Maryland law practice test

Whom may a licensed salesperson represent

Only brokers under whom they are licensed

License certificates issued for salespersons must be…

Retained by their broker in their company office

Brokers need not to notify the commission when…

Changes occur in commission splits

As a licensed salesperson you receive a lead from a friend who is not a real estate licensee. As previously agreed upon, you split the commission with your friend

This is a violation of the license law

Nicos is newly licensed in 2024 as a salesperson in southern Maryland and is determining what education he would like to attend to start his career. What is required for him to attend?

He has to attend specified topics for his first renewal and will have different CE topics needed for all of his future renewals

Which of the following is paid biennially?

Salesperson license renewal fee

The act of block busting is regarded by Maryland statute as…

A misdemeanor

Who may fine individuals found guilty of operating in the real estate business without a license?

The real estate commission

What is an unlicensed person improperly collecting a real estate commission guilty of?

A misdemeanor

Which of the following could result in discipline by the real estate commission?

Bad faith

What is the maximum penalty possible for filing false statement with the commission in reference to a guaranty fund claim?

$25,000 and imprisonment for three years

Who may hold licenses to provide Maryland residential real estate brokerage services?

Individuals

Who appoints members to the Maryland real estate commission?

The governor of Maryland

When will a salesperson license issued by the commission on November 1 expire?

Two years from the date of issue

What is the primary purpose of the brokers act?

To protect public interest

Who appoints the executive director of the commission?

The secretary of the department of labor

Sometimes MREW provides an expedited approach to issuing a license such as when a broker dies and becomes disabled and an adult member of their family is given an expedited process to get a brokers license quickly and step into the role of the broker. Who else is given an expedited process to get their Maryland real estate license quicker?

An out of state military service member with an active real estate license

What is the minimum level for the guaranty fund to be maintained?

$250,000

What is the membership composition of the Maryland real estate commission?

Four members that are not licensed and five that are licensed

The commission may refuse to issue a broker a license to a Maryland resident who has filed a proper application and met the legal requirements

If it then offers the ppl I can’t a hearing on the matter

Which of the following has the authority to set license fees?

The commission

Licenses of salespersons who are released by their brokers are to be

Returned to the commission by their brokers

What is the upper limit if any of a financial loss protected by the guaranty fund?

$50,000

Which statement about licenses issued for Maryland real estate brokerage services is NOT correct?

They are required for every person who sells real estate for consideration

What is a requirement for licensed real estate salespersons to deliver real estate brokerage services?

Performance of real estate acts only on behalf of brokers under whom they are licensed

What is required by law on any outdoor sign or advertisement displayed on property for sale subject to ground rent?

It must, if price is shown, show ground rent and cost of capitalization in same size lettering

Which of the following is true of ads in which licensees advertise real property they have listed?

The salespersons name is optional in the ad, but the designated brokers name is required

Which of the following satisfies the requirement that a broker maintain an office?

A definite place of business

Which of these does a licensee not need to do to be a qualified real estate agent and file as self employed on their federal tax return?

Be free from their brokers control of how their work is done

In Maryland who is the person primarily responsible for the real estate brokerage services provided through a corporation?

The licensed real estate broker of the firm

Under what circumstances may salespersons use their own names and phone numbers in advertising listed property?

When the designated name of their firm is clearly shown, as well as the firms phone number

When the sales contract calls for the broker to hold the earnest money deposit, what does the brokers act require?

Deposit is placed in the brokers account within seven days, regardless of the parties instructions

How must a check drawn on a brokerage firms escrow (trust) account be signed?

It doesn’t necessarily need a second signature if signed by the brokers firm

Which of the following may an unlicensed person working in a brokerage firm not do?

Conduct an open house to gauge public interest

Which of the following team names would be permissible under the brokers act?

ABC professional service team

Which of the following is a requirement for team advertising?

The name of the team is directly connected by a single word to a conspicuous broker name

Which of the following statements about teams is false?

A salesperson cannot be a team leader

If a sales contract calls for the title company to hold the earnest money deposit for the parties what is required?

Title insurance companies are asked to sign an escrow holding agreement along with the parties

A buyer is using a provided right of cancellation to terminate the sales contract due to the unfavorable home inspection outcome. The buyer’s $10,000 earnest money deposit will be

Returned to the buyer within 30 days unless the seller files for mediation

Which government agency may purchase easements to restrict land to agricultural use?

