The agent's action is a classic example of steering. Steering is the illegal practice of directing or channeling prospective buyers to or away from specific neighborhoods based on their protected class status (in this case, national origin and ethnicity). Even though the buyer initiated the request, the agent's compliance is a violation of the Fair Housing Act. The agent has an affirmative duty to provide housing options based on the buyer's objective, non-discriminatory criteria (e.g., price, size, amenities) without regard to the racial or ethnic composition of a neighborhood.

A. blockbusting: This is the illegal act of inducing homeowners to sell by making representations about the entry of persons of a protected class into a neighborhood.

B. pandering: This term is not a specific violation defined under the Fair Housing Act.

C. redlining: This is the illegal discriminatory practice by lenders or insurance companies of refusing to provide loans or insurance in specific geographic areas.

1. North Carolina Real Estate Commission. (2023). North Carolina Real Estate Manual. Chapter 8, Fair Housing, pp. 8-6, 8-7. The manual defines steering as "the illegal practice of channeling prospective buyers or tenants to or away from a particular neighborhood based on their race, color, religion, national origin, or other protected class." It clarifies that this is illegal even if the client requests it.

2. U.S. Department of Housing and Urban Development (HUD). (n.d.). Fair Housing - It's Your Right. HUD-328-F. Retrieved from HUD.gov. The official HUD documentation states, "Steering [is] the act of directing prospective home buyers toward or away from certain neighborhoods because of their race." This principle extends to all protected classes, including national origin.

3. Galster, G. C. (1990). Racial Steering by Real Estate Agents: Mechanisms and Motives. The Review of Black Political Economy, 19(1), 39–63. https://doi.org/10.1007/BF02717839. This academic article analyzes the practice of steering, noting that it occurs when agents "provide differential information or service to minority and white customers, which results in the customers' learning about available housing in neighborhoods that are racially segregated" (p. 40), confirming the agent's action in the scenario as steering.

According to North Carolina Real Estate Commission (NCREC) rules, the price and other material terms of an offer are the confidential property of the party who made the offer (the buyer/offeror). A listing broker, despite their fiduciary duty to the seller, is prohibited from disclosing these terms to a competing party to solicit a better offer unless they have received the express authority of the offering party. The seller's permission is insufficient as they do not own the confidential information contained within the buyer's offer. This rule maintains fairness and protects the buyer's negotiating position.

A. The seller cannot grant permission to disclose the confidential terms of an offer made by another party (the buyer).

C. The existence of multiple offers is a material fact that must be disclosed, but the specific terms of those offers remain confidential.

D. Disclosing the terms of any offer, including the highest, without the offeror's express permission is a violation of NCREC rules.

1. North Carolina Real Estate Commission. North Carolina Real Estate Manual (2023-2024 ed.). Chapter 8, Handling Offers and Closing, Section: "Disclosure of Offer Terms," pp. 8-10, 8-11. The manual explicitly states, "A broker is prohibited from disclosing the price or other material terms of an offer to a competing party without the express authority of the party making the offer."

2. North Carolina Administrative Code. Title 21, Chapter 58A, Section .0115, "Disclosure of Offers." The rule states: "(a) A broker shall not disclose the price or other material terms contained in a party's offer to purchase, sell, lease, rent, or option real property to a competing party without the express authority of the offering party."

3. UNC School of Government. North Carolina Real Estate Law and Practice, by Patrick K. Hetrick, James B. McLaughlin Jr., and Patricia A. Moylan. Chapter 10, "The Real Estate Contract," Section 10.5 "Duties of Agent in Offer and Acceptance Process." This text reinforces the principle that offer terms are confidential to the offeror and cannot be used as "leverage" with other buyers without the offeror's consent, citing NCREC Rule 58A .0115.

In North Carolina, the priority of liens is generally determined by the order of recordation under the "pure race" statute. However, certain liens are given statutory super-priority. Ad valorem property tax liens and special assessment liens are superior to all other liens, including mortgages, judgments, and mechanic's liens, regardless of when the other liens were recorded. This special status ensures that local governments can collect necessary revenue. Therefore, in a foreclosure sale, the ad valorem tax lien must be satisfied before any other lienholder receives proceeds.

B. Judgment lien: This is a general lien whose priority is determined by its date of docketing and is subordinate to property tax liens.

C. Mortgage lien: This is a specific lien whose priority is determined by its date of recordation and is subordinate to property tax liens.

D. Whichever lien was recorded first: This principle, known as the "race" statute in North Carolina, applies to most liens but is overridden by the statutory super-priority granted to property tax liens.

