Brokerage SAE Study
The Fed may require an institution to reserve at most 0% of its first ___, 3% of the first $25 million after that and 10% of all other funds.
$2 million
With an Mortgage Credit Certificate (MCC), the qualified homebuyer is eligible to take a portion of the annual interest paid on the mortgage as a special tax credit, up to _____, EACH YEAR that they occupy the home as their principal residence.
$2,000
When an Agent changes Brokers, the agent and the new sponsoring Broker complete the SALES AGENT SPONSORSHIP FORM-1. If it is completed on line the fee is _____. If the form is mailed the fee is $40.
$20
If TREC records do not reflect completion of CE requirements at the time you submit your renewal application, you must pay a ___ CE Deferral Fee, or renew in inactive status.
$200
A real estate licensee can provide a lending collateral analysis if the loan transaction at issue is less than...?
$250,000
Homeowners who are single are exempt up to _______
$250,000
The consumer asks the company NOT to call again, the company must honor the request. If the company calls again, it may be subject to a fine of up to _______
$40,000
Married couples who sell their principal residences are exempt from the capital gains tax up to _______
$500,000
The Texas minimum wage is the same as the federal minimum:
$7.25 an hour
Fact Procedure. If you did something wrong, you should employ the following fact procedure
(1) Admit and apologize (2) Limit the scope (or put the mistake in perspective) (3) Propose a solution so the mistake is unlikely to reoccur
Rumor Procedure. If what others say is not true, you should employ the following three steps of the rumor procedure
(1) Don't publicize the rumor (2) Promote the opposite of what the rumor says without mentioning the rumor (3) Provide undeniable and verifiable proof to support
Lenders protected classes:
1.Race or color 2.Religion 3.National origin 4.Sex 5.Handicap 6.Familial Status 7.Marital status* 8.Age (as long as you are old enough to enter into a contract )* 9.Receipt of income from any public assistance program* 10.Exercising in good faith your rights under the Consumer Credit Protection Act*
IABS link must be in at least a ______ point font and in a readily noticeable place on the homepage of the business website of the broker and sales agent.
10
How many days does a broker have to inform the Commission of a change of address?
10 days
At what percentage threshold must a licensee disclose his/her ownership in a real estate transaction?
10 percent
Rachel is subject to court-ordered supervision due to an antitrust violation. This oversight may continue for as long as ______.
10 years
S Corps are restricted to no more than ____ shareholders.
100
A timeshare program may be subject to the property condition disclosure law if it involves no more than how many interests?
12
Liabilities must be paid in the next _____ or are considered current liabilities
12 months
A company with which a consumer has an established business relationship MAY call for up to _____ after the consumer's last purchase or last delivery, or last payment, unless the consumer asks the company not to call again
18 months
What are the most common actions that fall under competition?
Antitrust Predatory pricing Trademark infringement Passing off Misappropriation of trade secrets Trade libel Tortious interference
All commercial leases should contain the conditions under which the lease can be terminated; the names and signatures of all parties; and ______. A clause determining who will pay to have an attorney review the agreement A list of repairs the landlord needs to make to the property before the tenant can move in Any additional information based on negotiations and specific situations Restrictions as to utilities use
Any additional information based on negotiations and specific situations
The licensee must disclose _____ defects in a property (of which he or she is aware), including any additional information about the property that may affect the prospective buyer's final decision
Any and all
Which generation will likely be in the homebuying market? Any generation could be Baby boomers Gen Xers Millennials
Any generation could be
Principles of Real Estate I (30 classroom hours), Principles of Real Estate II (30 classroom hours), Law of Agency (30 classroom hours), Law of Contracts (30 classroom hours), Promulgated Contracts Forms (30 classroom hours), Real Estate Finance (30 classroom hours), Real Estate Brokerage (30 classroom hours)
Brokerage mandatory courses
Texas Real Estate Commission requires the ______ _______on EACH page of a website.
Brokerage name
What kinds of reports does the Texas Real Estate Center provide that could be useful to brokers and agents?
Housing activity Rural land Building permits Population
Texas is the most _______________ state in the nation.
Housing-affordable
The following actions could result in revocation of a agents license:
I. Failing to submit to an owner before his acceptance of an offer, all formal, written offers received for property listed for sale. II. Quoting to prospective buyers of a property a sales price other than the on stipulated by the owner.
The buyer should not tell the owner's agent anything the buyer would not want the owner to know because an owner's agent MUST disclose to the owner any _____ information known to the agent
Material
The licensee is NOT required to disclose to third parties any issues with the property that are not _____
Material facts
Gains
Reported on the income statement as the net of two amounts: the proceeds received from the sale of a long-term asset minus the amount listed for that item on the company's books (book value)
A broker can assist you in locating a property, preparing a contract or lease, or obtaining financing without _____
Representing you
Negotiating a listing agreement with a property owner, spending the afternoon with a couple showing houses for sale or rent, or negotiating a contract to buy or lease real property
Require a license.
Calculating a Net Lease
Requires a tenant to pay fixed and variable operating expenses
The Home Mortgage Disclosure Act (HMDA) (REG C: "C" discrimination)
Requires lenders to disclose specific lending information, which HUD then uses to map lending patterns
Four general circumstances under which a dwelling is exempt from the federal Fair Housing Act
Single-Family Residences Sold by Owner, Rental of Rooms or Units in Owner-Occupied Property, Dwellings Belonging to Religious Organizations or Private Clubs and Housing for Older Persons
Actual location of the office space
Site
If an Oregon Principal broker wants to put a booth in a local shopping mall...
he must register the booth as a branch office
Licensed real estate professionals and licensed real estate inspectors are responsible for ADHERING to the Texas Real Estate License Act (TRELA), and ABIDE by the rules of the ______
Texas Real Estate Commission (TREC)
Empowers TREC to enforce the Real Estate License Act and to make and enforce new rules. Requires that those persons who perform any real estate acts as defined in Sec. 1101.002 (sell, exchange negotiate auction or deal in real estate) in expectation of compensation must obtain a state license.
Texas Real Estate License Act (TRELA)
LLC is formed by filing articles of organization with _________________
Texas Secretary of State
An excellent program to help first time home buyers and low income buyer is the _____ programs.
Texas State Affordable Housing Corporations (TSHAC)
Is responsible for all laws in Texas, which includes those laws that directly affect the real estate industry. (State Senate and the House of Representatives)
Texas State Legislature
The principal governing bodies that directly affect the real estate industry are the:
Texas State Legislature, the Texas Property Code and the Texas Real Estate Commission (TREC).
During periods of declining economic activity or rising interest rates, the amount of work for brokers & agents will _________ and employment may ____________________
amount of work will slow employment may decline
Section 1101.004
if a person acts as a broker or a salesperson in performing any real estate act for another person, with the expectation of being paid, that person needs to have a real estate license
A broker with 10% interest in a development company must disclose his license status in a sale agreement for the sale of the company's property, IF...
if he participates in the negotiations for the sale of the company's property.
If an Oregon principal broker closes his office and moves to another state, he is required to do what with his real estate records?
find a place in Oregon to store the records for the 6-year requirement.
All licensed brokers must maintain a ______________________ in the state.
fixed place of business in the state
A real estate broker or property manager must retain within the State of Oregon records of his Oregon real estate activity for...
for 6 years after the date of the transaction
The purpose of the policies manual is to
guide the sales force and support staff in accordance with the firm's goals and objectives.
What's the purpose of a firewall? It backs up your files to an external hard drive. It encrypts your email. It prevents hackers from infecting your system with viruses, worms, and malware. It stores logins and passwords.
hacking
If an Oregon real estate broker associated with a principal broker makes an intentional misrepresentation to a client, the broker and his principal broker may
have their licenses suspended or revoked.
A broker must maintain all records for _____ years.
4
Broker must, at a minimum, maintain the following records in a format that is readily available to the Commission for at least ____ years from the date of closing, termination of the contract, or end of a real estate transaction
4
In the 1970s the Texas Real Estate Commission adopted the first three Cannons of Ethics
Fidelity, Integrity and Competency (codified in 1976)
The intent of the perpetrator
"Harass, annoy, alarm, abuse, torment or embarrass" another person.
If HUD determines that a discriminatory practice has occurred- violation of fair housing law: Pay the Federal Government a civil penalty. The maximum penalties are _____ for a first violation and another violation within seven years $50,000
$10,000
Texas offers a ______ senior citizen exemption in addition to the homestead exemption for residents who are 65 or older on January 1. School taxes are also frozen when the homeowner files for the over 65 exemption in Texas
$10,000
Violations of RESPA regulations can lead to serious penalties for both licensees and lending institutions' employees. Fines of up to _____ can be assessed, as can prison terms of up to a year.
$10,000
Fair Housing Act civil penalties up to _____ 1st violation and $65,000 for future violations
$16,000
In Texas, employers may pay tipped employees as little as
$2.13 an hour
Ali is selling her property to Winston for $94,000, and Winston is assuming an existing mortgage at 4 1/2 % interest per annum, with an unpaid balance of $9,200. Mortgage payments are due the first of each month and include interest up to, but NOT including, the day of payment. The last payment was made March 1, and settlement is to be March 26th. Compute the interest proration that will be credited to the buyer (Winston) using a 365-day year and holding the buyer (Winston) responsible for the day of closing.
$28.26 (credited to the buyer aka Winston)
Violations of the Sherman Act individuals can be fined up to ____ and sentenced to up to 3 years in prison. Companies can be fined up to $10 million
$350,000
During the interview and application process, the employer should avoid questions about:
*Race, color, religion, sex, age, national origin, marital status, and familial status *Physical disabilities or mental disabilities *Experience and education that is not required for the job *Birth dates *A spouse's employment status *The number of children in an interviewee's family
Lower Level Management
*Regional Manager *Admin Manager *Brokerage Manager *Sales Manager *Sales Executive
The harassing behavior itself The Texas Penal Code lists the following activities which may be considered criminal harassment
*Requesting an obscene activity, such as sexual activity *Threatening to inflict bodily harm on another person, family member or property *Conveying a false report of the death or bodily injury of another person *Repeatedly calling another person on the telephone in an annoying manner *Sending electronic communications, such as emails or text messages, in an annoying, threatening or abusive manner
Before holding a seminar, brokers should:
*Select a central location for the meeting *Pick a facility that can hold the expected number of people who will attend; typically hotels and conference centers are best *Advertise the career seminar through flyers at least two weeks in advance *Obtain the necessary equipment, such as projectors, easels, and sound systems *Create marketing packets that include general information about real estate careers and their firms *Outline and plan the topics that will be discussed
To make sure your goals are clear and reachable, each one should be:
*Specific (simple, sensible, significant) *Measurable (meaningful, motivating) *Achievable (agreed, attainable) *Relevant (reasonable, realistic and resourced, results-based) *Contributing to the company's goals for the company
Texas law is very clear on the definition of harassment. There are two primary elements to a harassment offense:
*The intent of the perpetrator *The harassing behavior itself
Brokers have 4 types of records:
*Transaction Records *License Records *Personnel Records *Financial Records
Personal Property
-goes with the person -generally movable
Real Property
-goes with the property -gererally immovable
Fee Simple Estate
-highest possible ownership -also known as fee simple absolute
A principal real estate broker must retain for a period of 6 years all
-listing agreements and earnest money receipts -clients' trust account records and ledgers -vouchers, bills or obligations paid for the account of a client.
Trade fixture
-personal because it goes with a business
Lease
-possession but not ownership from lessor to lessee -considered personal property
The broker's initial publicity and advertising plan should try to...
-publicize the experience of the sales force -create a positive image in the minds of the public -bring the firm to the attention of other firms that will be willing to cooperate on the sales of their listings.
Riparian Rights
-river - moving body of water
Fixture
-was personal and is now real -MARIA Method Adaption Relationship Intention Agreement
A copy of the offer should be first given to the prospective buyer
...
One of the benefits of RWD is that you'll only need to maintain ___ version of your site
1
How often may I download data from the national registry?
1 Year
Ending on time is respectful to all participants of the meeting. Schedule your meetings so that they will last no longer than _____. Start the meeting on time and end on time.
1 hour
SCORE volunteers donate over ____ of their time each year to support their communities
1 million hours
To become a Broker you have ______ from the date your application is filed to meet all license requirements.
1 year
A 2nd conviction for harassment is a Class A misdemeanor offense and is punishable by: Up to _____ in county jail and a fine of up to _______
1 year, $4000
TREC Promugated Contract Forms Available
1. 6 promulgated contracts 2. 15 promulgated addenda (including 2 temporary leases) 3. 1 promulgated amendment 4. 2 promulgated resale certificates 5. 2 promulgated notices 6. 2 promulgated consumer disclosures 7. 7 approved forms
RESPA stipulates certain procedures and disclosures that must happen during closing. First, within three days of receiving a loan application, the lender must provide the applicant with the following material within 3 days of the application
1. A booklet entitled "Know Before You Owe," concerning settlement services and lending information. 2. Loan Estimate- indicating the total credit costs and the annual percentage rate (APR) of the loan, a good-faith estimate of settlement costs
What are the 7 benefits of Buyer-Agency relationships?
1. Access to market data 2. Investment analysis 3. Culling unsuitable properties 4. Obtaining financing 5. Negotiations 6. Preparing offers & negotiating strategies 7. Surveys, inspections, and repairs
Most brokers prefer the Exclusive Right to Sell because of what 2 reasons?
1. Affords broker greatest degree of protection in earning commission during listing term 2. Helps avoid procuring cause lawsuits
What 7 things should be included in the written risk management policy?
1. Broker Safety 2. Client Safety 3. Cell Phone Use 4. checklists for office personnel 5. Listing and contract files 6. Copywright & license obligations 7. Other risk management issues the broker deems necessary
What are the 3 reasonable measures of destruction?
1. Burning, shredding, pulverizing documents 2. Erasing media files or electronic files 3. Hiring outside sources that specialize in destroying personal records
What are the 3 penalties for stolen identity?
1. Civil liability: up to $1,000 per employee 2. Class action lawsuits 3. Federal fines up to $2,500 per violation
Housing for older persons is exempt from the prohibition against families status discrimination if:
1. HUD has determined that it's specifically designed for & occupied by elderly persons under federal, state, or local government program OR 2. It's occupied solely by persons 62 or older OR 3. It houses at least 1 person 55 or older in at least 80% of occupied units, and adheres to policy that demonstrates an intent to house persons 55 & older
Supply can be restricted by what 5 factors?
1. Land costs 2. Construction costs 3. Taxation (i.e. income & property taxes) 4. Economics 5. Local govt building codes & zoning ordinances
When a business owner shops around for an office space, he or she should take the following factors into consideration:
1. Location 2. Site 3. Size
What are the 5 benefits of home ownership?
1. Occupancy 2. Tax benefits 3. Pride of ownership 4. Security 5. Investment
Family and medical leave. The federal Family and Medical Leave Act (FMLA) requires employers with at least 50 employees to give eligible employees up to _______ of UNPAID time off per year for illness, caregiving, and bonding with a new child
12 weeks
An NAR Survey estimated that FSBOs account for about _____ of home sellers, with an additional 5 percent of sellers first trying the FSBO route, but then retaining a broker to complete the sale.
12%
Yard signs account for about ____of sales transactions
14%
About ____ of the agency's real estate brokerage complaints relate to property management.
15-25%
The Code of Ethics consists of a Preamble and ___ Articles:
17
Active individual broker license renewal requirements
18 hours of approved Continuing Education (CE) courses
What are 5 potential sources to focus on marketing?
1st time buyers, expired listings, FSBO, empty nesters, and investors
Broker's License You must renew your license every _____ years
2
Broker's License: After _____ years past the expiration date, you will have to reapply and pass the examination.
2
HUD concluded that a "_____ occupants per bedroom" rule—taking other factors into consideration—constitutes a good basic model
2
TRELA is reviewed and updated every ____ years when the Texas Legislature meets
2
The Real Estate Brokerage course must be completed not more than ____ years before the application date.
2
The minimum amount of people required to form a partnership is?
2
Unemployment Benefits: In Texas, you must have worked in at least ____ of the four quarters of the base period (a 12-month stretch before you lost your job), and you must meet an earnings requirement, to qualify for benefits
2
Voting. Texas employers MUST give employees PAID time off work to cast their ballots. However, employees are NOT entitled to voting leave if they have at least ____ consecutive hours off work while the polls are open
2
When obtaining a Real Estate Broker's License, normally a real estate licensee must have ____ or more years of experience as an active salesperson, completed a required number of classroom hours (specified by each state), and successfully mastered the Real Estate Broker's License Examination.
2
A real estate licensee must notify the agency of an adverse ruling against him in court within _____ days of the ruling if the ruling involved a real property transaction in which the licensee was a defendant and the seller of the property.
20
The Age Discrimination in Employment Act of 1967 (ADEA) applies to employers with _____ employees.
20 or more
You may download data files from the national registry only ONCE in any ____ period.
24-hour
The DTPA lists _____ specific violations, commonly referred to as the "laundry list."
25
Military family leave. Under the FMLA, eligible employees may take up to _____ off in a single year to care for a family member who was seriously injured on military duty
26 weeks
Unemployment Benefits: If you are eligible, you will receive a percentage of your previous earnings for _____ (up to a maximum of $479 per week) while you are looking for a new job
26 weeks
To become a Broker you need to complete your qualifying education- ______ classroom hours of qualifying real estate courses
270
Steps to Take If W-9 Is Not Completed: The W-9 should be in hand before the commission is paid. If not, then the IRS rules specify that the payor (here, the listing broker) should withhold _____ of the payment as backup withholding
28%
Any trust money received by the broker must be deposited in a trust account or delivered to an authorized escrow agent within a reasonable time, which the Commission has determined to be not later than the close of business of the _______ WORKING day after the date the broker receives the trust money. (Ex: Tues--> end of Wed)
2nd
RESPA requires the Loan Disclosure to be delivered to the buyer at least _____ PRIOR to consummation or closing
3 days
What does mandatory continuing education include?
3 hours legal & 3 hours ethics
If a consumer makes an inquiry or submits an application to a company, the company can call for ______
3 months
CMA rule of thumb is to use what data?
3 recently sold 3 recently listed 3 recently expired
Most good economies have a GDP of about _____
3%
Buying existing business, lenders will need information about business for the past ______
3-5 years
What is the average turnover in most brokerages?
30 - 50%
"Reasonable time" means
30 days after demand is made for an accounting or for remittance of money belonging to others
If the parties demand such, the earnest money must be returned in a reasonable time, which is:
30 days after demand such, the earnest money must be returned in reasonable time.
_____ shop online each week
33%
Under The Age Discrimination in Employment Act of 1967 (ADEA) , all individuals OVER the age of ____ are protected from employment discrimination based on age
40
Under the FLSA, Texas employers must pay employees overtime—time and a half—for all hours worked after the first _____ in a week
40
It's difficult to make business plans too far into the future, so most long-range plans aren't longer than ________. Five years Four years Three years Two years
5 yrs
Instructors must pass the test with a grade of ____ or higher to be able to teach the course
80%
There are over _____ MLS systems in the United States
800
In an NAR Profile of Buyers and Sellers ____ of homebuyers said that Open Houses were useful or somewhat useful in their search for a home
87%
There are two types of real estate licenses:
A broker's license and a salesperson's license
Sale-Leaseback Agreement
A grantor (owner) sells a property to a grantee (buyer), and then leases it back from him or her
When a client appoints someone to act in his behalf, an agency relationship is created. Which of the following is NOT essential to establish an agency relationship? legal purpose Competency on the part of the client A limited power of attorney agreement of the parties to the agency
A limited power of attorney
Agent should avoid recommending a particular specialist; if the consumer is dissatisfied with the work of that individual, the licensee could be held liable. Instead, the agent can provide the consumer with _____
A list of qualified professionals
Experienced agents compare selling real estate to being a counselor, ______, and a teacher all rolled up into one
A minister
"Act of God"
A natural disaster or fire
How does Texas define an advertisement?
