omissions coverage is irrelevant to eligibility.

A Commission representative asks to examine a broker's transaction records. Under § 17-507, the broker must:

• a.Produce only records named in a sworn written complaint
• b.Insist on a circuit court subpoena before producing them
• c.Mail the records to the Commission's office in 30 days
• d.Allow entry in business hours and pay for any copies✓

Section 17-507(d)(1) says that on reasonable notice a licensee 'shall allow a representative of the Commission to enter the licensee's place of business during business hours to inspect a record required to be kept,' and (d)(2) puts the cost of any paper copy the Commission requests on the licensee. Subsection (d)(3) goes further for money: the licensee 'shall display to the Commission on demand all records, books, and accounts of any money held in trust' — on demand, with no notice at all. The Commission does hold subpoena power under § 17-209(a)(2)(iii), but the records-inspection right does not depend on using it, so demanding a subpoena first is a refusal. Nor is the duty satisfied by mailing a package later, and it is not limited to whatever a complaint happens to name. Failing to display trust records on demand is itself a ground for summary suspension under § 17-328(a)(2).

Section 17-302 allows an unlicensed individual to sell, in one calendar year, no more than:

• a.3 unimproved lots that the individual owns
• b.12 unimproved lots that the individual owns
• c.10 unimproved lots that the individual owns
• d.6 unimproved lots that the individual owns✓

Section 17-302(a)(1) exempts an individual who sells 'in a calendar year, 6 or fewer unimproved lots that the individual owns.' Two limits are doing the work: the lots must be unimproved, and they must be the seller's own — the exemption is for an owner disposing of land, not for anyone acting for someone else, which is what a license exists to regulate. The count resets with the calendar year rather than running over any twelve-month period. Section 17-302(a)(2) is a separate exemption on a different axis: an individual may subdivide and sell unimproved property owned for 10 years or more, with no cap on the number of lots, and (b) lets an heir add the years of preceding owners in the line of inheritance to reach that decade.

A Maryland license placed on inactive status expires, unless it is reactivated:

• a.1 year after the date it was placed on inactive status
• b.2 years after the date it was placed on inactive status
• c.5 years after the date it was placed on inactive status
• d.3 years after the date it was placed on inactive status✓

Section 17-316(c) is flat: 'unless a license on inactive status is reactivated, the license expires 3 years after the date it is placed on inactive status.' Inactive is not dormant — subsection (d) keeps the licensee responsible for renewing on the ordinary two-year cycle and meeting continuing education while inactive, and subsection (b)(2) preserves the Commission's power to discipline the license in the meantime. The three-year clock runs alongside all of that. Once it expires, § 17-316(e) sends the person back to §§ 17-301 through 17-308 — a fresh qualification, application, and examination — so the two-year renewal term is not the number to remember here. A salesperson or associate broker also lands on inactive status automatically on losing the affiliation named in the license certificate.

Chapter 330 of 2024 replaced Maryland's fixed license expiration with staggered expiration. A renewing licensee must now complete the required continuing education:

• a.Not later than 30 days before the license expires✓
• b.At any point before the license actually expires
• c.Within 30 days after the license has expired
• d.By April 30 of every even-numbered year

Chapter 330 of 2024 (Senate Bill 564, effective 1 October 2024) rewrote § 17-314. Subsection (a) now reads 'licenses issued under this title shall expire on a staggered basis,' and subsection (c)(1)(iv) requires the renewing licensee to have complied with the continuing education requirements of § 17-315 'not later than 30 days before the license expires.' That 30-day margin is the point of the change — it gives the Commission time to verify the hours before the license lapses — so finishing on the last day no longer satisfies the statute. A licensee who misses it is not automatically unlicensed but is subject to a reinstatement fee under (c)(2). April 30 of an even-numbered year is a real Maryland deadline, but it belongs to branch office certificates under § 17-518(e)(1), which staggering did not touch.