1. North Carolina General Statutes, Chapter 105, Subchapter II, Article 26. N.C.G.S. § 105-356(a)(1) explicitly states, "The lien of taxes imposed on real and personal property shall attach to real property at the time prescribed in G.S. 105-355(a). The priority of that lien shall be determined in accordance with the following rules: (1) The lien of taxes imposed under the provisions of this Subchapter shall be superior to all other liens, assessments, charges, rights, and claims of any and every kind in and to the real property to which the lien for taxes attaches regardless of the claimant and regardless of whether acquired prior to or subsequent to the attachment of the lien for taxes."

2. UNC School of Government, Coates' Canons Local Government Law Blog. In the article "Lien On Me: Property Tax Liens and the Machinery Act," (2019), author Christopher B. McLaughlin clarifies, "The Machinery Act grants property tax liens 'super-priority,' meaning they trump all other liens on the property, including the mortgage liens that are usually recorded long before the tax liens arise."

3. Hess, D. B. (2011). North Carolina Real Estate Manual. North Carolina Real Estate Commission. In the chapter on "Encumbrances and Liens," the manual details the priority of liens, establishing that real property tax liens and special assessment liens are the highest priority liens against real property and are paid first from the proceeds of a foreclosure sale. (Specific section: Chapter 8, "Liens").

According to North Carolina Real Estate Commission rules, a licensed real estate broker may only receive compensation for brokerage activities from the broker-in-charge (BIC) with whom they are affiliated. In this scenario, the commission is first paid by the seller to the listing firm (XYZ Realty). XYZ Realty then pays the cooperating brokerage firm (ABC Realty) its share of the commission. Finally, the supervising broker-in-charge at ABC Realty is legally responsible for disbursing the earned portion of the commission to the non-provisional broker who represented the buyer. This ensures proper accounting and supervision of all brokerage compensation.

A. The buyer client: The buyer's agent is compensated through their firm. Direct payment from a client to an affiliated broker is generally prohibited by commission rules.

B. The seller: The seller pays the total commission to the listing firm (XYZ Realty) at closing, not directly to the individual agent from the cooperating firm.

C. The qualifying broker of XYZ Realty: The listing firm (XYZ Realty) pays the cooperating firm (ABC Realty) on a firm-to-firm basis, not the individual agent at the other company.

1. North Carolina Real Estate Commission. (2024). North Carolina Real Estate Manual.

Chapter 8, "Real Estate Brokerage," Section on "Brokerage Compensation": This chapter details the flow of commission payments. It clarifies that compensation is paid to the firm and then disbursed by the broker-in-charge to the affiliated broker. Specifically, it states, "A broker affiliated with a firm as an employee or independent contractor must be compensated for brokerage services by the firm and not by a principal or other party to a transaction."

Reference to N.C. General Statute § 93A-6(a)(8): This statute gives the Commission the power to discipline a licensee for "Accepting a commission or valuable consideration as a real estate broker for the performance of any of the acts specified in this Article from any person except his or her broker-in-charge or licensed real estate brokerage firm."

2. North Carolina Administrative Code. (2024). Title 21, Chapter 58, Subchapter A, Section .0110.

21 NCAC 58A .0110(a) - Brokerage Fees and Compensation: This rule explicitly states: "A broker shall not receive any compensation, incentive, bonus, rebate, or other consideration of more than nominal value in connection with a real estate transaction from any person other than the broker with whom he or she is affiliated for any act for which a license is required..." This directly supports that the non-provisional broker must be paid by their supervising BIC at ABC Realty.

According to the North Carolina Real Estate Commission (NCREC) Rule A .0106(a), a broker is required to deliver copies of any executed written instrument, such as a purchase agreement, to all parties involved. The rule specifies that this delivery must be made "immediately, but in no event later than three days from the date of execution." This ensures that clients and customers promptly receive official documentation of their legally binding agreements, allowing for timely review and record-keeping.

A. 24 hours: While brokers are encouraged to act "immediately," the rule provides a maximum timeframe of three days, not 24 hours.

B. 2 days: This is an incorrect timeframe; the NCREC rule explicitly allows up to three days for the delivery of executed documents.

D. 4 days: This timeframe exceeds the maximum three-day period mandated by NCREC Rule A .0106 and would constitute a violation.

1. North Carolina Real Estate Commission. (2023). North Carolina Real Estate License Law and Commission Rules. Rule A .0106(a), "Delivery of Instruments," Page 78. Retrieved from ncrec.gov.

Quote: "Every broker shall immediately, but in no event later than three days from the date of execution, deliver to the parties thereto copies of any written agency agreement, contract, offer to purchase, lease, or option."

2. North Carolina Real Estate Commission. (2023). North Carolina Real Estate Manual. Chapter 8, "Contracts and Closing," Section: "Handling Transaction Documents," Page 8-19.

Reference: This section explains the practical application of Rule A .0106, reiterating that brokers have a duty to deliver copies of contracts and other instruments to their clients no later than three days after execution.

