Virginia 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.

Which body licenses and disciplines real estate brokers in Virginia?

• a.The Virginia Association of Realtors
• b.The Real Estate Board, part of DPOR✓
• c.The Virginia State Corporation Commission
• d.The Virginia Department of Housing

Section 54.1-2104 creates a nine-member Real Estate Board within the Department of Professional and Occupational Regulation, and Section 54.1-2105 A gives that Board power to "do all things necessary and convenient for carrying into effect the provisions of this chapter" and to promulgate regulations, which is where both the license and the discipline come from. A trade association such as the Virginia Association of Realtors is a private membership group that can enforce its own code against its own members but issues no state license and revokes none. The State Corporation Commission charters and regulates business entities and industries such as insurance and utilities, so a brokerage may file with it as a corporation while its real estate license still comes from elsewhere. And a housing department administers housing programs and funding rather than occupational credentials, so it has no role in licensing an individual broker.

Under 18VAC135-20-335, which task may an unlicensed assistant in a Virginia brokerage lawfully perform?

• a.Answering a caller's questions on financing
• b.Placing a for sale sign on a listed property✓
• c.Holding an open house at a listed property
• d.Agreeing to a commission split with a firm

Subsection B of 18VAC135-20-335 lists "placing signs on properties" among the activities an unlicensed individual may perform, alongside clerical duties, scheduling appointments and acting as a courier. Subsection A reserves the other three to licensees by name: it lists "answering questions on listings, title, financing, closing, contracts, brokerage agreements, and legal documents," so fielding a financing question is licensed activity even over the telephone; it lists "holding an open house" separately from "showing property," so staffing one is licensed activity even if the assistant never opens a contract; and it lists "negotiating or agreeing to any commission, commission split, management fee, or referral fee," so the money side of a cooperating arrangement is reserved as well. Subdivision 3 of 18VAC135-20-165 makes the supervising broker responsible for adequate supervision of unlicensed personnel.

What licensed experience must an applicant for a Virginia real estate broker license show?

• a.Thirty-six of the preceding 48 months as a salesperson✓
• b.Twenty-four of the preceding 36 months as a salesperson
• c.Sixty of the preceding 84 months as a salesperson
• d.Twelve of the preceding 24 months as a salesperson

Subsection C of 18VAC135-20-35 requires that broker applicants "have been actively engaged as defined in 18VAC135-20-10 as a real estate salesperson for a period of 36 of the 48 months immediately preceding application," and the same subsection requires the principal or supervising broker for whom the applicant worked to verify that experience. Twelve months in a 24-month window and 24 months in a 36-month window both fall short of the three years the regulation actually demands. Five years within seven is another state’s broker standard, not Virginia's, and applying it here would keep qualified Virginia applicants out of the examination for two extra years. Subsection E 4 applies the same 36-of-48 test to broker applicants seeking licensure by reciprocity, verified there by an individual with direct knowledge of the applicant's activities.

18VAC135-20-10 defines "actively engaged" for the Virginia broker experience requirement as active licensure performing licensed activity for what level of effort?

• a.Any level of effort, so long as the license stayed active
• b.At least twenty transactions closed over the same period
• c.An average of at least 40 hours per week over the period✓
• d.At least six months of full-time work in each of three years

The definition in 18VAC135-20-10 reads that "actively engaged" means "active licensure with a licensed real estate firm or sole proprietorship in performing those activities as defined in Section 54.1-2100 of the Code of Virginia for an average of at least 40 hours per week." Holding an active license is therefore necessary but not sufficient; a licensee who parked a license with a firm and sold nothing has active licensure without the hours. The regulation measures time rather than production, so no transaction count appears in it and an applicant with a light but full-time practice still qualifies. And the standard is an average across the qualifying period rather than a run of separately certified full-time months, which is why subsection C of 18VAC135-20-35 has the principal or supervising broker verify the experience rather than having the applicant document each month.

What education does Section 54.1-2105 require of an applicant for an initial Virginia real estate broker license?