A written or oral statement which induces or attempts to induce a member of the public to use the services of a real estate licensee
Real estate offices have to comply with the ___ requirements
ADA
A principal broker who wants to put an earnest money deposit in an interest-bearing account must get written authorization from...?
ALL parties with an interest in the funds
__________assesses the real estate market and tries to be proactive in their responses to what is happening.
ARELLO
A license is required for any person who controls the ____ or deposit of rent from a resident of a single-family residential real property unit
Acceptance
What are some of a brokerage's back office systems?
Accounting, purchasing, payroll, marketing, scheduling, maintenance, and hiring/firing
ABR—
Accredited Buyer's Representation
ALC—
Accredited Land Consultant
___ basis of accounting revenues are reported on the income statement when earned- before cash received
Accrual
Fair Credit Reporting Act (FCRA) (REG-V)
Act that protects privacy of background information and ensures that information supplied is accurate.
Implied Agency
Actions of the parties indicate that they have mutually consented to an agency.
What is a marketing disclosure agreement?
Agreement signed by seller, that gives the agent the authority to market the property on the Internet.
Liabilities
All debts the owner owes on equipment to investors, etc
Which of the following is a duty to the agent -accept only those tasks which can skillfully perform -assume full liability for any wrongful act committed or permitted by himself or his employees -Completely truthful dealings with the principal
All of these
Monopoly
All producers of particular service were to merge
Teach your agents about roll back taxes and why it is dangerous to sign a Builder's contract that says "_________" without understanding what that means
All tax prorations are final
Tenant Improvement Allowance
Allowance to customize generally for business purposes
Can a license holder offer to give a $50 gift card to an unlicensed person for referring a potential lessee or buyer?
Although a license holder may not pay an unlicensed person valuable consideration for referring a potential lessee or buyer, gifts of merchandise with a retail value of $50 or less are not considered valuable consideration. [Rule 535.20(a)] Therefore, a $50 gift card that is only redeemable for certain merchandise (e.g. a gift card to a restaurant or department store) is not defined as valuable consideration and is permissible
Commercial property transactions are NOT normally included under the Fair Housing Act, they are covered by other laws, such as the ____
Americans with Disabilities Act
Texas courts have consistently held that the One-to-Four Family Residential Real Estate Contract is an ________
As-Is Contract
Investors invest in your business- cash will show on balance sheet as ___
Asset
Which of the following may appear on a closing statement as a credit to the purchaser? A. Prepaid property taxes B. Purchase money mortgage C. Overdue rent from a tenant D. Recording fees
B. Purchase money mortgage
If a person with an active Oregon license fails to comply with the administrative rules related to real estate brokers, the Real Estate Commissioner may do all of the following EXCEPT A. revoke his license. B. fine him. C. suspend his license. D. formally reprimand him.
B. fine him
A principal broker licensed in Oregon accepts a $2,000 check as earnest money at 10am on a saturday. If the earnest money agreement does not provide for holding the deposit until acceptance of the offer, the principal broker must...
BEFORE the close of business on Friday, either deposit the check in his clients' trust account OR deposit the check in a neutral escrow depository located in Oregon.
Born between 1946 and 1964
Baby Boomers
4 reports that show the financial picture of a business:
Balance Sheet Income Statement Cash Flow Statement Statement of Stockholders' or Owner's Equity
How does Texas determine whether an applicant's moral character complies with the Commission's requirements?
Based on the applicant's answers on the Moral Character Determination form
The seller tells the broker that termites have destroyed the floor and the pool is a violation of the city setback requirements. Which of the following must the broker disclose to a prospective buyer?
Both the condition of the floor and the setback of the pool
Market is a place where things are _____
Bought and sold
A broker sponsored by another broker
Broker associates
What does SBA offer to small business owners?
Can help facilitate a loan for you with a third party lender, guarantee a bond, or help you find venture capital.
A rule or principle or standard of conduct adopted by a professional organization to guide the conduct of its members
Cannons
Previous or current occupant of real property may have had, has, or may have AIDS, HIV-related illnesses, or HIV infection as defined by the Centers for Disease Control of the US Public Health Service
Cannot disclose, it would be illegal
What is the foundation for a successful brokerage recruitment plan?
Careful examination of the broker's mission statement and long-term goals
Which financial statement is a record of cash available at different points of time?
Cash flow
What are the three financial statements the broker should include in the business plan?
Cash flow, balance sheet, & income statement
What financial forms are necessary to operate a real estate brokerage?
Cash flow, income statement, balance sheet
Niche Markets
Catering to the unique demands that mainstream providers aren't addressing
Corporations are NOT required to file a _____ because the corporation is a legal entity and is entitled to use its own name
Certificate of business name
CPM—
Certified Property Manager
CRB—
Certified Real Estate Broker
CRE—
Certified Real Estate Counselor
CRS—
Certified Real Estate Specialist
A new broker will need a good real estate attorney and a good _____ on their team.
Certified public accountant (CPA)
The real estate market is unique and is constantly ____
Changing
The Texas Real Estate License Act (TRELA) was formerly called Vernon's Texas Civil Statutes, Article 6573a, and is now known as
Chapter 1101 of the Texas Occupations Code
Double Net Lease (Net-Net)
Charges for community area maintenance and property taxes in addition to base rent
TREC Qualifications to obtain a Broker's license:
Citizen of the United States or lawfully admitted alien, 18 years of age or older, Resident of Texas, unless you: were licensed in Texas as a sales agent or broker in the last two years; or you are licensed as a broker in another state, Meet TREC's qualifications for honesty, trustworthiness, and integrity
The _______ included a prohibition against discrimination on the basis of race, color, and national origin in any program or service funded by the federal government. Religion, sex, handicap and familial status were later added to the act.
Civil Rights Act of 1964
Question 39 Which of the following is true about the security of your clients' information? Client data can be compromised if the brokerage's computer system is compromised. Data security is one-size-fits-all. Poor record retention ensures data security. There is nothing a licensee can do to safeguard client data.
Client data can be compromised if the brokerage's computer system is compromised.
The fair housing laws do NOT apply to _____ transactions unless those transactions include property that would be properly defined as a dwelling
Commercial
When a business applies for an SBA loan, it is actually applying for a _____ loan, structured according to SBA requirements with an SBA guaranty
Commercial
Texas license law makes it illegal to _____ funds with the licensee's personal or business accounts
Commingle (mix)
The law prohibits _____ money a license holder holds for another with a license holder's own funds.
Commingling
Which of the following is considered a variable expense?
Commissions
A broker is following a problem-solving process to handle a situation in which one of her licensees has violated a brokerage policy. Which of these actions must be part of the solution she pursues to resolve the problem?
Communication
Harassment typically occurs through a ____ medium, such as: Telephones, Email, Text messages
Communication
Must show whether the business has the potential to generate profit. Attract investment capital, secure loans, hire employees, and appeal to potential investors
Communication tool
An attempt to resolve the issues raised by a complaint or an investigation though informal negotiations between the aggrieved person, the respondent, and the HUD Secretary
Conciliation
Clearly addressing how employees are expected to behave on the job is essential
Conduct
One of the IRS tests for classifying a brokerage's independent contractors as statutory non-employees is ______. Confirmation the worker has a valid real estate license No overtime pay Reduced benefits Regular paydays
Confirmation the worker has a valid real estate license Benefits, a steady paycheck, and overtime pay don't apply. A license is required.
The only requirement for establishing an agency relationship is the ____ of both parties
Consent
_______________________must be displayed in a prominent location in each place of business that a broker maintains
Consumer Protection Notice CN 1-2
A really good supplement to traditional SEM campaigns
Content Remarketing (Banner ads)
Your ad is a reminder to people who weren't ready to buy right away
Content Remarketing (Banner ads)
What are the 3 C's of Nonverbal Communication?
Contex, Clusters, Congruence
What information in a website listing is protected by copyright law?
Copyright laws do not protect basic facts about listed properties, their size or features. However, the law does protect graphics and highly-detailed, creative descriptions of listings.
Which of the following is true about corporations? Close corporations are located near company headquarters. Corporations are sole legal entities created under state law. Corporations require the use of state-certified trade names. General corporations pass liability on to the owners.
Corporations are sole legal entities created under state law.
Is LEGAL if a lender asks about the credit of a loan applicant's husband when the husband is a party to the loan application
Correct. If an applicant's spouse is named as a party to the loan application, the lender may ask about him or her
Operating Expenses
Cost business must incur in order to remain in business
The DBA should be registered with the _____ and be approved before it can be used.
County clerk's office
Before a business selects its name, it should make sure that no one else is using the DBA by performing a search through its _____
County clerk's office or online system
Up the Hill Realty has purchased a contact list. New licensees at the brokerage are asked to spend three hours a week cold-calling individuals on this list. Which of these actions is NOT one they need to take before making these calls?
Create a fake phone number that individuals will see on their caller ID.
Having trouble making ends meat, contact creditors or see a legitimate ______
Credit consulor
Who participates in what decisions; when various people can act independently and when they need to check with someone else; who shares in hiring, grievance, conflict resolution, and other decisions. It is important agents have someone to call for help 24/7
Decision-making structure
As demand decreases the prices _____
Decrease
Brokers can find _____ from census data, banks, the Chamber of Commerce, school districts, and MLS
Demographic information
What agency enforces the ADA?
Department of labor
Means that you have a staff of people who specialize in one specific area of the property management business
Departmental Structure
Assets going down in value over time and eventually disappear are being ____
Depreciated
According to Fair Housing Law, what should an agent do when writing an advertisement to avoid any violation?
Describe the property only
Which of the following statements are true regarding determining the amount of office space needed for your brokerage? Desk fees should be calculated to determine how many licensees are needed to cover expenses. Offices and cubicles require the same amount of space. Principal working quarters should not be more than 50 square feet per staff member. The need for conference rooms and separate training rooms won't increase the size requirements.
Desk fees should be calculated to determine how many licensees are needed to cover expenses.
Limitation or discrimination based on race, color, religion, sex, national origin, ancestry, familial status or handicap of an owner, previous or current occupant, potential purchaser, lessor or potential lessee of the property.
Discriminatory Practices
How must a broker provide the Consumer Protection Notice to consumers?
Display it noticeably in each place of business, and in at least 10 font and noticeably on the homepage of the business website.
As the broker, it will be your job to gather and ___ information
Disseminate (spread)
Improvement that ____ add value- New Roof or Flooring (necessary) Landscaping or Cosmetic Enhancements (unnecessary)
Do
Straw buyer
Does not intend to pay any payments
Improvements that ____ add value- Plumbing and Foundation Repairs (necessary) Expensive Fixtures or Amenities (unnecessary)
Don't
C Corps are subject to _____ taxation
Double
What does the Texas Broker Lawyer Committee do?
Drafts and revises contract forms. Contracts are approved for use by TREC.
Equilibrium Stage
During equilibrium, very little changes. The houses are kept up and values remain constant.
The first 9 Articles are
Duties to Clients and Customers
Articles 15, 16, 17 are
Duties to REALTORS®
Articles 10 through 14 are
Duties to the Public
Income statement
Earning and expenses over period of time (profitability of company)
Design your site to help make it ____ for your customer to complete their most common tasks: from task conception, to visiting your site, to task completion.
Easier
The economic characteristics that distinguish land as a commodity are:
Economic scarcity, alteration, fixity and situs
________ are highly concerned with predicting inflation.
Economists, Market Analysts, and Investors
What does TX require the landlord and tenant to do when the lease is an estate for years?
Either must give 30 days notice prior to termination.
Once you have met all the requirements to get your license, TREC will send an active broker license to you via
A well-crafted application should include all of the following EXCEPT:
Employment history - for only 6 months
Herzberg's Hygiene and Motivational Theories
Environmental factors and psychological factors of which the manager should be aware
The _____ makes it illegal for a lender to discriminate against borrowers
Equal Credit Opportunity Act (ECOA)
The balance sheet includes assets, liabilities, and ________. Cash flow Equity Expenses Net income/loss
Equity
If the designated broker does NOT directly own at least 10% of the entity TREC requires proof that the business entity maintains _______ in the amount of $1 million per occurrence.
Errors and omissions insurance
Provides for increases in rent over a specified time period
Escalation Clause
Using an _____ means the rent will increase without question or negotiation. When presented at the time the lease is signed, prepares the renter for scheduled increases up front
Escalator
What type of lease is for a definite period of time, with a beginning and an ending date that automatically terminates, without any requirement of notice?
Estate for years
Broker should hire _____ sales agents
Ethical and professional
The study and development of one's ethical standards
Ethics
Who in a brokerage firm should know the firm's code of ethics?
Everyone
Puffing
Exaggerated or superlative comments or opinions.
The ______ is the amount of a foreign currency that a dollar can buy
Exchange Rate
Most brokers prefer the ______________ because it affords the broker the greatest degree of protection in earning commission during the listing term & it helps avoid procuring cause lawsuits
Exclusive Right To Sell
The _____ provides an overview of the business plan, a brief description of the company's history and basically explains why the business owner believes the company will be a success.
Executive summary
If calls are being made for the sole purpose of conducting a survey or poll, they are ______
Exempt
All fair housing laws are federal laws
False
Owners that are selling own home do NOT have to complete sellers disclosure- only used by real estate community
False
T/F All license holders will be members of NAR
False
Tenant harassing verbally- all other tenants, the landlord has the right to evict him
False
The License Act says the licensee MUST disclose a suicide that took place on the property
False
The Texas Real Estate Commission (TREC) requires sellers disclosure
False
The licensee can never give an agency disclosure verbally
False
A 1988 amendment to the federal Fair Housing Act itself added ____
Familial status and handicap
Texas Fair Housing Act of 1989 closely parallels the ________________
Federal Fair Housing Act
The lending rate between banks at the Federal Reserve is known as the ____
Federal Funds Rate
The ______ is in charge of the Fed's principal tool—its open-market operations. These operations consist of buying government securities, either from the U.S. Treasury or from other federal agencies, and selling them.
Federal Open Market Committee (FOMC)
FACTA is enforced by ___________________
Federal Trade Commission
If you work in Texas, ______ employment laws protect your workplace rights
Federal and State
Offer home sellers the option to purchase less than the full bundle of services traditional brokers provide
Fee-for-service brokers—"flat-fee" brokers or "limited-service" brokers
_____ was a system of land ownership in which all the land in the kingdom was considered to be owned by the head of the state (the king or queen).
Feudalism
What are the characteristics of a buyer's market?
Few offers Long market time Buyers ask for everything Lower earnest money deposits Low ball offers
FBN
Fictitious Business Name
Provides for a fixed amount of rent over a fixed rental period (term)
Fixed Lease
The only requirement for establishing an agency relationship is the consent of both parties
Forming An Agency Relationship
Real estate _____ offer buyers a packaged business operation and built—in name recognition, as well as national advertising paid for by the franchiser.
Franchises
Debt financing
Funds provided by lenders (creditors) that will be repaid with interest
Equity financing
Funds provided by the owners of a company, selling ownership interest to investors in exchange for capital
Born between 1901 and 1926
G.I.Generation (Greatest Generation)
Which of the following is a lagging economic indicator? Consumer confidence index Consumer inflationary index Consumer price index Gross domestic product
GDP
A ____ occurs when the proceeds are MORE than the book value.
Gain
A ____ agent has more limited authority than a universal agent but is usually authorized to manage all of the principal's affairs in certain specified areas, like the business manager who is allowed to enter into contracts and make business decisions for a company. Associated licensees usually also have a relationship of this agency with their supervising brokers
General
Is an on-going relationship. It will cover many transactions.
General agency
Help you build an email list even if a customer isn't ready to buy
Giveaway Campaigns
What should a broker do after choosing a name for the brokerage?
Go to the state offices and check against their records to be sure there is not another brokerage with the same or similar name.
Should be specific, have a time limit and be measurable
Goals
A fear of many small tenants in a shopping center is that a major tenant will go out of business or not renew its lease, known as ____
Going dark
"Whatsoever ye would that others should do to you, do ye even so to them."
Golden Rule
Describe the quality of tough mindedness as a good broker characteristic.
Good brokers tend to be low in sentimental attachments and comfortable with criticism
Includes anyone who has, had, or may have AIDS, an HIV-related illness or HIV infection
Handicap
What protected class was added by the 1987 amendments to the Civil Rights Act of 1968?
Handicap
Landlords cannot forbid assistance animals to help a ____ for being there even if they have a no pet policy.
Handicapped tenant
What is the basis of the initial planning stage?
Having goals
What measures whether or not a typical family earns enough income to qualify for a mortgage loan on a typical home at the national and regional levels based on the most recent monthly price and income data?
Housing Affordability Index
Sex was added in 1974 to the protected classes by the _____
Housing and Community Development Act
My wife and I signed an offer to buy a house over the weekend. Now we have changed our minds and don't want to buy the house after all. Can we get out of the deal?
If the seller has accepted your offer, you may have a binding contract. There is no automatic three-day or 72 hour cooling off period for you to change your mind like in some other consumer contract situations. Any rights that you have to terminate the contract will be contained in the contract. For example, you may have paid a fee to obtain an "option" period in the contract. You should consult with a private attorney for advice regarding termination of your contract.
Which of the following actions could compromise your security when meeting with a customer for the first time in the field?
Ignoring a lewd comment
It is _____ for your employer to take any negative job action against you, whether you complain within the company, to a government agency (like the Equal Employment Opportunity Commission or the Texas Workforce Commission), or in a lawsuit.
Illegal
Assets
Include everything owned or due to be paid to the company (cash, inventory, equipment buildings)
Revenues
Income
Is LEGAL if a lender asks a loan applicant how much child support she, the applicant, is receiving, although she has stated that she doesn't intend to use the money to qualify for the loan
Incorrect. Under the ECOA, a lender may only ask about child support if the applicant intends to use that money to qualify for the loan
As demand increases the prices _____
Increase
As supply decreases prices will ______
Increase
Maximize NOI
Increase gross rental income, control expenses and minimize vacancies
So how do you maximize NOI?
Increase gross rental income, control expenses and minimize vacancies
Cityville administrators are trying to control urban sprawl, but they still need to plan for the growing population. They've revamped zoning laws to allow residential units to be built on smaller lots, and multi-family housing to be built in areas once zoned for single-family housing. Which real estate trend does this describe?
Increased density
Business Structure: Doing business as an individual you will be able to do so under the name your Broker's license is in. You will be taxed as an individual and will need to pay income tax quarterly.
Independent
What is the best way to transfer risk?
Insurance
What is errors and omissions insurance?
Insurance that protects professional practitioners against liability claims made by clients and/or customers
Licensees must use prudence and caution to avoid misrepresentation by acts of commission or omission.
Integrity
The concept of _____ overlaps with the duty of honest and fair dealing
Integrity
The duty of reasonable care includes two components:
Integrity and competency
Taxpayers can deduct ____ from taxes
Interest
Equity Skimming
Investor uses a straw buyer and false documents to obtain a loan. The straw buyer signs the property over to the investor who rents the property, but makes no payments on the loan and eventually loses it in foreclosure.
What two issues could hurt a brokerage that is named after the broker/owner?
It may be hard to recruit new and particularly experienced agents to the brokerage firm named after the broker/owner. It may make future resale difficult.
What if I call a number that's not on the registry without checking the registry first?
It's against the law to call
Broker Sam has extended an offer to licensee Jane, who has accepted the offer. Jane will work as an independent contractor for Sam. Based on this, which of the following statements is true?
Jane will need to fill out a W-9 for IRS reporting purposes. Independent contractors are required to fill out a W-9 for IRS reporting purposes. Only actual employees are required to complete the W-4.
Housing and Economic Recovery Act of 2008 (HERA)
Law that created SAFE Act
What is the difference between leaders and managers?
Leaders are conceptual thinkers; managers are doers.
