PSI New Jersey Real Estate State Practice Exam

A real estate licensee representing a buyer may do all of the following EXCEPT:

1. Disclose the buyer's financial information

2. Negotiate terms on behalf of the buyer

3. Assist in obtaining financing

4. Disclose the highest price the buyer is willing to pay

The correct answer is: Disclose the highest price the buyer is willing to pay

A real estate licensee representing a buyer has a fiduciary duty to act in the best interests of the client, which involves maintaining the confidentiality of certain sensitive information. Disclosing the highest price the buyer is willing to pay can undermine the buyer's negotiating position, potentially compromising their ability to secure the property at a favorable price. Such disclosure may give the seller an advantage, as it reveals the buyer's maximum budget, which can lead to higher counteroffers. In contrast, disclosing the buyer's financial information may occur, but it typically requires the buyer's consent and is often necessary for lenders and other involved parties. Negotiating terms on behalf of the buyer is a core function of the licensee’s role, aimed at ensuring that the buyer's interests are effectively represented and their positions advocated for during negotiations. Similarly, assisting in obtaining financing is part of providing comprehensive support to the buyer throughout the purchasing process. However, revealing the buyer's maximum willingness to pay is not permissible and is a breach of the duty of confidentiality that the licensee owes the buyer.