• a.A baccalaureate degree with a major or minor in real estate
• b.Not less than 60 hours of a principles of real estate course
• c.Not less than 12 semester hours of real estate courses✓
• d.Not less than 30 hours of post-license education in one year

Subdivision B 2 of Section 54.1-2105 requires every applicant for an initial broker license to hold at least a high school diploma or its equivalent and to have "completed not less than 12 semester hours of classroom or correspondence or other distance learning instruction in real estate courses," with subsection D specifying that the content be in real estate brokerage, finance, appraisal, law and related Board-approved subjects. The 60-hour principles course is the salesperson requirement in subdivision B 1 b, and a broker candidate needs considerably more than that. A real estate degree is not a route the section creates, though subsection C lets the Board waive education or experience for an applicant found to have the equivalent. And the 30-hour figure is the post-license curriculum that Section 54.1-2105.01 imposes on new salespersons within their first year, which is neither a broker requirement nor a prelicence one.

When does a Virginia salesperson, broker or firm license issued under 18VAC135-20 expire?

• a.One year from the date printed on the face of the license
• b.Three years from the last day of the month it was issued
• c.Two years from the last day of the month it was issued✓
• d.On 30 June of the second year following its issuance

18VAC135-20-90 provides that licenses for salespersons, brokers and firms "will expire two years from the last day of the month in which the licenses were issued, as indicated on the license," with concurrent broker licenses expiring on the same date as the original broker license. A one-year term is too short and would double the renewal cycle the Board actually runs. Three years is longer than the regulation allows and would let a licensee go a full extra year without the continuing education Section 54.1-2105.03 ties to renewal. And Virginia does not use a common fixed expiry date for everyone; each licensee's cycle runs from the licensee's own issue month, which is why 18VAC135-20-110 C warns that failing to receive the Board's renewal notice does not excuse a late renewal.

Of the 24 hours of continuing education a Virginia broker must complete each licensing term, how many hours must relate to supervision and brokerage management?

• a.Two hours, of which one covers broker supervision
• b.Three hours, of which one covers broker supervision
• c.Five hours, of which two cover broker supervision
• d.Eight hours, of which two cover broker supervision✓

Subdivision A 1 b of Section 54.1-2105.03 requires "a minimum of eight hours of courses relating to supervision and management of real estate agents and the management of real estate brokerage firms as are approved by the Board, two hours of which shall include an overview of the broker supervision requirements under this chapter and the Board regulations." Two hours and three hours both match other line items in the same curriculum rather than this one: subdivision A 1 a sets two hours of fair housing, two of legal updates, two of agency, two of contracts and three of ethics. Five hours is the general elective allowance in subdivision A 1 c. The eight-hour management block is what makes the broker's 24-hour requirement larger than the salesperson's 16 hours under subdivision A 2, and it is a broker-only obligation.

A Virginia salesperson moves house. Within what period must the change of address be reported to the Real Estate Board?

• a.Within 10 calendar days of the change of address
• b.Within 21 calendar days of the change of address
• c.At the next renewal of the salesperson's license
• d.Within 30 calendar days of the change of address✓

Subdivision A 1 of 18VAC135-20-170 requires salespersons and individual brokers to keep the Board informed of their current name and home address, and states that "changes of name and address must be reported to the board in writing within 30 calendar days of such change." Ten days is the deadline in subdivision B 1 of the same regulation for a different event, the principal broker's notice that a licensee has terminated active status. Twenty-one days is the deadline in subsection B of 18VAC135-20-240 for answering a Board inquiry. Waiting for renewal would leave the Board writing to a dead address for as long as two years, which is why the same subdivision adds that the Board is not responsible for correspondence a licensee fails to receive after neglecting to report a move.

A salesperson leaves a Virginia firm. Who must notify the Real Estate Board of the termination, and within what period?

• a.The departing salesperson, within 10 calendar days
• b.The principal broker, within 30 calendar days
• c.The principal broker, within 10 calendar days✓
• d.The departing salesperson, within 30 calendar days

Subdivision B 1 of 18VAC135-20-170 places the duty on the firm rather than the individual: when a salesperson or broker "is discharged or in any way terminates active status," it is "the duty of the sole proprietor or principal broker to notify the board with the licensee name, license number, and date of termination within 10 calendar days." Giving the principal broker 30 days confuses this obligation with the 30-day address rule in subdivision A 1, which runs against the individual licensee. Both answers that shift the duty to the departing salesperson invert the regulation, which is deliberate: the firm controls the license records and the departing licensee may already be gone. Subdivision B 2 applies the same 10-day rule to the firm when a principal broker terminates active status.