Estate At Will (Tenancy At Will)
Lease agreement that permits tenant or landlord to terminate the lease at any given time
Ground lease
Lease of land only
Texas has no documents to prepare a _____. The documents must be prepared by a licensed attorney
Lease-option or a Lease-purchase
Fee simple land owner (lessor) enters into contract with ground lease with person or entity (lessee)
Leasehold
Tenancy Of Years (Estate For Years)
Leaseholds are designed to expire after certain terms of years (starting date and ending date)
Land owner
Lessor
The least complex business structure. It gives you the perk of pass—through taxes, limited liability and legal protection for your personal assets.
Limited Liability Company (LLC)
______ are sometimes referred to as "silent partners"—in other words, they can make investments in the company but have no voting power or control over its day—to—day operations.
Limited partners
Allows any number of "limited partners," whose liability is limited to the total amount of their investment in the company.
Limited partnership (LP)
Area where the company wishes to do business
Location
If the branch office of a real estate firm maintains a separate clients' trust account, it must also
Maintain a separate bookkeeping system.
Another way to increase NOI?
Make strategic improvements to the property to make it stand out, drawing tenants willing to pay a premium for nicer kitchens and bathrooms, or washers and dryers.
The Equal Credit Opportunity Act (ECOA) (REG- B: Be Equal)
Makes it illegal to discriminate against borrowers
Economic characteristics are ______
Man-made
CAN-SPAM makes it a ______ to send spam with falsified header information.
Misdemeanor
A written declaration of an organization's core purpose and focus that normally remains unchanged over time
Mission statement
Space permitting, what would be a good thing to include in your marketing materials?
Mission statement
Expenses
Money paid out to cover the cost
When a broker holds earnest money or any money from property management activities in a trust account, how often is a broker required to account for that money?
Monthly
Two requirements that must be met for all advertisements
Must "clearly and conspicuously contain the name of the broker, either a business entity or an individual." and An advertisement must include a designation that serves to clearly identify the advertiser as a real estate agent.
Promulgated Contract Forms
Must be used by all licensees
CAN-SPAM requires that sender's message include ________________
Must include a valid physical address
The REALTOR® logo can only be used by those who are members of the _____
National Association of REALTOR® (NAR)
Physical characteristics occur _____
Naturally
If John is a real estate agent and is selling his own home does he have to use a promulgated sales contract form?
No
Estate at will
No definite expiration date and can only terminate with a 30 day notice to vacate.
John is representing his aunt and uncle in a transaction. Does he need to disclose that relationship?
No, because he only has to disclose a spouse, parent, or child.
I signed a Property Management Agreement and do not understand some of the terms. Can you explain them to me?
No. A Property Management Agreement is a private contract and TREC is unable to advise you in private contractual matters. You should discuss the terms of the agreement with a private attorney.
Can a listing broker share a portion of the listing broker's commission with an attorney who represented the buyer in a real estate transaction?
No. A broker is prohibited from sharing fees with or otherwise compensating the attorney acting as a buyer's agent unless the attorney holds an active real estate license.
Non Homogeneity
Not the same
When the sponsorship of a salesperson ends, what should the broker do?
Notify the commission, by written request, that the sponsorship has ended; Return the license to the commission; The broker must immediately notify the salesperson in writing
Remembering the acronym ______ can help you remember the fiduciary duties an agent owes to a client. ARMOR CANDOR FARMOR
OLD CAR Remember the acronym OLD CAR. It stands for the duties of obedience, loyalty, disclosure, confidentiality, accounting, and reasonable skill and care.
What are the minimum fiduciary duties & responsibilities of agents?
OLDCAR Obedience Loyalty Disclosure Confidentiality Accounting Reasonable Care
Is one who leads by example
Pacesetting leader
Blockbusting may also be referred to simply as _____
Panic selling
Allows its' agents and employees to have more input in the decision-making process
Participative
Express Agency
Parties "express" the fact that they want to form an agency relationship.
All business entities engaged in real estate brokerage activity, including ______, need to be licensed.
Partnerships
Licensee Audrey was convicted of an antitrust violation. What is the maximum prison sentence she can serve? 10 years Five years No prison time Two years Penalties for violating antitrust laws can include fines of as much as $1 million and a prison term of up to 10 years.
Penalties for violating antitrust laws can include fines of as much as $1 million and a prison term of up to 10 years.
Landlord shares in your good (or bad) fortune. The lease provides for a fixed amount of rent, plus an additional amount that is set as a percentage of your gross receipts or sales
Percentage Lease
The combined goals of the agents, the staff, the managers and the company
Performance management
Appendix will include:
Pictures of the locations and/or agents Management resumes Examples of marketing material Market survey and research
Allow business owners to prepare for any potential roadblock or complication.
Planning tool
This is a more professional structure, which means that each staff member or property manager is individually responsible for all aspects associated with one given property
Portfolio Structure
Fee Simple Defeasible
Possesses the property as a fee simple subject to a condition
What 3 rights of ownership will a lessee gain
Possession, use, and exclusion
There are four steps in the employment process:
Prescreening, Formal interview, Selection and Hire
Brokerage firms may not agree or confer with other brokerage firms about commissions
Price Fixing
______________ is any attempt by a group of brokers or between a group of brokerage firms to set the commission rates in their area
Price Fixing
Five Anti-trust Issues
Price-fixing, Market or customer-allocation, Bid-Rigging, Group Boycotts and Real-estate brokers constantly work collectively
Is the individual that authorizes another person to act on his or her behalf. This person may also be referred to as the client.
Principal
The license holder MUST put the interest of the license holder's ____ above the license holder's own interest
Principal
The third party negotiates with the principal through the agent
Principal- Agent- Third Party
The 4 P's of Marketing are:
Product Price Promotion Place
What should analysis of the competition include?
Production numbers, number of associates, years in business, number of locations, and business structure
Fair Housing Act
Prohibits discrimination in the sale, rental, advertisement and financing of dwellings
A broker owns 70% of the firm, in order to renew a Business Entity Broker License what documentation is needed?
Proof of ownership of the firm
Federal Uniform Trade Secrets Act (UTSA)
Provides compensation, injunctive relief, attorney fees and punitive damages to companies that are harmed by theft or misuse of trade secrets
The North Texas Real Estate Information System (NTREIS)
Provides the information for the MLS in much of Texas
Purported survey calls are NOT exempt if they are also part of a plan, program or campaign to induce ______
Purchases of goods or services
The new broker will want to consider three possibilities.
Purchasing an existing real estate business, purchasing a franchise office or a start up from scratch
What does an equity partner do?
Puts up the capital for an entity and then wants payback and equity interest in the company.
There are NO EXCEPTIONS to the Civil Rights Act of 1866. This means that you may NEVER turn away a ______ because of race or color; neither may you publish an advertisement that discriminates against someone on this basis.
Qualified tenant or purchaser
This Act required HUD to set reasonable limitations on the number of occupants allowed in a dwelling
Quality Housing and Work Responsibility Act
_____ are zealous to maintain and improve the standards of their calling and share with their fellow REALTORS® a common responsibility for its integrity and honor
REALTORS®
Net
Rent paid to the lessor/landlord
Truth in Lending Laws
Requires that a firm making loans disclose all the information about the terms of that loan
The contract is canceled and the parties are restored legally and financially to the position they were in before entering the contract
Rescission
The Fed has the authority to require all depository institutions to keep a certain percentage of their funds in the regional ______
Reserve bank
Gross Lease (Straight Lease)
Residential lease, tenant pays flat rental fee. Owner pays taxes and maintenance fees
General partner is responsible for ________________________ and has ______ liability
Responsible for day-to-day operations Has full liability
The page uses the same URL and the same code whether the user is on a desktop computer, tablet, or mobile phone— only the display adjusts or "responds" according to the screen size
Responsive Web Design (RWD)
A place you can go to be alone, to get away from it all
Retreat
Which of these would be an advantage for the broker of hiring licensees as salaried employees, rather than as independent contractors on a commission-based compensation plan?
Sales agents will probably make fewer errors as a result of more broker control and supervision.
Demand and price move in the _____
Same direction
_____ is great for a company that is looking to show up on the first page of Google (or Bing, or Yahoo) for keywords relevant to their business.
Search Engine Marketing (SEM)
In the context of real estate, seller of goods is the _____ of real property
Seller
The State of Texas requires all sellers of residential property to submit a _____
Seller's disclosure form
______ are still responsible under DTPA
Sellers
Market Expansion (Market Development)
Selling current services in a new market
A message CANNOT be sent through an open relay, CANNOT be sent without an unsubscribe option, CANNOT be sent to a harvested email address, CANNOT contain a false header, SHOULD contain at least one sentence, CANNOT be null, Unsubscribe option should be below the message
Sending behavior compliance
SRES—
Senior Real Estate Specialist
The term REALTOR®, whether used on the Internet, as part of the domain name, or in any other advertisement, must refer to a member or member's company, may NOT be used with descriptive words or phrases, and SHOULD be _____ from the member's name or company's name. Ex: (johndoe—REALTOR®.com or abcrealty—realtors.com)
Separated
Broker Amanda is getting discouraged. Even though she's only had her brokerage open for a few months, she's having second thoughts about her business's original long-range plan. What should she do? She should scrap the original long-range plan immediately and come up with a new one. She should stick with the original long-range plan for however long it takes to make it work, even if it's several years down the road. She should stick with the original long-range plan until her brokerage has been in business for at least six months, and then come up with a new plan. She should stick with the original long-range plan until she's established her company's position in the marketplace.
She should stick with the original long-range plan until she's established her company's position in the marketplace. When you're creating a business, there may be trends or ideas that tempt you to change course. Your long-range plan is there to remind you of your end goal, and the reliable, strategic road map you're following to get there.
The purpose of antitrust laws are to protect competition and prevent monopolies for the benefit of consumers (Fined up to $350,000 + 3 years in prison)
Sherman Anti-Trust Act
It depends on what the property manager is doing for the property owner. If the duties include ______ the property for the owner for which the manager gets paid, a license is required.
Showing or Leasing
______________ is a venture that is owned by one individual
Sole Proprietorship
Disbursements
Spending of money
A common state law, which, in Texas, requires the Sunset Commission to evaluate all state agencies every 12 years with respect to their efficiency and the need for their services.
Sunset Act
What does it mean when we say the real estate industry is currently in a neutral market?
Supply and demand are about equal
Opt-out lists also known as _______ are only used for compliance purposes.
Suppression lists
The firm's target market information in the marketing plan includes which of the following? Average time on market Demographics Interest rate trends Inventory of homes
Target market information includes demographics, location, and price point related to potential buyers and sellers.
Tax incentives include tax exemptions, tax deductions, and ________
Tax Credits
The government may also increase the quantity demanded of a good or service by granting ____
Tax Incentives
______________ restrict use of the fax machine to deliver unsolicited advertisements
Telephone Consumer Protection Act
In which form of tenancy/estate do the landlord and tenant agree that the tenancy will have no specified termination date provided rent is paid on time and other lease conditions are met?
Tenancy at will
The agent works for the principal and works with, but not for, the third party
The Agency Relationship
My broker did not fill out our contract properly and the effective date is blank. Does this mean that the contract is invalid or void?
The Commission cannot make a determination about the validity of your contract. You should consult a private attorney regarding this issue. A license holder's failure to properly complete a TREC promulgated form completely and accurately could be considered negligence and subject the license holder to disciplinary action
What are the REALTOR® marks?
The REALTOR® marks include the terms REALTOR®, REALTORS®, and REALTOR-ASSOCIATE®, as well as the REALTOR® block "R" logo. These marks are all federally registered collective membership marks owned by the National Association of REALTORS® (NAR)
_____ allows an aggrieved consumer to hold a seller of goods and services liable for damages resulting from deceptive or unfair trade practices
The Texas Deceptive Trade Practices-Consumer Protection Act (DTPA)
Measures current construction activity
The Texas Residential Business Cycle (Coincident) Index
So how do successful investors consistently increase gross rental income?
The best way is to include a rent escalator in all leases
Question 37 Which phase of the business life cycle is characterized by a small scope of work, a tight budget, and an efficient operating structure? Birth Growth Maturity Midlife The birth stage is characterized by a small scope of work, tight budget, and efficiency.
The birth stage is characterized by a small scope of work, tight budget, and efficiency.
When may a broker act as an intermediary?
The broker has written consent from each party for the broker to act as an intermediary in the transaction and the written consent of the parties states the source of any expected compensation to the broker.
One of the biggest disadvantages to becoming a broker...
The broker is responsible for the activities of all sponsored agents at the brokerage
What must a broker disclose to his/her client?
The broker must disclose any information that could affect the client's decision regarding a property.
CAN-SPAM
The federal law that regulates unsolicited advertising through email
Which of the following statements correctly describes the manner in which taxes are prorated at closing?
The seller must be given a credit for prepaid taxes
After years of dreaming of starting a real estate brokerage, Alison Jones is taking steps to make her dream a reality. Her mentor, James Jewels, a successful brokerage owner, has explained that having a business plan is both smart and necessary. He says that some companies fail because they don't plan sufficiently (or at all) for various reasons. Which of the following is one common reason companies fail to develop and implement a business plan? Lack of excitement Lack of incentive Lack of motivation Lack of talent
The top reasons some companies don't develop and implement business plan include the lack of time, money, and talent.
Question 47 When comparing a leader to a manager, which of the following actions or traits demonstrates leadership? Being people-focused Being process-focused Directing Establishing policies and procedures
There's always a little crossover between traits a leader and a manager must have, but typically, leaders are more focused on people; managers are more focused on policies and procedures.
When demand is constant and the supply of homes is low, what happens to the prices?
They go up
How is inorganic growth achieved? By adding similar services to those already offered By incorporating industrial sales into a business model By naturally expanding geographically throughout the market area Through the acquisition or merger of another company
Through the acquisition or merger of another company
"Properly account for or remit" means
To pay the money to the party or parties entitled to the money if it can be reasonably determined to which party or parties the money should be paid
Why were real estate laws enacted?
To protect public from unscrupulous real estate practitioners
The Fed typically has one of two goals in mind when buying and selling securities:
To reach a targeted amount of reserve balances held at the Reserve or to reach a targeted federal funds rate
joe's total current assets are $278,000, his total assets are $455,000, and the equity amount on his balance sheet is $276,000. What is the total of his liabilities? $177,000 $179,000 $2,000 $394,000
Total assets less equity equals liabilities. Assets - liabilities = owner's equity, or $455,000 - $276,000 = $179,000.
______ can also include both written statements, known as libel, and spoken statements, called slander
Trade defamation
_______ is defined as an intentional, false communication, either written or spoken, that harms a business/person's reputation.
Trade defamation
Military leave. In Texas, employees may also take UNPAID time off work for military _____. Employees must be reinstated after their leave, and may not be discriminated against because of their military service.
Training
Insurance is an example of which way to limit of risk?
Transfer
Question 59 Charli has chosen to purchase only liability insurance on the office building she owns. Which of the following combinations of risk handling is she using? Acceptance and avoidance Avoidance and mitigation Mitigation and transfer Transfer and acceptance
Transfer and acceptance
A ______ plan for a merger should include financial guidelines for how each firm will share profits in the future. Acquisition ROI Transaction Transition
Transition
The Deceptive Trade Practices Act (DTPA) provides both public and private remedies
True
The Texas Property Code invalidates any deed restrictions that require wood shingle roofs
True
The seller and listing agent should disclose a murder that took place on the property to prospective purchaser
True
Alison has written the mission and vision statements for her brokerage, Honesty Homes. Armed with those and the situational analysis data, she's ready to begin forming business objectives. Starting out, her brokerage will be small, with only three licensees and a part-time administrative assistant. How many objectives would be reasonable to start off with? Five Four Three two
Two: While the number of objectives varies based on the brokerage's size, its number of employees, and how complex it is, a small organization usually has only two general objectives.
There are such things as natural monopolies, which occur for several reasons that are Not illegal. Public industries like the _____ are good examples of sectors where natural monopolies flourish
U.S. Post Office and the utilities industry
The _____ helps Americans start, build and grow businesses
U.S. Small Business Association (SBA)
Immobility
Unable to move or be moved
The federal _____ provides compensation, injunctive relief, attorney fees and punitive damages to companies that are harmed by theft or misuse of trade secrets.
Uniform Trade Secrets Act (UTSA)
The ____ agent has a great deal of authority in his or her principal's affairs. A legal guardian, for example, has all of the power of this agent
Universal
What are the three types of agency authority?
Universal, General, Specific
_____ can write ads, put up signs, deliver contracts and paperwork but cannot prospect for buyers or sellers
Unlicensed Assistants
The 3 basic types of compliance defined in the CAN-SPAM Act
Unsubscribe, content and sending behavior compliance
What monthly expenses are typically not very flexible?
Utilities, automobile, rent, and overhead are usually expenditures that are not very flexible.
The key to minimizing vacancies is having a plan to keep tenants longer and market _____ faster
Vacant properties
Not responding to a TREC investigator's request for an interview or documents is usually a straightforward ____
Violation
When selecting a site for a brokerage, in addition to suiting your purpose and cost efficiency, what else should you consider? Availability of financing Competition Storage Visibility
Visibility Considerations when selecting a brokerage site include visibility, ease of access, parking, whether or not it suits the purpose, and cost efficiency.
Jake is considering the hardware and software needs of his brokerage. When determining his needs, what should he consider first? Software The central processor The computing memory The user's level of experience
When determining hardware and software needs, it makes sense to consider the software first. That's because the computing power, speed, and memory required by a hard drive or central processor will be affected by the demands of the software applications.
When is the Deceptive Trade Practices Act typically used to bring a suit against a real estate person?
When property defects are discovered after the buyer takes possession of the property or when the salesperson has made a misrepresentation concerning the property.
Joan is trying to determine the amount of space she needs for her brokerage. Most of her licensees are rarely in the office .Which site selection considerations are most important for her needs? Energy efficiency Environment Parking Who uses the office Space priority should be given to those who use the office the most. She should consider who uses the office to decide if she needs a small or large space.
Who uses the office
Darius reviews the items on his sales meeting agenda. He wants to make sure that his associates see the meeting as time well spent, so he checks that all agenda items ________. Are directly related to real estate or licensing laws Are strategies backed by well-known real estate gurus Can be represented as a dollar value to his licensees Will help his licensees perform better or more easily
Will help his licensees perform better or more easily. Sales associates want a sales meeting to provide information and tools that will help them build their businesses or become better producers, so Darius is wise to keep his topics aligned with that need.
With which type of lease does the tenancy period automatically renew for an indefinite period of time?
With the period to period lease, periodic tenancy, subject to timely payment of rent.
Al Brown, an Oregon licensee, wants to put a "for sale" sign on property belonging to Tim and Deb. He can only do so...
With written authorization from Tim and Deb.
Why is it important for a broker to be empathetic?
Without empathy, a broker cannot build trust. And without trust, brokers will never be able to get the best effort from their salespeople.
To the extent that a deed restriction applicable to a structure on residential property requires the use of a _______, the restriction is void
Wood Single Roof
A broker may act as an intermediary between the parties if the parties consent in ____
Writing
A salesperson may NOT pay a commission or other valuable consideration to another person except with the ____ consent of the salesperson's sponsoring broker.
Written
If the transaction does NOT close, the money can only be released upon _____ of all parties involved
Written consent
One of the best statutory defenses that arises out of law is _____________
Written information relating to the particular goods or service in question obtained from governmental records (i.e. tax records)
A license holder shall provide to a party to a real estate transaction at the time of the first substantive dialogue with the party the ______
Written statement
Barry has a listing. Another company brought him an offer. Barry happens to know this buyer and knows this buyer filed bankruptcy a few years ago. Barry is concerned as to if the buyer can qualify for financing. Should Barry tell his seller what he knows about the buyer?
Yes
Is asking the same questions of each candidate a good interviewing strategy?
