FREE Wisconsin Real Estate License Agency Law and Disclosures Questions and Answers

Question 1

A Wisconsin real estate licensee is representing a seller.
A potential buyer, who is a customer and not represented by any agent, asks the licensee for advice on how much to offer for the property.
According to Wisconsin agency law, how should the licensee respond?

Accepted Answer

Inform the buyer that they cannot provide advice, as their duty is to the seller, and recommend the buyer seek their own representation.

Answer

Advise the buyer on a competitive offer price based on market analysis.

Answer

Refuse to provide any advice, stating it would be a conflict of interest.

Answer

Suggest a low offer to start negotiations, benefiting their seller client.

Question 2

Which of the following statements is TRUE regarding multiple representation relationships without designated agency in Wisconsin?

Accepted Answer

The brokerage firm and its agents must remain neutral and cannot provide advice or opinions that favor one party over the other.

Answer

The brokerage firm can assign two different agents to represent the buyer and seller respectively, with each agent advocating for their client.

Answer

This type of relationship is illegal in Wisconsin due to the inherent conflict of interest.

Answer

The licensee is only required to get verbal consent from both parties to proceed with this type of representation.

Question 3

A licensee lists a property. The seller informs the licensee that the basement leaks during heavy rains, but they do not want this disclosed to potential buyers. What is the licensee's duty according to Wis. Admin. Code § REEB 24.07?

Accepted Answer

Disclose the leak to all parties in writing, as it is a material adverse fact.

Answer

Follow the seller's instructions and not disclose the leak, as the duty of obedience to the client is paramount.

Answer

Disclose the leak only if a buyer specifically asks about the basement's condition.

Answer

Advise the seller to fix the leak before showing the property to avoid disclosure issues.

Question 4

A buyer signs a WB-36 Buyer Agency/Tenant Representation Agreement with a brokerage firm. According to this agreement, the firm owes additional duties to the buyer as a client. Which of the following is an additional duty owed to a client, but NOT to a customer?

Accepted Answer

To provide advice and opinions on matters material to the transaction.

Answer

To provide brokerage services fairly and honestly.

Answer

To disclose material adverse facts in writing.

Answer

To safeguard trust funds and other property.

Question 5

In Wisconsin, when must a licensee provide the 'Disclosure to Customers' form to a potential buyer who is not represented by an agent?

Accepted Answer

Before negotiating on behalf of the customer.

Answer

At the time an offer to purchase is drafted.

Answer

Prior to or at the time of the first property showing.

Answer

Only after the buyer has expressed a serious interest in a specific property.

Question 6

A seller provides a completed Real Estate Condition Report (RECR) to their listing agent. The agent, during a visual inspection, notices a large water stain on the ceiling that was not disclosed on the RECR. What is the agent's responsibility?

Accepted Answer

Disclose the observation of the stain as a potential material adverse fact to all parties, regardless of what the RECR states.

Answer

Ignore the stain, as the seller is solely responsible for the accuracy of the RECR.

Answer

Ask the seller about the stain and amend the RECR on their behalf.

Answer

Recommend the seller paint over the stain before showing the property.