Document Sample

        While many professional are certified to gain credibility for carrying out their
duties, there is no reason to question why consumers should not be certified as a means
to gain knowledge and skills to protect themselves when making investments such as
purchasing a home.

               Participation in this certification exam will lead you through
        a process of reviewing several of the educational topics found on By successfully
        completing the exam you will:

              1. Be a wise home buying consumer,
              2. Be skillful at evaluating your buyer agent, and
              3. Be rewarded by receiving $100 for returning an
                 evaluations report on your buyer agent referred
                 by the National Home Buyers Association after
                 you close on a home bought through that agent.
Cerfication Exam

       As an “Open Book” exam you are encouraged to review the educational topics
found on the National Home Buyers Association website as you work through the exam.
Please check the most appropriate answer on the following multiple choice questions.

   1.      The National Association of Realtors (NAR) is a trade association that has a
           mission of protecting:

               ____ a. real estate brokers and agents.
               ____ b. home buyers and sellers
               ____ c. both a and b

   2.      Agent working with companies that list homes for sale generally serve buyers

             ____ a. buyer agents
             ____ b. designated buyer agents
             ____ c. exclusive buyer agents

   3.      Exclusive buyer agency is practiced by:

           ____   a. real estate brokers that do not list homes for sale
           ____   b. real estate brokers that lists homes for sale and offer
                     designated buyer agency
           ____ c. any agent that offers an exclusive buyer agency agreement
   4.      Most states have laws that require real estate agents to provide disclosures
      about representation:

      ____ a. before a contract is signed
      ____ b. at the first meeting with a client
      ____ c. only at open houses

5.    According to research by the NAR only ____ percent of all buyers received
      disclosures about representation at the appropriate time.

      ____ a. 60 %
      ____ b. 45 %
      ____ c. 30 %

6.    In most states a real estate agent is not working for the buyer:

      ____ a.   unless the agent commits to buyer agency
      ____ b.   unless the agent and buyer sign an agency agreement
      ____ c.   when the agent is considered a transaction broker
      ____ d.   a and b

7.    When you have a buyer agent representing you, the agent has fiduciary duties:

      ____ a. to the buyer
      ____ b. to the seller
      ____ c. both a and b

8.    Fiduciary duties include:

      ____ a. undivided loyalty
      ____ b. obedience
      ____ c. reasonable care and diligence
      ____ d. confidentiality
      ____ e. full disclosure
      ____ f. accounting
      ____ g. all the above

9.    When a buyer agent avoids advancing any interest adverse to the client’s
      interest or conducting the clients business in such a way as to benefit the
      seller or his/her own interest, the agent is carrying out:

      ____ a. confidentiality
      ____ b. accounting
      ____ c. undivided loyalty

10.   When the buyer agent acts by following and abiding all lawful instructions
      subject to the client’s control, but not exceeding the scope of authority
      conferred by the client, the agent is carrying out:

      ____ a. obedience
      ____ b. reasonable care and diligence
      ____ c. accounting

11.   When the buyer agent is protecting the client from reasonable risk of harm,
      recommends that the client obtain expert advice or assistance when the
      client’s needs are outside the scope of the agents expertise, the agent is

      ____ a. obedience
      ____ b. reasonable care and diligence
      ____ c. undivided loyalty

12.   When a buyer agent avoids communicating personal information about the
      client which would put the client at a disadvantage with others involved with
      any transaction, the agent is carrying out:

      ____ a. full disclosure
      ____ b. reasonable care
      ____ c. confidentiality

13.   When the buyer agent provides all information, that he/she knows, concerning
      the transaction and property that might affect the decision a client makes, the
      agent is carrying out:

      ____ a. full disclosure
      ____ b. accounting
      ____ c. reasonable care

14.   When the agent safeguards money or property held on behalf of the client,
      the agent is carrying out:

      ____ a. reasonable care
      ____ b. accounting
      ____ c. obedience

15.   Buyer agency representation can be created by:

      ____ a. written agreement
      ____ b. unintentional series of actions
      ____ c. inadvertently series of actions
      ____ d. all the above
16.   The agent that can serve a buyer without the conflicts caused by a brokerage
      that lists homes for sale is:

