North Dakota Real Estate Practice Exam

Correct answer: The salesperson’s true position must be clearly disclosed to the owner, with written proof retained.

NDAC 70-02-03-13(3) covers direct and indirect purchases and interests, requires prior disclosure to the owner and requires satisfactory written proof on request.

Why the other choices are incorrect:

• The salesperson may hide behind a relative as buyer. Indirect acquisition does not avoid the disclosure duty.
• Disclosure may wait until after recording the deed. The rule requires the position to be made known first.
• Only the buyer’s lender must be informed. The owner is the party specified by the rule.

Sources:

• NDAC 70-02-03-13(3) — NDAC 70-02-03-13(3)

Correct answer: Disclose the known adverse material fact to the buyer.

NDCC 43-23-12.1(2) requires honesty, good faith and disclosure to customers of actually known adverse material facts concerning title, physical condition and defects.

Why the other choices are incorrect:

• Conceal it because only clients are owed any duty. Customers are owed disclosure of the specified known adverse material facts.
• Wait until after closing to disclose it. That does not meet the transaction disclosure duty.
• Disclose only if the buyer hires the listing firm. The statutory duty applies to customers as well.

Sources:

• NDCC 43-23-12.1(2) — NDCC 43-23-12.1(2)

Correct answer: The brokerage trade name must be equal or greater in size and visibility than the team name.

NDAC 70-02-03-02.1(2) requires the licensed trade name to be at least as large and visible as a salesperson, associate-broker or team name.

Why the other choices are incorrect:

• The team name must always be omitted entirely. Team advertising is permitted when compliant.
• The brokerage name must appear only in the closing documents. Advertising has its own identification requirement.
• The team must have a separate independent brokerage license merely to advertise. A team operates under its brokerage and cannot suggest it is independent.

Sources:

• NDAC 70-02-03-02.1(2) — NDAC 70-02-03-02.1(2)

Correct answer: This is misconduct that can support license discipline.

NDAC 70-02-03-09 covers using, proposing, agreeing to or knowingly permitting undisclosed documents to obtain a larger or otherwise unavailable loan.

Why the other choices are incorrect:

• It is allowed if the buyer wants the arrangement. Buyer consent does not authorize deceptive loan documents.
• It is allowed if the side agreement is kept out of the broker’s file. Concealing the document does not make it lawful.
• It is allowed whenever the buyer eventually repays the loan. Later repayment does not cure the deceptive arrangement.

Sources:

• NDAC 70-02-03-09 — NDAC 70-02-03-09

Correct answer: Disclose the representation orally and provide the required written disclosure as soon as practicable.

NDAC 70-02-03-15.1(2)(c) addresses impracticable immediate written disclosure, including telephone contact with an absent party.

Why the other choices are incorrect:

• Skip disclosure permanently because the call was remote. The exception postpones the writing, not the disclosure obligation.
• Wait until closing without saying whom the licensee represents. The rule calls for oral disclosure followed promptly by writing.
• Treat the caller automatically as a represented client. A phone call does not create a written agency agreement.

Sources:

• NDAC 70-02-03-15.1(2)(c) — NDAC 70-02-03-15.1(2)(c)

Correct answer: Keep that price flexibility confidential.

NDAC 70-02-03-15.1(3) protects a represented party’s willingness to accept less without informed written consent. This does not permit concealment of material property defects.

Why the other choices are incorrect:

• Tell every buyer because it may speed the sale. A faster sale does not remove confidentiality.
• Publish the minimum price in the next advertisement. No informed written permission has been given.
• Disclose it whenever a buyer asks directly. A buyer’s question alone does not waive the client’s confidentiality.

Sources:

• NDAC 70-02-03-15.1(3)(b) — NDAC 70-02-03-15.1(3)(b)

Correct answer: Before performing any act as the buyer’s representative.

NDAC 70-02-03-05.1 applies to one-to-four-family residential property and requires the signed written buyer agreement before representative acts.

Why the other choices are incorrect:

• Only after the seller accepts an offer. That is later than the rule permits.
• Only when the buyer applies for a mortgage. Financing does not set the agency-agreement deadline.
• Only at closing if the buyer still wants representation. Representation already performed requires the agreement beforehand.

