Champions Texas RE Study

According to the TREC contract form, when must the title company deliver the title commitment to the buyer?

20 days from the receipt of the contract

The total hours required at the end of your SAE renewal period consist of:

270 qualifying hours plus 8 hours of Legal 1 & 2 (278 total)

Which of the following properties would qualify for homestead protection in Texas?

A life estate of someone who occupies the property as their primary home.

An agent is aware of a foundation issue that was not disclosed on the Seller's Disclosure. She discusses it with her broker who advises the agent to let the Seller fill out the Disclosure. Who is in violation of DTPA?

Both the agent and broker are in violation.

An unlicensed assistant is showing property for her broker. Which of the following penalties would apply and to whom?

Both the broker and the unlicensed assistant would be subject to fines by TREC

With the knowledge and consent of her broker/employer, an unlicensed assistant is showing property to prospective buyers. What is true about this situation?

Both the broker and unlicensed assistant can be fined an administrative penalty of $5,000 per day

Which of the following statements about Earnest Money Deposits and Option Fees is FALSE?

Earnest money and option fees can be combined in one check from the buyer

Who is eligible for a TVLB loan?

Eligible Veterans residing in TX

What department of the Federal Government administers the Do Not Call list?

FTC

What could cause TREC to deny an application for a Real Estate License?

Failure of the applicant to successfully demonstrate honesty, integrity and trustworthiness.

For which of the following properties does TREC have a promulgated contract form?

Farm and ranch

A broker sponsors only one associate license holder. He has a listing and a buyer client who wants to purchase that listing. What is true?

He can do intermediary without appointments

A broker has several offers on one of his listed properties. What is true?

He must present all offers in whatever order he chooses

A foreign broker advertises that he sells houses outside his state for a flat fee. What is true?

He must refer this transaction to a broker licensed in TX.

Without proper authorization, a sales agent may accept a commission directly from:

His broker

Which statement about Texas Homestead protection is FALSE?

Homestead protection will prevent foreclosure for unpaid property taxes

Which of the following is NOT found in the TREC 1-4 Family Resale Contract?

If lender required repairs exceed 20% of the sales price the buyer may terminate the contract

Which of the following statements regarding mold and mold remediation is false?

If mold is visible, it must be remediated

TREC can investigate the actions of a license holder at its own motion. Under what other circumstances can TREC investigate a license holder?

If they have a written, signed complaint no more than 4 years old

When a license holder markets his own property, he should:

Inform the buyer that he is a license holder, and the owner of the property

A Texas broker has signed an Exclusive Right to Sell listing agreement with a negotiated commission of 5.5%. He has a buyer-client with a written Buyer Representation Agreement. His buyer-client wants to buy the seller-client's property. What role will this broker play in this transaction?

Intermediary

May has listed the property at 123 Main St. The sellers have told her that the property has 2,000 sq. ft. May has verified the square footage and entered this information correctly into the MLS. John, a license holder from another firm, shows the property to some buyer customers. He tells them that the property has 2,500 sq. ft. Who is liable for this misrepresentation?

John and his broker

A broker has received a referral from his neighbor. The referral results in a sale and the broker earns a commission on the transaction. How can he thank his unlicensed neighbor for the referral?

No commission

How much Continuing Education (CE) may be carried over to the next renewal period?

None

Broker Bob has a listing contract and a buyer's representation agreement, and so is acting as intermediary in a transaction. The buyer tells Bob that if he is successful in purchasing the property, he plans to buy all the surrounding property too. What should Bob tell the seller?

Nothing, as this is confidential information from the buyer

A seller's disclosure is not required:

On new construction that has not been occupied

When must representation be disclosed and in what form?

Orally or in writing at first contact

For what one cause of license revocation does TRELA specify a payment prior to relicensing?

Payment out of the Recovery Trust Account

Which of the following can a licensed real estate sales person do?

Prepare a BPO

A license holder in Texas can:

Prepare a contract addendum for a client per their instructions

An HOA can ban which of the following?

Privacy fences.

Which of the following statements is FALSE?

Real Estate Inspectors must use promulgated inspection forms for all properties

A license holder in violation of the TRELA has received a summons from TREC that a hearing will be held regarding the possible revocation or suspension of his license. The license holder fails to respond to the summons. What will TREC do?

Schedule a hearing at the TREC office in Austin

TREC has received an application for a Texas Real Estate Sales License from Mary. Mary has completed all her educational requirements, and passed the state exam. At this point TREC will begin the background check. Which of the following statements is FALSE?

TREC has 30 days to complete the background check

What TREC promulgated form should be incorporated into the contract when a buyer wants to obtain possession before the closing and funding of the transaction?