Maryland agricultural land preservation foundation

Which of the following would meet or exceed the requirement for prescriptive easement in Maryland?

25 years continuous use

Which of the following is recognized in Maryland?

Easement by prescription

Mia Lynn is buying a vacation home from salesperson Shelley. Mia is considering a beautiful house on two acres along the banks of a navigable waterway. What water rights could Mia enjoy with this property?

She may build a pier out into the river subject to state and federal laws

What form of ownership is created in Maryland by a deed that conveys ownership to “Karen and David Munoz, husband and wife” but does not specify the form of ownership?

This language will construed to create a tenancy by entirety

What is a license of registration requirement for a developer wishing to create a Maryland time share?

Register with the Maryland real estate commission

What is required for amending the bylaws of a Maryland condominium?

It requires affirmative vote by 60% of the owners in good standing

If an existing apartment building is being converted to timeshares, the current tenants must be given

120 days notice to vacate

Which of the following is true of developers who wish to sell newly built Maryland condominium units to original purchasers

If the developers fail to deliver public offering statements to them they are subject to their purchasers voiding their contracts

When purchasers contract with developers to purchase new time shares, which of the following is true of their rights and responsibilities?

They have the right, for ten days, to cancel the sale for any or no reason

To protect the contracts enforceability what must the owner of a condominium units furnish to purchasers not later then 15 days before closing when reselling the property?

A copy of the declaration, the bylaws, rules and regulations, a statement regarding monthly expenses proposed capital improvements, other fees, financial statements of the condominiums and insurance details

Which type of residential listing agreement is illegal for a broker to use in Maryland?

Net

Terry is with a high performing team in Annapolis and is listing a waterfront property. When should his seller complete the residential property disclosure and disclaimer statement?

When an offer is received

What is the consequence when purchasers receive no residential property disclosure and disclaimer statement before, at, or after entering into a purchase agreement?

The purchasers may rescind the contract before they apply for a mortgage loan

When must a licensee give a copy of the signed listing agreement to the sellers?

Before the firm advertises the property or offers it for sale

What is required of a Maryland licensees who wish to show a property located n Virginia that is multiple listed by a Maryland firm?

They must hold a Virginia real estate license

What is the sellers minimum disclosure responsibility when completing the residential property disclosure and disclaimer statement?

Known latent defects

Which of the following is true of a listing on Maryland residential property?

It must be in writing and signed by all parties

What is the effect on purchasers who have received the residential property disclosure and disclaimer statement before signing their contract offer?

They may not rescind the contract based on any facts the statement discloses

Which of the following is correct about the amount of real estate commission charged?

It must be stated in the listing agreement

Which of the following is true of a Maryland buyer representation agreement?

It must be in writing

Brokers principals are called…

Clients

Which is true when brokers handle the purchase and sale of the same residential property?

They may designate two intracompany agents if proper consent has been given

Mike has been selected by his broker, Mary, to represent a buyer for the purchase of a property listed by Angela. Both mike and Angela are high performing sales people with Mary’s firm. In this situation which of the following is true?

Mike is the intracompany agent for his buyer. Mary is not a single agency broker, an agenda is the intracompany agent for her seller

Which of the following is true of brokers when they represent buyers of real estate?

They must disclose this brokerage relationship to unrepresented sellers

Which of the following statements about brokerage relationships is true in Maryland?

Dual agency is permitted only in brokerage firms consisting of three or more licensees

Confidential information must remain confidential until…

It becomes public information

Which statement about subagents (as shown on the understanding whom real estate agents represent form) is false?

Subagents cannot represent the buyer

Which of the following is true about the understanding whom real estate agents represent disclosure form?

Failure to properly present the form constitutes a violation of the brokers act by the licensee

Broker Connie remembers interviewing a buyer recently who shared with her that they had inherited a generous amount of money and could complete a purchase as a cash buyer. Connie never got the chance to work with them. Months later, she is reviewing an offer with salesperson lee Ann, who has received a low offer with closing help on her listing. Connie recognizes he buyers names who are capable of offering a far better price and do not need closing help, what does Connie share with her salesperson?

