North Dakota Real Estate Practice Exam

What can result in the suspension or revocation of a real estate license?

1. Making a minor mistake in a contract

2. Offering free consultations

3. Making material false statements

4. Having an expired license

The correct answer is: Making material false statements

Making material false statements can lead to the suspension or revocation of a real estate license because it undermines the trust and integrity required in the real estate profession. When a licensee provides false or misleading information — whether verbally or in writing — it can create significant legal issues, not only for the licensee but also for clients and the public. Such actions can be seen as fraud or misrepresentation, which are serious offenses in the real estate industry. Regulatory bodies prioritize honesty and ethical conduct, so material false statements breach the essential standards expected from licensed professionals, which can lead to disciplinary measures including license suspension or revocation. In contrast, making a minor mistake in a contract typically may not result in drastic consequences, especially if it does not involve deceit or harm. Offering free consultations is generally an accepted practice and does not pose any inherent risk to one's licensure. Having an expired license, while problematic, generally might lead to penalties or fines but isn't directly linked to misconduct related to the performance of real estate activities, which explains why this option does not align with the most serious consequences outlined in the question.