Sources:

• NDAC 70-02-03-05.1 — NDAC 70-02-03-05.1

Correct answer: Five members, including three active real estate brokers.

NDCC 43-23-01 establishes a five-member Commission, with three members required to be active real estate brokers, appointed by the governor.

Why the other choices are incorrect:

• Three members, all active salespersons. The statute specifies five members and three active brokers.
• Five members, all required to be attorneys. That is not the statutory membership requirement.
• Seven members elected by licensees. The governor appoints the five members.

Sources:

• NDCC 43-23-01 — NDCC 43-23-01

Correct answer: At the time of signing.

NDAC 70-02-03-04 requires an exclusive agency or exclusive right-to-sell agreement to be clearly identified and a copy given to the owner at signing.

Why the other choices are incorrect:

• Only after the property sells. The copy is due when the agreement is signed.
• Only if the owner pays a separate copying fee. The rule does not condition delivery on that fee.
• At the next listing renewal. That is later than the required delivery.

Sources:

• NDAC 70-02-03-04 — NDAC 70-02-03-04

Correct answer: The brokerage has no general statutory obligation under this provision to discover unknown defects.

NDCC 43-23-12.1(3) distinguishes discovering defects from disclosing known facts. Unless otherwise agreed in writing, it does not require defect discovery, ownership verification or independent verification of others’ statements.

Why the other choices are incorrect:

• The brokerage must guarantee that no defects exist. The statute does not impose that guarantee.
• The brokerage may conceal defects it actually knows. Known adverse material facts remain subject to disclosure duties.
• The brokerage must independently verify every statement by every third party. The stated rule generally does not require that unless otherwise agreed in writing.

Sources:

• NDCC 43-23-12.1(3) — NDCC 43-23-12.1(3)

Correct answer: Appropriate title examination and legal counsel.

NDAC 70-02-03-08 directs licensees not to practice law and to recommend title examination and legal counsel when a party’s interest requires it.

Why the other choices are incorrect:

• That the client rely on the licensee as a substitute attorney. The rule cautions against engaging in the practice of law.
• That the parties ignore the issue until after closing. That does not protect the parties’ interests.
• That a salesperson’s license automatically resolves title disputes. Real estate licensure does not confer that authority.

Sources:

• NDAC 70-02-03-08 — NDAC 70-02-03-08

Correct answer: That another buyer client of the licensee has submitted a competing written offer.

NDCC 43-23-12.1(5) requires disclosure of that fact when the same individual represents competing buyers under written agreements. The rule does not authorize revealing the other client’s identity or offer terms.

Why the other choices are incorrect:

• The other buyer’s complete financial history. The required fact disclosure does not authorize revealing confidential details.
• Nothing, because competing buyers can never trigger disclosure. The statute expressly requires disclosure in this individual-licensee situation.
• That the competing buyer’s agency agreement is automatically void. Competing interest does not automatically terminate that agreement.

Sources:

• NDCC 43-23-12.1(5) — NDCC 43-23-12.1(5)
• NDAC 70-02-03-15.1(7)(b) — NDAC 70-02-03-15.1(7)(b)

Correct answer: No; the deposit should be returned and the broker should look to the seller for compensation.

NDAC 70-02-03-12 requires return of the deposit at once when seller failure prevents completion without buyer fault, even if the broker earned a commission.

Why the other choices are incorrect:

• Yes, an earned commission always takes priority over the buyer’s deposit. The rule expressly rejects that use in the stated circumstances.
• Yes, if the broker keeps only half. The broker has no right to any portion for that purpose.
• Yes, if the buyer has not yet hired an attorney. Legal representation does not change the deposit rule.

Sources:

• NDAC 70-02-03-12 — NDAC 70-02-03-12

Correct answer: 18 years.

NDCC 43-23-08(2) requires a broker or salesperson applicant to be at least 18 years old, in addition to the other qualifications.

Why the other choices are incorrect:

• 19 years. The statute specifies 18.
• 21 years. That is higher than the statutory minimum.
• 25 years. That is not the minimum stated in the law.

Sources:

• NDCC 43-23-08(2) — NDCC 43-23-08(2)

Correct answer: Yes, if the coverage meets the Commission’s minimum requirements.