Yes, to be compliant with the ADA
May a license holder use an assumed name in business (DBA)?
Yes. TREC, however, must be notified in writing by the broker of the broker's or sponsored sales agent's use of an assumed name in business within 30 days of starting or stopping use of the name
Who has the most valuable information about your firm's operations to assist in identifying potential risk? Risk management consultants You and your staff Your attorney Your financial experts
You and your staff
You'll have various levels of business planning. When you get started, though, your focus should be on _____________. How quickly you can be up and running Your business's long-range plan Your end goal Your objectives
Your long-range plan, also known as the blueprint, master plan, general plan, or strategic plan, is the beginning point for the organization.
Before you set goals, what must you analyze?
Your office, your sellers, your buyers, your salespersons, your staff, and yourself
Filled with or showing a strong and energetic desire to get something done or see something succeed
Zealous
Blockbusting occurs when...
a broker uses racial fears to prompt people in a changing neighborhood to sell their homes.
A disclosed limited agency agreement is required for one agent to represent
a buyer AND a seller in the same transaction
On a balance sheet, which of the following would be considered a liability? A bank account Accounts receivable A debt owed
a debt owed
The Oregon property condition disclosure law applies to the sale of:
a dwelling which the buyer will reside.
Which of the following is an example of a service expansion, as opposed to a geographic expansion? Dave's firm decided to take on a new niche: golfers. Jennifer's brokerage opened up a new market across town. Ralph's firm began charging a slightly higher commission to its clients, based on market averages. Simone's brokerage used to service the east side only, but began serving clients on the west side as well.
a. Service expansion methods focus on offering services to additional niches, or more generalized services that could be used by many consumers.
Clarence's brokerage has been selected for an audit by the state regulatory agency. He doesn't worry, though, because he has ______. Accurate records A smart accountant Audit insurance The right to appeal any findings
accurate records
Accretion
additional of land
A broker who represents a party in a real estate transaction or who lists real estate for sale under an exclusive agreement for a party is that party's _____________.
agent
It is best if real estate employment contracts/business agreements are drafted by
an attorney
Tie-In Arrangements
arrangement that requires the buyer to agree to something in exchange for the sale.
LLC is formed by filing articles of ____________________ with the Texas Secretary of State
articles of organization
What does a balance sheet show?
assets and liabilities
Question 53 Which of the following is a preventive measure that takes very little time and can save hours of work if a computer system crashes? Backing up data Reinstalling software Rekeying data Retrieving data
backup data
The License Act provides for 2 types of licenses to be issued: _______________ & ________________
broker license & sales agent license
TREC refrains from becoming involved in disputes between __________
brokers & sales agents
The nuances of a sales associate's exact role in the brokerage are best explained in
business agreement
LLC & its business assets ARE / ARE NOT protected from any judgement creditors of its members
business assets ARE protected
After real estate broker Jones lists Mrs. Cale's home, Jones
cannot disclose any info about Cale, even after the listing expires.
What should a broker know about a competitor's commission structure?
commission rate the competition charges its clients the competitor's commission split structure with its agents
Reese and his staff have developed an engaging, action-oriented listing presentation to present to potential sellers. Which component in the marketing model does the listing presentation represent?
communicating
What are the four essential elements of a contract?
competent parties legal subject matter consideration for the promises contained in the contract mutual assent
central element of an antitrust violation is _______. A contract Customer relationships High stakes Interstate dealings
contract Antitrust involves a contract and conspiracy among competitors. Question 60
Which of the following should your contingency files contain?
copies of insurance policies and licenses
SUBCHAPTER A
deals with definitions, an explanation of required education
Question 50 Tyrone started a job in the sales department of a large firm. In an organizational chart, his department is shown alongside many others. Departments are run as teams with individuals at all levels responsible for making business decisions. What type of organizational structure is this? Centralized Decentralized Monolithic Vertical
decentralized
Warranty Deed
deed that guarantees a clear title to the buyer of real property
Estate at Will
end at any time
Oral agreements are valid in Texas but not ________________
enforceable
Illegal boycott is enforced by ______________________
enforced by Texas Attorney General
Estate from period to period (periodic tenancy)
enter an agreement for an indefinite time. no expiration date.
The balance sheet includes assets, liabilities, and ________. Cash flow Equity Expenses Net income/loss The balance sheet includes assets, liabilities, and equity.
equity
Which special lease clause stipulates increased rental rates at specific times during the lease term, or requires tenants to pay a proportionate amount of the overall increased utility expense, in addition to their base rent? Assignment/subletting Escalation Service included Tax
escalation Because expenses continue to increase to the point that landlords end up with no profit on real estate investments, many current office leases are designed to "pass on" the increase to individual tenants through an escalation clause.
Deeds
evidence of transfer
Most business plans include a synopsis of the plan as a whole, designed to be read by shareholders, lenders, and other third parties with an interest in learning about the organization. What is this synopsis called? Company description Description of services Executive summary Mission statement
executive summary
James is an unlicensed assistant at Franklin Brokerage and is paid a monthly salary. According to labor standards he is classified as a(n) ______ employee. Exempt FLSA Non-exempt Tax free
exempt
LLC is governed by _______________________
governed by the Texas Limited Liability Company Act
Reliction
gradual recession of water leaving land permanently uncovered.
Real Estate Investment Syndicate
group pooling resources to buy real estate
Angel Investor
invests in a company when it is still new and has the possibility of strong growth
Under Oregon statutory law, after a seller lists her property, she
is neither considered to have imputed knowledge of all facts known by her agent, nor has primary liability for all acts, errors and omissions of her agent
Buyer Kristin has a buyer agency agreement with Carlotta, a licensee. Kristin's brother, Dalton, is going to showings with Kristin and working to help her decide which house is the best fit. Who is/are Carlotta's client(s)? Kristin Kristin and Dalton Kristin and the seller The seller
kristin
What is one of the top reasons a brokerage fails?
lack of funds
What is the most frequent reason for the failure of a small brokerage?
lack of funds
Constructive Eviction
landlord fails to do something that he has a legal duty to provide
Estate at Sufferance
landlord is suffering as tenant is in possession passed agreed upon time
A quiet title action
lawsuit in order to establish a party's title
Venture capitalists
lend money and count on big returns
Less than Freehold Estate
limited period of time
Steering is an illegal practice which:
limits options for the buyer.
Question 51 As a broker-owner, you should be most concerned with __________ laws. Antitrust Local Local, state, and federal RESPA
local, state and federal
An agent who represents only the seller has the duty to
maintain confidential info about the seller, even after the listing expires.
Demographics play a key role in the ______________
market
A broker trying to make a sale
may make statements of opinion as long as they are noted as such and are not intended to deceive.
Broker F has been showing homes to buyer X and Buyer Y. When both buyers decide to make offers on the same property, Broker F
may take no action adverse or detrimental to either buyer's interest in the transaction
EBIT (earnings before interest and taxes)
measures the business decisions and the efficiency with which a company functioned.
A policy and procedures manual is best developed by
members of the firm under the direction of an administrator.
A brokers statement to a buyer that, " This house exceeds the requirements for insulation" when in fact the house does not meet the requirements is an example of
misrepresentation
A real estate broker associated with a principal broker may have his license suspended for...
misrepresentation
A buyer revokes his offer after receiving the property condition disclosure and requests the return of his earnest money. The broker...
must PROMPTLY return the earnest money.
With regard to real estate counseling activities of an associate licensee, a principal broker...
must assure that fee-for-service or consulting services are authorized.
Question 52 What is a benefit of affiliating with a national corporation? Increased decision-making authority Maximum control and flexibility Name recognition Shared office space
name recognition
A personal representative of a deceased person's estate who wishes to sell some of the real estate included in the estate needs a real estate license...
neither to advertise the property for sale nor to negotiate a sale.
The real estate industry is currently what type of market?
neutral
Personal assets of shareholders are _______________ at risk
never at risk
Freehold Estate
no fixed duration of ownership
Which of the following factors most directly determines the complexity of an organization's operating structure?
number of job roles
A broker's records must include a consecutively numbered file for each...
offer or transaction that involves the actual sale, purchase, ;ease option, or exchange of real property.
Title
ownership
Periodic Tenancy
period such as month to month
The best resource of start-up funds is:
personal loan
Sandwich Lease
primary party is lessee and a lessor
A real estate broker assoc. with a principal real estate broker in Oregon may handle a closing if authorized to do so by the... ?
principal broker supervising the transaction who, in addition, must file a signed copy of authorization with the Real Estate Agency.
Blockbusting is a term which means a...
real estate broker induces a homeowner to list his property by indicating that minority persons are attempting to buy property in the area.
Under the Fair housing Law, a property owner may
refuse to rent an apartment in a triplex to a member of a minority group if the owner occupies one of the units in the triplex.
A market analysis of the economic, _______, and competitive business environments should all be part of planning a new business. CCI GDP Regulatory Sales data
regulatory An analysis of the market includes a thorough evaluation of three key environments: economic, regulatory, and business.
Acceptance of a listing to sell a farm
requires a real estate license
The final step in the risk management process is _______. Risk handling Risk identification Risk management Risk tolerance
risk handling
Appurtenances
runs with the land
Rob listed Ann's home. Ann has accepted an offer, but the sale has not yet closed. Robert must
submit all additional offers to purchase received UNTIL the sale closes
Abstract of title
summary
Broker Allie wants to attract new licensees to her brokerage. Which of the following is a good way to do this? Ask her current licensees to act as ambassadors with their colleagues. Network at local real estate commission meetings. Pass out her card to licensees she meets at industry events. Talk to real estate school instructors.
talk to real estate school instructors. Strategies for recruiting new licensees include developing a relationship with real estate school instructors and simply talking about real estate as a career with non-licensees.
Avulsion
tearing away of land
Gross Lease
tenant pays fixed amount
Net Lease
tenant pays taxes, insurance and maintanence
A person needs a real estate license in order to negotiate between a buyer and a seller for the sale of a mobile home...
that is permanently located on land being sold with the mobile home.
An "agency coupled with an interest" means...
the agency cannot be terminated by the principal before the expiration date.
"First dollar defense: means:
the broker or salesperson pay only the deductible in an E&O claim.
A broker selling timeshare plans should tout (attempt to sell/promote) ...
the timeshare as a means of providing affordable family vacation accommodations.
Edgar and his management staff identified their work with real estate contracts as a potential risk to the firm. If Edgar hires an attorney to review every contract written in his office, which risk-handling strategy does this represent?
transfer
Having a seller's disclosure statement is the same as:
transferring risk
A disclosed limited agency agreement is required when
two agents in the same company will represent different buyers making an offer on the same property.
The FTC fines telemarketing companies up to _______________ for each call to a member of the Do Not Call Registry
up to $16,000 per call
Penalties for violating the Federal Fair Housing laws are up to _________ for the first violation and up to ___________ for subsequent violations
up to $75,000 for 1st violation up to $150,000 for subsequent violations
Expanding your business by adding specialized real estate fields is known as:
vertical expansion
Maslow's Hierarchy of Needs
we all have a set of needs we are constantly trying to satisfy
What is a "seasoned" lease?
when paid on time and met all terms of lease for a specific period.
Bootstrapping
when you do it yourself
A principal real estate broker is responsible to review and initial all the documents written by his associated real estate brokers...within
within 7 banking days from the date the document was accepted, rejected or withdrawn.
As supply increases prices will _____
Decrease
Builders do NOT have to be _____, in Texas
Licensed
Cloud on title
Defect in title. ex. single women married
What is the main use of a business plan?
Define goals and objectives of the business based on concrete evidence
Infected with HIV or having AIDS, being an alcoholic, and having a learning disability. However, if a party has entered a drug or alcohol treatment program they are protected under the handicapped laws.
Definition of Disability
The investment permanence of land, also known as ______ refers to the idea that the cost of both real estate and improvements to real estate take many years to recoup
Fixity
The Different Property Management Pricing Structures
Flat-Fee Pricing Structure, Percentage of the Rent and Hybrid
____ can determine the likelihood of success in any level of expansion
Location
A leader who displays the quality of being a visionary is able to do what?
Look ahead at trends to meet future market demands
Which factor should be considered when evaluating the competition in a given market area? GDP Market share New building permits Vacancy rates
Market share
Introduces the reader to the product or service that the business will provide and the techniques the business will use to promote it.
Marketing section
A person who controls the collection of ____ on a single family residence must have a real estate license
Rent
Commissions on in-house sales Cooperating transaction commissions Appraisal Fees Referral fees
Gross Income
The _______ indicates the strength of the economy.
Gross domestic product or GDP
There are two parts to the general operating budget:
Gross income and operating expenses
What are two challenges faced by franchises?
High franchise fees and loss of independence
A property that is occupied by its owner as a permanent residence is considered a ______
Homestead
A broker owes a customer ______ along with disclosure about the property. Brokers
Honesty and fairness
Ethical standards include
Honesty, Compassion and Loyalty
In _____, "The three most important factors are location, location, and location":
Horizontal Expansion
Oligopoly
Horizontal integration- A few competitors remain
Buyer borrows money for down payment and has to repay it. Lender thinks they used their own money for down payment
Silent 2nd
People were born between 1927 and 1945
Silent Generation
May unlicensed persons assist in arranging financing?
Yes; however, great care must be taken that the person acts solely in an administrative capacity
Surrender
agreement to return the property to the owner (landlord) before the lease ends
Chattel Real
cows moooove - personal property
It is the obligation of a real estate agent to be knowledgeable as a real estate brokerage practitioner. The agent should be informed on
(1) Market conditions affecting the real estate business and pledged to continuing education in the intricacies involved in marketing real estate for others; (2) National, state, and local issues and developments in the real estate industry (3) Exercise judgment and skill in the performance of the work.
Complete 18 hours of approved Continuing Education (CE) courses:
* 8 hours of TREC Legal Update I and II; and * 6 hours of Broker Responsibility Update * 4 hours of elective CE
Brokerage define what insurance that he or she is required to have.
*Automobile: The sales associate would be likely required to have the brokerage as a co-insured on their business vehicle. *Errors & Omissions: The sales associate would likely be required to have the E&O insurance or pay for their share of the brokerage coverage. *General Liability: The sales associate will almost always be required to have minimum liability insurance as well.
Staff and agents know to NEVER say things like:
*Before you decide to list with ABC Realty you should know they are a discount broker. No one shows their listings. *The Association of REALTORS® (or MLS) sets the rate. Everyone charges the same thing. *If I lower the commission no one with show your house
Highest Level Management
*Director *Chief Executive Officer *Chief operating Officer *Managing Director *Chief Finance Officer *Senior Accounting Manager *Senior Law Consultant
A company's image: Examples of image builders are
*Donating money to local non-profit organizations and charities *Promoting the company as an equal opportunity employer *Being affiliated with companies that have a good public image *Being able to substantiate claims
Employers may be required to offer UNPAID leave for reasons such as:
*Family and medical leave *Military leave *Military family leave *Jury duty *Voting
Businesses types are not eligible for SBA 7(a) loan program assistance because of the activities they conduct:
*Financial businesses primarily engaged in the business of lending, such as banks, finance companies, payday lenders, some leasing companies *Businesses owned by developers and landlords that do not actively use or occupy the assets acquired or improved with the loan proceeds *Life insurance companies *Businesses located in a foreign country *Businesses engaged in pyramid sale distribution plans *Government-owned entities *Businesses primarily engaged in political or lobbying activities *Speculative businesses (such as oil exploration)
A good real estate salesperson must:
*Have excellent communication skills *Be disciplined *Be organized *Be educated *Be able to work independently
To be eligible for SBA 7(a) loan program assistance, businesses must:
*Operate for profit *Be small, as defined by SBA *Be engaged in, or propose to do business in, the United States or its possessions *Have reasonable invested equity *Use alternative financial resources, including personal assets, before seeking financial assistance *Be able to demonstrate a need for the loan proceeds *Use the funds for a sound business purpose *Not be delinquent on any existing debt obligations to the U.S. government
Mid-Level Management
*Project Director *General Manager *Assistant General Manager *Deputy Director *Assistant director *Accounting & payroll Manager *Legal Consultant *Legal Assistant
Estate For Years
-Defined period of time -for example 6 months or July 4th - September 9th.
Brainstorming and focus groups are a big part of this style of management. Coercive Dictatorial Laissez-faire Participatory
participatory
Oregon Administrative Rules require principal brokers to
-Deposit earnest money into either a neutral escrow or the clients' trust account. -pre-number checks used to transfer funds from the clients' trust account.
A Quitclaim Deed
-Deed releasing a person's interest with no warranties. -Typically in non-sale situations
According to Oregon real estate license law, a principal broker....
-Must maintain a definate place of business -Is responsible for the actions of the brokers licensed under him and must supervise their professional real estate activity.
A Grant Deed
-Transfer of real property from one person or entity to another person or entity. -required to sign it
The six contract forms promulgated by TREC are:
1.One to Four Family Residential Contract (Resale) 2.Farm and Ranch Contract 3.Condominium Contract 4.Unimproved Property Contract 5.New Home Contract (Complete Construction) 6.New Home Contract (Incomplete Construction)
Protected classes under the federal Fair Housing Act
1. Race 2. Color 3. National origin 4. Gender 5. Familial status 6. Religion 7. Disability
What 5 transactions are exempt from RESPA?
1. Secured by 25 acres or more, whether or not improved 2. Primary purpose if business, commercial, or agricultural 3. Temporary loans (i.e. construction loans) 4. Secured by vacant or unimproved property when none of the loan proceeds will be used to contruct a 1-4 residence 5. For assumption of existing mortgages when lender has no right to approve subsequent persons as borrowers
Is time taken off from work to make up for unpaid overtime
Compensatory time (comp time)
A state attorney general may recover up to how much in damages (civil penalties) resulting from Sherman Act violations? An amount equal to the damages Five times the amount of damages Three times the amount of damages Two times the amount of damages
3xs In a civil action, states may recover up to three times the amount of damage suffered due to violations of the federal Sherman Act. The federal government can recover up to two times the amount of damage suffered by victims or gain made by perpetrators.
A principal broker has a financial interest in a company engaged in the construction of new homes. The principal broker is negotiating the sale of the new homes his company has built. At what minimum percentage of interest in the company would he be required to disclose in writing, in the sale agreement, that he is licensed and representing himself as a seller?
5%
On a sign or other advertising media, the broker's name or assumed name must be at least _____ of the size of the largest item of contact information
50%
What percentage of agents surveyed said they paid no monthly technology fee to their broker?
55%
In 2015 a Texas law was passed that made it a crime for harboring or concealing immigrants that are in the U.S. without documentation. Recently the U.S. Court of Appeals for the ____ clarified that landlords are NOT breaking Texas law and "harboring" if they rent to these individuals
5th Circuit
If you have sponsored one or more sales agents, served as the designated broker for a business entity broker that sponsors sales agents, or have been made a supervisor of other license holders, you will need to take the ______ Broker Responsibility Course as part of your 18 hours of CE
6 hour
Broker's License You may renew your license up to ____ after the expiration date
6 months
1st time conviction for stalking can lead to: Up to ______ of incarceration in county jail and a fine of up to ______
6 months, $2000
Oregon law requires that real estate principal brokers keep adequate records of all professional real estate activity for a period of _____ years after the date of the transaction
6 years
Under the federal Fair Housing Act, there are ____ protected classes
7
______ U.S. adults shop online at least monthly
70%
What is an Executive Summary and when should a broker write it?
A brief synopsis of the business . The broker should write it last and present it first.
How are market trends and specialization related? A brokerage can capitalize on a trend to identify a niche. Both are permanent. Both drive real estate prices. Neither are important to brokerages.
A brokerage can capitalize on a trend to identify a niche. Market trends, such as the interest in green housing, may point to a lucrative niche for a brokerage.
how are market trends and specialization related? A brokerage can capitalize on a trend to identify a niche. Both are permanent. Both drive real estate prices. Neither are important to brokerages.
