North Carolina — Contracts & Leases — North Carolina Real Estate — State Law Practice Test

This North Carolina Real Estate — State Law North Carolina — Contracts & Leases practice set has 16 practice questions based on the official exam materials, each with an instant explanation.

Sample questions

Three questions from the North Carolina — Contracts & Leases bank with the correct answer and an explanation. The practice quiz above draws 16 questions at random from the same bank.

1. Under the North Carolina Offer to Purchase and Contract, a buyer pays the seller a $2,000 due-diligence FEE. The buyer then terminates the contract during the due-diligence period. What happens to that due-diligence fee?

   • The seller keeps it — the due-diligence fee is non-refundable — Correct answer
   • It is refunded to the buyer along with the earnest money
   • It is split equally between the buyer and the seller
   • It is held by the listing firm until the dispute is resolved

   Explanation: The due-diligence fee is a negotiated, NON-refundable payment made directly to the seller in exchange for the buyer's right to terminate for any reason during the due-diligence period. It becomes the seller's property on the effective date and is credited toward the purchase price if closing occurs — but if the buyer walks during the due-diligence period, the seller KEEPS the fee; it is not refunded. (Earnest money, by contrast, IS refunded on a due-diligence-period termination.) Due-diligence fee（尽职调查费）: non-refundable, paid to the seller, stays the seller's even if the buyer terminates. (NC Offer to Purchase and Contract / Form 2-T)

   Handbook: North Carolina Contracts & Leases — due-diligence fee (NC Offer to Purchase and Contract, Form 2-T)

2. A buyer using the NC Offer to Purchase and Contract delivers a due-diligence fee AND earnest money, then properly terminates the contract for any reason BEFORE the due-diligence period ends. Which statement correctly describes the buyer's recovery?

   • The earnest money is refunded, but the due-diligence fee is not — Correct answer
   • Both the earnest money and the due-diligence fee are refunded
   • Neither the earnest money nor the due-diligence fee is refunded
   • The due-diligence fee is refunded, but the earnest money is forfeited to the seller

   Explanation: On a termination during the due-diligence period, NC's standard contract splits the two deposits oppositely: the EARNEST MONEY is REFUNDED to the buyer, but the DUE-DILIGENCE FEE is NOT — it stays the seller's. This split is uniquely NC. Earnest money（定金）: refundable on a due-diligence-period termination. Due-diligence fee（尽职调查费）: non-refundable, seller keeps it. (NC Offer to Purchase and Contract / Form 2-T)

   Handbook: North Carolina Contracts & Leases — earnest money vs due-diligence fee split (NC Offer to Purchase and Contract, Form 2-T)

3. During the due-diligence period in the NC Offer to Purchase and Contract, for what reasons may the buyer terminate the contract?

   • For any reason or no reason at all — Correct answer
   • Only if a licensed home inspector finds a material defect
   • Only if the buyer's loan application is formally denied
   • Only if the seller breaches a term of the contract

   Explanation: The due-diligence period is the negotiated window in which the buyer may investigate the property (inspections, appraisal, financing, title, surveys, etc.) and may terminate the contract for ANY reason OR NO reason at all. The buyer who terminates within this window gets the earnest money back (the due-diligence fee stays the seller's). The buyer's broad right to walk is exactly what the non-refundable fee pays the seller for. Due-diligence period（尽职调查期）: buyer may terminate for any reason or no reason and recover the earnest money. (NC Offer to Purchase and Contract / Form 2-T)

   Handbook: North Carolina Contracts & Leases — due-diligence period (NC Offer to Purchase and Contract, Form 2-T)