NDCC 43-23-20 permits independent E&O coverage meeting Commission minimums. Section 43-23-22 requires an annual certificate from a licensee who does not participate in the group program.

Why the other choices are incorrect:

• No, every active licensee must use the group insurer. The statute expressly allows qualifying independent coverage.
• Yes, and any general automobile policy is sufficient. Coverage must meet the applicable E&O requirements.
• Yes, but independent coverage need not be reported. The separate certificate provision requires annual evidence for nonparticipants.

Sources:

• NDCC 43-23-20, 43-23-22 — NDCC 43-23-20, 43-23-22

Correct answer: A written agency agreement with the real estate brokerage firm.

NDCC 43-23-06.1(2) defines a client by the written agency agreement with the brokerage firm.

Why the other choices are incorrect:

• Attending an open house without an agency agreement. Attendance alone does not establish the defined client relationship.
• Receiving a listing flyer from the brokerage. A flyer alone is not a written agency agreement.
• Paying for a home inspection through an unrelated inspector. That does not create agency with the brokerage.

Sources:

• NDCC 43-23-06.1(2) — NDCC 43-23-06.1(2)

Correct answer: At once.

NDAC 70-02-03-15.1(2)(d) requires a new disclosure at once when a representation change makes the earlier disclosure incomplete, misleading or inaccurate.

Why the other choices are incorrect:

• Only on the next license renewal. The transaction disclosure cannot wait for renewal.
• Only if the commission amount changes. The trigger is a change making the original representation disclosure inaccurate.
• After the parties have signed closing documents. That is not the immediate timing required.

Sources:

• NDAC 70-02-03-15.1(2)(d) — NDAC 70-02-03-15.1(2)(d)

Correct answer: Written consent from both buyer and seller.

NDAC 70-02-03-15.1(7)(c) requires written consent for dual representation and explanation of the limited, impartial role and fee arrangement.

Why the other choices are incorrect:

• Only the seller’s oral consent. Both sides must consent in writing.
• Only the buyer’s signature on a loan application. A loan application is not the required dual-agency consent.
• No consent if both parties know the same broker. Acquaintance does not replace the required consent.

Sources:

• NDAC 70-02-03-15.1(7)(c) — NDAC 70-02-03-15.1(7)(c)

Correct answer: The applicant may test first, but the license cannot be issued until the education requirement is satisfied.

NDCC 43-23-08(4) permits the examination before completion of prerequisite education, but bars license issuance until satisfactory evidence of education completion is furnished.

Why the other choices are incorrect:

• Passing the exam permanently waives all required education. The education is still a condition of license issuance.
• The applicant must finish all education before taking the exam. The current statute expressly permits taking the exam earlier.
• The applicant may begin brokerage work as soon as the exam is passed. Passing alone does not authorize unlicensed practice.

Sources:

• NDCC 43-23-08(4) — NDCC 43-23-08(4)

Correct answer: No; the statutory appointed-agency arrangement is not dual agency as to those clients.

NDCC 43-23-12.3 permits written appointment through the designated broker and states that the firm and its licensees are not dual agents as to those properly appointed clients.

Why the other choices are incorrect:

• Yes, every same-firm transaction must be dual agency. The statute expressly provides the appointed-agency exception.
• Yes, unless both agents work without commission. Compensation is not the test in this provision.
• No, because neither client has representation. Each client is represented by the appointed agent.

Sources:

• NDCC 43-23-12.3(1)–(2) — NDCC 43-23-12.3(1)–(2)

Correct answer: That the wholesaler holds an equitable interest, may not be able to convey title and intends to profit from transferring that interest.

NDCC 43-23-24(2) requires the three stated disclosures in writing to all parties to the agreement.

Why the other choices are incorrect:

• Only that the wholesaler expects a quick closing. That omits all three required disclosure subjects.
• Only the amount of a possible future repair budget. That is not the statutory wholesaling disclosure.
• That the wholesaler already owns legal title, even when untrue. The required disclosure must accurately describe the equitable interest.

Sources:

• NDCC 43-23-24(2) — NDCC 43-23-24(2)

Correct answer: The designated broker.

