AgencyIntermediateNorth Carolina Exam

Which of the following best describes a material fact a North Carolina broker must disclose?

AThe seller's divorce proceedings

BA known roof leak that has not been repairedCorrect

CThe seller's urgency to sell quickly

DThe buyer's pre-approval letter amount, in general

Why A known roof leak that has not been repaired Is Correct

Answer B: A known roof leak that has not been repaired

A known material defect such as a roof leak is a material fact that must be disclosed to all parties regardless of agency relationship.

Exam Tip: Agency

Agency questions are among the most tested on the exam. Focus on the difference between client and customer, and memorize the fiduciary duties (OLD CAR). Watch for questions that try to blur the line between a general agent and a special agent.

Key Agency Terms in This Question

Agency

A legal relationship in which a licensee (agent) acts on behalf of a principal (buyer or seller) in a real estate transaction.

Pre-Approval

A lender's conditional commitment to loan a specific amount to a borrower, based on verified income, credit, and assets.

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Key Terms to Know

Agency

A legal relationship in which a licensee (agent) acts on behalf of a principal (buyer or seller) in a real estate transaction.

Pre-Approval

A lender's conditional commitment to loan a specific amount to a borrower, based on verified income, credit, and assets.

Dual Agency

A situation where a single real estate agent or brokerage represents both the buyer and the seller in the same transaction.

Fiduciary Duty

The highest legal duty an agent owes to a principal — requiring the agent to act in the principal's best interest above all others.

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