To renew a Maryland real estate license, a licensee must complete continuing education totaling:

• a.8 clock hours during the preceding 2-year term
• b.15 clock hours during the preceding 2-year term✓
• c.12 clock hours during the preceding 2-year term
• d.22 clock hours during the preceding 2-year term

Section 17-315(a)(1) requires 'at least 15 clock hours of continuing education instruction' during the preceding two-year term, and § 17-315(b)(2) then dictates how much of that block is spoken for: every two years a renewing licensee needs a 3-hour legislative and regulatory update, a 2-hour fair housing course, a 3-hour ethics course covering the Maryland Code of Ethics, and a 3-hour course on brokerage relationships and disclosures. A clock hour is defined by COMAR 09.11.06.01B(3) as a minimum of 50 minutes of instruction per 60-minute hour, so 15 clock hours is not 15 wall-clock hours in a seat. Licensees who work solely in nonresidential real estate swap the fair housing requirement for a 2-hour course on the federal Americans with Disabilities Act.

The 1.5 clock-hour course on the requirements of broker supervision must be completed, every two years, by a renewing:

• a.Salesperson, buyer's agent, or unlicensed assistant
• b.Appraiser, home inspector, or settlement attorney
• c.Broker, branch office manager, or team leader✓
• d.Instructor, course monitor, or education provider

Section 17-315(b)(2)(vi) attaches the supervision course to the three roles that actually supervise: it applies 'every 2 years for the renewal of a real estate broker license and the renewal of the license of an individual designated as a branch office manager or a team leader,' and requires at least one 1.5 clock hour course covering the requirements of broker supervision. COMAR 09.11.01.23, amended effective 27 April 2026, adds a front-end deadline — a licensee newly designated as broker, branch office manager, or team leader must take the course within 90 days of the designation unless they completed it in the previous four years. The course exists because Maryland layers supervision: § 17-320(d) and § 17-545 make branch managers and team leaders answerable alongside the broker, not instead of the broker. A rank-and-file salesperson, an unlicensed assistant, and the other licensed professions in the transaction supervise nobody under Title 17.

When real estate brokerage services are provided through a Maryland corporation or LLC, § 17-321 requires that:

• a.Each shareholder or member hold a broker license
• b.A licensed broker be designated broker of the firm✓
• c.The entity itself be issued a broker license by MREC
• d.A majority of the directors be licensed salespersons

Maryland licenses individuals, not companies. Section 17-321(b)(2) requires that the corporation, limited liability company, or partnership designate a licensed real estate broker 'as the broker of the firm, to be individually responsible for the provision of real estate brokerage services' through it, and subsection (e) makes that person subject to every provision of Title 17 governing those services. That is why the entity is never itself the licensee — it holds no license to suspend, so accountability has to rest on a named individual. Subsection (d) then limits who may work through the firm to the designated broker and licensees affiliated with that broker, whatever their corporate title, and subsection (f) preserves the entity's own liability for its agents' acts. Section 17-511(b)(1) separately caps associate brokers and salespersons at 50% of the interest in the business.

Before a Maryland broker may maintain a branch office, § 17-518 requires the broker to:

• a.Register the branch with the county and the zoning board
• b.Close the principal office while the branch is operating
• c.Obtain a branch office certificate and designate a manager✓
• d.Station at least three licensed salespersons at the branch

Section 17-518(b) requires a branch office certificate before the broker may maintain the office, and (c) sets out the application, the written notice naming the manager, and a $5 fee. Subsection (d)(1) then requires a designated manager for each branch — which may be the broker — and (d)(2) says that if the broker designates someone else, that person must be a licensed associate broker, a salesperson with at least 3 years of experience, or a salesperson who has completed the broker prelicense course and passed the broker examination. Subsection (d)(4) gives the manager the duty to supervise the licensees registered to that office. County registration and zoning approval govern where a business may sit and neither creates the certificate nor substitutes for the Commission's requirements. Nothing requires closing the principal office or staffing a branch to any headcount. The certificate expires on the first April 30 falling in an even-numbered year and renews for two-year terms.

