North Carolina Real Estate Broker Exam Practice Test
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Frequently asked questions
How many North Carolina Real Estate Broker Exam practice questions are here?+
A full bank of original North Carolina Real Estate Broker Exam practice questions across the official content areas, weighted like the real exam, with explanations. Free, no signup.
What is the North Carolina Real Estate Broker Exam exam like?+
About 140 questions, and you need 75% to pass. Practice by topic here, then take the full timed mock exam to gauge readiness.
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No. Every question is 100% original, written from public primary sources with explanations. We never copy real exam questions or paid prep material.
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PrepPass practice is in English, 中文 and Español. The official exam is in English — switch the question language to English any time to rehearse the exact terminology you'll see on test day.
Sample practice questions
A few real questions from this free bank, with full explanations. Use the practice tool above for the whole set.
- 1. Property Ownership
Which type of estate gives an owner the fullest bundle of rights, is of potentially unlimited duration, and passes to the owner's heirs?
- a.Fee simple absolute
- b.Estate at will
- c.Estate for years
- d.Life estate
Answer: a
Explanation: A fee simple absolute is the highest and most complete estate in land: it lasts indefinitely and is freely inheritable and transferable. A life estate ends at the death of the measuring life, so it is not inheritable. An estate for years and an estate at will are leasehold (less-than-freehold) estates that give possession, not ownership, so they confer far fewer rights.
- 2. Property Ownership
The private, recorded restrictions a developer places on every lot in a subdivision, binding all future owners, are known as:
- a.the power of eminent domain
- b.CC&Rs
- c.the government's police power
- d.local zoning ordinances
Answer: b
Explanation: Covenants, conditions, and restrictions (CC&Rs) are private deed restrictions a developer records against a subdivision; they run with the land, bind future owners, and are often enforced by a homeowners association. Zoning, eminent domain, and police power are governmental (public) controls, not private restrictions.
- 3. Financing
Private mortgage insurance (PMI) on a conventional loan primarily protects:
- a.the seller's equity in the home
- b.the lender against loss if the borrower defaults
- c.the borrower personally if they happen to lose their job
- d.the appraiser from a valuation error
Answer: b
Explanation: PMI protects the lender (not the borrower) against loss if a borrower with a low down payment defaults; it is typically required when the loan-to-value ratio exceeds 80% and can usually be canceled once enough equity is reached. It does not protect the borrower, seller, or appraiser.
- 4. Agency
A transaction broker (facilitator):
- a.helps both parties complete the deal without representing either as a fiduciary
- b.represents only the seller in the deal
- c.owes the complete range of full fiduciary duties to both of the parties at once
- d.is prohibited by law in every state
Answer: a
Explanation: A transaction broker assists both parties with the paperwork and process while owing honesty and fairness but not fiduciary loyalty to either. It is a recognized non-agency role in many states.
- 5. Practice of Real Estate
A 'blind ad,' prohibited by most license laws, is one that:
- a.includes the property's street address
- b.fails to disclose that the advertiser is a real estate licensee or broker
- c.lists an accurate price for the property
- d.contains the brokerage's full business name
Answer: b
Explanation: A blind ad conceals the fact that a licensee or brokerage placed it, misleading the public; most license laws require ads to identify the broker. Including the broker's name, an accurate price, or the address does not create a blind ad.
- 6. Real Estate Calculations
A borrower pays $9,000 in interest during the first year on a $150,000 interest-only loan. What is the annual interest rate?
- a.9%
- b.6.5%
- c.6%
- d.5%
Answer: c
Explanation: Rate = annual interest / principal = $9,000 / $150,000 = 0.06 = 6%. Dividing the interest paid by the loan balance backs into the rate.
- 7. Financing
Ginnie Mae (the Government National Mortgage Association) differs from Fannie Mae and Freddie Mac primarily because Ginnie Mae:
- a.Guarantees securities backed by federally insured or guaranteed loans like FHA and VA
- b.Makes low-interest loans directly to qualifying first-time buyers out of the federal Treasury
- c.Sets and enforces the interest rates charged on every residential mortgage nationwide
- d.Purchases only conventional loans that private lenders originate on the open market
Answer: a
Explanation: Ginnie Mae is a wholly government-owned corporation that guarantees mortgage-backed securities composed of government-backed loans (FHA, VA, and similar). Fannie Mae and Freddie Mac are government-sponsored enterprises that deal mainly in conventional conforming loans; none of these entities set rates for all mortgages.
- 8. Contracts
If a seller breaches a purchase contract and the buyer wants the court to compel the seller to convey the property (rather than pay money), the buyer seeks:
- a.Liquidated damages equal to the amount of the earnest money deposited under the contract
- b.Specific performance, because each parcel of real estate is unique
- c.Rescission that would cancel the agreement and return both parties to their earlier positions
- d.A novation that would substitute an entirely new contract in place of the breached one
Answer: b
Explanation: Specific performance is an equitable remedy forcing completion of the sale; courts grant it in real estate because land is unique and money damages may be inadequate. Liquidated damages and rescission are money or cancellation remedies, and novation replaces the contract rather than enforcing it.
- 9. Property Disclosures
The federal lead-based paint disclosure rule (under Title X) applies to the sale or lease of:
- a.All residential and commercial housing everywhere, regardless of the year it was constructed
- b.Only newer residential housing that was actually built and occupied after the year 1978
- c.Only commercial office buildings and industrial structures, never any residential dwellings
- d.Most residential housing built before 1978
Answer: d
Explanation: Because lead-based paint was banned for residential use in 1978, the federal disclosure rule targets most housing built BEFORE 1978. Sellers and landlords must disclose known lead hazards, provide any records, and deliver the required pamphlet.
- 10. Brokerage Practice
In North Carolina, what is the primary role of the broker-in-charge (BIC) at a real estate office?
- a.To supervise the brokers and the trust accounting at that office location
- b.To guarantee commissions to all affiliated brokers
- c.To act as the sole agent for all clients of the firm
- d.To personally close every transaction handled by the office
Answer: a
Explanation: The broker-in-charge is responsible for supervising the brokers affiliated with an office and overseeing the office's trust account and advertising. The BIC does not have to personally close every deal or serve as agent for every client. The BIC also does not guarantee other brokers' commissions; the role is one of oversight and compliance, not payment guarantees.