A Virginia licensee lets a license lapse. How long may that license be reinstated before the holder must reapply as a new applicant?

• a.One year following the expiration date✓
• b.Ninety days following the expiration date
• c.Six months following the expiration date
• d.Thirty days following the expiration date

Subsection C of 18VAC135-20-140 states that "a license may be reinstated for up to one year following the expiration date with payment of the reinstatement fee," and that "after one year, the license may not be reinstated under any circumstances and the applicant must meet all current educational and examination requirements and apply as a new applicant." Thirty days is the separate trigger in subsection B, after which the reinstatement fee rather than the renewal fee becomes payable, so it marks a price change and not the end of the window. Ninety days and six months appear nowhere in the regulation. Subsection D adds the real hazard of drifting through the window: activity conducted with an expired license "may constitute unlicensed activity" and be prosecuted under Chapter 1 of Title 54.1.

When must the principal or supervising broker of a Virginia firm conduct the mandatory audit of the firm's practices, policies and procedures?

• a.Within 90 days prior to the firm license's expiration✓
• b.Once in every calendar year, on a date the firm sets
• c.Within 30 days after any Board investigation opens
• d.Within 90 days after the firm license has been renewed

Subdivision A 1 of 18VAC135-20-225 requires the principal or supervising broker to "conduct or have a third party conduct an audit within 90 days prior to the expiration of the firm license," documented on a Board form, and Section 54.1-2106.2 makes the broker certify at renewal that the audit was done and keep the completed form on the premises for inspection. A Board investigation is not the trigger; the audit is a routine self-check tied to the license cycle and is meant to catch problems before an investigator does. A calendar-year cadence would drift out of step with a license term that runs from the firm's own issue month under 18VAC135-20-90. And running the audit after renewal would certify compliance the broker has not yet examined, which is the reverse of what Section 54.1-2106.2 asks.

A Board agent asks a Virginia licensee for the transaction file on a closed sale. Within what period must the licensee produce it?

• a.Within 30 days of the request, absent an extension
• b.Within 21 days of the request, absent an extension
• c.Within 10 days of the request, absent an extension✓
• d.Within 45 days of the request, absent an extension

Subsection A of 18VAC135-20-240 requires a licensee to produce "within 10 days of the request" any signature card, bank record, document, book or record concerning a real estate transaction in which the licensee was involved, though the Board may extend that period on a showing of extenuating circumstances. Twenty-one days is the deadline in subsection B, and it applies to a different thing: any other inquiry by the Board or its agents. Thirty days is the reporting period in 18VAC135-20-170 A for a change of name or address, and it governs the licensee's own record rather than a transaction file. Forty-five days appears nowhere in this regulation. The retention rules that make production possible sit in subsection C of 18VAC135-20-185, which keeps brokerage agreements and transaction documents for three years.

A Virginia principal broker opens a second staffed office that the public is invited to visit. What does Section 54.1-2106.1 require?

• a.Nothing further, because the firm license covers it
• b.A branch office license, kept on those premises✓
• c.Written notice to the Board within 30 days of opening
• d.A separate firm license in a different trade name

Subsection E of Section 54.1-2106.1 provides that a principal broker maintaining more than one place of business in the Commonwealth "shall be required to obtain a branch office license from the Board for each additional place of business maintained other than his primary place of business," and that "a copy of the branch office license shall be kept on the premises of the branch office." The firm license covers only the primary place of business named on the firm license application, so it does not stretch to a second office. A bare notice to the Board is not what the section asks for; it asks for a license, which the Board issues. And a second firm license in another trade name would create a separate firm rather than a branch of this one. The same subsection exempts locations such as vehicles, post office boxes and coffee shops, and a residence unless it is held out to the public.

A Virginia broker receives a buyer's earnest-money deposit that the firm will hold. Where must it go?

