NJ Real Estate Final Exam Flashcards

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Questions and Answers

What is the cost of the New Jersey salesperson's license examination?

$47

After completing a real estate licensing course in New Jersey, how long does an individual have to pass the state exam and apply for a permanent license?

1 year

Of the following, who needs a real estate license? (Select one)

  • A lawyer selling a house for a client who lives in a nursing home
  • A son selling a house for his parents in exchange for a new car (correct)
  • An investor selling his eight rental properties
  • An executor selling a house for a fee under the terms of a will

Who must possess a real estate license in New Jersey?

<p>Anyone who receives consideration for taking part in a real estate transaction</p> Signup and view all the answers

How often must a rental referral agency check the availability of an apartment?

<p>Every day</p> Signup and view all the answers

What must a rental referral agency do with an advance fee charged to prospective tenants?

<p>Deposited in an escrow account</p> Signup and view all the answers

What term describes a licensee who is qualified to be a broker but wishes to work for another broker?

<p>Broker-salesperson</p> Signup and view all the answers

How long does a failure to renew a license void it?

<p>Two years</p> Signup and view all the answers

Who is a referral agent allowed to refer prospects for brokerage services to?

<p>The supervising broker or the broker's designate</p> Signup and view all the answers

What happens to the licenses of agents if a broker's license is revoked?

<p>Suspended</p> Signup and view all the answers

What can the New Jersey Real Estate Commission do for a violation of the License Act?

<p>Suspend a license</p> Signup and view all the answers

In New Jersey, where must real estate brokers maintain their trust accounts?

<p>An authorized institution in New Jersey</p> Signup and view all the answers

Which crime allows the New Jersey Real Estate Commission to revoke the license of an agent awaiting trial?

<p>Kidnapping</p> Signup and view all the answers

Who may provide a purchaser of real estate with a portion of the broker's commission in the form of a rebate?

<p>Broker</p> Signup and view all the answers

When did a broker violate real estate law?

<p>Maintained his office in the home of a salesperson employed by that broker</p> Signup and view all the answers

What is legal for a real estate salesperson to do?

<p>Prepare a sales contract for a four-family home</p> Signup and view all the answers

Within how many business days must brokers deposit funds of others into their trust account after acceptance?

<p>5 business days</p> Signup and view all the answers

What does the violation referred to as 'commingling' mean?

<p>The mixing of broker funds with trust funds</p> Signup and view all the answers

If a broker has no agency duties, how are they acting?

<p>Transaction broker</p> Signup and view all the answers

What describes the fiduciary relationship between an agent and the agent's principal?

<p>Trust and confidence</p> Signup and view all the answers

How can a seller terminate the agency relationship with a broker?

<p>Revoking the listing agreement</p> Signup and view all the answers

What is one essential element of a fiduciary relationship?

<p>Putting the principal's interests above all others</p> Signup and view all the answers

What is the duty of a real estate broker to keep the principal informed of?

<p>Disclosure</p> Signup and view all the answers

What is an example of dual agency?

<p>A broker represents both the buyer and the seller in the same transaction</p> Signup and view all the answers

Under what condition is a broker permitted to represent both the seller and the buyer in the same transaction?

<p>Both parties have been informed and agree to the dual representation</p> Signup and view all the answers

When will the broker usually receive the sales commission from the seller?

<p>The transaction is closed</p> Signup and view all the answers

What kind of commissions does a real estate salesperson who is an independent contractor receive?

<p>Negotiated commissions on transactions</p> Signup and view all the answers

Why was the salesperson guilty of puffing?

<p>The salesperson stated that the house was 'the best house in the area'</p> Signup and view all the answers

Flashcards

NJ Real Estate Exam Cost

The cost to take the New Jersey salesperson's license examination.

Time Limit After Course

The time you have to pass the state exam and apply for a permanent license after completing the real estate licensing course.

Who Needs a License?

Someone who gets paid for participating in real estate transactions.

Rental Referral Responsibilities

Agencies that must verify apartment availability on a daily basis.

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Escrow for Advance Fees

A separate account where rental referral agencies must hold advance fees over $50.

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Broker-Salesperson

A qualified licensee working under another broker's supervision.

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License Status After Lapse

The status of a real estate license after it is not renewed for two years.

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Referral Agent's Scope

Individuals who can only direct prospects to their supervising broker.