Section 17-511 caps the interest that licensed associate brokers and salespersons may hold, directly or indirectly, in a business providing real estate brokerage services at:

• a.50 percent of the interest in the business✓
• b.25 percent of the interest in the business
• c.10 percent of the interest in the business
• d.75 percent of the interest in the business

Section 17-511(b)(1) provides that 'not more than 50% of the interest in a business may be held directly or indirectly by associate real estate brokers, real estate salespersons, or any combination of associate brokers or salespersons.' The effect is to keep control of a brokerage with the broker who answers for it, since a licensee who works under a broker cannot own the firm outright. Subsection (b)(2) closes the obvious route around it: an interest held by the licensee's spouse, parent, child, or sibling counts as the licensee's own unless that family member is themselves affiliated with the business as an associate broker or salesperson. For a corporation, 'interest in a business' is defined in (a)(4) as the outstanding voting stock. COMAR 09.11.01.22 requires licensees to report ownership interests with the renewal application, and any acquisition or disposal within 30 days.

Every brokerage agreement between a Maryland broker and a seller must contain:

• a.A definite termination date, effective without notice✓
• b.A guarantee of the seller's minimum net sale proceeds
• c.An automatic renewal clause running for six months
• d.A waiver of the seller's right to cancel the listing

Section 17-534(b)(1) requires the seller's brokerage agreement to 'have a definite termination date that is effective automatically without notice from the client,' and § 17-322(b)(10) makes accepting a listing without one a ground for discipline. Automatic termination is the point: the seller should not have to send anything to get free of the agreement. That is also why an automatic renewal clause runs against the statute rather than satisfying it, and why a waiver of the client's right to cancel is void — subsection (b)(5) affirmatively requires a cancellation provision. A guaranteed net return is separately prohibited: § 17-322(b)(11) and COMAR 09.11.01.01B both forbid the net listing, which would leave the licensee free to keep anything above the seller's number. The agreement must also state the compensation and explain what entitles the broker to it.

Under COMAR 09.11.01.10, a signed copy of a residential listing contract must reach the seller:

• a.Within five business days after the property is listed
• b.Only if the seller asks the listing broker for a copy
• c.At settlement, together with the closing disclosure
• d.Before the licensee advertises, shows, or offers it✓

COMAR 09.11.01.10 requires that all residential listing contracts — exclusive or open, for sale, rental, lease, or exchange — 'be in writing and signed, and a copy of the contract shall be given to the seller or owner before the licensee advertises, shows, or offers the property.' The trigger is the first act of marketing, not a fixed number of days, because the seller is entitled to hold the terms in hand before the licensee starts acting on them. A copy delivered five days later, or at settlement, arrives after the marketing it was meant to authorize. And the duty is unconditional — the Code of Ethics at COMAR 09.11.02.01H makes the same point generally, requiring copies of executed agreements to reach all parties within a reasonable time, whether or not anyone asks. Section 17-322(b)(14) and (15) separately require the licensee to furnish and keep copies of the listing, the contract of sale, and any lease.

In a residential transaction, the written agency disclosure required by § 17-530 must be made:

• a.Not later than ratification of the contract of sale
• b.Only after a consumer asks whom the licensee represents
• c.Within 72 hours of the first telephone call to a consumer
• d.Not later than the first scheduled face-to-face contact✓

Section 17-530(b)(1) fixes the moment: the disclosure 'shall occur not later than the first scheduled face-to-face contact with the seller or lessor or the buyer or lessee.' It has to come before the consumer starts talking, because the whole purpose is to tell people who is on their side before they say something a licensee owes to the other party. Waiting for ratification defeats that entirely, and so does waiting to be asked. Section 17-530(a)(3) covers the case where first contact is not face to face: the licensee must then disclose through whatever medium the contact occurs in, immediately rather than on a 72-hour clock. Section 17-530(b)(2) gives a single alternative — at an open house, a conspicuously displayed notice provided by the Commission satisfies the requirement. Section 17-530(a)(2) exempts a consumer who has already signed a brokerage agreement with the firm.

