Maine Real Estate Practice Test

Correct: A Protect consumers through licensee regulation

MREC's primary purpose is protecting the public by licensing qualified applicants, investigating violations, and imposing sanctions on licensees who violate the law. It does not set property values, negotiate commissions, or approve loans.

Correct: A One per agency

Each real estate agency in Maine must have exactly one designated broker who is responsible for supervising all licensees within that agency. If the designated broker retires, another qualified broker must be appointed before the agency can continue operating.

Correct: A One client only

Under single agency in Maine, all licensees in the brokerage represent the same one client. Unlike appointed agency, no licensee within the firm can represent the opposing party in the same transaction.

Correct: B At the first substantive communication

Maine Commission Rule Chapter 410, Section 9 requires the Real Estate Brokerage Relationship Disclosure form to be furnished at the first 'substantive communication' with a buyer or seller. This includes face-to-face, written, or electronic contact about residential real property.

Correct: C A federally insured institution authorized in Maine

Under 32 M.R.S. Section 13178, every agency must keep client funds in a federally insured account at a financial institution or credit union authorized to do business in Maine, as defined in Title 9-B, Section 131. The institution does not have to be headquartered in Maine — an out-of-state bank or credit union that maintains a Maine branch qualifies — but it must be authorized in the State, and the account must be identified as a real estate trust account.

Correct: A Before or at time of offer

Maine Title 33, Sections 171-176 requires sellers of 1-4 unit residential property to provide a written Property Disclosure Statement to prospective buyers before or at the time an offer is made. This gives buyers material information to make an informed decision.

Correct: C No, listings must be in writing

Maine requires all listing and brokerage contracts to be in writing to be enforceable. A verbal listing agreement, regardless of the parties' intent, cannot be enforced in court. This protects both the seller and the brokerage from disputes over terms.

Correct: D No, the agency trade name is required

Maine requires every real estate advertisement to contain the agency's trade name as licensed by the Commission. In print and similar media the name must be prominently displayed; for internet advertising — which the rule defines to include social media — the agency name must prominently appear or be readily accessible (Commission Rule Chapter 410, Section 1(2)). A post that omits the agency name entirely satisfies neither standard and is non-compliant.

Correct: A Tenancy in common

Maine law defaults to tenancy in common when the deed does not specify the form of co-ownership. Unlike joint tenancy, tenancy in common carries no right of survivorship, and each owner's share passes through their estate at death. Joint tenancy must be expressly created with survivorship language.

Correct: D No one; Maine mandates no specific closing agent

Maine does not require an attorney or any particular person to conduct a residential closing. In practice, closings are handled by attorneys or by title companies and their title agents, and the parties may choose. Under Title 9-A, Section 3-311, if a lender requires an attorney for the title search, the buyer gets to select that attorney.

Correct: B Two months' rent

Maine limits the security deposit to two months' rent for all residential rental units under Title 14 §6032. This cap protects tenants from excessive upfront costs while allowing landlords reasonable security against damage or unpaid rent.

Correct: D Creation, management, and termination of condos

Maine's Condominium Act provides the legal framework for forming, governing, and dissolving condominiums. It covers the declaration, bylaws, common elements, assessments, unit owner rights, and the process for terminating a condominium regime. It applies to all types of condominiums, not just commercial ones.

Correct: A Yes, 3 or more lots in 5 years is a subdivision

Maine defines a subdivision as dividing a tract into 3 or more lots within any 5-year period, counting from September 23, 1971 onward. Four lots in three years clearly meets this threshold. The definition includes division by sale, lease, or development regardless of lot size, with limited exceptions.

Correct: B Office of Professional and Occupational Regulation

MREC functions within the Office of Professional and Occupational Regulation (OPOR), which is part of the Department of Professional and Financial Regulation (DPFR). The Commission's Director handles day-to-day administrative operations such as processing applications and complaints.

Correct: C Negotiating a sale for compensation

Negotiating the sale, purchase, or exchange of real property on behalf of another person for compensation requires a license. Selling or managing your own property does not require a license because you are acting as a principal, not an agent.

Correct: B Written authorization from the DB

Under 32 M.R.S. Section 13278, appointed agency operates through the designated broker, who appoints licensees in writing to the client, and clients must be informed of the agency's appointed-agent policy and give written consent to it in advance of entering into a brokerage agreement (Commission Rule Chapter 410, Section 8). Some other states call this model designated agency, but in Maine 'designated broker' means the broker in charge of the agency.

Correct: D Yes, electronic contact qualifies

Substantive communication in Maine includes electronic contact, not just face-to-face meetings. Sending detailed property information via email constitutes substantive communication, triggering the requirement to furnish the Brokerage Relationship Disclosure form.

Correct: B No, it must be named a trust account

Maine requires trust accounts to be specifically named as 'real estate trust account.' Labeling an account as an operating fund does not meet this requirement and could lead to commingling of client funds with business operating funds, which is prohibited.

Correct: B 1-4 unit residential property

Maine's Property Disclosure Statement requirement applies to sellers of 1-4 unit residential property under Title 33, Sections 171-176. Commercial properties, vacant land without residential structures, and properties with more than 4 units are not covered by this specific requirement.

Correct: B The client to be charged

Maine's brokerage agreement statute requires the agreement to be in writing and to include, at a minimum, the signature of the client to be charged, the terms of the brokerage services, the method or amount of compensation, an expiration date, and a statement that the agreement creates an agency-client relationship. No statute or Commission rule requires the designated broker to personally sign each listing; the designated broker's role is supervisory, including reviewing and initialing documents prepared by a sales agent during the agent's first 90 days with the agency (Commission Rule Chapter 400, Section 2(3)).