Wisconsin Real Estate Broker Exam — All Questions

The WB-44 carries a CAUTION about how counter-offers relate to one another: a Counter-Offer does not include the terms or conditions in any other counter-offer or multiple counter-proposal unless:

• a.the parties have initialed them all
• b.they are incorporated by reference✓
• c.the earlier form is attached to it
• d.the Firm has retained a copy of it

The caution reads: "This Counter-Offer does not include the terms or conditions in any other counter-offer or multiple counter-proposal unless incorporated by reference." A closing note explains how: provisions from a previous counter-offer may be included by reproducing the entire provision or by incorporation by reference, indicated by specifying the number of the provision or the lines containing it, and in transactions involving more than one counter-offer the counter-offer referred to should be clearly specified. The WB-46 carries the identical caution.

The WB-45 Cancellation Agreement and Mutual Release is effective only if all Parties to the Contract have signed an identical copy and the fully executed form has been delivered to:

• a.the Firm that drafted the underlying contract of sale
• b.the escrow agent named in the original transaction
• c.the department, on the form it prescribes for that use
• d.the Party initiating the CAMR by the stated deadline✓

The form provides that the CAMR "shall be effective only if all Parties to the Contract have signed an identical copy of this CAMR (including signatures on separate but identical copies of the CAMR), and if the fully-executed CAMR has been delivered to the Party initiating the CAMR on or before" the date written in, with delivery made in any manner authorized in the Contract. A note adds that the initiating Party may withdraw the CAMR prior to acceptance and delivery. The same form releases the Firms and their licensees from liability for disbursing the trust funds as directed and states the disbursement amounts.

The WB-46 Multiple Counter-Proposal states that Buyer's approval of the Multiple Counter-Proposal is not binding on either Party until:

• a.Seller's binding acceptance of the approved proposal✓
• b.the earnest money has been deposited by the Buyer
• c.the Buyer's financing contingency has been waived
• d.the Seller's listing firm delivers a written notice

The APPROVAL BY BUYER block states that approval "is not binding on Buyer or Seller until binding acceptance of this approved Multiple Counter-Proposal by Seller," and the ACCEPTANCE BY SELLER block makes the terms binding only if Seller delivers a copy of the accepted Multiple Counter-Proposal to Buyer by the stated deadline in a manner authorized in the Offer. Until then either Party may withdraw. The form warns Seller not to sign the acceptance if there is an existing accepted offer unless the Multiple Counter-Proposal provides for a secondary offer.

The WB-46 carries a NOTE telling a buyer who does not approve the Seller's Multiple Counter-Proposal in its entirety to instead use:

• a.a WB-40 Amendment signed by the Buyer and Seller
• b.a WB-41 Notice delivered to the Seller's listing firm
• c.a second WB-46 identifying the changed provisions
• d.a WB-44 Counter-Offer or a new offer to purchase✓

The note reads: "If the above Multiple Counter-Proposal by Seller is not approved by Buyer in its entirety, do not use this form for a counter-offer by Buyer. Instead, submit a Counter-Offer (WB-44) or a new offer to purchase." The WB-46 exists so a seller can put differing terms to several prospective buyers at once without binding anyone until Seller's own acceptance; it is not designed to carry a buyer's counter. The WB-40 and WB-41 both presuppose an already accepted Offer.

Wis. Admin. Code § REEB 24.07 (8) (c) requires licensees to state whom the licensee represents as an agent in the transaction in which document?

• a.The firm's internal transaction file, kept only for the record
• b.The written disclosure statement given to the customer
• c.The offer to purchase, lease, option or exchange agreement✓
• d.The closing statement prepared for the settlement agent

Paragraph (8) (c), captioned WRITTEN PROPOSALS, provides that "[l]icensees shall state, in the offer to purchase, the lease, the option to purchase, or the exchange agreement, whom the licensee represents as an agent in a transaction." The WB-11 implements it on line 1, where the drafting licensee strikes all but the applicable choice among agent of Buyer, agent of Seller or listing Firm, and agent of Buyer and Seller. The customer and client disclosure statements required by Wis. Stat. § 452.135 are separate documents governed by § REEB 24.07 (8) (a) and (d).

