Principles, Property, and Land Use Practice Question

Question

A broker is correcting a new licensee’s misunderstanding for the New Jersey Real Estate Salesperson Exam involving title insurance and New Jersey Real Estate Commission. Which statement is most accurate for exam purposes? (Item 140)

Answer choices

1. A. The requirement matters only when the buyer obtains institutional financing.
2. B. The affiliated licensee may handle the matter independently without broker responsibility.
3. C. Local custom controls even when a statute, regulation, contract, or disclosure rule applies.
4. D. Recognize protection against covered title defects in a way that fits New Jersey exam practice.

Correct Answer

D. Recognize protection against covered title defects in a way that fits New Jersey exam practice.

Explanation

The correct answer is D because title insurance requires candidates to recognize protection against covered title defects. The New Jersey 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: Principles, Property, and Land Use
• Objective: title insurance

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