Having obtained written informed consent from all parties to act as a dual agent, a Maryland broker must then:

• a.Refer one of the two clients to a competing brokerage
• b.Assign a separate intra-company agent to each side✓
• c.Withdraw from the listing side of the transaction
• d.Report the dual agency to the Commission in writing

Section 17-530.1(a) begins by prohibiting dual agency outright; (b)(1)(i) then permits it where the broker obtains the written informed consent of all parties. Consent alone is not enough. Subsection (b)(1)(ii) requires the dual agent to 'assign a licensed associate real estate broker or licensed real estate salesperson affiliated with the real estate broker to act as the intra-company agent on behalf of the seller or lessor and another' to act for the buyer or lessee — two people, one for each side. Under (b)(1)(v) each intra-company agent must give their client the same service they would in an ordinary transaction, including advice on price and negotiating strategy, while (b)(1)(iii) blocks confidential information from crossing between them or being disclosed by the dual agent. Nobody is referred out and the broker does not step off the listing; § 17-530.1(e) lets the broker withdraw only from a client who refuses to consent. The consent is documented on the Commission's standard form under § 17-530.2, not filed with the Commission.

A Maryland salesperson makes an offer to buy a listed house for herself. The Code of Ethics requires her to disclose her licensing status in writing:

• a.Only if the seller asks whether she holds a license
• b.No later than the time that the offer is submitted✓
• c.Within ten days after the contract is ratified
• d.At settlement, on the closing disclosure form

COMAR 09.11.02.02D(1) requires a licensee seeking to acquire an interest in real property to disclose the licensee's licensing status in writing to the seller or lessor 'no later than the time that an offer is submitted.' The disclosure has to travel with the offer because that is when the seller decides, and a seller is entitled to know that the person on the other side reads the market for a living. Subsection D(2) extends the same duty when the licensee acts for an immediate family member, an entity the licensee has an interest in, or an employee of the brokerage or team; D(6) defines that family circle out to grandparents and grandchildren. The mirror-image rule in D(3) covers the licensee selling property they own — disclosure in writing at the time the property is offered — and D(5) allows the MLS to carry it. Section 17-322(b)(4) backs all of this with discipline for failing to disclose a material fact.

A Maryland seller elects the disclaimer, or 'as is', option on the statutory form. Under Real Property § 10-702 the seller must still disclose:

• a.The price the seller originally paid for the property
• b.The seller's reason for putting the house on the market
• c.Latent defects of which the seller has actual knowledge✓
• d.Every repair the seller made in the last three years

Real Property § 10-702(d)(1) requires the disclaimer statement itself to 'disclose any latent defects of which the vendor has actual knowledge,' and only then may the seller state that the property is otherwise sold as is, with no representation about its condition. Section 10-702(a) defines latent defects narrowly: material defects a purchaser could not reasonably be expected to find by careful visual inspection, that would pose a direct threat to the health or safety of the purchaser or an occupant. That definition is what excludes the other choices — they are not concealed physical dangers. What the seller paid is price history; why the seller is moving is personal circumstance; a list of past repairs describes work done rather than a hidden hazard, and the disclaimer route exists precisely so a seller need not catalogue condition. Under § 10-702(b) the section covers residential property of four or fewer single-family units, with exemptions including new construction, foreclosure and fiduciary sales, and unimproved land.