Under Wis. Admin. Code § REEB 24.07 (8) (b) 2., a firm may permit another firm to act as a subagent in a transaction only if:

• a.the firm's client authorized a subagent in the agency agreement✓
• b.the subagent firm carries errors and omissions coverage first
• c.the other party to the transaction consents to it in writing
• d.the subagent's compensation is disclosed on the closing form

Subdivision (8) (b) 2. provides that "[n]o firm or licensees associated with the firm may permit other firms to act as subagents in a transaction unless the firm's client has authorized the use of a subagent in the agency agreement." Subdivision 1. adds that firms must explain the responsibilities of listing agents, buyer's agents and subagents to their clients before entering into an agency agreement. The SUBAGENCY paragraph printed in the WB-1 and WB-36 gives the client that authorization and explains that a subagent firm will not put its own interests ahead of the client's.

Under 40 CFR 745.113 (a), the attachment required in each contract to sell target housing must include the Lead Warning Statement, the seller's disclosure, a list of available records, the purchaser's acknowledgment, and a statement that the purchaser has:

• a.read the EPA pamphlet within ten days of receiving the offer
• b.hired a certified lead risk assessor before signing the contract
• c.agreed to accept the property in its present painted condition
• d.received or waived the opportunity to conduct an evaluation✓

Paragraph (a) (5) requires "[a] statement by the purchaser that he/she has either: (i) Received the opportunity to conduct the risk assessment or inspection required by § 745.110 (a); or (ii) Waived the opportunity." Paragraph (a) (6) adds, where an agent acts for the seller, statements that the agent informed the seller of the seller's obligations under 42 USC 4852d and that the agent is aware of the duty to ensure compliance. Paragraph (a) (7) requires the signatures of the sellers, agents and purchasers, with dates, certifying to the accuracy of their statements.

A licensee faxes only the signature page of an accepted offer to the other firm. Which requirement of Wis. Admin. Code § REEB 15.02 (1) does that fail?

• a.To deliver the document within 48 hours of the signing
• b.To confirm the transmission with a follow-up telephone call
• c.To obtain the other firm's written consent to use a fax
• d.To provide an exact and complete copy of the document✓

Subsection (1) requires a licensee to "promptly provide an exact and complete copy of any document utilized, prepared, or received by the licensee in real estate practice to any person who has signed the document." Sending part of a multi-page contract is not an exact and complete copy, which is why sending every page is the practice the exam outline refers to. The rule imposes no 48-hour deadline, no consent requirement for fax, and no confirming call; the WB-11 separately lists fax as one of the five authorized methods of delivery, alongside personal, commercial, U.S. Mail and email.

On the WB-11, terms preceded by an OPEN BOX are part of the Offer:

• a.unless the parties strike the box before signing
• b.only if the box is marked, such as with an X✓
• c.in every case, because the form is board-approved
• d.whenever the drafting licensee fills in the blanks

The INCLUSION OF OPTIONAL PROVISIONS paragraph states that terms preceded by an OPEN BOX "are part of this Offer ONLY if the box is marked such as with an 'X'. They are not part of this offer if marked 'N/A' or are left blank." That is why optional contingencies must be affirmatively selected, and why the form warns that if the financing commitment contingency box is not marked, the not-contingent-on-financing provisions apply instead. Wis. Admin. Code § REEB 16.06 (1) (b) protects the same mechanism by forbidding reproductions that drop optional provisions without showing where they occur.

Wis. Admin. Code § REEB 15.02 (2) requires prompt distribution of exact and complete copies of an accepted offer to purchase to the seller, the buyer, and:

• a.the closing agent and the buyer's title insurer
• b.the listing broker and the selling broker✓
• c.the lender and the appraiser of record
• d.the department and the local assessor

Subsection (2) lists four recipients for accepted and fully signed offers to purchase, amendments to contracts of sale, counter-offers, exchange agreements and grants of option: the seller, the buyer, the listing broker and the selling broker. Subsection (3) covers leases and rental agreements, requiring a copy to the tenant on execution and to the landlord on request. Subsection (1) is the general rule: an exact and complete copy of any document to any person who signed it.

Under Wis. Admin. Code § REEB 15.04 (1), how long must a firm retain copies of listing contracts, offers to purchase, closing statements and trust account records?