NDAC 70-02-03-02.1(4) places licensee advertising under the designated broker’s supervision and requires brokerage identification and contact information.

Why the other choices are incorrect:

• Only the website hosting company. Technical hosting does not replace broker supervision.
• Only the property owner. Owner approval does not remove the designated broker’s role.
• Only the newest salesperson on the team. The rule assigns supervision to the designated broker.

Sources:

• NDAC 70-02-03-02.1(4) — NDAC 70-02-03-02.1(4)

Correct answer: Within 20 days after receiving the complaint.

NDAC 70-02-01-16(2) requires an answer within 20 days of receipt, on the Commission form, in properly certified affidavit form with a factual response.

Why the other choices are incorrect:

• Within 5 days after the transaction closes. The rule uses receipt of the complaint and 20 days.
• At the next annual renewal. Renewal does not extend the response deadline.
• Only after the Commission holds a hearing. The answer is required before that stage under the stated procedure.

Sources:

• NDAC 70-02-01-16(2) — NDAC 70-02-01-16(2)

Correct answer: The owner’s or the owner’s duly authorized agent’s consent.

NDAC 70-02-03-10 requires owner or authorized-agent consent for sale or lease signs.

Why the other choices are incorrect:

• Only an interested buyer’s consent. An interested buyer does not authorize a sign on the owner’s property.
• Only a neighboring owner’s consent. The neighbor cannot authorize use of this property.
• No consent if the sign contains the brokerage name. Proper branding does not replace permission.

Sources:

• NDAC 70-02-03-10 — NDAC 70-02-03-10

Correct answer: Within 24 hours after receipt.

NDCC 43-23-11.1(1)(s) requires salesperson turnover within 24 hours. It separately governs broker deposit and provides a next-business-day depository exception for the specified closures.

Why the other choices are incorrect:

• Within 7 calendar days. That exceeds the stated ordinary deadline.
• Only after the sale closes. Trust money must be handled before closing.
• Whenever the salesperson next visits the office. Office convenience does not replace the statutory deadline.

Sources:

• NDCC 43-23-11.1(1)(s) — NDCC 43-23-11.1(1)(s)

Correct answer: Cancel without penalty and retain earnest money paid by the wholesaler.

NDCC 43-23-24(3) gives the seller this remedy for a wholesaler’s violation, notwithstanding contrary contract provisions. The buyer has a separately stated remedy in subsection (4).

Why the other choices are incorrect:

• Cancel only by paying a penalty to the wholesaler. The statute permits cancellation without penalty.
• No cancellation right until after closing. The right applies before the close of escrow.
• Only the right to request an apology. The statute provides a specific cancellation and earnest-money remedy.

Sources:

• NDCC 43-23-24(3) — NDCC 43-23-24(3)

Correct answer: After the existing agreement expires or is released.

NDAC 70-02-03-11 permits the owner- or buyer-initiated exception only when the new agency contract does not become effective until the existing one expires or is released.

Why the other choices are incorrect:

• Immediately, even though the existing exclusive contract remains in force. The exception requires the new contract to wait.
• Whenever the second broker places a sign. A sign does not end the first agreement.
• Automatically the next morning. The effective date depends on expiration or release, not a fixed one-day delay.

Sources:

• NDAC 70-02-03-11 — NDAC 70-02-03-11

Correct answer: No; the Commission does not hear commission disputes between licensees.

NDAC 70-02-01-17 states that the Commission is not authorized to consider or conduct hearings involving fee or commission disputes between licensees. Separate misconduct allegations are a different matter.

Why the other choices are incorrect:

• Yes, it sets the split in every brokerage. The Commission does not determine these private fee disputes.
• Yes, but only if the salesperson earned more than half. The rule has no percentage exception.
• Yes, if the transaction involved residential property. The rule is not limited by property type.

Sources:

• NDAC 70-02-01-17 — NDAC 70-02-01-17

Correct answer: The licensed broker under whom the salesperson is licensed.

NDCC 43-23-11.1(1)(q) prohibits a salesperson from accepting licensed-activity compensation from anyone other than the broker under whom the salesperson is licensed.

