Agency and License Law Practice Question
Question
An agent compares two similar exam concepts for the Michigan Real Estate Salesperson Exam involving trust money and seller disclosure practice. Which response best applies the rule? (Item 191)
Answer choices
- A. A verbal understanding always replaces a written real estate requirement.
- B. The safest practice is to avoid written documentation so fewer questions are raised later.
- C. Handle client funds separately, promptly, and according to broker/state rules in a way that fits Michigan exam practice.
- D. A licensee may give legal conclusions instead of recommending qualified legal advice when uncertain.
Correct Answer
C. Handle client funds separately, promptly, and according to broker/state rules in a way that fits Michigan exam practice.
Explanation
The correct answer is C because trust money requires candidates to handle client funds separately, promptly, and according to broker/state rules. The Michigan 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: medium
- Domain: Agency and License Law
- Objective: trust money