• a.At least 5 years from the date of closing
• b.At least 7 years from the date of closing
• c.At least 2 years from the date of closing✓
• d.At least 1 year from the date of closing

Subsection (1) requires a firm to retain those records "for at least 2 years, unless required by federal law or there is an active or ongoing investigation by the Board," with the period running from the date of closing or, if the transaction was not consummated, from the date the listing contract or agency agreement terminated. The records must be available for inspection and copying by the board, and the board may not require copies beyond the retention period. Electronic or digital retention is permitted, and Wis. Stat. § 452.42 (2) says the same.

Wis. Admin. Code § REEB 15.02 (4) requires a broker or salesperson to promptly distribute an exact and complete copy of a signed listing contract or agency agreement to the client:

• a.at the first showing of the listed property
• b.within 48 hours of the firm's acceptance
• c.when the client signs an agency agreement✓
• d.no later than the closing of the transaction

Subsection (4) requires the copy of a listing contract or agency agreement "that has been accepted and signed by all parties" to go to the client "when the client signs an agency agreement." The trigger is the client's signature, not a later deadline. Wis. Admin. Code § REEB 15.04 (2) adds the internal counterpart: a licensee associated with a firm must submit transaction documents and records to the firm in a timely manner, which Wis. Stat. § 452.132 (6) (b) also requires.

Which of the following is a protected class under Wisconsin's open housing law, Wis. Stat. § 106.50, but not under the federal Fair Housing Act?

• a.Lawful source of income✓
• b.Familial or family status
• c.Religion or national origin
• d.Physical or mental disability

Section 106.50 (1m) (nm) defines a member of a protected class by reference to sex, race, color, disability, sexual orientation, religion, national origin, marital status, family status, status as a victim of domestic abuse, sexual assault or stalking, lawful source of income, age, or ancestry. The federal Fair Housing Act covers race, color, religion, sex, familial status, national origin and disability, so lawful source of income is protected in Wisconsin and not federally, as are marital status, sexual orientation, age, ancestry and victim status. Wisconsin Statute § 452.23 (1) bars a licensee from disclosing any information whose disclosure would be unlawful discrimination under § 106.50 or under 42 USC 3604, 3605, 3606 or 3617.

Under Wis. Stat. § 106.50 (1m) (am), "age" as a protected class in Wisconsin's open housing law means:

• a.at least 40 years of age
• b.at least 18 years of age✓
• c.at least 55 years of age
• d.at least 62 years of age

Paragraph (1m) (am) provides that "'Age', in reference to a member of a protected class, means at least 18 years of age." The 55 and 62 figures appear elsewhere in the same section, in the definition of housing for older persons under § 106.50 (1m) (m): housing solely intended for and solely occupied by persons 62 or older, or housing primarily intended and primarily operated for occupancy by at least one person 55 or older per dwelling unit. The 40-year threshold belongs to federal employment law, not to housing.

Under 40 CFR 745.103, "target housing" for the federal lead-based paint disclosure rule means housing constructed before 1978, except housing for the elderly or persons with disabilities and:

• a.any dwelling that has been completely repainted since the year 1978
• b.any rental unit leased for a term of longer than one full year
• c.any building containing more than four separate dwelling units
• d.any 0-bedroom dwelling, unless a child under 6 will reside there✓

The definition reads: "Target housing means any housing constructed prior to 1978, except housing for the elderly or persons with disabilities or any 0-bedroom dwelling (unless any child who is less than 6 years of age resides or is expected to reside in such housing)." A 0-bedroom dwelling is defined as one where the living area is not separated from the sleeping area, including efficiencies, studios, dormitory housing, military barracks and rentals of individual rooms. Repainting, unit count and lease length do not change the classification, though 40 CFR 745.101 does exempt foreclosure sales, certified lead-free leases, short-term leases of 100 days or less with no renewal, and certain lease renewals.

Before a purchaser is obligated under a contract to purchase target housing, 40 CFR 745.110 (a) requires the seller to permit a period to conduct a risk assessment or inspection, unless the parties mutually agree in writing on a different period. That period is:

• a.15 days
• b.10 days✓
• c.5 days
• d.30 days

Paragraph (a) requires the seller to "permit the purchaser a 10-day period (unless the parties mutually agree, in writing, upon a different period of time) to conduct a risk assessment or inspection for the presence of lead-based paint and/or lead-based paint hazards." Paragraph (b) lets the purchaser waive the opportunity by so indicating in writing, and 40 CFR 745.113 (a) (5) requires the contract attachment to record whether the purchaser received or waived it. There is no corresponding evaluation period for lessees; 40 CFR 745.110 applies to purchasers only.