Why the other choices are incorrect:

• Directly from the seller instead of through the broker. The statute specifies the broker under whom the individual is licensed.
• From any unrelated salesperson in another firm. That does not satisfy the required payment route.
• From an unlicensed referral company instead of the employing broker. That company is not the specified licensed broker.

Sources:

• NDCC 43-23-11.1(1)(q) — NDCC 43-23-11.1(1)(q)

Correct answer: With a written nonagency disclosure signed by the customer before services begin.

NDAC 70-02-03-15.2 requires a written disclosure signed before services are provided, with a copy retained by the brokerage.

Why the other choices are incorrect:

• Only with a private unsigned note in the broker’s file. The rule requires the customer’s signature.
• Only with an oral explanation after closing. Both the form and timing are wrong.
• No disclosure is needed because the customer is unrepresented. The rule specifically requires disclosure of the nonagency relationship.

Sources:

• NDAC 70-02-03-15.2 — NDAC 70-02-03-15.2

Correct answer: A definite expiration date.

NDAC 70-02-03-05.1 requires an expiration date, compensation amount, services and compensation-triggering events or conditions; a separate dual-agency disclosure is needed if applicable.

Why the other choices are incorrect:

• An indefinite term that the buyer can never end. The rule requires a definite expiration.
• A guarantee that the buyer will receive financing. That is not a required buyer-agency term.
• A waiver of all legal duties owed to the buyer. The rule does not authorize such a waiver.

Sources:

• NDAC 70-02-03-05.1(1)–(4) — NDAC 70-02-03-05.1(1)–(4)

Correct answer: Inactive license status.

NDCC 43-23-19 requires E&O coverage for salespersons and brokers except those holding inactive licenses. Separate statutory provisions address coverage administration.

Why the other choices are incorrect:

• Active status with only one transaction per year. The statute does not create that transaction-count exception.
• Active status while working only with buyers. Buyer representation does not create an exception.
• Active status during the first year of practice. The statute does not give new active licensees that exemption.

Sources:

• NDCC 43-23-19 — NDCC 43-23-19

Correct answer: At least 90 hours.

NDCC 43-23-08(4) requires evidence of successful completion of at least 90 hours of Commission-approved study for salesperson licensure.

Why the other choices are incorrect:

• At least 40 hours. The current statute requires at least 90 hours.
• At least 60 hours. Sixty additional hours is the broker education requirement.
• At least 120 hours. That is not the minimum stated for this salesperson route.

Sources:

• NDCC 43-23-08(4) — NDCC 43-23-08(4)

Correct answer: No; work may begin only after the broker receives notification of licensure.

NDAC 70-02-01-10 says a salesperson may not commence work until the broker receives notification of licensure from the Commission.

Why the other choices are incorrect:

• Yes, the exam score alone authorizes practice. A passing score is not the required notification of licensure.
• Yes, if a seller gives verbal consent. A seller cannot waive the licensing requirement.
• Yes, provided the first commission is delayed. Delaying payment does not authorize unlicensed work.

Sources:

• NDAC 70-02-01-10 — NDAC 70-02-01-10

Correct answer: Owner/Licensed Salesperson.

NDAC 70-02-03-02.1(7) requires “Owner/Licensed Salesperson” after the name and expressly includes inactive licensees.

Why the other choices are incorrect:

• No designation because the license is inactive. The rule expressly applies to inactive as well as active salespersons.
• Owner/Licensed Broker, even though no broker license is held. That would misstate the license held.
• Unlicensed Owner, regardless of the inactive license. That does not satisfy the prescribed disclosure.

Sources:

• NDAC 70-02-03-02.1(7) — NDAC 70-02-03-02.1(7)

Correct answer: As a customer.

NDCC 43-23-06.1(4) defines a customer to include an unrepresented buyer or prospective buyer in the transaction.

Why the other choices are incorrect:

• Automatically as the brokerage’s client. A client relationship requires the written agency agreement.
• Automatically as the seller’s appointed agent. A buyer is not an appointed licensee merely by purchasing.
• As a dual agent. An unrepresented buyer is not a dual agent.

Sources:

• NDCC 43-23-06.1(4) — NDCC 43-23-06.1(4)

Correct answer: No; team advertising must not suggest an independent brokerage.