• a.Into the brokerage's own operating account
• b.Into an escrow account in the firm's name✓
• c.Into the supervising broker's personal account
• d.Into the seller's hands on the day of receipt

Subdivision A 1 of 18VAC135-20-181 requires each firm holding money to maintain "one or more federally insured escrow accounts into which all funds received in connection with a real estate transaction must be deposited," in the name by which the firm is licensed, with the accounts, checks and bank statements labeled "escrow" and the principal broker holding signatory authority. Putting the money in the operating account or in the broker's own account is commingling under subdivision D 2, and the personal account adds the risk of conversion on top of it. Handing the deposit to the seller on receipt disposes of money whose destination still depends on how the contract performs, and Section 54.1-2108.2 reserves that disposition for the four routes it lists. Subdivision A 1 e also requires the escrow balance to be sufficient at all times to cover every fund the firm is holding.

In Virginia, mixing client trust money with the broker's own funds is known as commingling. How does 18VAC135-20-181 treat it?

• a.Allowed if the broker reconciles monthly
• b.Listed as improper maintenance of escrow funds✓
• c.Allowed for sums under one thousand dollars
• d.Required whenever the firm has one bank

Subdivision D 2 of 18VAC135-20-181 lists as improper maintenance of escrow funds "commingling the funds of any person by a principal or supervising broker or the broker's employees or associates or any licensee with the broker's own funds," and adds that pledging or hypothecating a certificate of deposit bought with escrow money, or letting the original certificate leave the broker's direct control, counts as commingling too. Careful bookkeeping is no defense, because the wrong is the mixing rather than the recordkeeping, and a reconciliation performed on a commingled account documents the violation rather than curing it. Nor is there a small-sum allowance; the regulation draws no threshold. And a firm that banks in one place still opens a separate escrow account there, which is exactly what subdivision A 1 d contemplates when it requires the account to be designated "escrow" with the financial institution.

Buyer and seller make conflicting written demands for an escrow deposit a Virginia broker holds. What does the law require of the broker?

• a.Hold the funds until one lawful route to disbursement is met✓
• b.Pay the seller, whose property was under contract first
• c.Retain the deposit and apply it against the earned commission
• d.Pay whichever party first delivers a written demand letter

Subdivision B 1 a of 18VAC135-20-181 sends earnest money to Section 54.1-2108.2 of the Code, and subdivision 3 of that section keeps the funds in escrow until one of four things happens: all principals agree in a written agreement, a court of competent jurisdiction orders disbursement, the funds are successfully interpleaded, or the broker releases them under "the clear and explicit terms of the contract that established the earnest money deposit." Which property went under contract first is a fact about the transaction's history and settles nothing about entitlement. Treating a contested deposit as commission is the conversion that subdivision D 2 of the regulation exists to prevent, and subdivision B 1 b bars the licensee from any part of the deposit as commission before consummation anyway. Paying whoever writes first substitutes a race for a resolution; the same subdivision 3 says no broker is required to decide who is entitled to the money.

Under Section 54.1-2108.2, by when must an earnest-money deposit held in the firm's escrow account be placed there?

• a.By the end of the next business banking day after receipt
• b.By the end of the third business banking day after receipt
• c.By the end of the tenth calendar day following ratification
• d.By the end of the fifth business banking day after ratification✓

Subdivision 1 of Section 54.1-2108.2 provides that "upon the ratification of a contract, an earnest money deposit received by the principal broker or supervising broker, or an agent of such principal broker or supervising broker, that is to be held in the firm's escrow account shall be placed in such escrow account by the end of the fifth business banking day following ratification," unless the principals agree otherwise in writing, and it must stay there until the transaction is consummated or terminated. The next banking day and the third banking day are both tighter than the statute, and neither appears in it. The ten-calendar-day option changes the clock as well as the count, and calendar days would run the deadline through weekends and holidays that business banking days exclude. Subdivision 2 gives the same five-banking-day window for delivering a deposit to an escrow agent named in the contract when the firm will not hold it.

A Virginia broker gives written notice that a disputed deposit will be released under the contract's clear and explicit terms. How long may the other principal protest?

