Midterm Law Exam

When a citation is issued by the superintendent of the Ohio Division of Real Estate and Professional Licensing, how long does a licensee have to request a hearing or make other arrangements with the superintendent before the citation becomes final?

30 days

How long after the Ohio superintendent of real estate position is vacated does the real estate commission have to submit names of potential candidates to the director of commerce?

60 days

After reviewing the investigator's report regarding a complaint against an Ohio licensee, the superintendent decides if the case should proceed to ______.

A formal hearing

Which of the following could a listing agreement be considered?

An employment contract between a licensee representing the brokerage company and a seller

When a broker dies, the Ohio Division of Real Estate and Professional Licensing can recommend that a(n) ______ be appointed to conclude the transactions currently in progress.

Ancillary trustee

Andrew just received a compensation check from his brokerage firm. Since Andrew is an independent contractor, what determines how he's paid?

Andrew's sales

Which of the following is a duty that Ohio buyer's agent, Craig, owes to his clients, the Hellers?

Answer the Hellers' questions about offers and counter-offers.

To provide sellers with assurance they won't back out of the sale, buyers may offer a financial deposit that will be kept in escrow until the conditions are met at closing. What's this deposit called?

Earnest money

What's the principal broker's responsibility with regard to licensees who want to gain competency in a specific area of real estate?

Ensure they work with another affiliated and competent licensee to gain competency in the area.

Which of these duties is outside the scope of Ohio's superintendent of real estate?

Evaluating commission splits between licensees

When working with a seller, you signed a listing agreement that ensured you'd receive a commission, provided the property sold during the listing term. What type of listing agreement did you sign?

Exclusive right to sell

What type of listing agreement guarantees the seller agent a commission no matter who finds a buyer for the property?

Exclusive right-to-sell agreement

What formal role does the superintendent of real estate play relative to the Ohio real estate commission?

Executive officer of the commission

What types of email subject lines are prohibited by the CAN-SPAM Act?

False or misleading

Tamara has identified a neighborhood where she'll concentrate her real estate activities. She starts by sending postcards to all residents, then walks door to door to introduce herself. Over time, she sends more communications, participates in neighborhood events, and eventually becomes the "go to" real estate professional for the neighborhood. What approach has she used?

Farming

Who or what entity enforces the Telephone Consumer Protection Act?

Federal Trade Commission

Jenna is licensed in the border state of Indiana, and wants to help her friend in Ohio sell her home. What must Jenna do?

Follow the nonresident license process.

Douglas is the buyer's agent for a transaction in which May (from a different brokerage) listed her seller client George's property. From whom will Douglas receive his compensation?

From his own broker

Paulo is a property manager for several large properties. Which type of agent is he in relation to the landlord/client?

General

An Ohio licensee can possibly avoid an investigation and formal hearing if the licensee agrees to ______ instead.

Go to informal mediation

What is a code of ethics?

Guidelines for conduct

Henry wants to submit an offer for Lacy's house. Under the statute of frauds, which of the following is NOT a requirement Henry must meet for his offer to become an enforceable purchase agreement?

The contract must be notarized.

Debra's listing agent, Raj, just called to tell her that he'd received an offer on her house and an earnest money check for $4,500. "I'm on my way over to go through the offer with you. I think you'll like it!" Debra's excited, and she knows exactly what she wants to spend that $4,500 on. What's wrong with Debra's thought process?

The earnest money doesn't belong to Debra. It will be held in an escrow account.

Who pays the filing fee for qualifying a foreign real estate property in Ohio?

The foreign real estate dealer applicant

In the buyer customer relationship, which of the following is an important fact for buyers to understand?

The licensee represents the seller.

Boy, have these last 18 years flown by. The Martins remember the day their son was born like it was yesterday. And here he is today, preparing to head off to college. Now that he'll be out of the house soon, the Martins really don't need a house this large. What type of buyer are the Martins?

Trade-down buyers

Butch and Meg listed their five-bedroom Colonial and are looking for a three-bedroom luxury townhome to buy. Now that their kids have grown and moved away, they don't need such a big house, but definitely want to be close to parks, major travel routes, and the local casino (Meg loves the slots). What buyer category most fits Butch and Meg?

Trade-down buyers

Which court hears monetary claims against the U.S. government?

U.S Court of Federal Claims

Amanda is an Ohio broker who's interested in hiring several licensees to assist her at her brokerage. Which of the following is a true statement?

Written employee/independent contractor agreements aren't required, but are highly advisable.

Regarding licensee compensation, which of the following statements is true?

Licensees may only receive compensation for real estate services through their broker.

