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Questions and Answers
If a broker’s license expires, all salesperson’s licenses are placed on ______ status.
If a broker’s license expires, all salesperson’s licenses are placed on ______ status.
non-working
A broker may conduct business under a fictitious name if the broker files a fictitious name statement with the ______ clerk.
A broker may conduct business under a fictitious name if the broker files a fictitious name statement with the ______ clerk.
county
A fictitious name may not be misleading, previously used, or include the name of a salesperson instead of the ______.
A fictitious name may not be misleading, previously used, or include the name of a salesperson instead of the ______.
broker
If a licensee is delinquent in child support payments, the DRE may suspend the ______.
If a licensee is delinquent in child support payments, the DRE may suspend the ______.
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A real property securities dealer must have a real estate broker’s license, unless licensed as a securities ______.
A real property securities dealer must have a real estate broker’s license, unless licensed as a securities ______.
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If accusation is proved, the Commissioner may suspend or revoke ______
If accusation is proved, the Commissioner may suspend or revoke ______
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Maximum fine for disciplinary action can be up to $_____
Maximum fine for disciplinary action can be up to $_____
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Licensee disciplined by Commissioner may face criminal prosecution by the ______
Licensee disciplined by Commissioner may face criminal prosecution by the ______
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False promise is making a promise likely to persuade someone to do or refrain from doing something, which is considered a violation of ______
False promise is making a promise likely to persuade someone to do or refrain from doing something, which is considered a violation of ______
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Acting as a dual agent without the consent of both parties can lead to ______ of license
Acting as a dual agent without the consent of both parties can lead to ______ of license
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Failing to put definite termination date in exclusive listing agreement is grounds for disciplinary action.
Failing to put definite termination date in exclusive listing agreement is grounds for disciplinary action.
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Performing licensee activities negligently or incompetently is grounds for disciplinary action.
Performing licensee activities negligently or incompetently is grounds for disciplinary action.
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As a broker, failing to exercise reasonable supervision over salespersons is grounds for disciplinary action.
As a broker, failing to exercise reasonable supervision over salespersons is grounds for disciplinary action.
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Failing to disclose personal interest in property to a buyer is grounds for disciplinary action.
Failing to disclose personal interest in property to a buyer is grounds for disciplinary action.
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Illegal compensation for referring customers to escrow, pest control, home warranty, or title insurance companies is grounds for disciplinary action.
Illegal compensation for referring customers to escrow, pest control, home warranty, or title insurance companies is grounds for disciplinary action.
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Advance fees must be handled as ______ funds.
Advance fees must be handled as ______ funds.
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Salesperson/broker must obtain prior approval from DRE for: advertising, and advance fee ______.
Salesperson/broker must obtain prior approval from DRE for: advertising, and advance fee ______.
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Broker must keep real estate transaction documents for at least 3 years after ______ date.
Broker must keep real estate transaction documents for at least 3 years after ______ date.
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Trust fund records must be kept for at least 3 years after date of ______.
Trust fund records must be kept for at least 3 years after date of ______.
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Receipts and disbursements must be in ______ order.
Receipts and disbursements must be in ______ order.
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Good faith deposits belong to the ______ before the seller accepts the offer.
Good faith deposits belong to the ______ before the seller accepts the offer.
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Broker may hold a check only with the seller's written authorization after the offer is ______.
Broker may hold a check only with the seller's written authorization after the offer is ______.
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If parties dispute who is entitled to the deposit when the transaction fails to close, the broker files an interpleader action and turns funds over to ______.
If parties dispute who is entitled to the deposit when the transaction fails to close, the broker files an interpleader action and turns funds over to ______.
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Commingling is illegally mixing trust funds with other ______.
Commingling is illegally mixing trust funds with other ______.
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Funds in the trust account should always equal the broker's trust fund ______.
Funds in the trust account should always equal the broker's trust fund ______.
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A real property securities dealer must have a real estate broker’s license, unless licensed as a securities ______.
A real property securities dealer must have a real estate broker’s license, unless licensed as a securities ______.
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If parties dispute who is entitled to the deposit when the transaction fails to close, the broker files an interpleader action and turns funds over to ______.
If parties dispute who is entitled to the deposit when the transaction fails to close, the broker files an interpleader action and turns funds over to ______.
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Advance fees must be handled as ______ funds.
Advance fees must be handled as ______ funds.
