California Real Estate Practice Exam

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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.