• a.Five business days from the date of the notice
• b.Ten business days from the date of the notice
• c.Thirty calendar days from the date of the notice
• d.Fifteen calendar days from the date of the notice✓

Subdivision 3 of Section 54.1-2108.2 lets the broker send notice "that release of such funds shall be made unless a written protest is received from the principal who is not receiving the funds by such broker within 15 calendar days of the date of such notice." Five and ten business days both shorten the window and change the unit, and business days would exclude the weekends the statute counts. Thirty calendar days doubles it. The same subdivision lists the delivery methods that comply when the contract does not specify one, including hand delivery, prepaid post with proof of mailing, electronic means with proof of delivery, and overnight delivery, and it closes by immunizing a broker who follows the section from liability to any party to the contract.

When may a Virginia licensee take a share of an earnest-money deposit held in escrow as part of the commission?

• a.After the escrow account has been reconciled
• b.After the contract's contingency periods expire
• c.After the listing agreement has expired
• d.After the transaction has been consummated✓

Subdivision B 1 b of 18VAC135-20-181 states that "unless otherwise agreed in writing by all principals to the transaction, a licensee will not be entitled to any part of the earnest money deposit or to any other money paid to the licensee in connection with any real estate transaction as part of the licensee's commission until the transaction has been consummated." Contingencies expiring do not close a sale; they only clear the way to one, and the deposit stays where ratification put it. An expired listing ends the brokerage agreement without consummating anything, so it produces no claim on a buyer's deposit. And reconciling the account only proves the balance is right, as subdivision A 1 e requires at all times; it is not a license to draw commission early. Subdivision A 2 b does allow money that will ultimately belong to the licensee to sit in escrow, provided it is separately identified and withdrawn at intervals of not more than six months.

Rent collected by a Virginia licensee for a landlord client must be placed in an escrow account by when?

• a.By the end of the month in which it was received
• b.By the end of the fifth business banking day after the lease ends
• c.By the end of the fifth business banking day after receipt✓
• d.By the end of the tenth business banking day after receipt

Subdivision B 1 of Section 54.1-2108.1 provides that "any rent paid to a real estate licensee acting on behalf of a landlord client in connection with the lease shall be placed in an escrow account by the end of the fifth business banking day following receipt, regardless of when received," unless the principals to the lease agree otherwise in writing. Holding rent until month end would let a firm sit on other people's money for weeks and defeats the phrase "regardless of when received." Waiting for the lease to end confuses rent with a security deposit, and even security deposits go into escrow on the same five-banking-day clock under subdivision B 2. Ten banking days doubles the statutory period. Subdivision B 3 sets a variant for application deposits, which go into escrow within five business banking days after the landlord approves the rental application.

The Virginia Residential Property Disclosure Statement required by Section 55.1-703 takes which approach to the condition of the home?

• a.The owner warrants the condition of every component
• b.The owner certifies the home will pass an inspection
• c.The owner advises the buyer to exercise due diligence✓
• d.The owner is excused from disclosing anything at all

Subsection A of Section 55.1-703 says the owner furnishes the statement "for the buyer to beware of certain matters that may affect the buyer's decision to purchase such real property," and every item in subsection B is framed as the owner making no representation and the purchaser being advised to exercise whatever due diligence that purchaser deems necessary. A warranty is the opposite posture, and so is a certification that the property will pass inspection; both would convert a notice into a promise the statute never asks the owner to make. Nor is the owner excused from disclosing, because the statement itself must be delivered and separate affirmative disclosures survive, including the military air installation noise zone disclosure in Section 55.1-704. The nineteen enumerated items include resource protection areas under a locality's Chesapeake Bay Preservation Act ordinance, special flood hazard areas, radon zones and defective drywall.

A Virginia home sits in a locality with a military air installation. What does Section 55.1-704 require of the owner?

• a.Nothing, since the buyer-beware statement covers it
• b.A written estimate of the average decibel level
• c.Disclosure of any noise or accident potential zone✓
• d.A recorded plat showing the flight paths overhead

Section 55.1-704 requires the owner of residential property in a locality where a military air installation is located to "disclose to the purchaser whether the subject parcel is located in a noise zone or accident potential zone, or both, if so designated on the official zoning map," naming the specific zone, on a form the Real Estate Board provides. This is one of the few affirmative disclosures the chapter still demands, so the buyer-beware statement does not absorb it; subdivision A 9 of Section 55.1-702 even keeps this disclosure alive for first sales of a dwelling that are otherwise exempt. No decibel estimate is called for, because the disclosure reports the locality's zoning designation rather than a measurement. And no plat is required. Subdivision B 18 of Section 55.1-703 handles ordinary public-use airport noise the other way, as a no-representation item, and subsection C of Section 55.1-709 removes the termination remedy where the designated zone is below 65 decibels day-night average.