NDAC 70-02-03-02.1(8) requires team advertising to follow the advertising rules and prohibits suggesting that the team is an independent real estate brokerage.

Why the other choices are incorrect:

• Yes, whenever two licensed salespersons form the team. Two licensees do not become an independent brokerage merely by teaming.
• Yes, if its logo is different from the brokerage logo. A distinct logo does not permit misleading independence claims.
• Yes, if the designated broker verbally approves the misleading claim. Broker approval does not override the rule.

Sources:

• NDAC 70-02-03-02.1(8) — NDAC 70-02-03-02.1(8)

Correct answer: The undisclosed compensation can support discipline.

NDCC 43-23-11.1(1)(g) addresses secret or undisclosed compensation and failure to reveal the full amount to the principal or employer.

Why the other choices are incorrect:

• It is permitted whenever the main commission was disclosed. Disclosure of one payment does not authorize concealing another.
• It is permitted if the payment is called a bonus. The label does not eliminate the disclosure requirement.
• It is permitted if the sale closes successfully. A successful closing does not excuse secret compensation.

Sources:

• NDCC 43-23-11.1(1)(g) — NDCC 43-23-11.1(1)(g)

Correct answer: As a specific amount or a specific percentage.

NDAC 70-02-03-05 requires listing or sales contracts to state the agreed brokerage amount as a specific amount or percentage.

Why the other choices are incorrect:

• As “whatever is customary,” with no amount or percentage. That is not the specificity required by the rule.
• Only in an undisclosed separate office note. The listing or sales contract must state it.
• It must always be exactly the same percentage for every broker. The rule requires specificity, not uniform rates.

Sources:

• NDAC 70-02-03-05 — NDAC 70-02-03-05

Correct answer: No; the listing cannot require a cancellation notice after its definite expiration date.

NDAC 70-02-03-04 requires a definite expiration and prohibits a provision requiring the signer to notify the broker of an intention to cancel after that date.

Why the other choices are incorrect:

• Yes, every listing must include automatic continuation. The rule prohibits the stated cancellation-notice condition.
• Yes, provided the commission rate is specified. Including compensation does not cure the expiration provision.
• Yes, if no buyer has made an offer by June 30. The lack of an offer does not create an exception.

Sources:

• NDAC 70-02-03-04 — NDAC 70-02-03-04

Correct answer: Promptly deliver true executed copies to both buyer and seller.

NDAC 70-02-03-06 requires prompt delivery of true executed copies signed by seller and purchaser to both parties after proper acceptance.

Why the other choices are incorrect:

• Keep the only copy in the office until closing. Both parties must receive executed copies promptly.
• Give a copy only to the party paying the commission. The rule calls for copies to both parties.
• Wait until the buyer’s lender requests it. A lender request is not the trigger for the duty.

Sources:

• NDAC 70-02-03-06 — NDAC 70-02-03-06

Correct answer: The principal’s knowledge and permission.

NDAC 70-02-03-14 bars accepting a note, nonnegotiable instrument or other value not readily negotiable as a deposit without the principal’s knowledge and permission.

Why the other choices are incorrect:

• Only the buyer’s assurance that the note is valuable. The buyer’s assurance does not supply the principal’s required permission.
• No permission if the note is called earnest money. The label does not remove the restriction.
• Only approval from another salesperson who is not the principal. That is not the consent required by the rule.

Sources:

• NDAC 70-02-03-14 — NDAC 70-02-03-14

Correct answer: A signed written listing agreement containing the required terms.

NDAC 70-02-03-04 requires a signed written listing for one-to-four-family residential property before advertising or offering it for sale. Required terms include price, commission, signatures and a definite expiration date.

Why the other choices are incorrect:

• Only a buyer’s request to tour the home. A buyer does not supply the seller’s listing authorization.
• Only a draft listing agreement that the seller has not signed. The rule requires a signed agreement.
• Only a promise to complete the listing after an offer arrives. The agreement must precede advertising or offering the property.

Sources:

• NDAC 70-02-03-04 — NDAC 70-02-03-04

Correct answer: At first substantive contact, before discussing personal finances or starting negotiations that could affect the buyer’s bargaining position.