A brokerage can capitalize on a trend to identify a niche. Market trends, such as the interest in green housing, may point to a lucrative niche for a brokerage.
Dwelling
A building or place of shelter to live in
What types of residential housing may be exempt from Fair Housing Laws under certain circumstances?
A building with no more the 4 units & the owner is living in one of the units or a single family home
The 1970 case against Prince George's County Board of REALTORS® involved a consent decree. What is this? A compromise where the party agrees to stop certain illegal actions without admitting guilt A decision issued by the court ordering the defendant to stop performing certain illegal actions A guilty plea An innocent plea
A compromise where the party agrees to stop certain illegal actions without admitting guilt. consent decree is a compromise
Option Agreement (Lease Option)
A contract between a tenant and landlord that gives the tenant the option of purchasing the property at the end of his or her lease period
Mike and Ike set up a real estate company. Mike, Ike, and Spike each own a portion of the stock. Mike & Ike Realty is a legal entity of its own. Mike is involved in a ______. Corporation Limited liability company Partnership Sole proprietorship
A corporation is a legal entity. Most likely, this is a close corporation.
Truth in Lending Act (TILA) (REG-Z: GodZILLA)
A federal law requiring lenders to provide residential loan applicants with estimates of the total finance charges and the annual percentage rate (APR)
What is the NAR Research Resource Guide?
A guide to the surveys, reports, data, and products that NAR Research has created, updated for the current year
Sarina's firm primarily uses electronic marketing communications, including emails, Twitter feeds, and Facebook posts. Which of the following marketing tools might receive special attention?
A hand-written thank you note
A company's risk management plan should involve two key components:
A lawyer and an accountant
Estate for years (tenancy for years)
A leasehold with a specific starting and ending date - it survives death or the sale of the property
When accepting compensation, which of the following statements is most accurate, according to the NAR Code of Ethics? A licensee shall not accept compensation directly from more than one party to a transaction. A licensee shall not accept compensation from anyone. A licensee shall not accept compensation from more than one party to a transaction without consent from the client. A licensee shall not accept compensation from more than one party to a transaction without the consent of all parties.
A licensee shall not accept compensation from more than one party to a transaction without the consent of all parties. Licensees may only accept compensation from more than one party with the full knowledge and consent of all involved parties. As a reminder, compensation goes through the broker and isn't given directly to the licensee by the parties involved.
Does not require proof of damages or reference to circumstances
A per se violation
Lessee
A person who acquires the right to possession and use of goods under a lease
Question 58 Which of the following statements is true regarding real estate licensing requirements? A person assisting a friend in selling a home must have a real estate license, even when no compensation is given. A person must have a real estate license in order to research a property that's for sale. A person selling a home as 'for sale by owner' must have a real estate license. A person who receives a $50 gift certificate for performing real estate activities on a friend's behalf must have a real estate license.
A person who receives a $50 gift certificate for performing real estate activities on a friend's behalf must have a real estate license.
What's a financing portfolio? A collection of your investments in the stock market A credit application A proposal presented to lenders or investors when seeking funding A summary of the various types of funding your firm uses
A proposal presented to lenders or investors when seeking funding A financing portfolio contains information that lenders or investors can use to determine the viability of funding your request.
Which license can charge a seller a fee to provide an estimate of the sales price of the seller's property for the purpose of obtaining a listing?
A real estate broker or principal broker.
Two things that an individual needs before she or he can start a brokerage firm:
A real estate broker's license and funding
Who typically runs a small-scale startup?
A single broker usually operates a small startup.
Rob doesn't know much about accounting, so he just reviews the monthly financial statements. He figures he doesn't need an accountant because Sally, who's been with the firm since it opened, does all the work, and she's very protective of the records. What's wrong with Rob's approach? A single individual shouldn't handle all accounting tasks. Everyone in the firm should have access to the records. Hiring an accountant will free Sally up to perform other tasks. Rob should know how to maintain the accounting records in case Sally leaves.
A single individual shouldn't handle all accounting tasks. One very important standard that helps prevent fraud is that no one person should perform all accounting tasks for a firm. Separating those duties helps prevent fraud and reduces the temptation to commit it.
Alison is taking steps to become the owner of her own real estate brokerage, Honesty Homes. She and the two real estate professionals who will become her first employees are drafting the firm's vision statement. Which of the following should be included?
A statement of what the company's future results, achievements, and successes will be
Search Engine Optimization (SEO)
A systematic process of ensuring that your firm comes up at or near the top of lists of typical search phrases related to your business
Canons of Professional Ethics and Conduct, what is Article 3
Competency
Licensees must use judgement and skill when exercising their duties.
Competency
The obligation of a real estate agent to be knowledgeable as a real estate brokerage practitioner
Competency
Which of the following statements about buyer representation is true? An exclusive agency relationship offers the buyer the highest level of representation, but restricts the buyer's right to self-represent. An exclusive right-to-represent relationship offers a buyer the lowest level of representation, and affords the buyer the greatest amount of autonomy. An open agency relationship gives the buyer flexibility, but limits the amount of representation received from any one professional. Open agency, exclusive agency, and exclusive right to represent all support a buyer's right to self-represent.
An open agency relationship gives the buyer flexibility, but limits the amount of representation received from any one professional. Open agency offers buyers with the most flexibility to work with multiple agents but limits the level of representation.
The National Association of REALTORS® Code of Ethics is reviewed and updated _____
Annually
A person who holds an _____ license can practice real estate while the other two cannot
Active
Express agreements and some implied agreements grant actual authority to the agent.
Actual
Broker Wright and Broker Bates are both associated with ABC Realty. Wright has listed his property that Bates is showing to his buyer. Adam is their principal broker. Under Oregon agency law...
Adam is a disclosed limited agent
_____ positions can be unlicensed employees
Administrative
What functions may an unlicensed office manager perform?
Administrative tasks such as training or motivating personnel, and those tasks dealing with office administration and personnel matters
The federal Fair Housing Act also protects families with children under the age of 18 living with one or more parent or guardian, as well as pregnant women and those planning to ____
Adopt
Written or oral statement or communication which induces or attempts to induce
Advertisement
The _____ is the newsletter from TREC and often contains information regarding changes in rules, contracts, etc.
Advisor
RESPA also requires that any time the closing agent refers a borrower to a firm with which the lender is affiliated, the lender must inform the borrower of the connection through an _______ Disclosure stating the relationship and that the buyer need not use affiliated firms.
Affiliate Business Arrangement (AfBA)
Place high emphasis on a "team first" approach
Affiliative leaders
____ relationships are the backbone of the modern real estate industry
Agency
Is any individual acting as a representative for another individual in dealings with a third party
Agent
Policy and Procedures Manual must include
Agent's Authorized Activity, Advertising, Compensation, Records Management, Trust Accounts
Leasehold Estate
Allows company temporary ownership of land to use for algaculture, business or dwelling
Index Lease
Allows for rent payments to increase or decrease relative to a selected set of economic conditions, which describes the value of money and goods at a particular time
Individuals with disabilities are protected under the _____
Americans with Disabilities Act (ADA)
Revenues from 2nd activities (Non operating revenues)
Amounts a business earns outside of selling services
Unconscionable action
An ___ __ is an action that takes advantage of the lack of knowledge of someone with more than a reasonable or acceptable level or amount.
If a large real estate company decided to expand by purchasing hundreds of brokerages across the country, this would be considered what?
An acquisition
If your business is struggling, but you want to survive while maintaining your name, logo, staff, and sales people, which of these is your best option?
An acquisition
Who would likely have the most difficult time creating a new relationship with the sales staff when transitioning into a managing broker role? A former managing broker from the same office A managing broker from another office An associate broker at the same office An associate broker from another office
An associate broker at the same office
Sometimes, the actions or words of a principal can convince a third party that the agent has authority when in fact the agent has no authority
Apparent
This section of a business plan should summarize findings and company highlights, rather than detail accounts of every document and piece of information the company holds
Appendices/Appendix
With the parties' consent, a broker acting as an intermediary between the parties may ____ a person who is licensed under The Texas Real Estate License Act and associated with the broker to communicate with and carry out instructions of one party and another person who is licensed under that Act and associated with the broker to communicate with and carry out instructions of the other party
Appoint
A tax exemption is a dollar-by-dollar reduction in the ____ of a property
Appraisal Value
Agency by Estoppel
Arises by the actions of the parties involved, rather than by a written agreement.
The SW ADA center services which 5 states?
Arkansas, Louisiana, New Mexico, Oklahoma, & Texas
When disbursing funds from the trust account, the broker, in complying with sound business practices should:
Ask parties for written information on receipts, releases, and authorizations
REALTOR® members agree to submit commission disputes between Brokers to arbitration through their _____
Association of REALTORS®.
ARELLO
Association of Real Estate License Law Officials
How often does the broker/agent need to download the National Do Not Call Registry?
At least every 31 days
How often must I access the registry and remove numbers from my calling list?
At least every 31 days
Where should an agent park when showing a house?
At the curb in front of the property
HUD may also ask the _____ to handle the suit in court to obtain temporary or preliminary relief.
Attorney General
________ are exempt from any of the provisions of the Texas Real Estate License Act. They are permitted to represent clients in real estate transactions by virtue of their license to practice law.
Attorneys
The amount of authority that an agent has differs depending upon the arrangement
Authority
Which of the following statements is true about a centralized management system? Administrative functions (e.g., training, accounting) tend to be decentralized. Authority is heavily concentrated at the top. Each major organizational function operates as a separate business unit. It is responsive and allows for more flexibility.
Authority is heavily concentrated at the top. centralized structure, authority is at the top and flows down to levels of senior management.
A broker may only _____ another license holder to withdraw or transfer money from any trust account, but the broker remains responsible and accountable for all trust money received by that broker and all deposits to or disbursements from the trust account.
Authorize
Similar to the dictatorial style, but it is not as authoritative
Autocratic
Periodic Estate (Periodic Tenancy)
Automatically continuing for consecutive periods of time (month to month)
Jarvis, a broker, discusses antitrust scenarios at staff meetings and makes certain his firm makes independent decisions about co-op fees. This is a great way to __________. Avoid antitrust violations Eliminate the competition Get in trouble with the DOJ Inadvertently violate antitrust law
Avoid antitrust violations
What are ways to limit risk?
Avoidance, transfer and reduction
What are the four essential elements of a valid contract?
Competent parties, legal subject matter , consideration, & mutual assent
Percentage Lease
Based upon a percentage of gross receipts
A licensed business entity real estate broker qualifications
Be authorized to transact business in Texas and Designate an active Texas real estate broker to act on behalf of the organization
Creditors view a higher debt to equity ratio as risky ______?
Because creditors have invested more in the business than investors
Payment of the CE Deferral Fee allows you to remain active for an additional 60 days from your expiration date to complete CE requirements. To receive the additional 60 days to complete any outstanding CE, the CE Deferral fee must be paid ____ the expiration date of your license.
Before
The best time to think about selling a brokerage is when?
Before you open it
The _____ course is to address the regulatory aspects of the management, operation and supervision of a real estate brokerage firm in Texas. The course provides an understanding and working knowledge of a broker's responsibilities and obligations under 22 TAC §535.2.
Broker Responsibility MCE
Once the annual general operating budget has been established, the broker should set up monthly ______ to determine whether or not the company is meeting its financial goals.
Benchmarks
The practice of encouraging the panic selling of homes below market value, generally by raising fears that an influx of individuals belonging to a particular minority group will decrease property values in a neighborhood and affect the area negatively.
Blockbusting
Stating or implying that property values may deteriorate because members of a specific class are moving into or out of a neighborhood is called _______. Blockbusting
Blockbusting, or panic peddling, is the term used for trying to induce sales by communicating that members of a particular class are moving into or leaving a neighborhood.
List five possible funding sources.
Bootstrapping Going into debt Friends and family Angel investors Venture capitalists
A principal real estate broker must keep, among other things, records of which of the following? I. receipts for earnest money deposits that were returned to the purchasers after the sales failed II. Listing agreements of unsold properties
Both
Which of the following is TRUE of a personal representative of a deceased person's estate who wishes to sell some of the real estate included in the estate?
Both I. He can advertise the property without a real estate license. II. He can negotiate the sale of the property without a real estate license.
2 antitrust violations that affect real estate companies are
Boycotting and Price Fixing
If a broker has more than 1 place of business, a _______________ is required for each location.
Branch office license is required for each location
Brian received an earnest money check from his buyer. He presented it to the seller's broker. What should he do now? Ask for the check back to deposit it into his business account. Get and keep a receipt for the funds he transferred. Note on the contract that he transferred the funds. Record the disbursement in his escrow ledger.
Brian wouldn't use an escrow ledger because he didn't deposit the funds. He should get a receipt for the check and retain the receipt in his transaction files.
Agents should NEVER respond to a subpoena or provide a deposition related to an E&O claim. The agent must notify the ____ and they will notify the E&O company.
Broker
Only a _____ can enter into an agency relationship with a seller, buyer, landlord or tenant
Broker
Some national Internet websites aggregate some of the MLS data from across the country and allow potential home buyers to search the databases
Broker Referral Networks
How does a licensee's liability change after becoming a broker?
Broker is liable for themselves and their agents
Which of the following statements describes business objectives? Business objectives are derived from business goals and align with the strategies that direct the actions laid out in the company's long-range plan. Business objectives are derived from situational analysis data and align with and expand upon the company's mission to define what the organization will focus on for the duration of its long-range plan. Business objectives are derived from the company's strategies and expand upon them to define how much money the company will make by the end of its long-range plan. Business objectives are derived from the company's vision statement and expand upon it to define what the company's reputation will be at the conclusion of its current long-range plan.
Business objectives are derived from situational analysis data and align with and expand upon the company's mission to define what the organization will focus on for the duration of its long-range plan. The situational analysis data and company mission form the basis for the creation of business objectives, which will define what the organization will focus on for the duration of its long-range plan.
A ______ will include information about the company—such as the Mission Statement, the Vision Statement, a description of the business, marketing techniques, operating procedures, competition, and personnel
Business plan
The purpose of a _____ is to direct the organization's financial and human resources to the activities that will yield the greatest return on investment
Business plan
SCORE is volunteer business people helping small business people solve _____
Business problems
IT Infrastructure
Businesses entire collection of hardware, software, networks, data centers, development equipment, test, operate, monitor, manage, support IT services
Businesses and establishments affected by the ADA:
Businesses with 15 or more employees, Any facilities or offices affiliated with state or local government, Public and private schools, Hospitals and dental offices, Hotels and motels, Grocery and retail stores, Shopping malls, Libraries and museums, Banks, Theaters, Amusement and recreation parks
In the context of real estate, consumer is the _____
Buyer
TREC does NOT provide Listing Agreements, _____ or Property Management Agreements
Buyer's Representation Agreements
How do government regulations impact a real estate brokerage?
By increasing liability (more to comply with)
Bid-Rigging
Competitors' agreement that one bidder will have the lowest bid for a particular job
A person CAN / CAN NOT hold both a broker license & sales agent license at the same time?
CAN NOT hold both at the same time
____________ requires the sender's message to include a valid physical address & an unsubscribe feature active for 30 days after the message is sent
CAN-SPAM Act of 2003
An illegal group boycott is an agreement among two or more competitors not to do business with another competitor for the purpose of inducing the other competitor to change its business practices
Group Boycotts
Acquisition
Company purchases another company to expand its operations
General Operating Budget
Company's financial picture how company plans to use financial resources, projected income and expenses over period of time
Consumer whose number is not on the national registry can still prohibit individual telemarketers from calling by asking to be put on the _____ do not call list
Company's own
Organic Growth
Companys existing business growth
A _____ will track the status of all of your leads, and remind you to follow up with them on a regular basis
CRM system
Anyone who is going _____ with people to prospect for buyers and sellers MUST have a valid real estate license
Call or visit
Grants all citizens of the United States—without exception—a set of basic rights regardless of their race, color, or previous condition of servitude. Among the rights granted by this Act are the rights to "make and enforce contracts, to sue, be parties, and give evidence, to inherit, purchase, lease, sell, hold, and convey real and personal property."
Civil Rights Act of 1866
The Department of Housing and Urban Development, commonly referred to as HUD, enforces the ______
Civil Rights Act of 1968
Registered sex offenders. The law says the agent has NO duty to disclose but with the ______ the agent MAY Disclose
Client's Permission
When analyzing her competition, what are the two parts of commission structure that a broker should know?
Client's commission and agent's commission
What is a flat-fee pricing strategy?
Clients are charged a pre-set fee for a pre-determined service.
Are ones who spends a great deal of time and energy on the individuals in a given group
Coaching leaders
Real-estate brokers constantly work collectively, presents many opportunities for illegal _____
Collective activity
Good leaders share 3 C's
Communication, Commitment and Charisma
Business plans serve three basic purposes:
Communication, management and planning tools
The _____ seeks to enable all parts of a community, no matter if a wealthy community or a poor community are able to have access to credit.
Community Reinvestment Act (CRA)
The _____, passed in 1977, requires lenders to assist their local communities by participating in community development projects. The Act also requires that lenders submit an annual statement including public comments about their attempts to help low-income communities.
Community Reinvestment Act (CRA)
Brokers may also require the agent to have automobile insurance and name the _____ as an additional insured
Company
What should the broker include in the Company Section of the business plan?
Company history, strategy and management team
Economic Scarcity
Created solely by demand for land in particular areas -most valuable when it is in short supply and high demand -some land is more desirable than other land
When a sales associate is interested in possibly pursuing a switch to a managerial role, the broker can use ______________ to help the associate decide if it will be a good fit. A training presentation Counseling Cross-training Mentoring
Cross-training is a way to help a worker experience another type of role before making a decision.
New way of making investments and loaning money on the internet
Crowdfunding
A(n) ________________ is certain to save a brokerage money.
Culture of retention
Commonly, the Federal Trade Commission will receive leads about a potential antitrust violation through which avenue?
Hearing consumer complaints
What is the purpose of a mission statement?
Helps identify who you are
Bonding Program (Surety Bonds)
Helps small business contractors who cannot obtain surety bonds through regular commercial channels
A policies and procedures manual should serve to do all of the following EXCEPT: A. answer routine questions on practices and procedures. B. stabilize policies, procedures, and practices of the brokerage. C. provide considerable freedom of action, rather than broad policy limitations. D. attempt to cover procedures for every business situation.
D. attempt to cover procedures for every business situation.
All of the following are true to the Timeshare Estates law EXCEPT A. it does not apply to programs with 12 or fewer interests. B. it requires delivery of a public report to a purchaser prior to execution of the purchase contract. C. it provides for a rescission period of five calendar days after the purchase. D. it requires that the availability of an exchange program be touted (promoted) as the main selling point of the sales presentation.
D. it requires that the availability of an exchange program be touted (promoted) as the main selling point of the sales presentation.
A real estate broker associated with a principal broker is allowed to accept a commission directly from which of the following? A. an escrow agent. B. the seller. C. the buyer D. None of these
D. none of these A real estate agent may only accept commission from his principal.
Unless a licensee has committed an unconscionable act, misrepresentation of a material fact, or a failure to disclose with the intention of inducing a consumer into a transaction, the licensee can NO longer be held liable under _____
DTPA
Title insurance
Ensure clear and marketable title
Chain of Title
History of ownership which shows conveyances and encumbrances
The ________ requires lenders to disclose specific lending information, which HUD then uses to map lending patterns
Home Mortgage Disclosure Act
An as-is clause might bar claims brought under the _______
DTPA
Business owners typically opt for ______ because loans are a fixed expense, the creditor does not have any ownership rights in the business and the interest on the loan is tax deductible
Debt financing
Agent should always keep ____ notes throughout the real estate transaction
Detailed and accurate
When Andrew schedules a sales meeting at his brokerage, he prepares well in advance by ___________.
