Free South Carolina Real Estate Practice Exam

Q1.In South Carolina, what is the PRIMARY purpose of designated agency under S.C. Code § 40-57-360?

• A.To allow the broker-in-charge to personally represent both the buyer and seller and charge double commission
• B.To enable the firm to represent both buyer and seller while assigning a different licensee to each party, thereby preserving individual fiduciary duties
• C.To eliminate the need for a written agency agreement with either party
• D.To allow a licensee to act as an independent contractor for both parties without firm supervision

Q2.In a designated agency arrangement, which statement best describes the role of the supervising broker?

• A.The broker represents both parties and provides guidance to designated agents
• B.The broker maintains overall responsibility but does not represent either party directly
• C.The broker acts as a neutral facilitator without representing either party
• D.The broker automatically becomes a dual agent in all transactions

Q3.A buyer's broker is representing a purchaser of a pre-1978 residential property. The seller's broker provides the EPA-mandated Lead-Based Paint Disclosure and the EPA/HUD pamphlet 'Protect Your Family from Lead in Your Home.' The buyer's broker advises her client to waive the 10-day lead-based paint inspection contingency to strengthen the offer. Which of the following BEST characterizes the buyer's broker's potential liability?

• A.The buyer's broker may face liability for breach of fiduciary duty if she recommended waiving the inspection without ensuring the buyer fully understood the legal right to conduct an inspection and the potential health and financial risks of lead-based paint.
• B.The buyer's broker has no liability because the EPA disclosure requirement is solely the seller's obligation; once the seller complies, all inspection decisions become the buyer's sole responsibility.
• C.The buyer's broker is immune from liability because the buyer, as an adult, signed the disclosure form and voluntarily elected to waive the contingency.
• D.The buyer's broker violated the Toxic Substances Control Act (TSCA) directly by recommending waiver of a federally mandated inspection period.

Q4.Which fiduciary duty requires an agent to place the client's interests above their own and avoid conflicts of interest?

• A.Duty of care
• B.Duty of loyalty
• C.Duty of disclosure
• D.Duty of accounting

Q5.A property manager is analyzing a potential acquisition with the following data: Gross Potential Income $500,000, Vacancy Rate 8%, Operating Expenses $180,000, Debt Service $200,000. If the required capitalization rate is 9%, what is the maximum justified purchase price?

• A.$2,800,000
• B.$3,555,556
• C.$2,888,889
• D.$3,111,111

Q6.A property manager is preparing lease agreements for a mixed-use building that includes both residential and commercial spaces. Under federal fair housing law, which type of occupancy restriction would be legally permissible?

• A.Limiting occupancy based on maximum number of persons per bedroom according to local housing codes
• B.Restricting occupancy to married couples only
• C.Excluding tenants who receive Section 8 housing assistance
• D.Prohibiting occupancy by families with children under age 5

Q7.A home was purchased for $220,000. Three years later it sold for $253,000. What was the percentage of appreciation over the three-year period?

• A.$33,000
• B.13%
• C.15%
• D.12%

Q8.Under RESPA's affiliated business arrangement (ABA) disclosure requirements, when must a real estate brokerage provide the required written disclosure if they refer clients to their affiliated mortgage company?

• A.Within three business days after the mortgage application is submitted
• B.No later than the delivery of the Loan Estimate to the borrower
• C.At the time of the referral or when the referral is first discussed
• D.At closing when all settlement service providers are disclosed

Q9.Under 24 C.F.R. § 100.600(a)(1), how many incidents of quid pro quo harassment are required to establish a fair housing violation?

• A.At least two incidents
• B.Three or more incidents constituting a pattern
• C.Depends on the severity of each incident
• D.One incident is sufficient

Q10.Under the South Carolina Residential Property Condition Disclosure Act and S.C. Code Title 40, Chapter 57, which of the following duties is owed to a CLIENT but NOT to a CUSTOMER?

• A.Providing honest and accurate responses to questions about the property
• B.Disclosing all material adverse facts known about the property
• C.Promoting the client's best interests and maintaining loyalty
• D.Accounting for all monies received on behalf of the parties

Q11.A borrower obtains a $250,000 conventional mortgage with a 10% down payment. Under standard mortgage lending guidelines, what will the lender most likely require because the loan-to-value ratio exceeds 80%?

• A.A balloon payment clause in the mortgage
• B.An adjustable interest rate structure
• C.Private Mortgage Insurance (PMI)
• D.A prepayment penalty provision

Q12.Which of the following properties is generally EXEMPT from the federal Fair Housing Act?

• A.A 20-unit apartment complex owned by a corporation
• B.A single-family home sold through a licensed real estate broker
• C.An owner-occupied building with no more than four units where the owner resides in one of the units
• D.A condominium complex with 10 units

Q13.A South Carolina real estate salesperson places an online advertisement for a listed property that identifies only the salesperson's name and contact information, with no reference to the employing brokerage. Under the South Carolina Real Estate License Law, this advertisement is:

• A.Permissible, because the salesperson is the agent of record for the listing.
• B.Permissible, as long as the salesperson's license number appears in the ad.
• C.Prohibited, because all advertising must clearly identify the licensed brokerage under which the salesperson is affiliated.
• D.Prohibited only if the advertisement appears in a print publication, not online media.

Q14.Under South Carolina's Vacation Time Sharing Plans Act, a purchaser of a timeshare interest has the right to cancel the contract within how many days of signing?

• A.3 days
• B.5 days
• C.7 days
• D.10 days

Q15.In South Carolina, a real estate licensee who represents neither the buyer nor the seller but assists both parties in completing a transaction is operating in which capacity?

• A.Dual agent
• B.Designated agent
• C.Transaction broker
• D.Facilitator