Which type of agent is an escrow officer?

Limited agent

Retaining paper and electronic records of transactional documents for the time period prescribed by your regulating authority helps to ______ risk.

Manage

"If you buy this house now, it'll easily appreciate 15% over the next 10 years," is an example of ___________.

Misrepresentation

Ricky is working for Matt, a buyer client, who is interested in a property at which the listing agent offers compensation to cooperating agents. The listing agent has offered Ricky or any cooperating agent additional compensation if the transaction closes within 40 days. Is this ethical?

Yes, but only if all of the involved parties have full knowledge and provide consent.

In an Ohio brokerage, who assumes the responsibility for leading and supervising all brokerage operations, and ensuring licensees operate within their scope of competency?

Principal brokers

As an Ohio property manager, how often must Doug provide financial reporting to property owners?

Quarterly

In addition to the real estate commission, which Ohio group is asked to supply names of candidates for the superintendent of real estate?

Real estate appraiser board

What's the main point of the statute of frauds?

Real estate purchase and sale contracts must be in writing to be enforceable.

The way in which independent contractors and employees are compensated and how their income is reported to the IRS differ. Which of the following statements describes how independent contractors are compensated and their income reported?

Yes, but only if all of the involved parties have full knowledge and provide consent.

May listing agreements be terminated without penalty?

Yes, if both the listing broker and the seller's agree in writing

Juanita's broker didn't include a provision in the Ohio purchase agreement to have the earnest money she deposited returned to her in the event of a dispute. The seller can't be reached in order to have him sign a written authorization to release the funds. Under what circumstances will she get it back?

She files a lawsuit and the court orders the funds returned to her.

Which of the following may Ohio licensees do without breaching their duty to the seller?

Show alternative properties to prospective buyers

Which of the following requires that contracts transferring ownership of real property be in writing to be enforceable?

Statute of frauds

When there's no buyer agency agreement in place, which of the following tasks can a licensee perform for the buyer?

Submit an offer on a listing.

If the ______ determines that no licensing violation has occurred, then a complaint against an Ohio licensee will be dropped.

Superintendent

Who determines whether an Ohio complaint should proceed to a formal hearing?

Superintendent of real estate

What happens if you move while you're licensed in Ohio?

You must inform the superintendent of real estate.

In addition to serving as the listing agent for several clients, your own house is also on the market. You receive a call from another licensee who wants to show her buyer client your house. What must you immediately disclose to the buyer's agent and buyer?

You own the property.

You make a listing presentation to a client, then learn she's meeting with a few more licensees before deciding which licensee gets her listing. You know these competitors. Which action best demonstrates good faith?

You tell the seller you hope she'll decide to work with you.

You're representing Crystal in the purchase of a house. Crystal has a trust fund and can more than afford the house on which she's made an offer. Which of the following statements is true?

Your duty of confidentiality to your client dictates that you not disclose your client's financial situation to the seller.

Mitch, your seller client, asked you about the tax ramifications of selling his townhome. What's your best response?

"That's not my area of expertise. You should ask your tax advisor."

Which of the following is an example of puffery?

"This condo has the best view this side of the river!"

In Ohio, applicants for a broker's license must show the equivalent of how many completed transactions?

20

If the Ohio superintendent refuses to qualify a foreign real estate property, the applicants can submit a new application after ____ days.

10

Which of the following is an example of self-dealing?

A licensee purchases a listing through his cousin but does not inform the seller.

Which of the following is true of agency agreements?

A listing agreement is an express agreement.

Kylie is selling a little bungalow on the outskirts of Cincinnati. Her best friend, Jasmine, is her agent. Jasmine also represents the buyer, Bob. Which of the following disclosures must Jasmine provide?

Both a dual agency disclosure and a disclosure about her personal relationship with Kylie

Kennedy lists Heather's home. He noticed evidence of termites, and asked Heather about it. She said a pest control company came in and solved the problem. What can Kennedy do to reduce the risk of misrepresentation?

Ask for the pest control company report from Heather.

The Ohio Division of Real Estate and Professional Licensing doesn't have the authority to do what relative to complaints?

Award monetary damages

In addition to investigating complaints about licensed individuals, the Ohio real estate division will investigate complaints about unlicensed individuals possibly engaging in ______.

Brokerage services

Who must complete at least three CE hours during each licensing period on brokerage operations and duties?

Brokers and management level licensees

Which of these statements best describes how brokers handle income and Social Security taxes for independent contractors?

Brokers don't withhold income or Social Security taxes for independent contractors.

Which of the following is an example of an escalator offer?

Buyer offers $650,000 with clause that buyer will beat all competing offers by $3,000 up to $675,000.