A Maryland buyer signs a contract of sale without ever receiving the disclosure or disclaimer statement. Real Property § 10-702 gives that buyer:

• a.A claim against the listing broker for the deposit paid
• b.A statutory reduction of the price at the settlement table
• c.An unconditional right to rescind and recover the deposit✓
• d.A one-year home warranty paid for by the seller's broker

Real Property § 10-702(f)(1) requires the vendor to deliver the completed statement to the purchaser on or before entering into the contract of sale. Subsection (h)(1) supplies the remedy when that does not happen: on written notice the purchaser has 'the unconditional right' to rescind at any time before receiving the statement or within 5 days after receiving it, and to the immediate return of any deposits. The right is not open-ended — (h)(2) terminates it once the buyer applies for a mortgage where the lender has disclosed that consequence in writing, or 5 days after such a lender disclosure. Subsection (k)(1) makes any attempted waiver in the contract void. Note the flip side in (g): a buyer who did receive the statement on time has no right to rescind based on what it says. Deposits held in a broker's trust account come back through the § 17-505 procedure, so the remedy runs against the transaction rather than as a damages claim against the listing broker.

Section 17-502 requires a Maryland broker to deposit trust money promptly, and in no event later than:

• a.7 business days after both parties accept the contract✓
• b.5 business days after both parties accept the contract
• c.3 business days after both parties accept the contract
• d.10 business days after both parties accept the contract

Section 17-502(b)(1) requires the broker to deposit trust money 'promptly, but not more than 7 business days after the acceptance of a contract of sale by both parties' into an account held separately from the broker's own accounts and used solely for trust money. Two details decide the timing: the clock starts on acceptance by both parties, not on receipt of the check, and the days are business days. Before that, § 17-502(a) requires an associate broker or salesperson who takes in trust money to hand it to the broker promptly — the licensee never holds it. Subsection (b)(2) forbids using trust money for any other purpose, and § 17-503 requires the account to be at a State-located, federally or State-insured institution. The only exception to the deposit rule is written direction to the contrary as authorized by § 17-505(d).

COMAR 09.11.01.17 permits an unlicensed office employee to sign escrow account checks only when:

• a.A designated licensee also cosigns each check✓
• b.The amount of the check is under one thousand dollars
• c.The broker is out of the State on the day of signing
• d.The Commission has approved that employee in writing

COMAR 09.11.01.17 requires the real estate broker to be a signator, or at least one of the signators, on checks drawn on the escrow accounts the broker must maintain. The broker may name an alternate signator, but 'this designated alternate signator shall be a licensee.' The regulation then allows a nonlicensed person to be a cosignator only 'provided all checks are also cosigned by a designated licensee.' So an unlicensed bookkeeper is never a sole signature on client money — a licensee, answerable to the Commission, always signs too. The rule turns on who is accountable, not on the size of the check or on the broker's travel schedule, and there is no per-employee approval process at the Commission. COMAR 09.11.01.07A separately requires the broker to report the bank name and account number to the Commission as soon as trust monies are received, and to give written notice within 10 days of changing the account or the bank.

A Maryland listing expires without a sale. Section 17-507 requires the licensee to keep the transaction file for:

• a.3 years after the date of the listing
• b.7 years after the date of the listing
• c.5 years after the date of the listing✓
• d.10 years after the date of the listing

Section 17-507(b)(2)(i) sets a single retention period measured from one of two points: records must be kept 'for 5 years, starting on the date of the closing of a real estate transaction, or, if the transaction is not closed, 5 years after the date of the listing.' A listing that never produced a sale therefore runs from the listing date. Property management records run 5 years from termination of the management agreement. What must be kept is broad — listings and any other document executed or obtained in connection with providing brokerage services, including any electronic signature on a document. Subsection (c) permits electronic storage, but only if the stored record cannot be erased or edited, was made in the regular course of business, has an identifiable custodian, and sits in a reliable indexing system giving convenient access and chronological arrangement. Trust money records get their own rule in (a): they stay in a secured area within the broker's office.

