Vermont Real Estate Salesperson Exam — All Questions

Under Vermont rules, the mandatory consumer disclosure of brokerage relationships should be given:

• a.Only after a contract is signed
• b.At the closing table
• c.Early in the relationship, before the consumer shares confidential information✓
• d.Within 30 days after an accepted offer

Vermont requires licensees to provide the mandatory consumer disclosure early in the working relationship, before the consumer shares confidential information. The disclosure explains seller agency, buyer agency, and dual agency so the consumer can decide how to proceed.

In Vermont, may a firm act as agent for both the buyer and the seller in the same transaction?

• a.Yes, with no disclosure needed to either of the parties
• b.Yes, and it arises automatically when a firm has both sides
• c.No, both firm types are barred from dual or limited agency✓
• d.Yes, provided both parties give informed written consent

Vermont does not permit dual agency, with or without consent. The Commission's rules say a Non-Designated Agency Firm and all its licensees 'shall not practice dual or limited agency, acting as agent for both a buyer and seller in the same transaction', and impose the identical bar on a Designated Agency Firm and its designated agents. Either may still act for one party where the other side is an unrepresented CUSTOMER. Vermont uses designated agency where other states would use consented dual agency, which is why the consent answer — true in most states — is wrong here. Cite: Vermont Real Estate Commission Administrative Rules 4.3(d)(1), 4.4(e)(1).

Under the Vermont Real Estate Commission's rules, a brokerage firm and its licensees:

• a.May not practice dual or limited agency✓
• b.May practice dual agency only on commercial property
• c.May practice dual agency if the firm has one office
• d.May practice dual agency with written consent of both sides

Both kinds of Vermont firm are barred from dual agency: a Non-Designated Agency Firm and all its licensees shall not practice dual or limited agency by acting as agent for both a buyer and a seller in the same transaction, and the same prohibition applies to a Designated Agency Firm and its designated agents. The firm may still act for one party where the other is an unrepresented customer. Cite: Vt. Real Estate Commission Rules 4.3(d)(1) and 4.4(e)(1).

A Vermont brokerage firm may elect to practice Designated Agency only if the firm has:

• a.At least one branch office
• b.A licensed attorney on staff
• c.At least ten affiliated licensees
• d.More than two licensees✓

If a brokerage firm has more than two licensees, the firm may elect to practice Designated Agency, and its status as a Designated Agency Firm must be disclosed in the seller and buyer service agreements. Cite: Vt. Real Estate Commission Rule 4.4(a).

In a Vermont Designated Agency Firm, the fiduciary duties to a particular client are owed by:

• a.Every licensee affiliated with the brokerage firm
• b.The designated agent or agents for that client✓
• c.The principal broker alone, in every transaction
• d.Whichever licensee first met the client

A Designated Agency Firm delegates all firm agency and fiduciary responsibilities for specific clients to individual licensees under written service agreements, and only the designated agent or agents owe that client the duties of a fiduciary. Cite: Vt. Real Estate Commission Rule 4.4(b).

When a Vermont designated agent is appointed, information the agent knows or acquires:

• a.Is imputed to every licensee in the firm
• b.Is not imputed to the firm or to other licensees✓
• c.Must be reported to the client on the other side
• d.Becomes public once an offer is accepted

When a designated agent is appointed, information known to or acquired by that designated agent is not imputed to the brokerage firm or to other licensees within the same firm. Cite: Vt. Real Estate Commission Rule 4.4(i).

A Vermont Designated Agency Firm must obtain the client's written consent to the appointment of designated agents:

• a.When the seller or buyer service agreement is signed✓
• b.Only if the client asks who will be handling the file
• c.Within ten days after the first showing of a property
• d.At the closing of the transaction itself

The firm and the designated agents must obtain the written consent of the client to the appointment of the initial and any subsequent designated agents at the time the seller or buyer service agreement is executed or amended. Cite: Vt. Real Estate Commission Rule 4.4(d)(1).

In a Vermont Non-Designated Agency Firm:

• a.All affiliated licensees act as agents of the clients✓
• b.Licensees owe fiduciary duties only to buyers and tenants
• c.Each licensee chooses which clients to represent
• d.Only the principal broker owes fiduciary duties

Non-Designated Agency is the practice by which all licensees affiliated with a brokerage firm act as the agent of the firm's clients, and all of those licensees owe the client the duties of a fiduciary. Cite: Vt. Real Estate Commission Rule 1.8(r).

A Vermont licensee must deliver the Commission's consumer disclosure form to an unrepresented person with whom the licensee has substantial contact:

• a.Within thirty days after their first meeting in person
• b.Only when the person asks to receive it
• c.At the closing of the transaction itself
• d.Before a service agreement is signed or a showing✓

The firm and its licensees must provide a true copy of the most recent consumer disclosure form adopted by the Commission at the first reasonable opportunity, and it must occur before entering into a brokerage service agreement or showing a property. Cite: Vt. Real Estate Commission Rule 4.6(b).

A Vermont consumer received the consumer disclosure form more than twelve months ago. The licensee must:

• a.Obtain the consumer's oral confirmation instead
• b.Rely on the earlier form for two full years
• c.Give a new consumer disclosure form✓
• d.File a copy of the earlier form with the Commission

If it has been more than twelve months since the consumer disclosure form was given, a new consumer disclosure form must be given. Cite: Vt. Real Estate Commission Rule 4.6(c).

At first contact with a member of the Vermont public who expresses interest in buying or selling, the licensee must disclose:

• a.The seller's lowest acceptable price on any listing
• b.The firm's usual commission rate for that type of property
• c.That nothing is confidential without a signed agreement✓
• d.The names of the other clients the firm represents

At the time of first contact with a member of the public who expresses an interest in buying or selling real property, a licensee must give an oral or written disclosure informing the person that there is no confidentiality between them until and unless there is a signed brokerage service agreement. Cite: Vt. Real Estate Commission Rule 4.6(a).

A Vermont client instructs the licensee not to reveal a fact the licensee believes must be disclosed. The licensee must:

• a.Withdraw from the agency relationship✓
• b.Disclose the fact only to the other licensee
• c.Ask the Commission for a declaratory ruling
• d.Follow the client's instruction and stay silent

A licensee working for a firm employed by a seller must fully and promptly disclose to a prospective buyer all material facts within the licensee's knowledge concerning the property. If the client refuses to consent to disclosure after being told the licensee considers it necessary, the licensee must withdraw from the agency relationship. Cite: Vt. Real Estate Commission Rule 4.5(b).

Before showing real property in Vermont, a licensee must disclose any known significant limitation on the seller's ability to convey a fee simple, such as:

• a.The number of showings held in the past month
• b.The commission the seller agreed to pay
• c.The size of the seller's remaining mortgage balance
• d.An option or right of first refusal on the property✓

A licensee, before showing real property, must disclose any known significant limitations on the seller's ability to convey a fee simple interest, such as options, rights of first refusal, or the property being subject to prior closings. Cite: Vt. Real Estate Commission Rule 4.5(c).