NDAC 70-02-03-15.1(2) governs one-to-four-family residential transactions and defines substantive contact with unrepresented parties by those discussions or negotiations. The document must be offered for signature.

Why the other choices are incorrect:

• Only after the buyer’s offer is accepted. That is later than first substantive contact.
• Only at the closing appointment. Closing is too late for this disclosure.
• Only if the buyer asks who the licensee represents. The rule requires an affirmative disclosure.

Sources:

• NDAC 70-02-03-15.1(2)(c) — NDAC 70-02-03-15.1(2)(c)

Correct answer: No; the confidentiality duty continues, subject to the rule’s stated exceptions.

NDAC 70-02-03-15.1 continues confidentiality after agency ends, subject to matters such as later permission, applicable law or authorized orders, and information made public from other sources.

Why the other choices are incorrect:

• Yes, every confidence expires with the listing. The rule preserves confidentiality beyond termination.
• Yes, if the former client did not buy another property. That does not supply an exception.
• Yes, if the agent switches brokerages. Changing firms does not itself authorize disclosure.

Sources:

• NDAC 70-02-03-15.1(5)–(6) — NDAC 70-02-03-15.1(5)–(6)

Correct answer: Ask the owner and tell the buyer the owner’s response, including a refusal to answer.

NDAC 70-02-01-20 generally does not classify psychological impact as a required material-defect disclosure, but a direct buyer question requires inquiry of the owner and communication of the response or refusal.

Why the other choices are incorrect:

• Ignore the question because no inquiry is ever required. A buyer’s direct question triggers the stated inquiry and reporting duty.
• Assure the buyer nothing occurred without asking the owner. That would not follow the prescribed process.
• Disclose all former occupants’ medical histories instead. Medical history is not the requested property-event information.

Sources:

• NDAC 70-02-01-20 — NDAC 70-02-01-20

Correct answer: Loyalty, subject to the governing law and rules.

NDCC 43-23-12.1(1) lists loyalty, obedience, disclosure, confidentiality, reasonable care, diligence and accounting for clients served through written agency agreements.

Why the other choices are incorrect:

• A guarantee that the property will sell at the asking price. The statute does not guarantee a price or sale.
• Permission to keep undisclosed transaction compensation. Secret compensation is not a client duty and is prohibited.
• Authority to ignore every disclosure obligation. Agency does not remove statutory disclosure requirements.

Sources:

• NDCC 43-23-12.1(1) — NDCC 43-23-12.1(1)

Correct answer: During the depository’s next business day.

NDCC 43-23-11.1(1)(s) provides the next-business-day deposit rule for the specified holiday or depository-closure circumstances.

Why the other choices are incorrect:

• Whenever the purchase agreement’s inspection period ends. Inspection timing does not control the deposit exception.
• Within 30 days after the holiday. The exception is only until the next business day.
• Only when the seller requests the deposit. The duty does not depend on a seller request.

Sources:

• NDCC 43-23-11.1(1)(s) — NDCC 43-23-11.1(1)(s)

Correct answer: No; the Commission neither recommends nor recognizes uniform commission-rate agreements.

NDAC 70-02-01-18 states that the Commission neither recommends nor recognizes agreements to fix or impose uniform commission rates.

Why the other choices are incorrect:

• Yes, the Commission publishes one mandatory rate. The cited rule rejects uniform-rate agreements.
• Yes, unless the buyer pays cash. Financing does not create such a mandatory rate.
• Yes, but only for exclusive listings. The rule does not make an exception for exclusive listings.

Sources:

• NDAC 70-02-01-18 — NDAC 70-02-01-18

Correct answer: Reduce the requested offer to writing and submit it as required.

NDCC 43-23-11.1(1)(t) makes failure to reduce a requested offer to writing a disciplinary ground and requires offer submission within its stated preacceptance period.

Why the other choices are incorrect:

• Refuse solely because the price seems low. The statute does not permit rejecting the buyer’s request on that basis.
• Change the price without the buyer’s permission. The licensee cannot replace the buyer’s offered terms.
• Wait until another buyer offers more. That does not fulfill the requested offer duty.

Sources:

• NDCC 43-23-11.1(1)(t) — NDCC 43-23-11.1(1)(t)