Which legislative act prohibits certain types of electronic communication?

CAN-SPAM

What's the purpose of an ancillary trustee?

Conclude all brokerage business.

Which source of law regulates governmental action?

Constitutional

When finding listings, which statement describes the referral approach?

Contacting prospective clients through previous clients, co-workers, networks, etc.

What does CAN-SPAM Act stand for?

Controlling the Assault of Non-Solicited Pornography and Marketing Act

Which entity creates regulations governing real estate activities in Ohio?

Division of real estate

Darnell has been appointed an ancillary trustee for Hometown Realty in Ohio. Which of the following is a true statement?

He must withdraw all advertising.

Charles, a real estate professional, has just finished touring a property he'd like to list for sale. When talking with the owner about the property and comparing it to other properties recently sold in the area, he tells the owner he appraises the property at a value of $350,000. What, if anything, did Charles do wrong?

He referred to his opinion on the value of the property as an appraisal.

At the conclusion of a formal hearing, who prepares the report submitted to the Ohio Real Estate Commission for its review and decision regarding a complaint against a licensee?

Hearing Examiner

In Ohio, who files the report with the real estate commission that documents findings of fact and conclusions of law?

Hearing examiner

Georgina is an escrow agent who's holding funds for several transactions. Which of these statements about how she'll disburse these funds is true?

If the transaction doesn't close, Georgina will disburse the earnest money as instructed by the parties or according to state law.

You've just received an offer from a potential buyer for a property you listed. When should you present the offer to your client?

Immediately

Ohio licensee Karl must provide his brokerage's policy on agency in which of the following transactions?

Lease for vacant land

Zelda owns a unique piece of property that she's listed exclusively with licensee Len. Len suggested selling the property to the city so it could build a park. Both Zelda and Len attend a city council meeting to make the proposition, disclosing Len's relationship and potential commission should the city decide to buy the land. After the meeting, Grant, a council member, told Zelda that the only way the city would by the land is if it was listed through Grant. Is Grant acting ethically?

No, Grant is interfering with the contract that Zelda and Len have in place.

Noah lives in and assisted with the purchase of a commercial building in Ohio that will be used as a community center. He doesn't hold a real estate license, yet his actions didn't violate any license laws. What must be true about Noah's situation?

Noah is a public official whose salaried duties include real estate transactions.

When done for others and for compensation, which of the following may be done by someone who doesn't hold an Ohio real estate license?

Researching school districts and crime statistics for various neighborhoods

If a buyer makes an offer that the seller finds lacking, which of the following actions is the seller most likely to take?

Respond with a written counter-offer.

What does the Ohio legislature create?

The Ohio Revised Code

Brooke is opening a property management trust account for her Ohio brokerage. Which of the following is a true statement?

The account may earn interest.

Which of the following statements about agency creation in Ohio is true?

The agency relationship must be created using a written or verbal agency agreement.

In which of the following ways may agency be legally terminated?

The broker becomes incapacitated.

Why do brokers prefer the exclusive right-to-sell agreement?

The broker will receive compensation when the house sells, no matter who finds the buyer.

In Ohio, team advertising must include ______.

The broker/brokerage name

The licensees who work in Brett Foster's Ohio brokerage have decided to form a team called "Brett's Brokers." When they advertise, which of the following must they include?

The broker/brokerage name

Which of the following is NOT a valid way to terminate a listing agreement?

The buyer requests it

A client terminates a listing agreement before its expiration date. What happens now?

The client may owe a commission anyway.

In a seller agency relationship, to which party does the licensee owe undivided loyalty?

The seller

In a buyer agency relationship, what relationship does the seller have to the licensee?

The seller is the licensee's customer.

Which of the following is true about lockboxes?

They require a seller's written permission to post.

Which of the following statements is true of independent contractor licensees?

They're paid by the job.

Which of the following is a true statement about Ohio real estate teams?

Unlicensed team members must be identified in all advertising.

Which of the following factors helps the IRS determine whether a licensee is classified as an employee or an independent contractor?

Whether the licensee receives benefits from the brokerage firm

What determines limited reciprocity regarding real estate licensing in Ohio?

Whether the state has a signed limited reciprocity agreement with Ohio

How many sections are there in the Ohio Canons of Ethics for the Real Estate Industry?

three

For how long must Ohio trust account records be maintained?

three years

Kayla, an Ohio broker, is sorting through digital and hard copy records. For how long must she keep trust account records?

three years

For tax purposes, employees are required to complete IRS form W-4. Which IRS form or forms are independent contractors required to complete?

w-9 form