South Carolina Real Estate Salesperson Exam — All Questions

Under the South Carolina Residential Property Condition Disclosure Act, the seller of residential real property must generally:

• a.Obtain a professional home inspection before listing
• b.Guarantee the property is free of all defects
• c.Furnish the buyer a completed property condition disclosure statement✓
• d.Provide a title insurance policy to the buyer

South Carolina's Residential Property Condition Disclosure Act (Title 27, Chapter 50) requires most sellers of residential property to give the buyer a completed disclosure statement describing the known condition of the property. The law does not require the seller to inspect or to warrant the property, but it does require honest disclosure of known conditions on the state form.

Earnest money a South Carolina salesperson receives from a buyer must be:

• a.Given directly to the seller when the offer is made
• b.Delivered to the broker-in-charge for deposit in the firm's trust (escrow) account✓
• c.Sent to the Real Estate Commission for safekeeping
• d.Held by the salesperson in a personal account until closing

Client money such as earnest money must be handled through the firm's trust account, which the broker-in-charge maintains. A salesperson who receives funds must deliver them promptly to the broker-in-charge, and trust money must be kept separate from personal and business funds. Commingling or misusing trust money is a serious violation of South Carolina license law.

South Carolina's deed recording fee is:

• a.$1.30 for each $500 of value, all of which goes to the county
• b.$1.85 for each $500 of value, or fraction of $500✓
• c.$2.20 for each $1,000 of value
• d.one-half of one percent of the sale price

The fee is one dollar eighty-five cents for each five hundred dollars, or fractional part of five hundred dollars, of the realty's value. It is made up of a state fee of $1.30 and a county fee of $0.55; the county keeps its $0.55 and remits the state portion. Cite: S.C. Code 12-24-10(A) and 12-24-90.

South Carolina's Residential Property Condition Disclosure Act covers transfers of residential property with:

• a.any number of dwelling units
• b.at least five dwelling units
• c.one dwelling unit only
• d.at least one but not more than four dwelling units✓

The article applies to sales, exchanges, installment land sales contracts and lease-with-option-to-purchase contracts of residential real property consisting of at least one but not more than four dwelling units. Larger residential buildings and commercial property fall outside it. Cite: S.C. Code 27-50-20.

In a South Carolina sales transaction, an earnest money check must be deposited in the trust account within forty-eight hours of:

• a.the licensee receiving the check
• b.the buyer signing the offer
• c.written acceptance of the offer by the parties✓
• d.the closing attorney's title search being ordered

For sales and exchanges, checks must be deposited within forty-eight hours after written acceptance of the offer by the parties, excluding Saturdays, Sundays and bank holidays. Cash or certified funds are different: those go in within forty-eight hours of receipt. Cite: S.C. Code 40-57-136(D)(1).

If a South Carolina seller never delivers the property condition disclosure statement, the failure:

• a.voids the purchase agreement automatically
• b.creates a defect in the title to the property
• c.does not void the contract or delay the closing✓
• d.requires the closing attorney to postpone the closing until it is cured

The Act says plainly that failing to provide the form does not void the agreement, does not create a title defect, and is not a valid reason for anyone, including a closing attorney or lender, to delay or interfere with the closing. The owner can still be liable in damages for a knowing violation. Cite: S.C. Code 27-50-50(B) and 27-50-65.

Which South Carolina transfer is exempt from the residential property condition disclosure statement?

• a.A resale of a ten-year-old house by its owner-occupant
• b.The first sale of a dwelling never inhabited✓
• c.A lease with an option to purchase a used home
• d.An installment land sales contract on an older house

New construction being sold for the first time is on the statutory exemption list, along with foreclosure and court-ordered transfers, transfers between co-owners or family members, and property sold at public auction. Lease-with-option and installment land sale contracts are inside the Act, not exempt from it. Cite: S.C. Code 27-50-30(10) and 27-50-20.

When a South Carolina buyer and seller dispute entitlement to earnest money, the broker-in-charge must:

• a.release the money to whichever party asks first
• b.hold the funds until the dispute is resolved✓
• c.send the funds to the Real Estate Commission
• d.divide the money evenly between the two parties

Disputed trust money stays in the trust account until the dispute ends in one of four ways: a separate written agreement signed by all claimants, an interpleader action, a court order, or voluntary mediation. Disbursing contrary to the contract is itself treated as incompetence. Cite: S.C. Code 40-57-136(E) and (B)(5).

A buyer of South Carolina property subject to a vacation rental agreement takes title subject to rentals that begin:

• a.at any time during the twelve months after the closing date
• b.only if the buyer agreed to them in writing
• c.only if the rental was recorded
• d.within ninety days after the deed is recorded✓

The grantee takes title subject to the vacation rental agreement and the vacation rental management agreement for every rental period beginning no later than ninety days after the grantee's interest is recorded in the office of the register of deeds. Cite: S.C. Code 27-50-250(A).

The South Carolina deed recording fee is exempt when the realty's value is:

• a.one hundred dollars or less✓
• b.one thousand dollars or less
• c.five hundred dollars or less
• d.below the county's assessed value for property tax purposes

Deeds transferring realty worth one hundred dollars or less are exempt, as are transfers to government, partition deeds, corrective and quitclaim deeds confirming existing title, and deeds in lieu of foreclosure. For an exempt deed the word "exempt" is noted on the instrument and the affidavit states the reason. Cite: S.C. Code 12-24-40(1) and 12-24-60.

If a South Carolina vacation rental is due to begin more than ninety days after the new owner's interest is recorded, the tenant:

• a.may still occupy the property as scheduled
• b.is due a refund of payments within forty-five days✓
• c.must negotiate a fresh agreement directly with the new owner
• d.forfeits all money paid toward the rental

A rental beginning outside the ninety-day window cannot be enforced by any party against the new owner, but the tenant is not simply out of pocket: payments made toward the agreement must be refunded within forty-five days of the recording of the transfer of interest. Cite: S.C. Code 27-50-250(A).

South Carolina's Vacation Rental Act defines a vacation rental as a rental of residential property for:

• a.fewer than fourteen days
• b.fewer than forty-five days
• c.fewer than ninety days✓
• d.any period, provided the tenant is a tourist

A vacation rental is a lease, sublease or other rental of residential property for fewer than ninety days, excluding weekly or monthly rentals governed by the South Carolina Residential Landlord and Tenant Act. Hotels, motels, campgrounds and timeshare accommodations are outside the Act. Cite: S.C. Code 27-50-230(3) and 27-50-220(B).

When a South Carolina owner learns that a delivered disclosure statement has become materially inaccurate, the owner must:

• a.wait for the buyer to discover the change
• b.cancel the contract and relist the property
• c.notify only the listing agent, who then decides whether the buyer is told
• d.promptly correct the statement or repair the problem before closing✓

If the owner discovers a material inaccuracy, or an event makes the statement inaccurate in a material way, the owner must promptly deliver a corrected disclosure statement to the purchaser or make the reasonable repairs the event requires before closing. Cite: S.C. Code 27-50-60.