Real Estate Sales Exam FREE CA Real Estate Sales Question and Answers 2 — Questions and Answers
Question 1: Under California law, what is the maximum commission rate a real estate broker can charge on a residential sale?
- There is no legally set maximum; commissions are negotiable (Correct answer)
- 6% as set by the Bureau of Real Estate
- 5% for residential and 10% for commercial
- 3% for the listing agent and 3% for the buyer's agent
Correct answer: There is no legally set maximum; commissions are negotiable
In California, real estate commissions are fully negotiable between the broker and the client, with no legally mandated maximum rate.
Question 2: Which document must a seller in California provide to a buyer disclosing known material facts about the property's condition?
- Grant Deed
- Transfer Disclosure Statement (TDS) (Correct answer)
- Preliminary Title Report
- Estoppel Certificate
Correct answer: Transfer Disclosure Statement (TDS)
California Civil Code requires sellers of residential property to complete a Transfer Disclosure Statement revealing known defects and material facts.
Question 3: In California, what is the purpose of the Natural Hazard Disclosure (NHD) report?
- To disclose whether the property is in a zone subject to natural hazards such as floods, earthquakes, or wildfires (Correct answer)
- To report the property's current market value adjusted for environmental risks
- To certify that the property meets seismic retrofit requirements
- To list all prior insurance claims related to natural disasters
Correct answer: To disclose whether the property is in a zone subject to natural hazards such as floods, earthquakes, or wildfires
The NHD report informs buyers whether the property lies within mapped natural hazard zones including flood, fire, earthquake fault, and seismic hazard areas.
Question 4: A California real estate licensee who acts as a dual agent must do which of the following?
- Obtain written consent from both the buyer and the seller before acting as a dual agent (Correct answer)
- Only disclose dual agency status at the close of escrow
- Reduce the total commission by half
- Represent only the seller's interests while informing the buyer
Correct answer: Obtain written consent from both the buyer and the seller before acting as a dual agent
California law requires that dual agency be disclosed and that written consent be obtained from both parties before the agent may represent both sides.
Question 5: What is the statutory vesting period for a mechanic's lien in California after completion of a work of improvement?
- 30 days
- 60 days
- 90 days (Correct answer)
- 120 days
Correct answer: 90 days
In California, a direct contractor must record a mechanic's lien within 90 days after completion of the work of improvement.
Question 6: Under California's Subdivision Map Act, a developer dividing land into five or more parcels must file which type of map?
- Parcel map
- Tentative map followed by a final map (Correct answer)
- Lot line adjustment
- Certificate of compliance
Correct answer: Tentative map followed by a final map
Subdivisions of five or more lots in California require filing a tentative map for review and approval, followed by a final map for recordation.
Real Estate Sales Exam FREE CA Real Estate Sales Question and Answers 2
Under California law, what is the maximum commission rate a real estate broker can charge on a residential sale?