      ____ a. a designated buyer agent
      ____ b. an exclusive buyer agent
      ____ c. a transaction broker

17.   A buyer agent should be:

      ____ a. trusting
      ____ b. candid
      ____ c. results oriented
      ____ d. all the above

18.   A buyer agent should be:

      ____ a. patient
      ____ b. caring
      ____ c. ambitious
      ____ d. all the above

19.   For the best home search results in a normal market buyers should compress
      their search to:

      ____ a. 2-3 days
      ____ b. 2-3 weeks
      ____ c. 2-3 months

20.   If a buyer can not find a suitable home among those on the market when they
      start looking at homes, the buyer will most likely:

      ____ a. eventually pay close to asking price
      ____ B. eventually find a real bargain

21.   When a buyer is ready to make an offer on a property, the best person to look
      To seek advice from is:

      ____ a. your exclusive buyer agent
      ____ b. your father or mother
      ____ c. close friend

22.   When there is a major problem with the property that problem should be:

      ____ a. dealt with after the inspection
      ____ b. addressed for satisfactory improvement in the contract

23.   Under most circumstances which inspections should a buyer conduct after
      the contract is signed by both parties?

      ____ a. structural
      ____ b. mechanical
      ____ c. termite
      ____ d. all the above

24.   New home developments with model homes on display attracting hundreds of
      buyers on the weekend are:

      ____ a.” bated traps” for buyers
      ____ b. are great for meeting buyer agents

25.   If a buyer completes and signs an information card at new home developments
      he/she may be giving up their right to:

      ____ a. secure a buyer agent
      ____ b. to be represented
      ____ c. a and b

26.   The agent working new home developments will be:

      ____ a. representing the seller
      ____ b. may represent the buyer
      ____ c. a and b

27.   To avoid costly mistakes pre-planning for buying or building a new home
      should start with:

      ____ a. meeting with the builder
      ____ b. meeting with a buyer agent
      ____ c. meeting with your banker

28.   Your budget for a new house should include a fund of _____ percent over the
      price of the home for upgrades or unexpected construction costs.

      ____ a. 5-10 %
      ____ b. 10-15 %
      ____ c. 15-20 %

28.   When searching for a buyer agent to represent you for purchasing or
      building a new home, which of the following are desirable?

      ___ a.    strong knowledge of residential construction
      ___ b.    new home contract negotiation experience
      ___ c.    project management skills
      ___ d.    assertiveness
      ___ e.    all the above

29.   When working in a consulting role a buyer agent should:

       ___ a.   conduct research
       ___ b.   lead
       ___ c.   advise
       ___ d.   all the above

30.   Most buyer agents from firms that lists homes for sale would not
      do all the duties, identified in the educational topics, for a buyer agent

      ___ a. they wont take the time
      ___ b. too much liability for agents and broker

31.   Good sources for reviewing new home plans before you must meet
      with a builder to build a new home are:

      ___ a.    builders websites
      ___ b.    architectural firm website, specializing in residential design
      ___ c.    book stores and libraries
      ___ d.    all the above

32.   The most economical cost of securing house plans is:

      ___ a. employing an architect to design the plan
      ___ b. purchase a plan already designed by an architectural design
             firm, modify if necessary

33.   Be sure you want to carry out the contract before you:

      ___ a.   sign the contract
      ___ b.   deliver the non-refundable earnest money
      ___ c.   have loan approval
      ___ d.   all the above

34.   When meeting with vendors for carpet, cabinets, etc.:
      ___ a. know what the contract allowances are
      ___ b. secure written invoices or signed documents
             on all costs over allowances
      ___ c. a & b

35.   When using a “construction perm” loan the buyer can:

       ___ a. avoid non-refundable earnest deposits
       ___ b. avoid duplicated loan costs
       ___ c. a & b

36.   To avoid builder delays and additional finance costs on a
      “construction perm” loan include a contract clause that the
       builder will:

       ___ a. complete all work by a certain date
       ___ b. pay for all financing costs after a mutually agreeable date

37.   When planning to use a “construction perm” loan ask the builder to
      to provide a bid:

       ___ a. with financing costs
       ___ b. without finance costs
       ___ c. a & b

38.    When building a new home most buyers will want to visit the
       build site frequently, by doing so:

       ___ a. most builders are cooperative
       ___ b. most builders view this as causing unnecessary problems

39.    When there is a need to have the builder make corrections, the need
       should be communicated by:

       ___ a. the buyer agent
       ___ b. the buyers

40.   The buyers and their agent should visit the construction project:

       ___ a. when engineer has staked out the location of home on lot
       ___ b. when the footings have been poured
       ___ c. when forms have been removed and foundation damp-proofed
              and drainage system installed
       ___d. all the above
41.   When the framing is completed, including installation of the
      roofing, the site should be visited to observe:

      ___ a.   all exterior and interior walls
      ___ b.   rafter installation
      ___ c.   caulk and foaming
      ___ d.   all the above

42.   If you employ an inspector for a build job he/she should start:

      ___ a. at the beginning of the project
      ___ b. at the completion of the project

43.   On the purchase of resale homes, after the home has been inspected
      and unacceptable conditions negotiated the buyers and agent should:

      ___ a. visit home to ensure work has been completed
      ___ b. secure all invoices and warranties
      ___ c. a & b

44.   The title commitment is a promise by the insurance company to:

      ___ a. provide a “Fee Simple” interest in the property
      ___ b. insure the title against defects, liens, encumbrances
             and adverse claims
      ___ c. a & b

45.   For a through review of the commitment policy the buyer should seek advise

      ___ a. buyer agent
      ___ b. an attorney

46.   Prior to the closing meeting the buyer should expect the buyer agent to:

      ___ a. review the settlement statement
      ___ b. review the contract for all requirements
      ___ c. a & b

47.   If you feel you should read all the closing documents you should:

      ___ a. take time to do so at the closing
      ___ b. request copies of all documents and read prior to the closing

48.   If you are closing with an (a-) or (b) high risk loan you should:
      ___ a. be informed of any prepayment penalties
      ___ b. understand all costs related to the loan
      ___ c. a & b

49.   Unless you have a 20 % down payment and pay a fee your
      mortgage company will set up an escrow fund for payment of:

      ___ a. home owners insurance
      ___ b. real estate tax
      ___ c. a & b

50.   Deeds are filed by the title company or attorney after the closing and at:

      ___ a. city recording office
      ___ b. county recording office

                         TRUE AND FALSE QUESTIONS

Please check the correct answer.

___ T ___ F 1.    When the agent does not represent the buyer he/she has no
                  responsibility to protect the buyer in any aspect of a home
                  purchase transaction.

___ T ___ F 2.    The National Association of Realtors (NAR) and state realtor
                  associations have the power to control the real estate industry.

___ T ___ F 3.    Many agents working for brokers that list homes for sale fraudulently
                  claim to be exclusive buyer agents.

___ T ___ F 4.    The use of “exclusive buyer agency agreements,” which limits the
                  the buyer from purchasing a home through another agent while the
                  agreement is active, lets agents appear to be working as exclusive
                  buyer agents.

___ T ___ F 5.    An Oklahoma Supreme Court Judge has stated that exclusive buyer
                  buyer brokers can provide a higher level of service than designated
                  buyer agents.

___ T ___ F 6.    While most people would think that real estate commissions protect
                  all real estate consumers (buyers and sellers), the reality is that they
                  assist the power real estate brokers in the industry with controlling the

___ T ___ F 7.     Representation is significant in that it identifys who the agent works
                   for and the duties the agent is responsible for.

___ T ___ F 8.     In the real estate industry an agent either represents the seller or the

___ T ___ F 9.    If the agent is working under a “dual agency” or “transaction broker”
                  classification the agent does not represent either party and has limited
                   responsibilities to the parties.

___ T ___ F 10.   A buyer agency agreement should specify how the agent is to be

___ T ___ F 11.    A buyer agency agreement should include the duties of the agent
                   and the responsibilities of the client.

___ T ___ F 12.    While active, an exclusive agency agreement prohibits the buyer
                   from purchasing a home through another agent.
___ T ___ F 13.    While it is not the preferred method of representation if you must
                   use a buyer agent associated with a broker that list homes for sale
                   it is better than using an agent who represent the seller.