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Broker Revocation Impact

What happens to agents' licenses when their employing broker's license is revoked.

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License Suspension

The disciplinary action the New Jersey Real Estate Commission can take for violations of the License Act.

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Broker Trust Account

The type of financial account in which brokers must keep funds for transactions, located in an authorized New Jersey institution.

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Commission's Disciplinary Power

The authority of the Commission regarding agent licenses for serious crimes like kidnapping.

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Rebates to Purchasers

Who is allowed to provide rebates to purchasers from a real estate commission.

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Brokerage Location Rules

A violation of real estate law exemplified by a broker operating from a salesperson's home.

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Commingling

Depositing broker's personal or business funds with money held in trust for others.

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Transaction Brokers

Brokers who do not represent either party in a transaction.

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Fiduciary Relationship

The core principle that governs the relationship between an agent and their principal.

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Revoking a Listing Agreement

Reason a seller can legally end a listing agreement if unsatisfied with the broker's performance.

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Principal's Best Interest

A key duty in a fiduciary relationship, ensuring the principal's best interests are the top priority.

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Duty of Disclosure

The duty of a broker to keep their principal informed of all relevant facts affecting a transaction.

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Dual Agency

The circumstance when a broker represents both the buyer and the seller in the same transaction.

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Informed Consent

What is required for a broker to legally represent both parties in a dual agency situation.

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Commission Source

Who typically pays the sales commission to the broker once the transaction is completed.

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Salesperson's Pay

How independent contractor salespeople are compensated for the transactions they complete.

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Puffing

Exaggerated or superlative comments or opinions not made as representations of fact and thus are not grounds for misrepresentation

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Study Notes

New Jersey Real Estate License Exam Information

  • The cost of the New Jersey salesperson's license examination is $47.
  • After completing the real estate licensing course, individuals have 1 year to pass the state exam and apply for a permanent license.

License Requirements

  • Only individuals receiving consideration for participating in real estate transactions require a real estate license in New Jersey.
  • A son selling a house for his parents in exchange for a car does not need a real estate license, while others in specific roles, such as executors or paid agents, do.

Rental Referral Agencies

  • Rental referral agencies must check apartment availability daily.
  • If charging prospective tenants an advance fee of $50, this fee must be held in an escrow account.

Broker and Licensee Dynamics

  • A qualified licensee working for another broker, rather than independently, is referred to as a broker-salesperson.
  • Failure to renew a license results in it being void after two years.

Referral Agents and Brokers

  • Referral agents can only refer prospects to their supervising broker or designated broker.
  • If a broker's license is revoked, all agents employed under that broker's license face suspension.

License Violations and Trust Accounts

  • The New Jersey Real Estate Commission can suspend a license for violations of the License Act.
  • Brokers must maintain trust accounts in authorized New Jersey institutions.
  • The Commission has the authority to revoke agents' licenses promptly for serious crimes, including kidnapping.

Broker Commissions and Agency Representation

  • Only brokers can provide rebates to purchasers from a broker's commission.
  • A broker who operates from a salesperson's home violates real estate law.
  • Legal for a salesperson to prepare a sales contract for a four-family home.
  • Brokers are required to deposit funds received for transactions into their trust accounts within 5 business days.

Commingling and Agency Relationships

  • "Commingling" refers to the improper mixing of broker funds with trust funds.
  • Brokers acting without agency duties are considered transaction brokers.
  • The fiduciary relationship between an agent and principal is built on trust and confidence.

Termination of Agency and Fiduciary Duties

  • A seller can terminate the agency relationship by revoking the listing agreement if unsatisfied with the broker's performance.
  • One key element of a fiduciary relationship is prioritizing the principal's interests above all else.
  • Brokers have a duty of disclosure, which involves keeping the principal informed about all relevant facts affecting a transaction.

Dual Agency Considerations

  • Dual agency occurs when a broker represents both the buyer and the seller in a transaction.
  • Brokers are permitted to represent both parties in a dual representation scenario only if they inform both and obtain their consent.

Commission Structure

  • Unless otherwise agreed in writing, brokers typically receive the sales commission from the seller once the transaction closes.
  • Independent contractor salespeople earn negotiated commissions on transactions.
  • Salespeople may be guilty of puffing if they make exaggerated claims about a property.

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