Nebraska Real Estate Broker Exam — All Questions

Absent any of the written arrangements the statute lists, a Nebraska licensee working with a buyer is:

• a.The buyer's limited agent, owing the duties set out in section 76-2418✓
• b.A dual agent for both sides, owing the duties set out in section 76-2419
• c.The seller's subagent, owing the duties set out in section 76-2417
• d.A transaction broker, owing no agency duties to either side of the deal

Section 76-2416(2) makes buyer's or tenant's limited agency the default. The licensee is treated as the buyer's or tenant's limited agent unless the designated broker enters a written seller's or landlord's agency agreement, a subagency agreement with another designated broker, a written dual agency agreement, or the expanded written agency agreement allowed by section 76-2422(6). Nebraska recognizes no transaction-broker status: every brokerage relationship under sections 76-2401 to 76-2430 is a limited agency, as the Supreme Court confirmed in Professional Mgmt. Midwest v. Lund Co.

What does a Nebraska seller's agent owe a prospective buyer who is not represented?

• a.Written disclosure of the adverse material facts the agent actually knows✓
• b.Verification that the seller's written statements about the property are accurate
• c.The same loyalty and confidentiality the agent owes the seller as client
• d.An independent inspection of the property made for the buyer's benefit

Section 76-2417(3)(a) says a seller's or landlord's agent owes a buyer no duty or obligation except to disclose in writing all adverse material facts actually known, which may include environmental hazards, the physical condition of the property, material defects in the property or the title, and material limits on the client's ability to perform. Section 76-2403 defines an adverse material fact as one significantly affecting desirability or value that is not reasonably ascertainable or known to that party. Subsection (3)(b) expressly denies any duty to inspect independently or to verify the client's or an inspector's statements. Loyalty runs to the client, not the customer.

How do Nebraska's statutory agency sections relate to the common law of agency?

• a.They supplement the common law, whose duties continue to apply in full
• b.They govern only where the parties have signed no written agreement at all
• c.They govern only residential transactions of one to four dwelling units
• d.They supersede the common law except under an expanded written agreement✓

Section 76-2429 provides that sections 76-2401 to 76-2430 supersede the duties and responsibilities of the parties under the common law, including an agent's fiduciary responsibilities to a principal, with a single exception: subsection (6) of section 76-2422, under which a designated broker contracts to duties exceeding those in sections 76-2417 and 76-2418. Professional Mgmt. Midwest v. Lund Co. held that common-law fiduciary case law is irrelevant unless that subsection is used. The sections are to be construed broadly, apply to commercial work as much as residential, and are not confined to unwritten arrangements.

Nebraska's Seller Property Condition Disclosure Statement must reach the purchaser:

• a.At or before the first showing of the property to that purchaser
• b.Within ten days after the purchaser's inspection period has ended
• c.Within three business days after the contract binds the purchaser
• d.On or before the effective date of the binding contract✓

Section 76-2,120(7) requires the seller or the seller's agent to deliver the statement, and any update, to the purchaser or the purchaser's agent on or before the effective date of any contract binding the purchaser, with the purchaser acknowledging receipt in writing. The statute covers residential real property of no fewer than one and no more than four dwelling units used primarily for residential purposes, and reaches leases with an option to purchase and sales of improvements coupled with a ground lease. Subsection (5) requires the seller to update the statement whenever he or she learns it is no longer accurate, measured against that same effective date.

Which sale is exempt from Nebraska's Seller Property Condition Disclosure requirement?

• a.A twenty-year-old house sold by its retiring original owner
• b.A newly constructed residence that has never been occupied✓
• c.A house sold under a lease that grants an option to purchase
• d.A duplex sold by an investor who has never lived in either unit

Section 76-2,120(6)(k) exempts a transfer of newly constructed residential real property which has never been occupied. The rest of the exemption list turns on the character of the transfer rather than the property: foreclosure and trustee's sales, transfers by a bankruptcy trustee, transfers between co-owners, transfers to a spouse or a lineal relative, transfers to or from a government entity, and certain relocation-company transfers. Nothing turns on how old the house is or whether the seller lived there; a duplex sits inside the one-to-four-unit definition; and subsection (2) expressly extends the requirement to a lease with an option to purchase.

