To avoid triggering full disclosure under TILA when advertising financing availability on a listed property, which of the following statements must a real estate licensee avoid using?
Answer(s): D
Under the Truth in Lending Act (Regulation Z), advertising is regulated to prevent misleading credit offers.If an ad uses "triggering terms" (such as monthly payment amount, interest rate, down payment, or loan term), then full disclosure of all financing terms must be provided."Buy for less than $650 per month" is a triggering term because it specifies a monthly payment.General terms like "assumable loan," "owner financing," or "FHA/VA available" are permissible without full disclosure.Correct answer = D.
Truth in Lending Act (TILA), Regulation Z; NJ Real Estate Salesperson Study Guide, Chapter on Financing and Advertising Rules.
A property that contains a 2,500-square-foot house has a land value of $45,000. The house suffers from $7,000 of physical depreciation and $2,500 of functional obsolescence. If the replacement cost of the house is $75 per square foot, what is the value of the property?
Answer(s): C
NJ Real Estate Salesperson Study Guide, Chapter on Appraisal (Cost Approach Method).
A licensee listed a house for $187,500, and a dual agency does not exist. A buyer is willing to offer $184,000. The licensee explains that the seller will take no less than $186,500. The buyer agrees to offer $186,500. Did the licensee act properly?
Under fiduciary duties of a seller's agent in New Jersey:A licensee must act in the best interest of their client (the seller).The agent cannot disclose the seller's bottom line or confidential financial information without the seller's explicit consent.Disclosing "the seller will take no less than $186,500" violated confidentiality and the duty of loyalty.Thus, the licensee acted improperly.
NJREC Rules and Regulations; NJ Real Estate Salesperson Study Guide, Chapter on Agency Duties and Disclosure.
The primary intent of the statute of frauds is to:
Answer(s): A
The Statute of Frauds (as adopted in New Jersey) requires that certain contracts be in writing to be enforceable, including:Contracts for the sale of real estate.Leases longer than 3 years.Certain other long-term agreements.Its purpose is to prevent fraud and misunderstandings by requiring written evidence of important contracts.
N.J.S.A. 25:1-13; NJ Real Estate Salesperson Study Guide, Chapter on Contracts.
A broker is offering a $100 gift certificate at a jewelry store to all sellers who list with the broker during a specified time period. According to the New Jersey Real Estate License Law, such a promotion is prohibited because it:
Answer(s): B
According to NJ Real Estate Commission rules, brokers and salespersons may not:Offer prizes, gifts, or inducements that are contingent on entering into a listing agreement.This is considered an improper inducement under N.J.A.C. 11:5-6.4.Therefore, the prohibition is because the gift certificate is conditioned on the seller listing with the broker.
NJREC Rules and Regulations, N.J.A.C. 11:5-6.4 (Advertising and Inducements).
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