California Real Estate Practice Exam

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Study for the California Real Estate Exam with confidence. Engage with interactive questions designed to enhance your understanding of real estate principles, laws, and practices. Prepare thoroughly for your licensing test and ensure you have the knowledge to succeed in your real estate career!

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What does a safety clause in a listing agreement ensure?

Buyer protection
Seller exclusivity
Broker's payment guarantee
Inspection requirements

The correct answer is: Broker's payment guarantee

A safety clause in a listing agreement ensures that the broker's payment is guaranteed by the seller. It stipulates that if the property is sold within a certain period of time, usually 90-120 days, and the seller finds the buyer on their own, they will not owe the broker a commission. This protects the broker from losing out on potential payment if the seller decides to handle the sale themselves or use a different broker after the agreement has ended. The other options, while important in a listing agreement, are not necessarily covered by a safety clause. Buyer protection may be included in the terms of the contract or through a separate agreement, seller exclusivity may be addressed in a separate agreement as well, and inspection requirements are typically set by the buyer's lender or the state and are not directly related to the broker's payment.