Commission Duties and Powers

After an investigation, the Commission determines that a licensee acting as a property manager improperly withheld a tenant's security deposit. In addition to awarding an administrative penalty, the Commission may also A)do nothing because the Commission may not involve itself in monetary disputes between licensees and consumers. B)award damages up to three times the amount of the security deposit. C)order the licensee to refund the security deposit. D)order the landlord to return the security deposit.

order the licensee to refund the security deposit. The Commission may order a licensee to pay a refund to a consumer instead of or in addition to imposing an administrative penalty or other sanctions. The amount may not exceed the amount the consumer paid for the service.

The Texas Real Estate Commission may undertake an investigation of a license holder based on all these grounds EXCEPT A)motion from the members of the Commission. B)its own initiative. C)random selection of license holders. D)written complaint submitted by a consumer or another licensee.

random selection of license holders. The Commission may not initiate a random search for investigations of license holders. There must be some valid reason. TREC can undertake an investigation on its own initiative, a motion from the Commission members, or a submitted written complaint.

All of the following statements regarding the Texas Real Estate Commission are true EXCEPT A)the Commission appoints an administrator and may designate an assistant administrator to carry out the daily activities of the Commission. B)examinations that must be taken by all applicants for real estate licensing are currently administered by an independent testing company rather than the Commission. C)the Commission makes and enforces the rules by which all real estate license holders must abide. D)the state association of REALTORS® selects the members.

the state association of REALTORS® selects the members. The Texas Association of REALTOR® (TAR) does not select the Real Estate Commission members. Commissioners are appointed by the governor and approved by the senate. The Commission is empowered to make and enforce rules. The examinations may either be prepared or contracted for by the Commission. Currently they are written under the supervision of the Commission and administered by an independent testing company. TREC must appoint an administrator and may designate an assistant administrator to carry out the day-to-day functions of the Commission. However, TAR does make recommendations to the governor for appointments to TREC.

As a result of a hearing, it was determined that a licensee had violated a provision of the licensing act. The maximum administrative penalty for the violation may NOT exceed A)$5,000 for each day the violation continued. B)$1,000. C)$1,000 for each day the violation continued. D)three times the damages incurred by the consumer.

$5,000 for each day the violation continued.

An unlicensed individual who engages in one activity for which a real estate license is required is subject to an administrative penalty of up to A)$1,000 and one year imprisonment. B)$5,000 and a mandatory prison term not to exceed five years. C)$1,000, in addition to other penalties provided by law. D)$5,000, in addition to other penalties provided by law.

$5,000, in addition to other penalties provided by law. The maximum Class A misdemeanor (criminal penalty) fine is $4,000 and/or one year in a county jail in addition to other civil penalties available to TREC and an aggrieved person. The maximum TREC administrative penalty is up to $5,000 per violation per day. Further, the unlicensed person could be liable to the state for a civil penalty of not less than the amount of money received or not more than three times the amount.

What is the maximum aggregate amount that can be paid from the real estate license holder Real Estate Recovery Fund arising out of the same transaction? A)$5,000 B)$20,000 C)$50,000 D)$100,000

$50,000 Payments, including attorneys' fees, interest, and court costs, are limited to $50,000 on behalf of any one transaction, regardless of the number of claimants.

The Commission proposes to suspend a salesperson's license for misrepresentation that occurred during the sale of the salesperson's personal residence. The licensee is entitled to a hearing conducted by the A)Texas Real Estate Commission. B)State Office of Administrative Hearings. C)district court in the county in which the offense occurred. D)Real Estate Broker/Lawyer Committee.

State Office of Administrative Hearings.

In Texas, real estate inspectors are licensed and regulated by the A)Texas Real Estate Commission. B)Texas Department of Licensing and Regulation. C)Texas Real Estate Inspector Committee. D)Texas Real Estate Inspector Commission.

Texas Real Estate Commission.

In Texas, the Texas Real Estate License Act is administered by the A)Texas Real Estate Commission. B)Department of Housing and Urban Development (HUD). C)Texas Association of REALTORS®. D)Texas Workforce Commission.

Texas Real Estate Commission.

