Iowa Agency
Practice Questions & Answers (2026)
Agency law is one of the most tested subjects on the Iowa real estate exam, and it's also one of the most misunderstood. The Iowa Real Estate Commission expects licensees to understand the legal duties owed to clients vs. customers, and the specific timing of required disclosures under Iowa law. Study these questions carefully — candidates who rely on national agency frameworks and don't account for IA-specific rules are among the most common failures on the state portion.
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Iowa Agency — Practice Questions & Answers
117 questions on Agency from the Iowa real estate question bank. First 10 are free — sign up to unlock all 117.
Q1. Iowa's agency disclosure law requires the licensee to provide a written agency disclosure form to the consumer:
Explanation
Iowa Code requires the agency disclosure to be provided at first substantive contact, before any confidential information is shared, to ensure the consumer understands who the agent represents in the transaction.
Q2. In Iowa, which of the following BEST describes a buyer's agent?
Explanation
A buyer's agent in Iowa owes fiduciary duties exclusively to the buyer. These duties include loyalty, confidentiality, disclosure, obedience, reasonable care, and accounting.
Q3. An agent discloses to the buyer that the seller is going through a divorce and must sell quickly. This is a violation of which fiduciary duty?
Explanation
Disclosing a client's personal circumstances (such as a divorce or financial urgency) that could weaken their negotiating position violates the fiduciary duty of confidentiality. Such information must be kept private.
Q4. Under Iowa law, an agent may act as a dual agent representing both the buyer and seller if:
Explanation
Iowa permits dual agency only when both the buyer and seller provide written informed consent after full disclosure of the potential conflicts of interest. Without consent, dual agency is not permissible.
Q5. An agent's duty to disclose material facts applies to:
Explanation
The duty to disclose material facts (such as latent defects) applies to both the agent's client and the other party in the transaction. An agent cannot conceal known material defects regardless of who they represent.
Q6. When a seller's agent presents an offer to the seller, the agent's duty of loyalty requires them to:
Explanation
The duty of loyalty requires the agent to act in the seller's best interest by presenting all offers (unless the seller has specifically instructed otherwise) and providing objective information to help the seller make an informed decision.
Q7. In Iowa, a transaction broker:
Explanation
A transaction broker (also called a facilitator in some states) assists the parties with completing a transaction but does not represent either party in a fiduciary capacity. Iowa law recognizes this limited service role.
Q8. The fiduciary duty of 'obedience' requires a licensee to:
Explanation
The duty of obedience requires an agent to follow all lawful instructions of their client. However, an agent is never required to follow instructions that violate the law, including fair housing laws or license law.
Q9. When does an agency relationship most commonly terminate in Iowa?
Explanation
An agency relationship in Iowa typically terminates upon expiration of the listing or buyer agency agreement, completion of the transaction (closing), mutual agreement, impossibility of performance, death or incapacity of a party, or revocation.
Q10. A seller's agent who learns that the buyer cannot qualify for a larger mortgage should:
Explanation
A seller's agent owes a duty of disclosure to their seller client. If the agent learns material information about the buyer's financial ability — such as the inability to qualify for adequate financing — this must be disclosed to the seller.
Q11. Which of the following is an example of an express agency relationship?
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