Developing an agenda, talking points, visuals, and handouts
Extremely structured and restrictive; this means that the manager has complete control over every aspect of the organization
Dictatorial
Which of the following most completely describes the cost of sales concept? Commissions paid to sales staff Cooperating broker commissions the firm received Direct costs, plus a portion of indirect brokerage expenses Direct costs, such as referral fees and cooperating broker commissions
Direct costs, plus a portion of indirect brokerage expenses Every dollar a firm earns has a cost. Some costs, such as referral fees and commissions, are easy to attribute directly to a specific sale. A portion of other brokerage expenses, such as utilities and rent, should also be allocated to each sale.
A tenant with Tourette's syndrome who cannot help making loud noises throughout the night may pose an indirect threat to other tenants through the long-term effects of sleep loss, but does NOT pose any immediate, ______
Direct threat
Although you may not discriminate against people because of a disability, it is NOT illegal to refuse housing to prospective tenants or to evict current tenants who have a physical or mental impairment that poses a ____ of harm to other tenants
Direct threat
______ offer buyers and sellers full-service real estate brokerage services at a price lower than the prevailing commission fees
Discount brokers
Sometimes companies charge a _____, and for a new business owner that may be a great way to go. You can build your business quickly that way; just make sure you don't over-commit to all the things that will fall under that set price, otherwise you'll be doing a lot of work for free
Flat-fee
Horizontal Expansion
Expanding in other locations and buying other offices
Vertical Expansion
Expanding new operations (ex: add mortgage company to brokers business)
Which budget type takes variable expenses into account and thus provides a more realistic picture of a brokerage's current financial status?
Flexible budget
These sellers market their homes themselves by placing ads in local media, posting signs, and conducting their own open houses
For-sale-by-owners (FSBOs)
Question 38 What is the best way for a brokerage to be culturally savvy? Advertise to a diverse segment of the community. Attend community events. Employ staff who are familiar with the customs, languages, and needs of people from different backgrounds and cultures in your community. Require all employees to take cultural diversity training.
Employ staff who are familiar with the customs, languages, and needs of people from different backgrounds and cultures in your community.
Population growth and decline in an area is usually the result of which type of changes?
Employment opportunities
ADA addresses discrimination in four general areas:
Employment, Public Transportation:, Public Accommodations and Commercial Facilities and Telecommunications
Question 46 Which of the following is essential software for most brokerages? Desktop publishing Financial management software Image editing Servers
Financial management software
The _____ status means that the license holder did not renew his or her license
Expired
Duties that the principal specifically tells the agent to do
Express Actual Authority
Does NOT need to be in writing to be valid
Express Agreement
Most agency relationships are formed by this agreement, where a principal appoints an agent, and the agent accepts the appointment.
Express Agreement
Congress added new sections of __________________ to address identity theft
FACRA (Federal Fair Credit Reporting Act)
One section of land is est. by...
Government survey
The _______ of the business plan includes cash flow statements, income statements, profit and loss statements, balance sheets, and a first-year budget
Financial section
In Texas, most employees work at will. This means they can be ____ at any time, for any reason that is not illegal.
Fired
Responsible for the general upkeep and maintenance of buildings to ensure that they meet health and safety standards and also the legal requirements. They need to manage the cleaning, waste disposal, catering, security and parking of each site, while managing the budgets and keeping records of all payments. Managing the office systems, which can often include the IT and office equipment.
Facilities Managers
*Environmental Issues (Wetlands, Endangered Species, Soil Contamination, Asbestos, Radon, Stucco, Lead Paint, Electromagnetic Forces) *Flood Zones/ Mud Districts/ Zoning Issues *Information to Buyer's and Seller's regarding Assumptions *Items that do not stay with the Property *Mandatory Membership in an Owner's Association and Resale Certificates *New Home Insulation *Property Condition (Roofs, Drainage, Foundation, Plumbing, *Electrical, Termite Damage, Artificial Stucco) *Representation by the agent *When the agent is acting as a Principal *Roll Back Taxes and Tax Exemptions *Stigmatized Property (Unrecorded Cemeteries, Notorious Properties, Violent Death,) *Title Notice recommending buyer obtain a title policy or an abstract
Factual Information
When filling out the TREC contract forms, licensees should only include information that they know is _______
Factual and Truthful
Civil Rights Act is also known as
Fair Housing Act
Shortly after the assassination of Dr. Martin Luther King Jr., Congress passed the Civil Rights Act of 1968. Title VIII of this Act, also known as the _______, prohibits discrimination in real estate practices
Fair Housing Act
The federal ______ sets the wage and hour standards employers must follow, including the minimum wage, overtime, and other wage protections
Fair Labor Standards Act (FLSA)
Which two agencies enforce antitrust laws? Department of Justice and the Department of State Federal Trade Commission and Department of Justice Federal Trade Commission and Department of State United Nations and Federal Communications Commission
Federal Trade Commission and Department of Justice
Military leave. The federal Uniformed Services Employment and Reemployment Rights Act (USERRA) and Texas law both require employers to allow employees to take leave from work for ______
Federal or state military service or duty
Licensees must be faithful and observant to the trust placed in them, as well as scrupulous and meticulous in performing task.
Fidelity
5 Canons of ethics
Fidelity, integrity, competency, consumer information, non-discriminatory actions
A broker owes the highest ____ obligation to the principal and is obliged to convey to the principal all information known to the agent that may affect the principal's decision, unless prohibited by other law
Fiduciary
Agency relationships are _____ in nature because one person places trust and confidence in another to responsibly handle the obligations of the position as his or her representative.
Fiduciary
A ______ is one where one party (the client) puts complete trust in another party (the agent).
Fiduciary relationship
A lender may ask only questions that are relevant to an individual's ____ standing. This means that while asking if someone is divorced is inappropriate, asking if someone must pay alimony is acceptable
Financial
Cost of both real estate and improvements may take years to recoup
Fixity
Top 3 mistakes beginners want to avoid?
Forgetting their mobile customer, Implementing the mobile site on a different domain, subdomain, or subdirectory from the desktop site and Working in isolation rather than looking around for inspiration
Steps to Take If W-9 Is Not Completed: If you still do not receive the W-9, file the ______ and write in the field for the cooperating broker's tax ID number "refused to provide."
Form 1099-MISC
You should address an email with the same _______________
Formality of speaking
GRI—
Graduate of the REALTOR® Institute
Assignment
Grants possession and responsibility
Sub Lease
Grants possession but not responsibility
Nat has a friend who's in the home construction business, and he says that in the last six months, there's been an increased demand from developers to build homes that are more energy efficient and use sustainable, non-toxic building materials. What current market trend is this an example of?
Greener buyers
Strong economic growth can also indicate future inflation
Gross Domestic Product (GDP)
An outline of how the company will allocate its financial resources. It is a forecast of anticipated income and expenses for a specified period of time (normally one year).
General Operating Budget
___________ is responsible for day-to-day operations of the business and has full liability
General Partner
The agents will have a _____ relationship with you as their sponsoring broker. It makes the broker liable and responsible for the agent's transactions
General agency
What are the two types of partnerships and which one is the most frequently formed?
General and limited are the two types of partnerships and general is the most frequently formed.
Which type of partner shares full personal liability for the partnership's debts and obligations? Close Franchisee General Limited
General partners share full personal liability for the partnership's debts and obligations to the extent of their ownership.
Born between 1965 and 1976
Generation X (Latchkey Kids)
Effective, especially on social networking sites like Facebook and LinkedIn. These can target very specific demographics. They work best when coupled with a tangible giveaway like an eBook
Giveaway Campaigns
Alison has written the mission and vision statements and defined objectives for her up and coming brokerage business, Honesty Homes. Now it's time to set some goals. She asks her mentor, brokerage owner James, for some guidance on what goals are, and how to write them. What advice do you think James would offer Alison? Goals regarding future revenue should be based on solid assumptions. Goals should be challenging and based on what experienced competitors are doing. Goals should be specific, measurable, attainable, realistic, and timely. Goals should have strict start dates and flexible end dates. Goals should be SMART: specific, measurable, attainable, realistic, and timely.
Goals regarding future revenue should be based on solid assumptions. X Goals should be challenging and based on what experienced competitors are doing. X Goals should be specific, measurable, attainable, realistic, and timely. Goals should have strict start dates and flexible end dates. X ans: Goals should be SMART: specific, measurable, attainable, realistic, and timely.
Role, structure, and membership of the Board; actual powers of the director and other administrators; parts that others - line staff, participants, community - play in the governance of the company
Governance structure
What is the primary driver of demand?
Growth in employment
What are the three stages of the real estate market?
Growth, Equilibrium, Decline
Charli is thinking about buying only liability insurance for the office building she owns. She knows she'll have to pay for any damage to the building. What factors should Charli consider in making this decision?
Her willingness and ability to withstand the risk posed by carrying only liability insurance (risk tolerance)
Name 3 defenses that would probably work in a DTPA lawsuit.
Have an inspection report Have seller's disclosure Have info given by government that can be assumed true.
Candidates for a broker license must also meet the following experience requirements:
Have at least four years' active experience as a licensed real estate sales agent or broker during the 60—month period preceding the filing of the application, Your experience must total 3600 points and be reported on the Qualifying Experience Report for a Broker License. You must also include a transaction identification list for each transaction claimed on the experience report
The thing to look out for is where it says________. Neither are necessarily the rates you'll be offered for your loan, as the rate you'll get will be personalized to your circumstances.
Headline rate or Rep/ Representative APR
Under Oregon's agency disclosure law I. prior to entering into a listing agreement, a real estate licensee must give a Real Estate Disclosure to the seller II. a seller is prohibited from paying a buyer's single agent's commission
I only
The Fair Housing Act covers which of the following? I. All buildings of five or more dwelling units. II. rental of the owner-occupied duplexes and 4-plexes.
I. All buildings of five or more dwelling units.
According to the Administrative Rules and Regulations of the Oregon Real Estate Agency, every listing must
I. Contain a definite expiration. II. Be reviewed by the principal broker or manager of a branch office within seven banking days of the date the listing is accepted by the owner.
How does the CAN-SPAM Act apply to real estate agents?
Licensees writing to their clients or customers about their transaction are exempt. This Act deals with emails sent to the list of clients advertising their services or listings.
If a principal broker wants to authorize another licensee in his office to supervise in the principal broker's absence, the principal broker must, among other things, include which of the following in the notice to the Real Estate Agency according to the Oregon real estate license law?
I. Specify the dates of the principal broker's absence. II. Have the authorized licensee sign the notice accepting the supervisory responsibilities.
A principal real estate broker may share his commission with I. a cooperating principal real estate broker under an oral agreement. II. the seller's attorney.
I. a cooperating principal real estate broker under an oral agreement.
Oregon real estate license law restricts brokers associated with principal brokers from...
I. bringing a lawsuit against a seller for payment of commission. II. directly accepting a finder's fee from a principal broker with whom the broker is not licensed.
In Oregon, a real estate license is needed to sell a business if...
I. transfer of ownership is involved II. a leasehold interest in the real property on which the business is located.
An _____ notice is required to be given at the first substantive communication
IABS
Under the Federal Fair Housing Act, which of the following practices is prohibited? I. a Live-in owner's refusal to rent a unit in a two-family dwelling to any member of a certain religious group. II. A broker's refusal to show a dwelling to a prospective purchaser because of the latter's ethnic background.
II. A broker's refusal to show a dwelling to a prospective purchaser because of the latter's ethnic background.
Which of the following is correct about listing agreements? I. The buyer must be given a copy upon request II. A copy of a listing agreement must be kept with the principal broker.
II. A copy of a listing agreement must be kept with the principal broker.
FACRA added new sections to address _______________
Identity Theft
What do the rules say about a complaint lodged against a salesperson?
If a complaint is made against a salesperson, it is also against sponsoring broker
What are the 2 main issues regarding whether a person needs to be licensed to sell real estate?
If the real estate transaction is on behalf of someone else and/or there is an expectation of compensation.
________ is an agreement among 2 or more competitors not to do business with another competitor for purposes of inducing the other competitor to change its business practices
Illegal Boycott
The practice of combining a principal real estate broker's personal funds with those of a client is
Illegal according to the Real Estate Agency administrative rules.
Actions that are necessary to complete the duties that were expressly authorized
Implied Actual Authority
The principal and agent may never explicitly state the nature or terms of the relationship, but the agent will be held to the duties of an agency relationship
Implied Agreement
Alteration
Improvements
A consistent disparity in listing versus selling prices may reflect ___________.
Inaccurate competitive market analyses
An _____ status means that the license holder does NOT have a sponsoring broker
Inactive
The effectiveness of a classified ad is best determined by its ability to
Incite the reader to call the office
U.S. Small Business Administration (SBA)
Independent agency of federal government to aid, assist and protect the interest of small business
What are two types of funds for starting a business operation?
Individual financing or funds from professional lenders
Which of the following statements is true regarding risk identification? It involves analyzing the level of exposure associated with risks the firm faces. It involves reviewing every aspect of the firm's operations to determine what risks each poses. It's the final step in risk management. It's the process of categorizing financial risks of various investments.
It involves reviewing every aspect of the firm's operations to determine what risks each poses.
Oregon's agency disclosure law applies to
Industrial property residential property commercial property
________ is a general rise in prices; it results in a decrease of the dollar's purchasing power
Inflation
A company website should provide customers with:
Information about its products and services A company description Contact information Office locations
What two types of items are typically stored in a brokerage office?
Infrequently needed items Past client files
If you suffer an on-the-job _____, you will likely be eligible for workers' compensation
Injury or Illness
The rate of growth of business, sales expansion etc. by increasing business reach by acquiring new businesses by way of mergers, acquisitions and take-overs
Inorganic Growth
To prevent the broker from becoming a common law dual agent, Texas has specific laws called the intermediary laws. The broker that is representing both the buyer and the seller in the same transaction becomes an ______
Intermediary
Graduated Lease Agreement
Is usually a long-term lease that is periodically adjusted to reflect changes in the appraised value of the leased property
Which option best describes what an environmental impact statement is?
It describes and analyzes a proposed action that may have a significant effect on the environment.
A coaching framework is useful at a brokerage because ______.
It gives structure to the coaching process, which helps it be most effective
Littoral Rights
Lake - body of water standing still
Non Fungible
Land is unique
Non Homogeneity
Land: No two pieces are exactly alike
After filling out the application and asked about criminal history. Sam did have a misdemeanor charge several years ago but did not put it on the application. He decided it was too long ago to mention. A misdemeanor charge was on a background report. What do you think TREC will do?
It is very possible TREC will consider dishonesty on the application and a sign of untrustworthy. They will listen to the reasoning but he will probably not get a license
Developing and implementing a solid business plan is challenging. The challenge can be lessened by following some key concepts. Which of the following is a concept that applies to a good business plan? It allows the company to invest time, money, and resources into some risky ventures. It encourages the owner to abandon the course in response to unforeseen market conditions. It focuses solely on the present market conditions and the organization's strengths. It requires buy-in and integration throughout all levels of the organization.
It requires buy-in and integration throughout all levels of the organization. A business plan is the organization's guidepost to doing what's right, and it requires cooperation and commitment from everyone in order for it to be effective.
why is the Consumer Price Index (CPI) important? It's a measure of the public's confidence. It's the best general indicator of inflation. It's used by the Federal Reserve to adjust monetary policies. It tracks growth or lack of growth of personal consumption.
It's the best general indicator of inflation. CPI essentially measures changes to the cost of living. A high CPI indicates lower purchasing power for consumers and potentially less demand for goods and services.
Unsolicited advertisements sent to a fax machine are sometimes called ____
Junk Faxes
Bribe or payment that's given to someone as a reward for their help with something
Kickback
A useful provision from your point of view, which spells out your rights as a tenant if your landlord's mortgage company forecloses on the leased premises
Landlord's Solvency
Which of the following is a test the IRS uses for establishing a licensee as a self-employed independent contractor? Compensation is paid by the buyer or seller in the transaction directly to the independent contractor. Language in the written agreement states that the licensee will not be treated as an employee for federal tax purposes. Taxes are withheld from a licensee's compensation. The licensee is paid hourly.
Language in the written agreement states that the licensee will not be treated as an employee for federal tax purposes.
Debt to be repaid
Liability
Both C and S Corps offer limited ______
Liability protection
What are three additional conditions of choosing a business structure?
Liability, cost and ease of set-up, and ease of operation.
List 6 types of insurance that a brokerage should consider having.
Liability, key person, building, contents, auto, errors and omissions
Non-management
Laissez-faire
_______ is a marketing platform to share info & get CMA info
MLS
what is the difference between leadership and management?
Management gets its power from the position. Leadership gets its power from influence.
The business owner identifies the owners and employees in the _____ of the business plan and explains how their skills will benefit the company
Management section
Allows business owners to track their progress
Management tool
Broker/Owners become responsible for the______ of the entire company
Management, operation and supervision
The Broker will become both the Leader and the _____
Manager
Question 44 A ______ would fulfill his or her assigned role within the brokerage by supervising licensees and staff. Clerk Manager Personal assistant Sales associate
Managers are responsible for directing the work of others to ensure that business goals are met.
Why might a real estate professional be a good source of investment funds?
Many would like to own a real estate brokerage but don't want to manage it.
Lenders are obliged to leave a _____ on your credit file when you apply for a loan. This is to help the industry make their borrowing decisions
Mark
The only way to grow using existing services and markets is to increase ______.
Market Share
______ is the percent of unit and dollar sales a company holds within a certain market vs. all other competitors
Market Share
Provides information pertaining to a business' customer base—such as their age, income, education level, household structure, and the number of people who rent. Analyzing
Market analysis
The agent should be informed on:
Market conditions affecting the real estate business and pledged to continuing education in the intricacies involved in marketing real estate for others; Be informed on national, state and local issues and developments in the real estate industry; and Exercise judgment and skill in the performance of the work
Market Penetration
Market existing services within the same market
Horizontal Integration
Merging 2 or more companies at the same point in their business
Trina's brokerage is a key player in the real estate marketplace. After 12 years of steady expansion, growth has slowed to a less-aggressive pace, allowing Trina and her management team to evaluate current operating structures and assess whether to take on new ventures. What stage of the business life cycle is Trina's business in? Decline Growth Maturity Midlife
Midlife In the midlife stage, the company is a key player in the marketplace. Growth is less aggressive, and taking on new ventures is an option
People born between 1977 and 1994
Millennials (Generation Y or Boomerang Generation)
A Realtor team is like a _____ inside of a larger brokerage.
Mini company
Proof of Ownership Documents
Minutes of the company meeting designating ownership percentages A Company Resolution indicating the percentage owned by the designated officer/manager/partner Articles of Organization/Incorporation that include ownership percentages Schedule K-1 (Form 1120S) from the IRS (Shareholder's share of income, deductions, credits, etc.) Schedule C (Form 1040) from the IRS Limited Partnership Agreement designating ownership percentages
A general business objective is designed to expand on which of the following? The company's core values The company shareholders' goals The company's mission statement The company's vision statement
Mission Statement-The purpose of business objectives is to state what the company will focus on to fulfill its mission, and to become the priorities during the plan's defined timeframe.
What are three advantages of becoming a broker.
More money generated through the efforts of others. Pride of ownership centralized decision making
TSAHC also provides an annual tax credit to qualifying first-time homebuyers through the issuance of a _____
Mortgage Credit Certificate (MCC)
It is interesting to Note that you can be too young to get a _____ but you cannot be too old
Mortgage loan
In a triple-net lease the tenant pays...
Most fees and other expenses for the property.
CAN-SPAM requires that messages have a ___________________ that is active for ______________ after message is sent
Must have an unsubscribe feature Active for 30 days after message is sent
If a broker joins _____ they have to agree that all of their associated agents will also become a member
NAR
Not all license holders will be member of ________________
NAR
Independent Contractors
Own boss
S Corps cannot be ____ by a C Corp, LLCs, partnerships, or many trusts.