The purpose of the Real Estate Recovery Trust Account is to provide A)a mechanism for the Real Estate Commission to recover funds from unethical licensees. B)a means by which an injured party can collect a judgment award. C)protection to the public from dishonest salespeople. D)a source from which to collect unpaid commissions.

a means by which an injured party can collect a judgment award. The Commission maintains the Recovery Trust Account to reimburse aggrieved persons who suffer actual damages caused by an act for which a license can be suspended or revoked.

If the amount of money in the Real Estate Recovery Trust Account drops below $1 million, the Texas Real Estate Commission mayA) limit payments from the fund to $5,000 per claim. B)assess each license holder a pro rata share to bring the account to $1,700,000. C)transfer license holder fees and Texas A&M Research Center fees to the fund. D)suspend payments from the fund until new license holders bring up the balance to an acceptable level.

assess each license holder a pro rata share to bring the account to $1,700,000. On a determination by the Commission at any time that the balance is less than $1 million, TREC is authorized to assess each license holder a pro rata share to replenish the fund and bring the fund to $1.7 million. The assessment may not exceed $10 per license holder. So far, it has never been necessary to assess license holders.

A consumer files a written complaint with the Texas Real Estate Commission regarding a licensee. TREC must investigate the complaint based on A)assigned priorities, using a risk based approach regardless of date received. B)whether the complaint involves a salesperson or broker licensee. C)the date received, with the most recent complaints investigated first. D)the date received, with the oldest complaints investigated first.

assigned priorities, using a risk based approach regardless of date received.

The Texas Real Estate Commission has all of the following powers EXCEPT A)enact the laws that govern real estate license holders. B)make and enforce the rules by which all real estate license holders must abide. C)administer the exams given at the testing sites. D)compose the examination questions on the state exam.

enact the laws that govern real estate license holders. The Real Estate Commission is authorized to adopt and enforce rules that have the force of law. Only the legislature, however, may enact law.

Members of the Texas Real Estate Commission are appointed by the A)Texas real estate license holders. B)Texas Association of REALTORS®. C)public. D)governor.

governor. The governor makes the appointments, but the senate must ratify the appointments.

Before a license is revoked or suspended, the licensee is entitled to a A)hearing conducted by the State Office of Administrative Hearings. B)trial by jury in a state district court. C)hearing before the local association of REALTORS®. D)trial by jury before the Real Estate Commission.

hearing conducted by the State Office of Administrative Hearings.

If a payment is made from the Recovery Trust Account because of acts of a licensee, the A)license is suspended until the Recovery Trust Account has been reimbursed. B)license may be revoked until the Recovery Trust Account has been reimbursed. C)licensee is liable to the damaged party to the extent provided by the Deceptive Trade Practices Act. D)status of the broker or salesperson license cannot be affected.

license may be revoked until the Recovery Trust Account has been reimbursed. The commission, upon making a payment from the trust account, may revoke the license of the offending licensee until the recovery trust account has been reimbursed, plus interest.

Regarding the Real Estate Recovery Fund, payments A)may result in the revocation of a license until the money is repaid plus interest. B)are limited to $100,000 for claims against a single Texas real estate license holder and result in an automatic revocation of the license holder's license. C)are limited to $50,000 for claims against a single Texas real estate license holder. D)are made at the request of a license holder who is unable to satisfy a judgment obtained by a member of the public against the license holder.

may result in the revocation of a license until the money is repaid plus interest.

A person acting as a real estate broker, real estate salesperson, or a right-of-way agent without a license or registration is guilty of a Class A misdemeanor that is punishable by a fine of NOT A)neither less than $3,000 nor more than $4,000. B)neither less than $1,000 nor more than $2,000. C)more than $4,000. D)more than $2,000.

more than $4,000. A violation of the License Act by an unlicensed person is a Class A misdemeanor, which is punishable by up to a $4,000 fine or imprisonment for a term not to exceed one year or both.

When the license of a sponsoring broker is suspended or revoked, the sponsored salespersons A)must stop listing and selling. B)may continue listing and selling during the search for a new broker. C)post a public notice and obtain a bond. D)must become employees instead of independent contractors.

must stop listing and selling.