New Jersey Real Estate License Exam Practice Question
A broker representing a seller is reviewing a contract for sale, and discovers that the buyer is signing as a corporation. The broker should take all of the following steps to ensure the validity of the contract EXCEPT:
Correct Answer: C
Rationale: Confirming the corporation's existence (A) is essential to ensure the buyer can legally enter into the contract. Obtaining a personal guarantee (B) is a common practice to protect the seller's interests, especially if the corporation's financial status is uncertain. Securing a board resolution (D) is critical as it verifies that the individual signing has the authority to bind the corporation to the contract. However, obtaining a power of attorney from the seller (C) is unnecessary in this context, as the broker already represents the seller and does not require additional authorization to negotiate on their behalf.
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