License Laws

What six specific areas does real estate law cover?

- Law of Contracts - General Property Law - Law of Agency - State-specific License Laws - Landlord-tenant Laws - Consumer Protection Laws

Some activities that real estate licensees perform are affected by license laws, and others are not. Which would likely be affected?

- Required education - Ethical client interactions - Required experience

Name additional AREC responsibilities.

1. Establish continuing educational requirements for real estate professionals 2. Determine whether violations have occurred and impose penalties. 3. Issue broker and salesperson licenses.

Which activities does the AREC administer and enforce laws?

1. Licensed real estate activities 2. Real estate violations and penalties 3. Suspended licenses

Which of the following people would NOT get their questions answered by AREC? A. Brock is setting up a new brokerage in Huntsville. He asks himself, "I wonder what's the best way to split commission with my employees?" B. "How many hours of continuing education do I need to complete this year?" Jim, a licensee, mutters to himself. C. Kathy is about to take her test to become a real estate licensee. "Now, what are the other requirements to get my license? If only I could remember," she tells her friend. D. Maura is pretty sure that Gerald, who she hired as her real estate agent and to whom she's just paid commission, isn't a real licensee. "How can I find out?" she asks herself.

A. Brock is setting up a new brokerage in Huntsville. He asks himself, "I wonder what's the best way to split commission with my employees?"

In which of the following cases can AREC use its authority to suspend a real estate license? A. Broker Dean has repeatedly broken confidentiality with his clients for financial gain. B. Broker Terrance has decided to switch his specialty from residential to commercial real estate. C. Client Becka backed out of the sale of a large commercial property, citing that she "didn't trust" her agent, Marty. D. Licensee Stacy has forgotten to complete all required transactional paperwork, and therefore, her client doesn't owe her commission.

A. Broker Dean has repeatedly broken confidentiality with his clients for financial gain.

Which statement is true about licensing authorities? A. Each state has its own licensing authority. B. Each state has the exact same requirements for licensure. C. Enforcement is conducted at a national level. D. The National Association of REALTORS® enforces licensing laws nationally.

A. Each state has its own licensing authority.

Which body comprises appointed members who oversee license law in Alabama?

Alabama Real Estate Commission

Which entity administers and enforces Alabama's residential and commercial laws for activities that require a license?

Alabama Real Estate Commission

AREC is looking for a new commission member to fill the "consumer" slot. Which of the following people is eligible? A. Cynthia, age 55, who has a master's degree and has lived in Alabama for the past five years. B. Sylvia, a registered voter, whose uncle Doug is the most successful real estate broker in Evergreen. C. Terry, 43, who worked as a real estate licensee until he was 28. He now owns a small bakery in Tuscaloosa. D. Timothy, age 20, an African American, who owns a condominium complex in Birmingham.

C. Terry, 43, who worked as a real estate licensee until he was 28. He now owns a small bakery in Tuscaloosa.

AREC commission members Dale, Sherry, Jasmine, and Ted have convened to impose a penalty on a broker who's been found guilty of fraud. Which of these reasons could prevent them from doing this work? A. The fact that all of these AREC members have served for less than one year. B. The fact that Jasmine has no real estate experience. C. The fact that only four members have convened, and there need to be at least five. D. The fact that these four members are from four different congressional districts.

C. The fact that only four members have convened, and there need to be at least five.

Law of Agency

Covers how an agency relationship is created and the duties of an agent to the principal

State-specific License Laws

Covers the requirements of a licensee when performing real estate activities within the state, to include license law, continuing education requirements, supervisory requirements and prohibited conduct.

General Property Law

Covers the rights of ownership and tenancy and the government's rights and authority under eminent domain.

After you have obtained your real estate license, you may legally draft a contract. (T/F)

False.

As long as you are actively pursuing your real estate license, you can legally perform the same activities that licensed real estate professionals perform. (T/F)

False.

Professional associations determine which activities are affected by state licensing laws. (T/F)

False.

Real estate professionals are licensed at the federal level. (T/F)

False.

Covers the forms of ownership and tenancy in real property, and its distinction from personal property within the common law legal system.

General Property Law

Which area of real estate law covers the rights of ownership and tenancy, and the government's rights and authority under eminent domain?

General Property Law

The Law of Contracts

Governs the use of contracts, and the required elements to make a contract valid as well as what happens if a breach of contract should occur.

AREC: Administering Law

In addition to granting and renewing licenses, the Alabama Real Estate Commission promulgates rules and regulations and administers and enforces laws.

Begins as legislation proposed by and voted into effect by a state legislature; also called a statute.

Law

Covers how an agency relationship is created.

Law of Agency

Covers the duties of an agent to the principal.

Law of Agency

Covers what happens in the case of a breach of contract, and how contracts may be terminated.

Law of Contracts

Governs the use of contracts, and the required elements to make a contract valid.

Law of Contracts

Suspended license

Licensees must generally complete certain actions or conditions before their license becomes active again.

Revoked license

Licensees must wait at least one year (or longer, if stated by the commissioner) before applying for reinstatement.

What is the primary purpose of license laws?

Protect consumers from unprofessional practices

A standard or rule adopted by a government agency, such as a state department of commerce or the Environmental Protection Agency.

Regulation

Covers the requirements of a licensee when performing real estate activities within the state, to include license law, continuing education requirements, supervisory requirements, and prohibited conduct.

State-specific License Laws

Real Estate Licensee Disciplinary Actions

Suspended license Revoked license Other Penalties Education Fines Return of documents or property

License laws often prescribe a standard of conduct for licensees. (T/F)

True.

License laws protect the rights of buyers, sellers, tenants, and property owners. (T/F)

True.

The purpose of licensing is to protect the public by requiring certain education, training, and standards for licensees. (T/F)

True.

The requirements for licensing provide an important oversight component to ensure that you continue to meet the terms of your license. (T/F)

True.

There are different types of licenses based on experience level and training, and different requirements and responsibilities that go with each license. (T/F)

True.

Your role as a licensee is limited to the use of legally approved forms and standard clauses. (T/F)

True.