If a Nebraska seller fails to deliver the required property condition disclosure statement:

• a.The transfer is voidable for one year at the purchaser's sole election
• b.The transfer stands, and the purchaser may sue for damages, costs, and fees✓
• c.The transfer is void, and the purchaser may recover every sum paid with interest
• d.The transfer stands, and a complaint to the Commission is the only remedy

Section 76-2,120(11) provides that a transfer may not be invalidated solely because of a failure to comply, so the conveyance itself survives. Subsection (12) gives the purchaser a cause of action against the seller for actual damages, court costs, and reasonable attorney's fees, in addition to any other cause of action, and requires it be commenced within one year after the purchaser takes possession or the conveyance occurs, whichever comes first. Voiding the contract and recovering payments with six percent interest is the remedy for a noncompliant subdivision sale under section 81-885.40, not for this statement.

How does a Nebraska designated broker become a subagent of another broker's client?

• a.By any cooperative showing arranged through the multiple listing service
• b.By written contract with the client, signed before any showing takes place
• c.By written notice to the Commission naming the primary broker and the client
• d.By written contract with the primary broker, or by taking up a unilateral offer✓

Section 76-2422(5) requires a designated broker intending to act as a subagent to enter a written contract with the primary designated broker for the client; where that broker has made a unilateral offer of subagency, another designated broker enters the relationship by disclosing to the customer that he or she is a subagent of the client. Section 76-2417(5) adds that the seller must have agreed in writing that subagents may be retained and compensated, and the subagent then carries the same limited-agency duties. The subagent does not contract with the client, no Commission filing creates the relationship, and cooperating on a showing is not subagency.

In a Nebraska cooperative transaction, the seller's payment of the buyer's broker:

• a.Converts the buyer's broker into a subagent of the seller for that deal
• b.Establishes an agency relationship with the seller by operation of law
• c.Does not by itself establish an agency relationship with the seller✓
• d.Requires the buyer's broker to obtain written dual agency consent

Section 76-2424(2) states that payment of compensation by itself shall not establish an agency relationship between the party who paid and the designated broker or any affiliated licensee. Subsection (1) allows compensation from the seller, landlord, buyer, tenant, or a third party, or shared between designated brokers. Where a designated broker is paid by more than one party, subsection (5) requires the parties to consent in writing at or before the time they enter the contract, and 299 NAC 5-003.06 requires that disclosure be signed and dated by all parties. Subagency arises only under section 76-2422(5), and dual agency only where one broker represents both sides.

Without informed written consent, a Nebraska dual agent may not tell one client that the other:

• a.Would accept a price different from the one publicly offered or asked✓
• b.Has retained an attorney to review the terms of the purchase agreement
• c.Has arranged a professional inspection of the property being sold
• d.Has received a competing written offer on the property being sold

Section 76-2419(4) protects exactly four items absent the informed written consent of the client they concern: that a buyer or tenant will pay more than the price or rate offered, that a seller or landlord will take less than the asking price or rate, the client's motivating factors, and willingness to accept other financing terms. Outside that list, subsection (3) lets a dual agent pass on information relevant to the transaction and requires disclosure of all adverse material facts actually known to both clients. Subsection (5) separately bars disclosing confidential information unless a statute requires it or silence would amount to fraudulent misrepresentation.

A Nebraska licensee buying a listed property for his or her own account must:

• a.Obtain the Commission's written approval of the purchase in advance
• b.Withdraw from the listing and refer the seller to an unaffiliated broker
• c.Disclose the interest in writing before the seller becomes obligated to sell✓
• d.Disclose the interest in writing within five days after the purchase closes

Section 81-885.24(9) makes acting in the dual capacity of agent and undisclosed principal an unfair trade practice, and rule 299 NAC 5-003.04 fixes the timing: where a licensee is purchasing for himself, herself, or an entity in which the licensee has any interest, the written disclosure must take place before the seller becomes obligated to sell, be signed and dated by the other party, and be kept for five years. Disclosure after closing comes too late, no rule forces the licensee out of the transaction, and the Commission does not approve individual purchases.