What does Section 55.1-703 say about a septic or other wastewater system serving a Virginia home offered for sale?

• a.The owner must supply a current pump-out receipt
• b.The owner makes no representations about the system✓
• c.The owner must state the tank's size and location
• d.The owner must have the system inspected before sale

Subdivision B 8 of Section 55.1-703 states that "the owner makes no representations with respect to the presence of any wastewater system, including the type or size of the wastewater system or associated maintenance responsibilities," and advises purchasers to exercise whatever due diligence they deem necessary "to determine the presence of any wastewater system on the property and the costs associated with maintaining, repairing, or inspecting any wastewater system, including any costs or requirements related to the pump-out of septic tanks." A pump-out receipt, a description of the tank and a pre-sale inspection would each be an affirmative representation about the system, and this item deliberately makes none. That does not leave a licensee free to help conceal what the licensee actually knows: subsection B of Section 54.1-2131 still requires written disclosure to prospective buyers of material adverse facts about the physical condition that the licensee actually knows.

How does the Virginia Residential Property Disclosure Act treat information about registered sexual offenders near a listed home?

• a.The owner makes no representations about it✓
• b.The owner must attach a printout of the registry search
• c.The listing broker must run the search for every buyer
• d.The owner must disclose any offender within one mile

Subdivision B 6 of Section 55.1-703 provides that "the owner makes no representations with respect to information on any sexual offenders registered under Chapter 23 of Title 19.2, and purchasers are advised to exercise whatever due diligence they deem necessary with respect to such information." The registry is public, so the statute points the buyer at it rather than making the owner a reporter of it. Attaching a printout would be an affirmative representation the item withholds, and it would go stale the day it was printed. Nothing in the chapter shifts the search onto the listing broker, whose duty under Section 55.1-712 is to inform the parties of their own rights and obligations under the chapter. And no distance rule exists in Virginia law; a one-mile radius is invented. Section 55.1-712 adds that a licensee who performs that duty to inform has no further duty to the parties under the chapter.

A Virginia seller does not mention that a homicide occurred in the house years ago. What does Section 55.1-713 provide?

• a.No cause of action arises against owner or licensee✓
• b.The buyer may recover actual damages from the owner
• c.The licensee, but not the owner, must disclose it
• d.The buyer may rescind within three days of learning it

Subsection A of Section 55.1-713 says that "notwithstanding any other provision of this chapter or any other statute or regulation, no cause of action shall arise against an owner or a real estate licensee for failure to disclose that the real property was the site of" either an act or occurrence with no effect on the physical structure or environment, or "a homicide, felony, or suicide." Rescission and actual damages are the remedies subsection B provides for failures to make the disclosures the chapter does require, and this is expressly not one of them. Splitting the duty so that the licensee must speak while the owner need not misreads the subsection, which names owner and licensee together. Subsection C sets the limitation period for actions that do lie under the chapter at one year from receipt of the disclosures, or from settlement where none were delivered.

A Virginia buyer contracts for a condominium unit and no resale certificate has ever been delivered. What is the buyer's cancellation right?

• a.Three days from ratification of the contract
• b.Cancellation at any time prior to settlement✓
• c.Fourteen days from ratification of the contract
• d.No right, because the contract was already ratified

Subsection C of Section 55.1-2312 provides that "if the resale certificate or notice that the resale certificate is unavailable has not been delivered to the purchaser, the purchaser or purchaser's agent may cancel the contract at any time prior to settlement." The three-day period in subsections A and B is the default once a certificate or an unavailability notice has actually been delivered, and no time period was agreed in the contract, so it presupposes the delivery that has not happened here. Fourteen days is the association's deadline to deliver the certificate after a written request under subsection B of Section 55.1-2309, after which the certificate is deemed unavailable. And ratification does not extinguish the right; Section 55.1-2308 requires the contract itself to disclose that the right to receive the certificate and to cancel is waived only if not exercised before settlement. Since the 2023 Acts of Assembly chapters 387 and 388, this one Resale Disclosure Act instrument replaced both the old property owners' association disclosure packet and the old condominium resale certificate.