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Funds in the trust account should always equal the broker's trust fund ______.
Funds in the trust account should always equal the broker's trust fund ______.
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Receipts and disbursements must be in ______ order.
Receipts and disbursements must be in ______ order.
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Commingling is illegally mixing trust funds with other ______.
Commingling is illegally mixing trust funds with other ______.
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If a broker’s license expires, all salesperson’s licenses are placed on ______ status.
If a broker’s license expires, all salesperson’s licenses are placed on ______ status.
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A real property securities dealer must have a real estate broker’s license, unless licensed as a securities ______
A real property securities dealer must have a real estate broker’s license, unless licensed as a securities ______
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If a licensee is delinquent in child support payments, the DRE may suspend the ______
If a licensee is delinquent in child support payments, the DRE may suspend the ______
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Receipts and disbursements must be in ______ order
Receipts and disbursements must be in ______ order
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Advance fees must be handled as ______ funds
Advance fees must be handled as ______ funds
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If accusation is proved, the Commissioner may suspend or revoke ______
If accusation is proved, the Commissioner may suspend or revoke ______
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Good faith deposits belong to the ______ before the seller accepts the offer
Good faith deposits belong to the ______ before the seller accepts the offer
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A broker may conduct business under a fictitious name if the broker files a fictitious name statement with the ______ clerk
A broker may conduct business under a fictitious name if the broker files a fictitious name statement with the ______ clerk
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A real estate license can be issued to a corporation if one corporate officer is designated to act as broker for the corporation, and that person meets qualifications for broker’s license. This designated officer is sometimes referred to as the ______.
A real estate license can be issued to a corporation if one corporate officer is designated to act as broker for the corporation, and that person meets qualifications for broker’s license. This designated officer is sometimes referred to as the ______.
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Penalties for unlicensed activities include a fine of up to $20,000 and/or 6 months in prison for individuals, and a fine of up to $60,000 for a ______.
Penalties for unlicensed activities include a fine of up to $20,000 and/or 6 months in prison for individuals, and a fine of up to $60,000 for a ______.
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Exceptions to the licensing requirement include a person buying or leasing property for himself or on behalf of a group to which he belongs, such as a partnership or corporation, is exempt from needing a license. These individuals are known as ______.
Exceptions to the licensing requirement include a person buying or leasing property for himself or on behalf of a group to which he belongs, such as a partnership or corporation, is exempt from needing a license. These individuals are known as ______.
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One of the exceptions to licensing requirements is an Attorney in fact who is authorized by a ______.
One of the exceptions to licensing requirements is an Attorney in fact who is authorized by a ______.
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An attorney providing legal services to a client is exempt from the licensing requirement as per the exception for ______.
An attorney providing legal services to a client is exempt from the licensing requirement as per the exception for ______.
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When a person is acting under a court order, such as a receiver in bankruptcy, they are exempt from the licensing requirement as they are considered to be acting under ______.
When a person is acting under a court order, such as a receiver in bankruptcy, they are exempt from the licensing requirement as they are considered to be acting under ______.
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Trustees under a deed of trust are also exempt from the licensing requirement as they are considered to be acting as a ______.
Trustees under a deed of trust are also exempt from the licensing requirement as they are considered to be acting as a ______.
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Rule against ______ makes it difficult for broker to dip into trust funds for her own benefit.
Rule against ______ makes it difficult for broker to dip into trust funds for her own benefit.
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If trust funds were in broker’s general account, creditor with judgment against broker might seize the trust ______.
If trust funds were in broker’s general account, creditor with judgment against broker might seize the trust ______.
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Reconciliation: Process of comparing trust fund balance to sum of individual ______.
Reconciliation: Process of comparing trust fund balance to sum of individual ______.
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When reconciled, trust account balance must equal total of balances due to individual beneficiaries (clients and ______).
When reconciled, trust account balance must equal total of balances due to individual beneficiaries (clients and ______).
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Broker may not deduct her commission from trust fund until after transaction ______.
Broker may not deduct her commission from trust fund until after transaction ______.
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Once earned commission is transferred to broker’s general account, money may be used to pay obligations, such as ______ commission.
Once earned commission is transferred to broker’s general account, money may be used to pay obligations, such as ______ commission.
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A broker may conduct business under a fictitious name if the broker files a fictitious name statement with the ______ clerk.
