North Dakota Real Estate Practice Exam

True or False: A real estate brokerage firm is obligated to discover defects in any real property unless agreed otherwise in writing.

1. True

2. False

3. Only in commercial properties

4. Depends on client request

The correct answer is: True

A real estate brokerage firm generally has a duty to conduct due diligence during a property transaction, which includes discovering defects in the property. This responsibility helps to protect the interests of clients and ensure that they are informed about potential issues that might affect the value or usability of the real estate. Unless there is a written agreement that states otherwise, this obligation exists across all transactions. The requirement to discover defects pertains to the brokerage's fiduciary duty and the principle of reasonable care in providing professional services. This duty is not limited to specific types of properties, such as commercial real estate, nor does it depend solely on the client's request—it is a default obligation established by the nature of the brokerage's role in facilitating property transactions. Therefore, the statement is true as it encapsulates the standard expectations within real estate practices in North Dakota.