The cost approach is a real estate valuation method that determines value by calculating the cost to replace the property's improvements, minus accrued depreciation, plus the value of the land. The formula is: (Reproduction/Replacement Cost New) - (Accrued Depreciation) + (Land Value) = Property Value. The question provides the cost to rebuild ($598,720), which is the first component. Therefore, the appraiser's next steps are to subtract the estimated loss in value due to depreciation and then add the estimated value of the land itself.

A. Labor costs are already factored into the total cost to rebuild; adding them again would be double-counting.

C. Land value is a fundamental component of the property's total value and must be added, not subtracted.

D. This option incorrectly omits the crucial step of subtracting accrued depreciation from the cost of the improvements.

1. North Carolina Real Estate Commission. (2023). North Carolina Real Estate Manual. Chapter 16, Real Property Valuation, Section: "The Cost Approach." The manual explicitly outlines the formula as: "Estimate the cost of the improvements as if new... Estimate the amount of accrued depreciation... Deduct the accrued depreciation from the cost new... Estimate the value of the land... Add the estimated land value to the depreciated cost of the improvements." This directly supports subtracting depreciation and adding land value.

2. The Appraisal Institute. (2013). The Appraisal of Real Estate (14th ed.). Chicago, IL. In Chapter 29, "The Cost Approach," the text states, "The basic formula for the cost approach is: Reproduction or replacement cost of the improvements - Accrued depreciation + Site value = Property value" (p. 570). This is the authoritative standard in appraisal practice.

3. Ling, D. C., & Archer, W. R. (2018). Real Estate Principles: A Value Approach (6th ed.). McGraw-Hill Education. Chapter 7, "Valuation Using the Cost Approach," presents the procedure as: "Estimated cost to construct structure today – Estimated accrued depreciation = Depreciated cost of building improvements + Estimated value of the site = Indicated market value by the cost approach." This university-level textbook confirms the required steps.

Under North Carolina Real Estate License Law and Commission Rules, a broker has a duty to disclose all material facts to all parties in a transaction. A material fact is any information that could influence a reasonable person's decision to buy, sell, or lease. Major highway changes are a classic example of a material fact because they can significantly affect a property's value, desirability, noise levels, and accessibility. This duty is proactive and absolute; it is not contingent on being asked by a party, receiving permission from the seller, or a specific project timeline.

A. The broker's duty to disclose material facts is proactive; they cannot wait to be asked before revealing such important information.

B. The legal obligation to disclose material facts supersedes any instruction from the seller. A seller cannot direct a broker to conceal a material fact.

D. The materiality of a major infrastructure project is not determined by an arbitrary one-year completion window. The existence of the plan itself is the material fact.

1. North Carolina Real Estate Commission. (2023). North Carolina Real Estate Manual.

Chapter 8, "Real Estate Brokerage and the Law of Agency," Section: Duties to Third Parties. This section details the broker's duty to disclose all material facts to all parties in the transaction, which includes facts relating directly to the property, such as "proposed zoning changes, or the planned construction of a new highway or airport." The duty is described as being owed to all parties, not just the client.

2. North Carolina Administrative Code, Title 21, Chapter 58, Rule A .0114(a).

21 NCAC 58A .0114(a) "Disclosure of Material Facts": This rule explicitly states, "A broker shall disclose to any party to a real estate transaction any material fact about the property proposed for transfer or the transaction of which the broker has knowledge or should reasonably have acquired knowledge..." This establishes the legal requirement for disclosure to all parties.

3. UNC School of Government. (2012). North Carolina Real Estate Law.

Chapter 10, "Duties of Real Estate Agents." This text, used in university-level instruction, clarifies that material facts include "external factors affecting the property," providing examples like planned highway construction. It reinforces that this disclosure duty is owed to third parties (e.g., buyers) and is not waivable by the agent's principal (the seller).

The practice described is redlining. Redlining is an illegal, discriminatory practice in which a lender refuses to make loans or provide other financial services for properties in specific geographic areas, based on the race, ethnicity, or other protected characteristic of the residents, rather than on an individual applicant's creditworthiness or the property's qualifications. The bank's refusal to lend in a neighborhood due to the ethnic background of its residents is a classic example of redlining, which is a direct violation of the federal Fair Housing Act and the Equal Credit Opportunity Act.

A. blockbusting: This is the illegal practice of inducing homeowners to sell by creating fear that minority groups are moving into the area, which will lower property values.

B. boycotting: This is an antitrust violation where competitors agree not to do business with a specific firm or individual, not a discriminatory lending practice.

D. steering: This is the illegal act of guiding prospective homebuyers toward or away from certain neighborhoods based on their protected class status.