Owned
C Corps have NO restriction on ____, they have unlimited growth potential
Ownership
The _______ is a list of phone numbers from consumers who have indicated their preference to limit the telemarketing calls they receive
National Do Not Call Registry
Personal Information: Business required to destroy such records that are NOT required or ___ for business operations
Needed
All commissions between the broker and his/her client are ___________ and not set by the Board of Realtors
Negotiable
A real estate licensee has a duty in every transaction in which he is involved to conduct an independent investigation of
Neither the property nor the buyer's financial condition
NOI
Net Operating Income
Company has operated profitably- bottom line of income statement indicates a ______
Net income
If a company was not able to operate profitably—the bottom line of the income statement indicates a _____
Net loss
Every investor want to maximize ______
Net operating income (NOI)
Assets less liabilities
Net worth
This essential feature of a business computer system allows communication within a brokerage and teleconferencing to remote locations, and allows staff to share files and folders stored on their hard drives with each other. Cloud computing Networking Security management Transaction management
Networking connects people in an office to each other and to the files and folders stored on various computers located at the firm
May an unlicensed person, identified as such, make calls to determine whether a person is interested in buying or selling property, or has property they wish to sell, and if so, make an appointment for a licensed agent to talk to them?
No
When a Broker terminates an agent or an agent resigns the Broker will need to notify TREC by sending them the NOTICE OF SALES AGENT SPONSORSHIP TERMINATION. It can be done on line with ___ fee or the form can be mailed with a $20 fee.
No
Rogelio is preparing a sales contract form for his buyers. He's leaving those areas that don't pertain to this transaction blank. Is this correct? No, because Rogelio didn't ask his clients for permission to leave those areas blank. No, it's best not to leave any area of a contract blank. Yes, anything written in those areas would confuse the issue. Yes, if they don't apply. Rogelio should put the words "not applicable" or the abbreviation "N/A" in any area of the contract that's not relevant to a particular transaction.
No, it's best not to leave any area of a contract blank. Rogelio should put the words "not applicable" or the abbreviation "N/A" in any area of the contract that's not relevant to a particular transaction.
I have a property management company and engage in leasing activity. May I have some of my unlicensed employees solicit business for me?
No. A rental agent who solicits a prospect by phone must be licensed
Can my unlicensed assistant unlock the door for potential buyer, if I'm running late?
No. Unlicensed assistants cannot show a home, and following the passage of a 2007 law requiring criminal background checks for license holders, TREC's interpretation of "show" has expanded to include unlocking and opening doors for potential buyers
Fair Housing does NOT cover ______ unless defined as dwelling
Non dwelling building or commercial
The Fair Housing Act does NOT cover ____ buildings
Non- dwelling
Tenancy At Sufferance
Not a lease agreement, tenant continues to occupy the property beyond existing lease agreement without consent of landlord (both ignoring the expired lease agreement)
Death occurred on a property by natural causes, suicide, or an accident unrelated to the condition of the property
Not required to disclose but MAY TELL
Fee Simple
Ownership with the greatest bundle of rights - the owner has all available rights to the property and can always pass it to his heirs - also called fee simple absolute
What is the term if a financial organization refuses to make mortgage loans in certain areas because they consider it an unsafe area? They are guilty of ______
Redlining
Under Oregon law , a principal real estate broker may perform the duties' of an escrow agent without obtaining an escrow license
ONLY if the closing is for the parties in a transaction handled by the principal broker AND if the parties are not charged a separate fee for the escrow services.
To lease you must have a _____
Real estate license
Helps in delegating and coordinating the task in the real estate organization.
Real estate management hierarchy
What fiduciary duties does and agent owe to a principal?
Obedience Loyalty Disclosure Confidentiality Accounting Reasonable care
Consideration
Obligation that each party makes to the other in order to make the contract enforceable
Depending upon the size and geography of the company, anything from where people's desks are located in the (one and only) office to where various sites are located in different towns and what happens at each
Office locations
MLS fees Rent Commissions paid to salespeople Marketing costs Office supplies Legal services
Operating Expenses
A good investor knows NOT to minimize _____ at the expense of income and equity gains
Operating costs
The ______ allows the business owner to establish how he or she wishes to run the business by describing how the business will be managed, its hiring procedures and insurance and lease agreements
Operations section
A license holder appointed under this section may provide_____ during negotiations to the party to whom the license holder is appointed.
Opinions and advice
Supply and price move in ______
Opposite directions
Most buyers in your client's situation will then also elect to pay an option fee pursuant to Paragraph 23 in exchange for the right to terminate for any reason within a negotiated number of days. During this ________, an inspection can be performed and if specific repairs are identified, the parties can negotiate to amend the contract to address these items, or the buyer can terminate the contract
Option Period
A budget _____ means that the amount budgeted for a specific line item has been overspent. Deficiency Deficit Overage Overrun
Overrun If you've budgeted $10,000 for marketing and have spent $12,000, that's a budget overrun.
What is a salesperson's ethical responsibility with regard to giving advice?
Real estate salespeople must take care not to give investment or legal advice. They should give advice only on pricing, marketing, purchasing, and negotiating.
Acquired
Receipted
Received
Receipts
What may cause the amount of work for brokers/agents to slow and employment to decline?
Periods of declining economic activity OR rising interest rates
_____________ is the least important factor that affects demant
Personal Preference
The broker has a few choices on how to obtain funding; a broker can get a business loan or use her or his own ______
Personal funds
There is NO requirement that a _____ included in an advertisement belong to the broker
Phone number or email address
What is the most fundamental management activity? Accounting Investment Planning Training
Planning is the most fundamental of all management activities. Every subsequent business decision should flow from the business plan.
Alison has begun developing her brokerage's long-range plan, and she asks her mentor, brokerage owner James, for his guidance. He wants to encourage her, yet make sure she understands the challenges she may face. "There are some business plan concepts that can really challenge an organization," he says. Which of the following is an example of a challenging business plan concept that James should share with her? A plan doesn't have to be implemented right away. A plan is a strict management tool that should be state in stern and realistic terms. If a plan doesn't appear to be effective in the first three months, it should be abandoned. Planning takes time and money up front.
Planning takes time and money up front. Developing and implementing a business plan requires realistic expectations, patience, and diligence. Be prepared to spend time and money up front and understand that it will take time for the plan to materialize once implemented.
Within the firm, in what document(s) would a licensee find information about the company's risk management processes? Independent contractor agreement Office newsletter Policies and procedures manual Transaction files
Policies and procedures manual
What steps does the FTC's Bureau of Consumer Protection take to protect consumers from unfair business practices?
Receives complaints & conducts investigations Brings litigation against companies & people that violate the rules Develops rules to maintain a fair business environment Educate consumers & business people about their rights & responsibilities
If supply is high and demand is high, the values will ____
Remain Stable
Which one of these professional development opportunities is designed to give a licensee expertise in a particular area and to recognize the licensee's commitment to professional education? Professional designation or certification Real estate conference Real estate seminar Required continuing education
Professional designations show an ongoing commitment to professional education and offer a way to become an expert in an area of interest.
An unlicensed owner cannot collect commissions but can collect ____ from the company
Profit
SBA's Small Business Investment Company (SBIC)
Program is a public-private investment partnership created to help fill the gap between the availability of growth capital and the needs of small businesses
The federal Fair Housing Act is primarily intended to _____ in the sale, rental, and advertisement of dwellings
Prohibit discrimination
Between VA and the Texas Veterans program, veterans are treated very well in Texas. Disabled veterans have even more help available. Veterans with a 100% disability pay NO _____ in Texas
Property tax
What was once cold calling and door knocking has turned into web-sites, texting, tweeting, blogging, skyping and making you-tube videos among other things
Prospecting
The primary functions of the Real Estate Commission are to:
Protect the public from unlawful or unscrupulous acts of licensed real estate brokers salespersons and certificate holders, Set minimum standards and qualifications for licensing brokers and salespeople, Protect licensed brokers and salespeople from unfair or unethical com
Texas Deceptive Trade Practices Act (DTPA)
Protects consumers against false, misleading, and deceptive business practices
Question 45 Which of the following programs at a brokerage will be most effective at incentivizing most associates to perform better? A disciplinary meeting when performance doesn't meet brokerage goals An annual performance review and rating Public recognition, such as at a sales meeting, of an associate's accomplishment Public reprimand, such as at a sales meeting, for inadequate performance Public recognition for accomplishments is a strong motivator for most people, while discipline and reprimands are much less effective.
Public recognition, such as at a sales meeting, of an associate's accomplishment
Reggie has thoroughly reviewed the sales contract with his clients, the Arnolds, and has confirmed that they understand all of the terms and provisions. What should Reggie do next? Ask the Arnolds if he can provide them with any legal advice about the contract. Ask the Arnolds to complete a satisfaction survey and rate their experience with him. Make a copy of the contract and send it to the seller's agent. Recommend that the Arnolds review the sales contract with an attorney before signing it.
Recommend that the Arnolds review the sales contract with an attorney before signing it. It's always a good idea for licensees to recommend their clients review the sales contract with an attorney before signing it.
There is no provision in the Act or the TREC Rules prohibiting a broker from _____ a salesperson or broker—associate affiliated with another broker.
Recruiting
The term _____ has come to connote competency, fairness, and high integrity resulting from adherence to a lofty ideal of moral conduct in business relations
REALTOR®
Before an open house, the agent should ask the seller to do what?
Remove valuables
___________ covers residential transactions and prohibits kickbacks and referral fees
RESPA
Businesses should use at least one of the following tools to promote their products and services:
Radio and television Print media The Internet Brochures
Educate consumers and to help them shop for settlement services and eliminate kickbacks
Real Estate Settlement Procedures Act (RESPA) (REG-X)
The Texas Real Estate License Act (TRELA) requires anyone that assist others to sell, rent or lease property for anything of value to have a
Real estate license
What elements does an income statement contain?
Revenue and expenses
Land reverts back to lessor
Reversion
What is transaction oversight?
Reviewing all contracts for certain items to be sure the brokerage is protected against any potential liability
Bundle of rights
Rights and interest of having title such as possession, control, sell, and of enjoyment
Purchasing or starting a new brokerage business is exciting and _____
Risky
How to protect your Corporate Image
Rumor Procedure, Fact Procedure and Turn negatives into positives
Provides a number of financial assistance programs for small businesses that have been specifically designed to meet key financing needs, including debt financing, surety bonds, and equity financing
SBA's Role
_____ offers mentoring and guidance for small business owners
SCORE
TREC has adopted a ______ for staff and enforcement to use in directing license holders as to what might be considered clear and conspicuous in advertising
Safe Harbor Policy
Employees have the right to request an Occupational Safety and Health Administration (OSHA) inspection if they believe their employer has committed _____ violations.
Safety
Question 60 The number of houses sold over a period of time is reflected in _______. Inventory rates New building permits Price levels Sales volume
Sales volume is the number of houses sold. The smaller the market, the more indicative this is of market conditions. For instance, sales volume for a city is less indicative for a home in a given neighborhood than sales volume for that neighborhood.
Great for targeting an audience that's ready to buy
Search Engine Marketing (SEM)
The license act requires that the funds are deposited into the account within a reasonable time, allowing up to the close of the______ from the signing of the contract for the deposit to be made
Second business day
A _____ is a debt instrument, such as a mortgage loan, that is held as evidence of a debt to be repaid with interest
Security
The assumption of a first mortgage appears on the closing statement as a debit to the
Seller
Special Warranty Deed
Seller only warrants or guarantees the title against defects that may have arisen during the period of ownership of the property
General Warranty Deed
Seller warrants or guarantees the title against defects that may have arisen during the entire life of the property
This form is required even when an owner sells his or her own property
Seller's disclosure form
Cash Flow Statement
Shows how the companies cash is acquired (receipted) and how its spent (disbursements)
Location preference, or ______, is an economic preference for a particular location and not a geographic one
Situs
How much space is needed
Size
Spoken statements
Slander
_____ have less than $21.5 million in annual receipts
Small business
This allows lenders to give you the actual rate you could borrow at before we leave a mark on your credit file that is visible to people other than you and Zopa.
Soft search
To prevent issues with computer systems, a brokerage should concentrate on ________. Having a small and manageable computer system Hiring a systems specialist Software updates, antivirus scans, and software and utility scans System damage and replacement plans
Software updates, antivirus scans, and software and utility scans Three key areas brokerages should concentrate on for system maintenance include software updates, antivirus scans, and software and utility scans.
What type of business structure is the easiest to set up and the fastest to get operational?
Sole proprietorship
The _____ agent has the most limited authority of any type of agent. Usually, the agent only has authority in one specific transaction. Also, the agent may not enter into or sign contracts on behalf of his or her principal. In the real estate industry, the licensee generally has this agency relationship with the principal
Special
The relationship with a client is called _____ It is for one specific transaction. The agent in the transaction is the broker
Special agency
If a client or customer asks for an agent's opinion, the agent should refer the individual to a ____ (for example, a property inspector, an attorney, or a plumber) who can provide unbiased and informed assistance to the consumer.
Specialist
Any money received by a real estate sales person must be immediately delivered to the salesperson's _____
Sponsoring broker
Even an unlicensed person can own a real estate company by hiring a broker to be the ______
Sponsoring broker
After determining a location, what is the next critical factor to consider?
Square footage needed
Often involve physically pursuing or sending items to another person in a threatening manner
Stalking and Bullying
Standard Policy of Title insurance
Standard Coverage Includes: -Defects that are found in public records -Forged documents -Incompetent grantors -Incorrect marital statements -Improper delivery of deeds
Where in the office policy manual is the best place to put your mission statement?
Statement of Purpose section
income statement might also be called the ________.
Statement of profit or loss
Which of the following requires that contracts transferring ownership of real property be in writing to be enforceable? Code of ethics Fair Housing Act Statute of frauds Statute of limitations
Statute of frauds
The practice of providing real estate advice or other real estate services in a manner that perpetuates segregated housing
Steering
Provides for set rent increases to take effect at stated times
Step Lease
avalanche Developing is building a new urban, mixed-used development that will cater to young singles and couples who are just starting their careers. Of the following, which is the best advertising medium for marketing this upcoming development? Billboards Classified ads Internet ads QR codes
Strategically placed billboards will blast information and images about this new development to many individuals, multiple times.
What is the Anti-Cybersquatting Consumer Protection Act intended to do?
Strengthen the rights of trademark owners as they expand their businesses onto the Internet
If you're going to take advantage of cloud computing to store sensitive client information, you will need what security measures to protect the data?
Strong passwords, limited access, and virus protection
Who reports to whom, who's responsible for what areas of the company's work, who makes things happen
Structure of responsibility
In recognition and appreciation of their obligations to clients, customers, the public, and each other, REALTORS® continuously strive to become and remain informed on issues affecting real estate, and as knowledgeable professionals, they willingly share the fruit of their experience and _____
Study with others
Spells out whether, and under what conditions, you are entitled to sublease the premises to another, you normally will still be liable for paying the rent if the subletting tenant does not pay.
Subletting
Substantial contract performance has occurred when ______. Both parties fully meet all contract obligations Essential elements of the contract have been completed, but perhaps not to the exact contract specifications One or more terms of the contract has not been met One party is being held to exact contract terms after having breached the contract
Substantial performance is a form of partial performance. Essential contract terms have been met, but perhaps not to specification. For example, substitution of eggshell paint finish for satin paint finish.
_____ means a meeting or written communication that involves a substantive discussion relating to specific real property
Substantive dialogue
Stigmatized
Suicide, natural death, criminal activity, paranormal, etc
When 2 or more parties join together to create & operate a real estate investment, it is called a ________________
Syndicate
The ____ was enacted in 1973. The purpose of the act is to protect consumers against false, misleading, and deceptive business practices, unconscionable actions and breaches of warranty
Texas Deceptive Trade Practices Act (DTPA)
Unfair business practice in relationship to real estate buyers or sellers is generally covered under the _____
Texas Deceptive Trade Practices Act (DTPA)
The Real Estate License Act (TRELA) is Chapters 1101 and 1102 of the ____. Chapter 1101 pertains to Real Estate Brokers and Salespersons and chapter 1102 pertains to Real Estate inspectors.
Texas Occupations Code
The Real Estate License Act (TRELA) is one section of a larger law passed by the State Legislature called the ________
Texas Occupations Code
Provides listings agreements, buyers representation agreements, property management plus brokerage forms
Texas Association Of Realtors (TAR)
Texas Free Enterprise and Antitrust Act is enforced by _____________
Texas Attorney General
Brokers can operate under an assumed name as long as the assumed name is registered with _____
TREC
NEVER delete a message from _____ without reading it carefully. It may contain information that you and your sponsored sales people need to know.
TREC
_____ provides both Approved and Promulgated (required) contract forms, addenda, an amendment, 2 temporary leases
TREC
The "Information About Brokerage Services" form is the written agency information required by _____
TRELA
T/F A substantive discussion requiring the IABS may not always occur at the 1st face to face meeting
TRUE
Which of the following business planning activities breaks the long-range plan down into smaller tasks and identifies which segment(s) of the company are responsible for doing what? Market analysis Situational analysis Strategic planning Tactical planning
Tactical planning is the most granular level of planning. Once the long-range plan has been broken down into smaller tasks, the management and staff are responsible for carrying out the tactics.
_____ are immediate, dollar-for-dollar reductions in a taxpayer's tax liabilities
Tax credits
Going to another city to take a designation or an MCE class where you can just go to class, then see the city after hours, stay in a hotel, eat in restaurants (where they cook and do the dishes) can provide a needed change and be ____
Tax deductible
Improvements are ____ expenses on rental property
Tax deductible
_____ are reductions in a taxpayer's taxable income, which in turn lower the amount of that taxpayer's income tax liabilities (that is, his or her taxes owed).
Tax deductions
S Corps are pass—through ____, allowing them to avoid being taxed at the corporate level and again on shareholders' personal income taxes.
Tax entities
C Corporation and. S Corporation differ in the complex realm of ____ and corporate ownership
Taxation
What three skill sets should a leader have?
Technical, human and conceptual skills
Landlords have to allow tenants to make modification to their property to accommodate their handicap. The modifications must be paid for by the ____ and the landlord can require the property to be put back to its' original condition when the tenant moves out.
Tenant
Estate at Sufferance
Tenant occupies the premises without consent of the landlord or other legal agreement with the landlord.
Net Lease
Tenant pays base rent and all expenses (commercial properties only)
Calculating Net Lease
Tenant pays fixed and variable operating expenses
Gross lease
Tenant responsible for paying the lease and expenses of the leased space but the landlord is responsible for taxes, insurance, and maintenance on the entire property.
Triple Net Lease (Net-Net-Net)
Tenant to pay a prorated portion of all the operating expenses for property
The biggest issue about office space that most brokers do not feel comfortable about is the long— _______
Term lease commitment
Gross Income
Total amount of earnings a company acquires before taxes are deducted
There is one exception to this prohibition: what the Fair Housing Act calls "housing for older persons."
That dwelling is provided under any state or federal program that the Secretary of Housing and Urban Development determines is designed and operated to provide assistance to the elderly, That dwelling is intended for and occupied solely by people who are 62 years of age or older and At least 80% of all occupied units in that dwelling house at least 1 person over the age of 55 and the landlord generally adheres to a policy with the demonstrable intent of housing persons over 55
_______ (also known as the Architectural and Transportation Barriers Compliance Board) a federal organization that issues guidelines to ensure that buildings, facilities and transit vehicles are accessible and usable by people with disabilities.
The Access Board
States that it is unlawful to discriminate against an individual due to his or her age with respect to any aspect of employment—such as hiring, firing, promotions, providing benefits, and awarding compensation
The Age Discrimination in Employment Act of 1967 (ADEA)
Which of these statements most accurately represents existing federal antitrust legislation? The Clayton Act supports the Sherman Antitrust Act's purpose of prohibiting monopolies by prohibiting mergers or acquisitions that would create a monopoly. The Federal Trade Commission Act established the Sherman and Clayton acts to prevent collusive activities that limit competition. The Federal Trade Commission Act prevents one large firm from acquiring another similar firm that would result in a restraint of trade. The Sherman Antitrust Act was passed to supplement the Clayton Act in an effort to prevent mergers that create monopolies.