___ T ___ F 14.    A buyer should always seek to secure an agent from an exclusive
                   buyer broker when there is one that serves the community.

___ T ___ F 15.    A buyer should never buy a home through the agent that has the
                   property listed (sign in the yard) or an agent working at a new
                   home development.

___ T ___ F 16.    To learn whether an agent can be trusted you should check references
                   among the past clients of the agent.

___ T ___F 17.     The educational topic “Selecting an Agent” provides a list of 20
                   questions to use to prepare for interviewing an agent.

___ T ___F 18.     In many communities it is important to have a radon inspection
                   conducted on the home you are purchasing.

___ T ___F 19.     Buyers should secure an inspector that is certified by ASHI and
                  covered by an appropriate amount of errors and omissions

___ T ___F 20.     It is not necessary to have a newly constructed home inspected
                  because city/county inspectors inspect the home for building code

___ T ___F 21.    It is not a good decision to have a friend inspect your home.

___ T ___F 22.    All buyers should consider their basic and desired home needs before
                  starting the search for newly constructed homes.

___ T ___F 23.    It is important to consider how your home needs will change in 5-10-
                  15 years before purchasing a home.

___ T ___F 24      If buyers want to be tough negotiators they must not be afraid to risk
                  losing the home.

___ T ___F 25. Loan approval documents submitted with an offer to purchase should
               not show approval for loan greater than what is stated in the offer.

___ T ___F 26. When you sign a contract it is assumed you have read the contract.
___ T ___F 27. Verbal agreements are enforceable when purchasing real estate.

___ T ___F 28. Some homes may be a good buy at the listed price.

___ T ___F 29. The educational topic “Search and Purchase of the Right Home”
               reveals 22 conditions the agent and buyer should check when taking a
               second look at the property they want to buy.

___ T ___F 30. When buyers have found the home they want they should not
               procrastinate in making an offer.

___ T ___F 31. Home buyers are able to finance 100 % of the cost of the home.

___ T ___F 32. Buyers should ask their buyer agent to assist them with their loan

___ T ___F 33. If you must use a high risk loan, with a prepayment penalty, you
               should assess whether you can handle the high risk associated
               with the loan.

___ T ___F 34.    Interest only loans become problem loans when the home values go

___ T ___F 35. Meeting with a buyer agent you should determine all your basic needs
               for the home you plan to build.

___ T ___F 36. The educational topic “Buying or Building a New Home” includes 20
               20 steps that should be followed when buying or building a new home.

___ T ___F 37.    When meeting with a builder your agent should secure a list of all
                  upgrade costs, signed by the builder.

___ T ___F 38.     If your buyer agent has not used the builder on previous contracts,
                   references should be checked by the buyer and the agent.

___ T ___F 39. The educational topic “Buying or Building New Homes” has a list of
               20 questions to use in checking builder references.

___ T ___F 40.     When checking references it is highly unlikely that you will get
                   positive comments from all buyers.

___ T ___F 41.     The educational topic “Buying or Building New Homes” includes a
                   list of 14 job duties for a buyer agent.

___ T ___F 42.     When you must hire a buyer agent whose firm lists homes for sale,
                   the agent will most likely not be able to carry out all the duties
                   identified in the educational topic for hiring a buyer agent.

___ T ___F 43.     A disadvantage of using a “construction perm” loan is that the builder
                   may delay your building project to work on his own projects which
                   he is financing.

___ T ___F 44.     With the “construction perm” loan the builder is paid as specific
                   phases of the work is completed.

___ T ___F 45.     On resale homes, buyers should require that the sellers vacate the
                   the home prior to closing to allow the buyer to do a thorough walk-
                   through prior to closing.

___ T ___F 46.     The educational topic “The Walk-Through” includes a list of 18
                   items to be checked during the final walk-through.

___ T ___F 47.     Buyers should be concerned with the schedule of exceptions not
                   covered by the title insurance.

___ T. ___F 48.    Your buyer agent should be available at the closing of your home.

___ T. ___F. 49.    Buyers should delay or not sign documents if they are unsure of what
                   they are doing.

___ T ___F 50.     When purchasing a home from the agent that has the property listed
                   the agent has a responsibility to pass on all information the buyer
                   told the agent to the seller.

Please return the completed test to

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