Iowa Real Estate Practice Exam

When a prospective buyer does not enter into a buyer agency agreement, what must the listing agent avoid asking?

1. Financial background

2. Specific property preferences

3. Confidential information

4. Homeownership history

The correct answer is: Confidential information

When a prospective buyer does not enter into a buyer agency agreement, the listing agent must avoid asking for confidential information. Confidential information typically includes sensitive details such as the buyer’s financial situation, motivation for purchasing, or future plans regarding property. This information is protected because the listing agent's primary duty is to the seller, and asking for such information from a prospective buyer could create a conflict of interest or compromise the buyer's negotiating position. While inquiries about financial background, specific property preferences, and homeownership history may seem pertinent from a sales perspective, they generally do not fall under the category of confidential information. The buyer is not obligated to share confidential information with the listing agent since there is no established agency relationship, making it crucial for the agent to respect the boundaries related to sensitive information.