A team leader and a branch office manager both supervise the same salesperson. Under §§ 17-320 and 17-545, the broker's own duty to supervise that salesperson is:

• a.Discharged, since the manager is closer to the salesperson
• b.Divided equally between the manager and the team leader
• c.Suspended, since a team leader must be an associate broker
• d.Unchanged, since their duties are added to the broker's own✓

Maryland stacks supervision rather than delegating it away. Section 17-320(c)(1) requires the broker to exercise reasonable and adequate supervision over anyone providing brokerage services on the broker's behalf, including independent contractors, and (c)(2) says that holds regardless of how the individual is affiliated. Section 17-320(d)(2) then states that the branch office manager's responsibility 'is in addition to, and not in lieu of, the responsibility of the broker,' and § 17-545(b) says the same of the team leader. Each layer adds a person who can be disciplined — §§ 17-322(b)(27) and (34) reach the broker and the branch manager separately — and none of it subtracts from the broker. COMAR 09.11.05.03C completes the picture: once a failure of supervision is shown, the burden is on the broker to prove the supervision provided was reasonable and adequate. A team leader may in fact be a salesperson with at least 3 years of experience under § 17-544(a).

A Maryland licensee lists a home whose mortgage is 90 days in default. Real Property § 7-302 keeps the licensee outside the Protection of Homeowners in Foreclosure Act only if the property is:

• a.Appraised by a Maryland-licensed appraiser before it is put on market
• b.Sold to a cash buyer who has had no prior dealings with the licensee
• c.Conveyed by quitclaim deed at least twenty days before the sale date
• d.Listed in the local multiple listing service and sold at a settlement✓

Real Property § 7-302(a)(6) exempts a Title 17 licensee from the Protection of Homeowners in Foreclosure Act only while the person is engaged in licensed activity and is not violating § 7-307 or Title 17, and only if the residence in default 'is listed in the local multiple listing service' and 'is sold or transferred through a settlement.' Those two conditions keep the transaction in the open market with a settlement record, which is exactly what the foreclosure-rescue schemes the Act targets avoid. A residence in default is defined in § 7-301(j) as owner-occupied residential property of not more than four units on which the mortgage is at least 60 days in default, so a 90-day default is squarely inside. The exemption does not turn on how the buyer pays or on getting an appraisal, and § 7-310(c) actually forbids using a quitclaim deed for such a sale except where a primary mortgage lender takes a deed in lieu of foreclosure. Section 7-302(b) removes the exemption entirely if the licensee is working to get title into their own hands or a relative's.

A Maryland broker plans to negotiate home improvement contracts with her sellers before listing their houses. Business Regulation §§ 8-101 and 8-601 let her do that only if she holds:

• a.An additional MREC branch office certificate
• b.A Maryland general contractor's surety bond
• c.A Commissioner of Financial Regulation permit
• d.A Home Improvement Commission license✓

Business Regulation § 8-101(n) defines 'sell a home improvement' as negotiating, or offering to negotiate, a home improvement contract with an owner, or seeking to get one. Section 8-601(b) then says a person 'may not sell or offer to sell a home improvement in the State unless the person has a contractor license or salesperson license' from the Maryland Home Improvement Commission, and § 8-601(c) makes a violation a misdemeanor carrying up to a $1,000 fine or 6 months on a first conviction. A real estate license authorizes brokerage services under Title 17 and nothing more, so an MREC branch office certificate does not reach this activity. The Commissioner of Financial Regulation licenses mortgage lenders and related credit businesses, not home improvement work. And a surety bond is a financial assurance a licensing scheme may require, not a substitute for the license itself. Section 8-101(g) excludes new home construction and work on apartment buildings of four or more units from 'home improvement'.

A Maryland listing is already under a ratified contract of sale when a second written offer arrives. Section 17-532 requires the licensee to:

• a.Return the offer to the buyer's agent as untimely
• b.Present the offer to the seller in a timely manner✓
• c.Hold the offer until the first contract falls through
• d.Present the offer only if the seller asks about it

Section 17-532(b)(1)(ii)3 requires the licensee, unless the brokerage agreement says otherwise, to present in a timely manner all written offers and counteroffers to and from the client 'even if the real estate is subject to an existing contract of sale or lease.' The client, not the licensee, decides what to do with a backup offer, and a seller cannot weigh what never reaches them. That is why holding the offer or waiting to be asked both fail — the duty is affirmative. COMAR 09.11.02.02H adds how: all written offers and counteroffers go to the client in full, and in hard copy or electronic format. What § 17-532(b)(4) does not require is that the licensee go looking for further offers while the property is under contract. The duties in this section may not be waived or modified under subsection (g).