A broker may conduct business under a fictitious name if the broker files a fictitious name statement with the ______ clerk.
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Desk cost is brokerage’s operating cost per ______
Desk cost is brokerage’s operating cost per ______
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In 100% brokerage, salesperson keeps all of his commissions but must pay desk fee to pay for firm’s operating ______
In 100% brokerage, salesperson keeps all of his commissions but must pay desk fee to pay for firm’s operating ______
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The company dollar is money left over for brokerage firm to pay its operating expenses after all commissions have been ______
The company dollar is money left over for brokerage firm to pay its operating expenses after all commissions have been ______
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Brokerage may need to pay business license tax based on its gross ______
Brokerage may need to pay business license tax based on its gross ______
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Good faith deposits belong to the ______ before the seller accepts the offer
Good faith deposits belong to the ______ before the seller accepts the offer
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False promise is making a promise likely to persuade someone to do or refrain from doing something, which is considered a violation of ______
False promise is making a promise likely to persuade someone to do or refrain from doing something, which is considered a violation of ______
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Broker may hold a check only with the seller's written authorization after the offer is ______
Broker may hold a check only with the seller's written authorization after the offer is ______
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Broker must keep real estate transaction documents for at least 3 years after ______ date
Broker must keep real estate transaction documents for at least 3 years after ______ date
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Trust fund records must be kept for at least 3 years after date of ______
Trust fund records must be kept for at least 3 years after date of ______
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Study Notes
License Expiration and Fictitious Names
- If a broker's license expires, all salesperson's licenses are placed on inactive status.
- A broker may conduct business under a fictitious name if the broker files a fictitious name statement with the county clerk.
Disciplinary Actions
- If a licensee is delinquent in child support payments, the DRE may suspend the license.
- If accusation is proved, the Commissioner may suspend or revoke the license.
- Maximum fine for disciplinary action can be up to $2,500.
- Licensee disciplined by Commissioner may face criminal prosecution by the district attorney.
Violations
- False promise is making a promise likely to persuade someone to do or refrain from doing something, which is considered a violation of real estate law.
- Acting as a dual agent without the consent of both parties can lead to revocation of license.
- Failing to put definite termination date in exclusive listing agreement is grounds for disciplinary action.
- Performing licensee activities negligently or incompetently is grounds for disciplinary action.
- Failing to disclose personal interest in property to a buyer is grounds for disciplinary action.
- Illegal compensation for referring customers to escrow, pest control, home warranty, or title insurance companies is grounds for disciplinary action.
Trust Funds and Accounting
- Advance fees must be handled as trust funds.
- Salesperson/broker must obtain prior approval from DRE for: advertising, and advance fee agreements.
- Broker must keep real estate transaction documents for at least 3 years after closing date.
- Trust fund records must be kept for at least 3 years after date of transaction.
- Receipts and disbursements must be in chronological order.
- Good faith deposits belong to the seller before the seller accepts the offer.
- Broker may hold a check only with the seller's written authorization after the offer is accepted.
- If parties dispute who is entitled to the deposit when the transaction fails to close, the broker files an interpleader action and turns funds over to the court.
- Commingling is illegally mixing trust funds with other funds.
Real Estate Securities Dealers
- A real property securities dealer must have a real estate broker's license, unless licensed as a securities dealer.
Licensing Requirements
- A real estate license can be issued to a corporation if one corporate officer is designated to act as broker for the corporation, and that person meets qualifications for broker's license.
- This designated officer is sometimes referred to as the broker of record.
- Penalties for unlicensed activities include a fine of up to $20,000 and/or 6 months in prison for individuals, and a fine of up to $60,000 for a corporation.
- Exceptions to the licensing requirement include a person buying or leasing property for himself or on behalf of a group to which he belongs, such as a partnership or corporation, is exempt from needing a license.
- These individuals are known as principals.
Brokerage Operations
- Desk cost is brokerage's operating cost per agent.
- In 100% brokerage, salesperson keeps all of his commissions but must pay desk fee to pay for firm's operating expenses.
- The company dollar is money left over for brokerage firm to pay its operating expenses after all commissions have been paid.
- Brokerage may need to pay business license tax based on its gross income.
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Description
Test your knowledge on grounds for disciplinary actions in real estate, such as failing to disclose compensation, fraudulent dealings, and using unauthorized trade names. This quiz covers important ethical considerations for real estate professionals.