The Clayton Act of 1914 supports the Sherman Antitrust Act of 1890 by prohibiting mergers or acquisitions that would result in an unreasonable reduction in competition or the creation of monopolies.
The Texas Real Estate License Act (TRELA) is strongly based upon ______
The Code of Ethics
Does TREC get involved in disputes between brokers & sales agents?
The Commission does not get involved
Each active real estate broker shall provide _______ by displaying it in a readily noticeable location in each place of business the broker maintains
The Consumer Protection Form CN 1-2
What Is NAR's main ethics rule?
The Golden Rule which says to "do unto others as you would have them do unto you."
Is available for Texas home buyers with low and moderate incomes.
The Home Sweet Texas Home Loan Program
Is available for teachers, fire fighters and EMS personnel, police and correctional officers, and veterans.
The Homes for Texas Heroes Home Loan Program
Which of the following agencies dictates records retention requirements? Local association of REALTORS® NAR® The IRS Your local MLS
The IRS IRS dictates the retention of financial records, while states regulate the retention of transaction records. Question 41
Business plan usually should include sections that cover:
The Mission statement The Vision statement The business description Marketing Finances Management Operations
Provides that The Commission is granted the authority to enforce all the statutes contained in the Act as well as provide for the commission to adopt and enforce new rules.
The Real Estate License Act (TRELA)
Created in 1974 to educate consumers and to help them shop for settlement services. Another goal of the act was to eliminate kick-backs
The Real Estate Settlement Procedures Act (RESPA)
The state legislature created ___ and it has two main functions: Enforce all real estate-related statues in the Texas Occupations Code, Chapter 1101 and 1102, also referred to as The Texas Real Estate License Act (TRELA) and To adopt and enforce new rules governing the practice of real estate, as needed to administer the law and protect the public
The Texas Real Estate Commission (TREC)
Signals future directional changes in the residential construction business cycle
The Texas Residential Construction Leading Index (RCLI)
Is the individual with whom the agent and principal enter into real estate negotiations; he or she is also sometimes referred to as the customer.
The Third Party
What is free cash flow?
The amount of cash that could be withdrawn from a firm without harming its ability to operate and to produce future cash flows.
My client does not want to accept the property "as is" and wants to wait until after the inspection to list specific repairs that he wants the seller to fix. Can I just leave both boxes in Paragraph 7D of the One to Four Family Residential Contract (Resale) blank or can I check 7D 2 and write in "repairs to be listed following inspection"?
The buyer should only choose Paragraph 7D2 if there are specific repairs known at the time of the contract that the buyer wants the seller to pay for. Otherwise, the buyer should check Paragraph 7D1
Roll Back Taxes
The difference between the taxes paid on the land's agricultural value and the taxes that would have been paid if the land had been taxed on a higher market value for every year permitted under that type of exemption
What FTC Division is responsible for enforcing the Fair Credit Reporting Act?
The division of privacy & identity protection
What is meant by an "established business relationship" exemption?
The do-not-call and do-not-fax rules do not apply to calls made and faxes sent when an established business relationship exists.
Must the earnest money check be deposited to create a binding contract?
The formation of a real estate contract requires "consideration" for the contract to be binding
Which of the following is one of the IRS requirements for a real estate brokerage worker to be classified as a statutory non-employee?
The individual and the employing broker have a written contract.
Which of the following is one of the IRS requirements for a real estate brokerage worker to be classified as a statutory non-employee?
The individual and the employing broker have a written contract. the written contract must describe the real estate services that the individual will perform and must explicitly state that the individual will not be treated as an employee for federal tax purposes.
Metropolitan Regional Information Systems, Inc. (MRIS)
The largest MLS information system in the country
Identify the forms that current law requires to be used in all lender-financed residential closings. GFE and Loan Estimate GFE and TIL Loan Estimate and Closing Disclosure Loan Estimate and TIL
The law requires two specific forms—the Loan Estimate and Closing Disclosure—to be used for all residential closings.
The Brendon Group is evaluating a new market and wants to know the market's cultural composition. That's likely because _________.
The licensees don't do any active selling.
Which of the following important components of a business plan outlines an organization's fundamental purpose? Goals statement Mission statement Purpose statement Vision statement
The mission statement is a reminder of why the organization is in business.
FTC
The nation's consumer protection agency
How are days counted in a TREC contract? Starting with the effective (final execution) date of the contract, the first day of the period starts ______ Each day is counted as calendar day.
The next day
Why does it matter if a brokerage decides to maintain a sales staff of 50 mostly new licensees, rather than 10 very experienced licensees? The brokerage can make more money with many licensees, regardless of experience level. The brokerage will be required to pay fewer taxes with a large group of new licensees than for a small group of experienced licensees. The brokerage will have more difficulty finding experienced licensees who want to switch brokers, so recruiting will be costlier. The number of licensees and their experience levels will affect the working relationships the brokerage has with its licensees.
The number of licensees and their experience levels will affect the working relationships the brokerage has with its licensees. Staffing the sales force requires the broker to make decisions about number of licensees and their experience level, because these factors will affect the working relationship the broker needs to have with sales associates to ensure their success.
Alison has set the goals for her new brokerage, and now she's ready to figure out the strategies. She's met with her mentor, James, so he can provide some guidance on strategy. James starts by explaining the purpose of strategy. Assuming James is an expert on the subject, which of the following statements would he make about the purpose of strategy? The purpose of a strategy is to provide alternative ideas, options, strategies, and resources when unexpected conditions arise. The purpose of a strategy is to state what the company will focus on to fulfill its mission, and determine what are to become the priorities during the plan's defined timeframe. The purpose of a strategy is to support and help reach a goal by determining the method by which the goal can be achieved. The purpose of strategy is to divide a company's general objectives into realistic, manageable, smaller accomplishments.
The purpose of a strategy is to support and help reach a goal by determining the method by which the goal can be achieved.
Which of the following actions can licensees take related to signs? They can only place signs on property they own. They can place signs on an owner's property with the owner's written consent. They can place signs on properties for which they are the listing agent, with or without the owner's permission. They can't place signs anywhere.
They can place signs on properties for which they are the listing agent, with or without the owner's permission.
Broker Craig fires salesperson Enrique for violating a provision of the license law. Which of the following is true of this situation? This is a valid reason to terminate the licensee's affiliation with the broker. This is not a valid reason for the broker to terminate his affiliation with a licensee. This is only a valid reason for the broker to terminate his affiliation with the licensee if the broker's given the licensee a written warning before the licensee violated the law the last time. This is only a valid reason for the broker to terminate the licensee's affiliation if the real estate commission has revoked or suspended the licensee's license for this legal violation.
This is a valid reason to terminate the licensee's affiliation with the broker. A salesperson who's guilty of violating real estate law or brokerage policy should receive disciplinary action and possibly termination, depending on the severity of the misconduct.
The Office of ______ (a bureau of the U.S. Treasury) also passed a regulation banning redlining
Thrift Supervision
Question 56 When working with a developer who's purchasing undeveloped land for a new subdivision, ABC Realty stipulates in the contract that in order to purchase the undeveloped land, the developer must purchase grading services from Bulldozers-R-Us. Which antitrust violation is this? Group boycotting Market allocation Price fixing Tie-in arrangement
Tie-in arrangement
Which of these is an example of antitrust violations common to real estate? Fraud, concealment, and misrepresentation Profiteering, racketeering, and domineering Puffery, hyperbole, and exaggeration Tie-in arrangements, market allocation agreements, and group boycotting
Tie-in arrangements, market allocation agreements, and group boycotting In addition to price fixing, antitrust violations include tie-in arrangements, market allocation agreements, and group boycotting.
The Americans with Disabilities Act prohibits discrimination against the disabled, and _____ protects the disabled from unfair housing practices.
Title VIII of the Civil Rights Act of 1968
In Texas, most licensees prefer an independent entity, usually the _____, hold these funds in an escrow account
Title company
According to the Statute of Frauds, why must a lease for longer than a year be in writing?
To be enforceable
_____ real estate management officials make all decisions in accordance with the company goal or mission
Top level
If a licensee convinces a client if a competing broker to terminate a listing agreement, the licensee would be guilty of what?
Tortious interference
Landlord cannot charge pet deposit for an assistance animal for handicapped individual- not considered pet
True
Only owners with housing that qualifies as senior housing can discriminate families with children
True
Usually the broker is holding money for the owner in the broker's _____ when managing the property.
Trust account
_____ means an account managed by one party for the benefit of another in a banking institution authorized to do business in Texas.
Trust account
_______ means client's money, earnest money, rent, unearned fees, security deposits, or any money held on behalf of another person
Trust money
The ____ sells securities when it needs to acquire funds to finance government activities or to repay other securities
U.S. Treasury
DTPA defines an "_____" as one that "takes advantage of the lack of knowledge, ability, experience, or capacity of a person to a grossly unfair degree."
Unconscionable action
Jury duty. Texas employers must also allow employees to take time off work for jury service. This time is ______
Unpaid
A ____ breaks a more general budget line item into details, making it easier to use in guiding business operations. General operating budget Monthly operating budget Profit center budget Variable expense budget
Variable expense budget A variable expense budget breaks high-level budget figures from the general operating budget into more detailed categories and amounts.
Adding a mortgage lending service to a real estate brokerage operation is an example of what type of growth? Geographic expansion Horizontal expansion Organic growth Vertical expansion
Vertical expansion Adding a mortgage lending service is an example of expanding into vertical markets that typically are performed before, after, or in conjunction with a real estate transaction.
Material misrepresentation or failure to disclose any known or latent property defects, Deceptive practices in the marketing, selling, or offering of real property, False promises made to the consumer through advertising or directly through the agent, Failure to disclose which party is compensating the agent, or that more than one party is liable for compensation without the written consent of all parties involved, Request or acceptance of an undisclosed compensation, Acting as agent and undisclosed principal in a transaction
Violations of license law which are also violations of the DTPA
Has more to do with the future and really describes what an organization plans or hopes to be in the future
Vision statement
Are strongest when it comes to finding new directions and new potential solutions to a given problem
Visionary leaders
Workers' comp provides you with a % of your usual earnings, pays for necessary medical treatment, and provides ____ and other benefits
Vocational Rehabilitation
Reasons people give for wanting to open their own Brokerage:
Wanting to create something from scratch, Wanting to be their own boss, Wanting to train and motivate real estate agents to be successful, Wanting to be leader in their community or in the industry, An entrepreneurial spirit
What does the Texas Real Estate Center say about the growth of the Texas population?
We will grow another 10 million by 2030 - 43.5% increase
Collect aggregate information about your site's performance
Web Analytics
Look at your keywords, page titles, text, etc. to rank internet pages
Web-crawlers and Bots
Secure and Fair Enforcement Act
What does SAFE Act stand for?
Which of the following training topics would be appropriate for a brokerage to offer to both new licensees and experienced salespeople? How to develop a sphere How to write a contract The basic process for a transaction What to do about structural defects
What to do about structural defects Some training topics are too basic for experienced salespeople, but are necessary for new licensees. Other topics, such as handling structural defects, are part of an associate's ongoing education.
What is a syndicate?
When 2 or more parties join together to create & operate a real estate investment
Libel
Written statement
Ethics
Wrong/Right
Does TREC ever discipline a license holder who fails to use an adopted form?
Yes
Does a license holder have to use TREC's contract forms?
Yes
George is a listing agent. He was showing his listing to a personal friend of his. He shared with his friend that the seller was very anxious to sell. Did George violate his duty of fidelity to his seller?
Yes
Is a real estate license necessary in order to be an apartment locator?
Yes
May unlicensed assistants set appointments to show a listing?
Yes
A residential service company is paying me a fee to advertise for it. Do I have to disclose that fee to my client and use a TREC form?
Yes and yes. You must also provide the client with the TREC Disclosure of Relationship with Residential Service Company form (RSC-2)
Question 49 Ginny counters Tom's offer of $250,000 for her house, asking for $255,000. Ginny's agent sends the counteroffer to Tom's agent. Tom is out of town for the week and can't be reached. On Tuesday, Ginny decides to revoke her counteroffer and instead ask for $260,000. Can she do this? No, because Ginny can't write two counteroffers. No, because Tom's agent has Ginny's first counteroffer. Yes, because she didn't write the original offer. Yes, because Tom hasn't accepted the first counteroffer.
Yes, because Tom hasn't accepted the first counteroffer.
Are experienced interviewers often good judges of character?
Yes, because they can see beyond impulsive judgments
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? No, it's never ethical for a licensee to accept compensation from more than one party. Yes, but only if all of the involved parties have full knowledge and provide consent. Yes, but only if the Matt has full knowledge of the compensation arrangement and provides consent. Yes, licensees can receive compensation from multiple parties in the transaction.
Yes, but only if all of the involved parties have full knowledge and provide consent. Licensees can only accept compensation from more than one party with the full knowledge and consent of all involved parties. That compensation must also go through the brokerage firm.
Can a non-license holder use the promulgated contract forms?
Yes, forms are available for public use
Can a sales agent be the owner of a property management company?
Yes. A sales agent may own the firm but the business must be conducted through the sales agent's sponsoring broker
If I am buying, selling or leasing property for a relative, do I need to disclose that I have a real estate license?
Yes. If you are acting on your own behalf or on behalf of your spouse, parent or child, you must inform any person with whom you deal that you are a licensed broker or sales agent acting on that relative's behalf
Is a link to the IABS form required on my website?
Yes. Rule 531.20(b) states that each broker and sales agent must provide a link on its homepage to the IABS Form labeled "Texas Real Estate Commission Information About Brokerage Services".
Does a lease for a term of longer than one year and a contract for the sale of real estate need to be in writing to be enforceable?
Yes. The Statute of Frauds, as defined by Chapter 26 of the Business and Commerce Code, requires that certain agreements be reduced to writing to be enforceable. However, you should consult with a private attorney for advice on this matter.
In determining the correct balance sheet relationships, the equity ratio is:
assets minus total liabilities divided by assets.
If a seller does not provide the buyer with a property condition disclosure the buyer may cancel the transaction... when?
at any time prior to closing of the transaction.
All buyers should be provided with an oral or written disclosure of representation at ______________, regardless of __________________
at first contact regardless of representation
Real estate securities include...
both rental pool arrangements and limited partnerships.
Mike and Ike set up a real estate company. Mike, Ike, and Spike each own a portion of the stock. Mike & Ike Realty is a legal entity of its own. Mike is involved in a ______. Corporation Limited liability company Partnership Sole proprietorship A corporation is a legal entity. Most likely, this is a close corporation.
corporation
Which of the following gives employers the right to hire and fire people with or without a reasonable cause? The doctrine of employment-at-will The doctrine of independent contractor status The Fair Labor Standards Act The U.S. Equal Employment Opportunity Commission
doctrine of Employment-at-will is in place in all states, but may be applied differently when the state has other laws or regulations that affect it.
Personality type models should be used to ____________.
inform and understand
A policy manual is a reflection of the broker's
mission statement
What business affiliation is used as part of an operational strategy whereby broker participants cooperatively share listing data and offer consumer access to MLS databases? Business networking association Multiple listing service National Association of REALTORS® Shared client service
mls: Multiple listing service
Over half agents survey said they paid not.........
monthly technology fee to their broker
When the attrition rate is high, a brokerage needs to recruit ______.
more
LLC offers a company _____________________
offers limited liability protection
Sole proprietorship is a venture owned by ____________
one individual
Sydney decided to add housing inspection services to her company, so she got licensed as an inspector and started offering her services to buyers. What type of growth is this? Corporate growth Inorganic growth Non-corporate growth Organic growth
organic growth
Question 57 A sales associate's ability to work most effectively is affected by five factors. These are the physical and technical environment, communication, knowledge and skills, motivation, and ___________. Emotional intelligence Organizational effectiveness Organization's size The real estate market The business model and the organization's mission, vision, goals, and values are the foundation that the sales associate must work within, so organizational effectiveness is one of the five factors that affect performance.
organizational Effectiveness
Life Estate
ownership of land for the duration of a person's life
Local demographic, zoning, political, and infrastructure changes may all impact your firm's sales. Which of the following is the best method to use to stay informed about these issues? Following national business news Keeping tabs on U.S. unemployment data Networking and checking local business reports Reading the Wall Street Journal
the best local resource is networking with other professionals in your area, including city government, banking, and other related industries. Local business reports provide a good source of information, too.
A branch office sign must contain...
the name of the principal broker as licensed.
Under Oregon law, if a principal real estate broker establishes an independent contractor relationship with an associated real estate broker
the principal broker must supervise the real estate broker's real estate activities so as to conform to the Oregon Real Estate License Law and administrative rules.
When a real estate broker transfers to a different principal broker....
the real estate broker's license must be reissued to the new principal broker.
What is the debt to equity ratio?
total liabilities/total equity
Does a link to the IABS Form in my email signature satisfy the representation disclosure required by TRELA §1101.558?
No. Rule 531.20(d) states that providing a link to the IABS Form in a footnote or signature block of an email is insufficient
The _____ is required to ascertain that Brokers are aware of all of their responsibilities.
Texas Real Estate Commission
Two good resources for finding past statistic for the real estate industry are
The National Association of REALTORS® and the Real Estate Center at Texas A&M University.
The IABS Form can be provided by:
(1) personal delivery; (2) first class mail or overnight common carrier delivery service; (3) in the body of an email; or (4) as an attachment to an email or as a link in the body of an email so long as there is a specific reference to the IABS Form in the body of the email.
If the designated broker owns ____ or more of the entity, proof of the designated broker's ownership
10%
Who Must Take The Broker Responsibility MCE Course?
A broker who sponsors salespersons, a designated broker of a business entity, and a license holder who is a delegated supervisor of one or more license holders (for six months or more during the supervisor's current license period), to complete this six—hour broker responsibility course to renew a license.
A business entity cannot act as a broker in Texas unless the entity designates an _____ to act on its behalf. They must be a managing officer of the business entity and must be in good standing with the Commission.
Active individual broker
"Doing business as" name
DBA
The ____ duties a broker owes to his or her client are obedience, loyalty, confidentiality, good faith, honesty, refraining from self-dealing, integrity, fair and honest dealing, and disclosure of anything that may have an effect on the client's decision.
General fiduciary
A ______ is a person who provides real estate services to another person in exchange for a commission
Licensed Real Estate Broker
The Rules of the Texas Real Estate Commission require that a Broker have a_______ before you start hiring agents
Policy and Procedures Manual
Brokers CANNOT share their fees with attorneys who perform a brokerage service, attorneys must seek compensation for that service directly from one of the ______ in a transaction
Principals
An individual with a bachelor's or master's degree from an accredited college or university, members of the state bar, and licensed attorneys are eligible to take the _______ without completion of classroom work and real estate sales experience
Real Estate Broker's License Examination
A licensed business entity real estate broker is an organization that can act as a _____ and is qualified to conduct business in Texas.
Real estate broker
Recruitment of a salesperson by a broker is not regulated with the exception that instructors or other persons associated with a ___ may NOT recruit or solicit prospective salespersons or brokers in a classroom during class time
School
SRS—
Seller's Representation Specialist
Allows a company to separate and protect multiple assets without the need to form additional entities.
Series LLC
Certain states allow companies to form a distinctive business structure called ____, it takes its name from the fact that it can have multiple members, managers, or business lines within it.
Series Limited Liability Company (LLC)
Each active real estate broker shall provide this notice by (1) displaying it in a readily noticeable location in each place of business the broker maintains and (2) providing a link to it labeled "Texas Real Estate Commission Consumer Protection Notice", in at least a 10 point font
The Consumer Protection Form (CN 1-2)