Under the Maryland Code of Ethics, written offers and counteroffers must be presented to the client:

• a.In summary, at the next scheduled client meeting
• b.In full, in hard copy or in electronic format✓
• c.In person, with the buyer's own agent also present
• d.In writing, only after the broker has reviewed them

COMAR 09.11.02.02H(2) provides that, unless the brokerage agreement specifies otherwise, all written offers or counteroffers shall be presented to the client 'in full' and 'in hard copy or electronic format.' In full is the operative phrase: the client sees the offer as written, not the licensee's precis of it, because the terms a licensee thinks unimportant may not be the ones the client cares about. Electronic delivery is expressly allowed, so nothing turns on a meeting or on the other side's agent being in the room. The regulation implements § 17-532's duty to present all written offers in a timely manner, and there is no rule making broker review a precondition to the client seeing an offer — though COMAR 09.11.05.03B(2)(b) does expect a supervising broker or branch manager to review executed contracts and brokerage agreements as part of adequate supervision.

A Maryland broker wants to pay a finder's fee to an unlicensed friend who referred a buyer to him. Section 17-604 provides that he:

• a.May pay it if the amount is under five hundred dollars
• b.May not pay compensation for brokerage services✓
• c.May pay it if the friend signs a referral agreement
• d.May pay it out of personal rather than escrow funds

Section 17-604(a) forbids a broker, associate broker, or salesperson to 'pay compensation, in any form, for the provision of real estate brokerage services to any person who is not licensed under this title.' In any form and to any person leave no room for a small payment, a signed paper, or a different pocket to make it lawful — the source of the money is irrelevant. The exceptions in (b) are narrow and specific: an individual licensed in another state who satisfies the reciprocal fee-splitting condition of § 17-513; a professional service corporation, limited liability company, or other entity formed under § 17-512 by the firm's own licensees; and a licensed title insurance producer paying on the broker's behalf under a written disbursement authorization at settlement. Section 17-322(b)(7) reaches the related dodge of retaining an unlicensed individual to evade the rule, and (b)(23) covers rebates and commissions paid in violation of the title.

A Maryland property manager receives a supplier rebate on repairs billed to the owner. The Code of Ethics permits her to keep it only:

• a.With the knowledge and consent of the owner✓
• b.If the rebate amounts to under one hundred dollars
• c.If the management agreement says nothing about it
• d.After the Commission approves the arrangement

COMAR 09.11.02.02E is short and absolute: when acting as agent in the management of property, 'the licensee may not accept any commission, rebate, or profit on expenditures made for an owner without the owner's knowledge and consent.' The money was spent on the owner's account, so any benefit flowing back belongs to the owner unless the owner knowingly agrees otherwise — silence in the management agreement is the opposite of consent, not a substitute for it, and the size of the rebate does not change whose money produced it. The Commission enforces this rule but does not pre-approve individual arrangements. The same principle runs through COMAR 09.11.02.02C, which bars accepting compensation from more than one party to a transaction without the full knowledge of all parties, and § 17-322(b)(23) makes a rebate paid or received in violation of Title 17 a ground for discipline.

