Contracts, Finance, and Transfer Practice Question
Question
A supervising broker is reviewing a transaction file for the Tennessee Affiliate Broker Exam involving financing contingency and agency and property condition disclosure practice. Which statement is the best answer? (Item 45)
Answer choices
- A. Understand buyer protection tied to loan approval or financing terms in a way that fits Tennessee exam practice.
- B. Client funds may be mixed with business funds if the broker reconciles the account later.
- C. The issue can be ignored if the parties want to close quickly.
- D. The rule applies only to commercial transactions and never to residential transactions.
Correct Answer
A. Understand buyer protection tied to loan approval or financing terms in a way that fits Tennessee exam practice.
Explanation
The correct answer is A because financing contingency requires candidates to understand buyer protection tied to loan approval or financing terms. The Tennessee 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: easy
- Domain: Contracts, Finance, and Transfer
- Objective: financing contingency