Connie has to iscuss the offer as if she has no knowledge of the buyers inheritance

Which of the following is a requirement in Maryland for a valid real estate sales contract?

It must be in writing

What is true of oral contracts for the sale of real estate in Maryland?

They are called parol agreements

What is a duty of licensee Cindy Holman when buying a bel air condo for her own use?

Advise the other party of the fact that they are real estate licensees

Which of the following is not required to be disclosed in a Maryland real estate sales contract?

The name of the tile insurance company

In what countries must critical areas notice be included in real estate sales contracts?

All counties, regardless of whether they are affected by such regulation

Broker jay contracts Mandy who is representing their buyer client, to let her know that the listing firm just sent over an email disclosing that the Waldorf property they will be settling on in two weeks has approximately 10 yeasts of remaining deferred water and sewer fees. What can jay and Mandys buyer do concerning this new disclosure?

The buyer has the right to cancel the contract in response to the new information

In Maryland what entity or entities can levy (impose) real estate taxes?

Cities, special taxing districts, counties

Which is true of Maryland residential real property assessment?

It is based on each properties full market value?

Hopper homes has been contracted to complete an addition that would increase total square footage by 35%. Sarah Arrington hired the hopper firm on December 1. James finished work on the addition on march 15. It is now June 15, and hopper homes has not yet been paid. Based on this situation, which of the following is correct?

Hopper has until September 15 to record a mechanics lien

Gary Stanley makes semiannual real estate tax payments on his ocean city investment property? Which of the following statements is true?

Taxes are due on July 1st of each year

Payment of Maryland property taxes are exempt for

100% disabled veterans

Which statement about mortgages on Maryland real property is true?

They may not be refused to any persons because of their religion

Pat Kane purchased a ski cabin near wisp resort with the aid of a balloon second mortgage that is reaching the end of its term. What are Jane’s rights now that the balloon payment is coming due?

He must be granted a six month extension if he now requests it from the lender

When Thomas Lowell obtained a loan to purchase a new home from BNN savings bank, BNN failed to record the mortgage document. The mortgage does not give BNN the power of sale in case of default. Which of the following is true?

If Lowell defaults on the loan, BNN cannot foreclose on the mortgage until the instrument is recorded

Bonita Harrison needs $365,000 to purchase a new home from a builder. She borrows it from first Maryland savings bank. Which of the following security arrangements can first Maryland savings bank use?

Mortgage or deed of trust

Which of the following is true concerning the first tie homebuyer savings account?

The amount is set up by someone who has not owned a house for at least 7 years

Which of the following statements about usury in Maryland mortgage loans is true?

There is no interest limit on first mortgages involving Maryland real estate

Which of the following is a requirement for claiming adverse possession?

Claimant must have been in possession for more then two decades

Which of the following is not required for the validity of a red that transfers title?

It must be recorded in the county land records

In Maryland what is required for a valid will?

A minimum of two witnesses

Where should a deed conveying title to land that lies in two counties be recorded?

In both counties

Tessa Marie has never before owned and occupied principal residence in Maryland. She is buying a three level bay front town house in Maryland for $400,000 to occupy. How will the state transfer tax be apportioned at settlement?

Tessa will pay $0 and sellers will pay $1000

Which of the following is false concerning requirements or recording a deed?

It must have been witnessed (attested) rather than notarized

Real estate sales agreements and deeds use legal description. Which of the following is true about the use of the lot and block system for such descriptions?

They are sufficient if the plat referred to was properly recorded

Which of the following is true of property description used in most Maryland real estate transfers?

They are based on recorded plats of subdivision of metes and bounds data

Which of the following is true of residential closings in Maryland?

They are always to be performed under an attorneys supervision

What is one of the requirements for handling evidence of the release of debt after a closing?

It must be sent to the seller within 30 days of closing

Which statement is true of attorneys who personally conduct settlements?

They owe all partied due care in the execution of closing duties

Which of the following is true about the ordering of title searches in Maryland and residential transactions?

They are ordered at the direction and expense of the purchaser

When a Maryland property is sold by an out of state individual which of the following is true?

The closing officer must withhold 8% of the sellers proceeds

Which is true of location drawings?

They are appropriate for typical residential resales