Authentic Real Estate Certification Exam Massachusetts-Real-Estate-Salesperson Questions Answers

The correct answer is B, Buyer. Massachusetts Board buyer-agency guidance explicitly recognizes that compensation alone does not create an agency relationship.

The broker ' s representation is determined by the agency agreement, disclosures, informed consent, and conduct—not simply by which party ultimately funds the broker ' s compensation.

Thus, a buyer ' s broker can remain the fiduciary representative of the buyer even where compensation is paid through a seller concession or another lawful transaction structure.

The broker continues to owe the buyer obligations such as loyalty, confidentiality, disclosure, reasonable care, accountability, and obedience to lawful instructions.

Payment by the seller does not automatically create dual agency. Dual representation requires the separate legal consent process described by Massachusetts agency law.

Study Guide Reference: Agency — Buyer Agency and Compensation.

An exclusive right-to-sell listing guarantees that the broker will receive a commission no matter who finds the buyer — even if the owner sells the property themselves. If the broker had an exclusive right-to-sell listing with the owner, the broker is entitled to a commission if the property sells during the listing period, regardless of whether the broker was involved in the sale or not.

Exclusive agency listing only entitles the broker to a commission if they or another agent find the buyer; if the owner sells the property themselves, they do not owe the broker a commission.

Open listing allows the owner to sell the property themselves without owing the broker a commission unless the broker finds the buyer.

Net listing is illegal in Massachusetts as it could encourage brokers to manipulate the sale price for their own benefit.

Thus, the broker is entitled to a commission if the listing was an exclusive right-to-sell.

The correct answer is B. Escrow funds are held by the broker as money belonging to others during the pendency of the transaction. The broker has no personal claim to that money merely because it has been deposited into the brokerage escrow account.

Massachusetts regulation 254 CMR 3.10 requires transaction money held by a broker to be deposited into an escrow account unless the parties have agreed otherwise in writing. The broker remains responsible until the transaction is consummated or terminated, at which point a proper accounting and distribution must be made.

Therefore, deposit money should not casually be described as automatically belonging outright to either buyer or seller while contractual rights remain unresolved. Its ultimate disposition depends on performance, termination provisions, valid agreements between the parties, or potentially legal resolution of a dispute.

A salesperson may not hold client funds independently; deposit money received must be promptly turned over to the employing broker.

Study Guide Reference: Massachusetts License Law — Client Funds, Escrow Accounts and Deposit Handling.