What must appear in every advertisement placed by an affiliated licensee of a Virginia firm?

• a.The licensee's own individual license number
• b.A statement that the firm is an equal housing lender
• c.The supervising broker's home address and telephone
• d.The firm's name and office contact information✓

Subdivision B 1 of 18VAC135-20-190 requires "a clear, legible, and conspicuous advertising disclosure, which must include (i) the firm's name and (ii) the office contact information," and subsection A requires the firm's licensed name to be clearly and legibly displayed on all advertising under the direct supervision of the principal or supervising broker. Individual license numbers are not part of the required disclosure, though the principal broker may specify additional information in the firm's written policies under the same subdivision. A broker's home address is not required and is not what "office contact information" means. And an equal housing lender line belongs to lending advertisements rather than brokerage ones. Subdivisions B 3 and B 4 add that property information must be consistent with the property's condition and current contract status and be updated in a timely manner when the listing materially changes.

Under Section 54.1-2137, at what point must a Virginia licensee have a brokerage agreement with a prospective client?

• a.Before providing brokerage services to that client✓
• b.Before presenting a written offer for that client
• c.Before accepting any compensation from that client
• d.Before the transaction is scheduled for settlement

Subsection B of Section 54.1-2137 states that "except as otherwise provided in this article, a licensee shall enter into a brokerage agreement with a prospective client prior to providing brokerage services," a rule the 2025 Acts of Assembly chapters 479 and 495 put in force on 1 July 2025. Compensation is the wrong trigger: Section 54.1-2140 says paying a broker creates no brokerage relationship at all, so the money neither starts nor delays the obligation. Waiting until an offer is written is far too late, because negotiating and drafting that offer is itself a brokerage service under the definition in Section 54.1-2130. Settlement is later still. The same subsection carves out one narrow step: a licensee need not have an agreement before "preparing property-specific materials with the intent to obtain a brokerage relationship with a prospective client."

A Virginia licensee is asked by an unrepresented prospective buyer to take her through three listings this afternoon. What does Section 54.1-2132 require first?

• a.Written consent from each of the three listing brokers
• b.A written disclosure that the licensee is unrepresented
• c.A brokerage agreement with that prospective buyer✓
• d.A signed acknowledgment of the buyer's loan approval

Subdivision A 1 of Section 54.1-2132 opens the buyer's-agent duties with "enter into a brokerage agreement with the prospective buyer prior to showing property to such prospective buyer." Until 1 July 2025 subsection G of the same section excused this where the licensee was showing under a seller-client's brokerage agreement, but the 2025 Acts of Assembly chapters 479 and 495 struck that exemption from the buyer section, so the agreement now comes first. A disclosure of brokerage relationship under Section 54.1-2138 is a separate obligation owed to someone who is not the licensee's client, and it does not substitute for the agreement. Listing brokers control access to their sellers' properties but their consent is not what Section 54.1-2132 conditions the showing on. And loan qualification is a financing step with no place in this statute. Subsection G of Section 54.1-2131 still lets a licensee show a seller client's own listing without a buyer agreement.

Section 54.1-2130 defines "showing property." Which virtual tour falls inside that definition?

• a.A pre-recorded walkthrough video posted to the listing
• b.A live tour given by a licensee inside the property✓
• c.A three-dimensional scan the buyer navigates alone
• d.A gallery of still photographs emailed to a buyer

The definition added to Section 54.1-2130 in 2025 covers "taking a prospective buyer or tenant to a property, obtaining access to such property, and taking the individual through the property, including entering a property to provide a live, virtual tour to a prospective buyer or tenant who is not physically present." Two conditions do the work: the licensee physically enters the property, and the tour is live. A pre-recorded walkthrough fails both, because nobody is in the house when the buyer watches it. A photo gallery fails for the same reason and is ordinary marketing. A self-guided three-dimensional scan has no licensee present at all, live or otherwise. The definition matters because Section 54.1-2132 A 1 now requires a brokerage agreement before a licensee shows property, so a licensee walking a house with a phone camera for a remote buyer needs the agreement first.

