Real Estate Sales Exam Real Estate Sales Fair Housing and Ethics Questions and Answers 3 — Questions and Answers
Question 1: Which of the following is exempt from the Fair Housing Act's prohibition against discrimination?
- An owner-occupied dwelling with no more than four units where no broker is used (Correct answer)
- All single-family homes regardless of how they are sold
- Any property owned by a religious organization used for commercial purposes
- Apartment complexes with fewer than ten units
Correct answer: An owner-occupied dwelling with no more than four units where no broker is used
The Mrs. Murphy exemption allows owner-occupied buildings with four or fewer units to be exempt when no broker is involved and no discriminatory advertising is used.
Question 2: An agent learns confidential information about a client's financial distress during a transaction. Under the NAR Code of Ethics, when may this information be disclosed?
- Only when required by law or court order (Correct answer)
- Whenever it benefits the other party in the transaction
- When another REALTOR requests it for a competing offer
- At the agent's discretion if it speeds up the transaction
Correct answer: Only when required by law or court order
The Code of Ethics requires agents to maintain client confidentiality and only disclose confidential information when legally compelled.
Question 3: A property manager implements a policy requiring all tenants to have a minimum credit score, which disproportionately affects a particular racial group. This is an example of what type of discrimination?
- Disparate impact discrimination (Correct answer)
- Intentional discrimination
- De jure discrimination
- Reverse discrimination
Correct answer: Disparate impact discrimination
Disparate impact occurs when a facially neutral policy disproportionately affects a protected class, even without discriminatory intent.
Question 4: Under the Fair Housing Act, which of the following is considered a protected class?
- Familial status (Correct answer)
- Source of income
- Marital status
- Sexual orientation at the federal level
Correct answer: Familial status
Familial status, which includes families with children under 18, was added as a protected class by the Fair Housing Amendments Act of 1988.
Question 5: A real estate licensee discovers a material defect in a property but the seller instructs them not to disclose it. What should the licensee do?
- Disclose the defect to potential buyers regardless of the seller's instructions (Correct answer)
- Follow the seller's instructions to maintain loyalty
- Withdraw from the listing only if asked by the buyer
- Disclose only if the buyer's agent specifically asks about defects
Correct answer: Disclose the defect to potential buyers regardless of the seller's instructions
Licensees have a legal and ethical duty to disclose known material defects, and seller instructions cannot override this obligation.
Question 6: Which federal law prohibits discrimination in ALL real estate transactions based solely on race, with no exemptions?
- Civil Rights Act of 1866 (Correct answer)
- Fair Housing Act of 1968
- Equal Credit Opportunity Act
- Americans with Disabilities Act
Correct answer: Civil Rights Act of 1866
The Civil Rights Act of 1866 prohibits racial discrimination in all property transactions with no exemptions whatsoever.
Real Estate Sales Exam Real Estate Sales Fair Housing and Ethics Questions and Answers 3
Which of the following is exempt from the Fair Housing Act's prohibition against discrimination?