Section 17-606 governs an outdoor sign on a Maryland property subject to ground rent. The cost and capitalization of the ground rent must be shown in print that is:

• a.Placed directly above the listing broker's own name
• b.No smaller than the lettering used to show the price✓
• c.At least twice the size of the lettering used for price
• d.Printed in a color that contrasts with the background

Section 17-606 forbids a licensee to post, on real property offered for sale or exchange, 'an outdoor sign or other advertisement on which the cost and capitalization of ground rent on the real property is shown in print or lettering that is smaller than the size of the print or lettering that is used to show the price of the real property.' It is a parity rule, not a magnification rule — the ground rent must be as legible as the price, so a buyer sees the recurring obligation at the same moment as the number that drew them in. Nothing in the section dictates the position of the text on the sign or its color. Ground rent is the Maryland arrangement, concentrated in Baltimore, under which the occupant owns the improvements while another party owns the land and is owed periodic rent for it. Violating § 17-606 is a misdemeanor under § 17-613(a)(12).

Section 17-547 requires every advertisement placed by a Maryland real estate team to carry the brokerage name, the name of at least one team member, and:

• a.The license number issued to each member of that team
• b.The telephone number of the broker or branch manager✓
• c.The date on which the team was registered with the MREC
• d.The address of the local zoning authority for the property

Section 17-547(b) lists exactly three things every team advertisement must contain: the name of the brokerage displayed in a meaningful and conspicuous way, the name of at least one licensee member of the team, and 'the telephone number of the real estate broker or branch office manager of the real estate broker.' A live number for the supervising licensee is what keeps a team from reading as an independent firm. Subsection (c) requires the team name to be directly connected to the brokerage name in the advertisement, and COMAR 09.11.02.01G(5) interprets that strictly: only the words 'of', 'from', 'with', or 'at' may sit between them, with no other word, symbol, or image. Subsection (a) bars a team name containing 'real estate' or 'real estate brokerage' or anything else suggesting the team offers brokerage services independently. Teams are defined in § 17-543 and are not separately registered or licensed by the Commission.

Section 17-608 forbids inducing an owner to sell by making representations about who is moving into a neighborhood. That prohibition applies:

• a.Whether or not the person acted for monetary gain✓
• b.Only when the person earned a commission on the sale
• c.Only in Baltimore City and in Montgomery County
• d.Only when the representations later prove to be false

Section 17-608(a)(2) opens with the words 'whether or not acting for monetary gain,' and reaches any person — not only licensees — who knowingly induces or attempts to induce another to sell, rent, or transfer real estate, or discourages another from buying, by making representations about the entry or proximity of individuals of a particular race, color, sex, religion, handicap, familial status, or national origin. The offense is complete on the attempt, so no sale and no commission is needed. Truth is no defense either: the statute also catches representations that such proximity will lower property values, change the character of an area, increase crime, or hurt the schools. Section 17-608(b) extends liability to anyone knowingly financing a transaction resulting from that conduct, § 17-609 separately bans door-to-door, telephone, and mass-circular solicitation aimed at changing a neighborhood's racial composition, and § 17-322(b)(16) makes the same conduct a ground for discipline. Sections 17-525 and 17-526 are the ones limited to Baltimore City and Montgomery County.

Section 17-525 applies only to residential property in Baltimore City. It requires each broker to keep a registry of listings and, on request, to show a prospective buyer:

• a.The registry, once the buyer signs a brokerage agreement
• b.The whole registry, including every listing in the city
• c.The part of the registry for the price category of interest✓
• d.The registry, but only for the broker's own exclusives

Section 17-525(c)(1) requires each broker to maintain a current and complete registry of the residential properties the broker lists for sale in Baltimore City, broken into price categories established by the Commission, and then: 'if a prospective buyer requests to see the registry, the real estate broker shall allow the prospective buyer to see the part of the registry for the price category in which the prospective buyer indicates interest.' Access is by price band, not the whole book, and it is not conditioned on the person becoming a client. The purpose stated in (a) is to prohibit steering, and (d) backs the registry with a duty not to refuse to show available property because of the buyer's race, color, sex, religion, or national origin or the racial composition of the neighborhood, and not to claim the shown listings are all there are when others exist in the stated price range. Subsection (c)(2) exempts properties obtained through a multiple listing service.