A Nebraska seller's agent must present written offers to the client:

• a.In a timely manner, but only until the property first goes under contract
• b.Only where the offer exceeds the price stated in the listing agreement
• c.In a timely manner, even while the property is already under contract✓
• d.Within three business days of receiving each written offer on the property

Section 76-2417(1)(c)(ii) requires presenting all written offers to and from the client in a timely manner regardless of whether the property is subject to a contract for sale or a lease or letter of intent to lease. Section 76-2418(1)(c)(ii) imposes the mirror duty on a buyer's agent even where the client is already under contract. The single exception, in section 76-2422.01, is where the client is an asset management company. Nebraska fixes no three-day clock, and rule 299 NAC 5-003.18 separately makes it a violation to fail to reduce a prospective purchaser's requested offer to writing, so price is no filter either.

Under the Nebraska Real Estate License Act, a completed and dated copy of the purchase agreement goes to:

• a.The seller only, at the moment the written offer is accepted
• b.Both the purchaser and the seller, within a reasonable time✓
• c.The purchaser only, at the moment the written offer is signed
• d.Both parties' attorneys, within three business days of signing

Section 81-885.24(20) makes failing to deliver within a reasonable time a completed and dated copy of any purchase agreement or offer to buy or sell to both the purchaser and the seller an unfair trade practice, and Firmature v. Brannon confirms the Commission may censure a licensee for it. Section 81-885.24(19) separately requires a copy of any written listing agreement be left with the principal, and section 76-2422(1) requires a copy of any written brokerage-services agreement be left with the client. At consummation, section 81-885.24(21) requires detailed closing statements to both sides.

Every written Nebraska listing agreement must contain:

• a.An automatic renewal provision, with a copy left with the principal
• b.A fixed date of expiration, with a copy left with the principal✓
• c.A protection period of at least ninety days after the expiration date
• d.A guaranteed minimum sale price, with a copy filed at the Commission

Section 81-885.24(19) makes failing to include a fixed date of expiration in any written listing agreement, and failing to leave a copy of the agreement with the principal, an unfair trade practice. Section 76-2422(2) repeats the fixed expiration requirement for the seller's agency agreement and adds the licensee's duties, the terms of compensation, and whether subagency may be offered. Nebraska requires no guaranteed price and no Commission filing, sets no protection period, and an automatic renewal provision is the opposite of the fixed expiration date the statute demands.

Besides a fixed expiration date, a Nebraska seller's agency agreement must set out:

• a.The seller's net proceeds, the closing date, and the buyer's financing terms
• b.The broker's insurance carrier, the policy limits, and the claims history
• c.The licensee's duties, the compensation terms, and any offer of subagency✓
• d.The seller's original purchase price, the assessed value, and the lien payoff

Section 76-2422(2) requires the agreement to include the licensee's duties and responsibilities specified in section 76-2417, the terms of compensation, a fixed date of expiration, and whether an offer of subagency may be made to any other designated broker. Under subsection (1) the designated broker enters the agreement unless affiliated licensees are authorized in writing to sign for the broker, and a copy is left with the client. A narrow carve-out lets a limited seller's agent for a builder set compensation for a specific new-construction property on or before the builder accepts a contract, and section 76-2422.01 excuses stating those duties where the client is an asset management company.

A Nebraska broker who closes a transaction purely as an independent party must:

• a.Disclose in writing to all parties that the broker acts as agent for neither✓
• b.Disclose in writing to all parties that the broker acts as agent for the seller
• c.Obtain a separate closing agent license the Commission issues for that role
• d.Decline any compensation for the services performed at that closing

Rule 299 NAC 2-013 lets a broker not otherwise involved before a written purchase agreement exists close the transaction, and 2-013.01 confines that role to the ministerial acts needed to complete it, including receiving and disbursing funds. The broker must disclose in writing to all parties, before the closing, that he or she is providing only that ministerial service and is not acting as agent for either party; the disclosure is signed by both parties and retained under 299 NAC 3-001. Where the broker was involved earlier, 2-013.02 requires the full obligations owed to seller and buyer. No separate closing license exists and no rule bars payment.