North Carolina Real Estate Broker Exam — All Questions

The standard North Carolina Offer to Purchase and Contract typically uses which mechanism to give the buyer a negotiated period to investigate the property and terminate for any reason?

• a.A due diligence fee and due diligence period✓
• b.An automatic 30-day inspection contingency
• c.A mandatory appraisal contingency
• d.A statutory three-day rescission period

North Carolina's standard form uses a negotiated due diligence period, often paired with a due diligence fee paid to the seller, during which the buyer may investigate and terminate for any reason or no reason. There is no general statutory three-day rescission right for a home purchase, and the inspection period is negotiated rather than a fixed automatic 30 days. Appraisal protections are handled within due diligence, not as a separate mandatory contingency.

In North Carolina, residential real estate closings are conducted under a model in which:

• a.Only real estate brokers may conduct the closing
• b.Closings are always handled by out-of-state escrow companies
• c.No attorney involvement is permitted
• d.A licensed attorney supervises the closing and handles the title work✓

North Carolina follows an attorney-supervised closing model in which a licensed North Carolina attorney handles the title examination and the disbursement of funds. Brokers may facilitate the transaction but do not perform the legal closing work themselves. Out-of-state escrow-only companies do not replace the attorney's role in North Carolina residential closings.

A North Carolina broker receives a fully executed offer to purchase. By when must copies reach the client or customer?

• a.Within five business days of the broker receiving the document
• b.Within three days of the broker's receipt of the document✓
• c.At the closing, together with the settlement statement
• d.Within twenty-four hours of the document being signed

A broker delivers a copy of any executed agency agreement, contract, offer, lease, rental agreement, option or related transaction document within three days of receiving it, and also within three days of a client's or customer's request for a copy. Cite: 21 NCAC 58A .0106(a).

Which provision may a North Carolina broker never include in a preprinted offer or sales contract form proposed to the parties?

• a.A clause disclaiming the broker's liability for his statements✓
• b.A clause naming the escrow agent who holds the deposit
• c.A clause naming each agent and firm and who each represents
• d.A clause setting the closing and possession transfer date

A broker may not use, or cause to be inserted into, a preprinted form any provision attempting to disclaim the broker's liability for his or her representations, even at the direction of the parties or their attorneys. The other three items are required contents of the form. Cite: 21 NCAC 58A .0112(a), (b)(2).

A closing attorney prepares the settlement statement for a North Carolina sale. What duty does the License Law still place on the broker?

• a.The broker has no duty once an attorney prepares the statement
• b.The broker must prepare a second statement of his own
• c.The broker must file the statement with the Commission
• d.The broker must review it and tell the parties of any errors✓

Failing to deliver an accurate, detailed closing statement at consummation is a ground for discipline. A broker may rely on an attorney's or settlement agent's statement, but must review it for accuracy and notify all parties to the closing of any errors. Cite: N.C.G.S. 93A-6(a)(14).

A buyer and seller dispute the earnest money a North Carolina broker holds. When may the broker deposit it with the clerk of superior court?

• a.Immediately, as soon as either party disputes the disbursement
• b.Not until 90 days after the claimants are notified✓
• c.Not until 30 days after the contract has been terminated
• d.Only after a court of competent jurisdiction has ordered it

An escrow agent may deposit disputed monies, other than a residential security deposit, with the clerk of court in the county where the property lies, but not until 90 days after notifying the persons claiming ownership. Cite: N.C.G.S. 93A-12(a)-(d).

How early may a North Carolina broker transfer earnest money from the firm's trust account to the closing attorney?

• a.At any time after the due diligence period expires
• b.Only on the day of settlement, never before then
• c.No more than 10 days before the anticipated settlement✓
• d.No more than 30 days before the settlement date is anticipated

A broker may transfer an earnest money deposit to the closing attorney or other settlement agent no more than 10 days prior to the anticipated settlement date, and may not otherwise disburse earnest money before settlement without the parties' written consent. Cite: 21 NCAC 58A .0116(e).