1. North Carolina Real Estate Commission. (2023). North Carolina Real Estate Manual (2023-2024 ed.). Chapter 8, Fair Housing and Ethical Practices, pp. 8-10. The manual defines redlining as the practice of "refusing to make mortgage loans or issue insurance policies in specific areas for reasons other than the economic qualifications of the applicants."

2. U.S. Department of Housing and Urban Development (HUD). (n.d.). Fair Lending: Redlining. Retrieved from the official HUD website. The site states, "Redlining is an illegal practice in which lenders avoid providing services to individuals living in communities of color because of the race or national origin of the residents in that community."

3. U.S. Department of Justice. (n.d.). The Fair Housing Act. Retrieved from the official DOJ website, Civil Rights Division. The Act, codified at 42 U.S.C. §§ 3601-3619, makes it unlawful to "discriminate in the terms, conditions, or privileges of sale or rental of a dwelling, or in the provision of services or facilities in connection therewith, because of race, color, religion, sex, familial status, or national origin," which includes the provision of mortgage loans.

The legal standard for determining if an item of personal property has become a fixture (part of the real property) is the "Total Circumstances Test." This test evaluates several factors to ascertain the objective intent of the person who attached the item. The primary considerations are the intention of the annexor, the character of the annexation (method of attachment), the adaptation of the item to the use of the property, and the relationship of the parties. The cost or monetary value of the item is not a relevant legal factor in this determination.

A. method of attachment. The way an item is attached—whether permanently or temporarily and whether its removal would cause damage—is a critical factor in the Total Circumstances Test.

C. intent of the person who attached it. The objective intent of the annexor is the most significant factor courts consider when determining if an item is a fixture.

D. item's adaptability. How an item is adapted for use with the specific property (e.g., custom-built shelving) is a key indicator of the intent for it to be a permanent addition.

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1. North Carolina Real Estate Commission. (2023). North Carolina Real Estate Manual. Chapter 2, Basic Real Estate Concepts, Section: "Fixtures," pp. 2-6 to 2-8. The manual details the "Total Circumstances Test" used in North Carolina, which includes intent, method of attachment (character of the annexation), and adaptation to the use of the land. It makes no mention of the item's cost as a determining factor.

2. Korngold, G. (2014). Private Land Use Arrangements: Easements, Real Covenants, and Equitable Servitudes. Carolina Academic Press. In discussions on property law principles, the text outlines the classic tests for fixtures (annexation, adaptation, and intention), which are universally recognized in U.S. property law and form the basis of the NCREC's teachings. The cost of the chattel is consistently omitted from this legal analysis.

3. UNC School of Government. (2012). Introduction to North Carolina Property Tax Listing and Assessing. Chapter 3, "What is Taxable? The Concept of Property," p. 3-10. This publication, in discussing the distinction between real and personal property for tax purposes, explains the fixture test, stating, "The North Carolina courts have developed what is called the 'total circumstances' test... The three main factors are: (1) the manner in which the item is attached to the real property; (2) the character of the item and its adaptation to the real property; and (3) the intention of the party who attached the item to the real property." Cost is not included as a factor.

In an installment land contract (also known as a contract for deed), the seller provides financing to the buyer. The seller retains legal title to the property as security for the loan, while the buyer receives equitable title at the time the contract is signed. Equitable title grants the buyer the right to possess and use the property (possession) and the right to obtain full legal ownership (legal title) once all the terms of the contract, including making all payments, have been fulfilled. The seller is obligated to transfer the deed and legal title upon the buyer's completion of the contract.

A. The buyer typically gains possession and the right to occupy the property immediately upon signing the contract.

C. The seller retains legal title as security; the buyer only receives legal title after fulfilling the contract, not immediately.

D. The contract is for the purchase of the entire real property, which includes the land and any improvements, such as a house.

1. North Carolina Real Estate Commission. (2023). North Carolina Real Estate Manual. Chapter 10, Financing Real Estate, p. 328. "Under an installment land contract... The buyer (vendee) has an equitable interest in the property (equitable title) and is entitled to possession of the property... The seller (vendor) retains legal title to the property during the contract term as security."

2. Bluestein, F. S. (2010). Contracts for Deed in North Carolina. UNC School of Government, Community and Economic Development Bulletin No. 1. p. 1. "Under a contract for deed, the seller retains legal title to the property until the buyer has paid the entire purchase price. The seller delivers the deed to the buyer only after the final payment has been made. The buyer has the right of possession and is said to have 'equitable title' to the property."

3. Webster, J. A., Jr., & Brough, P. (2011). Webster's Real Estate Law in North Carolina (6th ed.). LexisNexis. § 14.03[1]. This treatise explains that in an installment land contract, the vendee (buyer) is considered the equitable owner of the land, while the vendor (seller) holds the legal title in trust for the vendee as security for the purchase money.