Fair Housing, Practice, and Disclosures Practice Question
Question
A license applicant is reviewing a practice scenario for the Indiana Real Estate Broker Exam involving unauthorized legal advice and Indiana Real Estate Commission. Which answer best reduces risk? (Item 64)
Answer choices
- A. Client funds may be mixed with business funds if the broker reconciles the account later.
- B. The issue can be ignored if the parties want to close quickly.
- C. The rule applies only to commercial transactions and never to residential transactions.
- D. Avoid drafting legal rights or giving legal opinions beyond license authority in a way that fits Indiana exam practice.
Correct Answer
D. Avoid drafting legal rights or giving legal opinions beyond license authority in a way that fits Indiana exam practice.
Explanation
The correct answer is D because unauthorized legal advice requires candidates to avoid drafting legal rights or giving legal opinions beyond license authority. The Indiana reference keeps the scenario tied to state licensing practice, while the other options rely on unsafe assumptions about oral custom, escrow, client preference, independent licensee authority, or ignoring written duties.
Question details
- Difficulty: hard
- Domain: Fair Housing, Practice, and Disclosures
- Objective: unauthorized legal advice