Fair Housing, Practice, and Disclosures Practice Question

Question

A salesperson notices a possible compliance problem for the Michigan Real Estate Salesperson Exam involving risk documentation and agency and trust-money compliance. Which statement is most accurate for exam purposes? (Item 47)

Answer choices

1. A. The rule applies only to commercial transactions and never to residential transactions.
2. B. Client funds may be mixed with business funds if the broker reconciles the account later.
3. C. Use written records and timely disclosure to reduce transaction disputes in a way that fits Michigan exam practice.
4. D. The issue can be ignored if the parties want to close quickly.

Correct Answer

C. Use written records and timely disclosure to reduce transaction disputes in a way that fits Michigan exam practice.

Explanation

The correct answer is C because risk documentation requires candidates to use written records and timely disclosure to reduce transaction disputes. 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: Fair Housing, Practice, and Disclosures
• Objective: risk documentation

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