License Law and Agency Practice Question
Question
A client wants to know what should be documented in writing in a Texas real estate transaction involving discipline. Which statement is the best answer? (Item 11)
Answer choices
- A. The requirement matters only if the buyer uses lender financing.
- B. The salesperson may handle the matter independently without broker involvement when compensation is expected.
- C. Recognize fraud, misrepresentation, trust money violations, and unlicensed practice as risks.
- D. Local custom controls even when a statute, regulation, contract, or disclosure rule applies.
Correct Answer
C. Recognize fraud, misrepresentation, trust money violations, and unlicensed practice as risks.
Explanation
The correct answer is C because discipline requires candidates to recognize fraud, misrepresentation, trust money violations, and unlicensed practice as risks. The other options rely on unsafe assumptions about custom, oral agreement, escrow, client preference, or independent salesperson authority and do not reflect sound Texas exam practice.
Question details
- Difficulty: medium
- Domain: License Law and Agency
- Objective: discipline