A Virginia brokerage agreement is signed but states no termination date. What happens under Section 54.1-2137?

• a.It is void, because a definite date is mandatory
• b.It continues until the client's transaction is completed
• c.It runs until either party gives 30 days written notice
• d.It terminates 90 days after the date of the agreement✓

Subdivision C 1 of Section 54.1-2137 requires a brokerage agreement to have a definite termination date, then supplies the consequence when it does not: "if a brokerage agreement does not specify a definite termination date, the brokerage agreement shall terminate 90 days after the date of the brokerage agreement." That is a default the statute writes in, not a cap on how long parties may agree to work together, and an agreement with a stated 12-month term is unaffected. Nothing in the section voids the agreement; the legislature chose to save it with a shorter life instead. A 30-day notice term appears nowhere in the article. And leaving it open until the transaction completes would give the agreement no end at all if no transaction ever happens, which is the gap the 90-day rule closes. Subsection E of Section 54.1-2135 does the same for property management agreements.

A Virginia licensee performs a few routine, non-discretionary acts for a buyer with whom no brokerage agreement exists. What is that buyer's status?

• a.A client, because the licensee provided assistance
• b.A dual client, because two parties were assisted
• c.An unrepresented party owed no duty whatsoever
• d.A customer, which the statute presumes by default✓

Section 54.1-2130 defines a "customer" as "a person who has not entered into a brokerage relationship with a licensee but for whom a licensee performs ministerial acts in a real estate transaction," and adds the presumption directly: "unless a licensee enters into a brokerage relationship with such person, it shall be presumed that such person is a customer of the licensee rather than a client." A client is someone who has entered a brokerage relationship, which by Section 54.1-2137 C means a written agreement, so assistance alone does not create one. Dual agency under Section 54.1-2139 requires brokerage relationships with both sides and the written consent of all parties, neither of which exists here. And a customer is not owed nothing: subsection B of Section 54.1-2131 requires the licensee to treat prospective buyers honestly, give them no false information, and disclose in writing all material adverse facts about the physical condition of the property that the licensee actually knows.

A Virginia listing agent actually knows the basement floods every spring. What does Section 54.1-2131 require toward a prospective buyer who is only a customer?

• a.Disclosure only if the buyer asks about flooding
• b.Written disclosure of the material adverse fact✓
• c.Silence, because the duty of loyalty runs to the seller
• d.Referral of the buyer to the seller for an answer

Subsection B of Section 54.1-2131 provides that "a licensee engaged by a seller shall disclose to prospective buyers all material adverse facts pertaining to the physical condition of the property that are actually known by the licensee," and closes with "such disclosure shall be made in writing." The duty does not wait for a question; it attaches to the licensee's own actual knowledge. Loyalty to the seller does not license concealment, and the same subsection says no cause of action arises against a licensee for revealing what the article requires. Passing the buyer to the seller leaves the licensee's own statutory duty unperformed. The subsection limits itself to the physical condition of the land and improvements, expressly excluding matters beyond the boundaries, land use regulation and highways, and it separately requires disclosure of defective drywall the licensee actually knows about.

When must a Virginia licensee give the written disclosure of brokerage relationship required by Section 54.1-2138?

• a.At the first open house the other party attends
• b.No later than the presentation of a written offer
• c.No later than the first specific assistance✓
• d.No later than the settlement of the transaction

Subsection A of Section 54.1-2138 says the disclosure must be made "in writing at the earliest practical time, but in no event later than the time when specific real estate assistance is first provided," and it is triggered by a substantive discussion about a specific property with a buyer or seller who is neither the licensee's client nor represented by another licensee. Attendance at an open house is not itself the trigger, and a visitor who never has a substantive discussion is owed no disclosure under this subsection. Waiting for an offer or for settlement puts the disclosure after the assistance rather than at it, which is the sequence the statute forbids. Subsection D requires the licensee to keep copies of disclosures for fully executed purchase contracts for three years, whether or not the other party signed.