The Buyer's Temporary Lease Addendum

Which of the following TREC forms does not include the phrase, "time is of the essence"?

The Notice Regarding Coastal Area Property

How many properties can an unlicensed investor sell in a year?

Unlimited

How long does a broker have to deposit earnest money in an escrow account?

Until the close of business of the second business day after the offer was accepted and acceptance was communicated

A sales agent wished to transfer to a new broker. When may he engage in the business?

When the new broker submits the sponsorship forms to TREC

A broker from Colorado refers a buyer to a Texas broker. The Texas broker works with the buyer who finds a property to buy. The buyer then asks the Colorado licensee to represent his interest to the Texas broker. The Colorado broker reviews all the terms and conditions set forth in the buyer's offer and makes some suggestions that are then included in the offer. The Texas broker presents the offer. It is accepted. The transaction closes and the Texas broker earns a commission. Can he pay the Colorado broker a commission?

Yes

Who can a broker pay a referral commission to?

a broker license holder in this or any other state

What would NOT cause license revocation by TREC?

a second DUI conviction

The option period ends:

at 5:00 pm on the day mentioned in the contract

When is the termination option fee in the 1-4 Family Contract due?

by midnight of the third calendar day after the effective date of the contract

A buyer has purchased an option on a property giving him the right to purchase the property for $500,000 for 60 days. The negotiated option fee is $500 and the parties have agreed that the option fee will be paid within 5 days. How/where may the option fee be paid?

by money order to the seller

A broker has a listed property. The owner mentions that a neighbor is interested in selling. The broker meets with the neighbor and secures a second listing. Both listings sell and the broker earns a commission on each. The broker would like to thank the owner of the first listed property for this referral. How can the broker thank the seller?

cannot pay the seller any commission at all

A broker's duty consists of updating/notifying agents about:

compliance issues

Where should the consumer protection notice be?

displayed in the broker's office

Who is eligible for a TVLB loan?

eligible spouses

A property owner has discovered mold on his property. What is true in this situation?

he can remediate the mold himself.

A property has been listed for sale at $495,000. Several buyers are interested in the property and after a small bidding war the sellers have accepted an offer for $505,000. Included in the offer was the condition that the dining room furniture, washer and dryer be part of the sale. Where can this information be covered to insure that all parties are protected.

in an addendum to the sales contract and a Bill of Sale

Regarding the option fee in the TREC 1-4 Family Resale Contract, what is true?

it must be an amount discussed/agreed to by the buyer and seller

A sales agent is hired to list the property of a deceased party who died testate. The license holder must:

obtain the signature of the executor named in the will

Where should the Consumer Information Notice be posted?

on the Broker's business website homepage

An unlicensed person owns an option to purchase real property for a $190,000. He advertises the option for sale for $20,000. This action is:

only legal with full disclosure of the terms of the option

An unlicensed assistant may do which of the following?

prepare a CMA

The primary purpose of TREC is to:

protect the public

A broker who has a buyer representation agreement with a buyer decided to rebate part of the commission to the buyer to cover closing costs. The broker should:

rebate an amount on the closing disclosure (CD)

A buyer and seller have signed a Texas sales contract. Prior to signing, the buyer did not receive the Seller's Disclosure. If he receives it within the negotiated number of days in the contract, the buyer can:

terminate the contract for up to 7 days after he receives the disclosure

What is an example of something that could be entered in paragraph 11?

the information from any TAR addendum.

A buyer's agent rebates a portion of their commission to a buyer. Who needs to approve this?

the sponsoring broker

An unlicensed assistant prospects for leads for their agent employer. Who could be fined, and/or have a license suspended or revoked by TREC?

the unlicensed assistant, agent and sponsoring broker

Where or to whom does the Earnest Money Deposit go?

to an escrow account

How long does the buyer have to deliver the Earnest Money Deposit to an escrow agent?

within 3 days after the effective date of the contract

When a broker posts pictures of other brokers' listings on his website, what is required?

written permission

Which of the following is the responsibility of the broker?

The listing advertisements of the sales agents he sponsors

In the usual Texas listing agreement, how long is the protection period?

The number of days negotiated between the broker and the seller

The designated officer of a licensed real estate corporation owns 15% of the corporation. How much E&O insurance is required by TREC?

$0

A licensee has been successfully sued by a past client in connection with a single transaction. The client has prevailed and been awarded a judgment for $75,000.00. The licensee has declared bankruptcy and is unable to pay the judgment. The client has applied to TREC for payment out of the Recovery Trust Account. TREC has agreed to the payment. How much will the client receive:

$50,000

An individual has successfully sued a license holder in connection with a single transaction and won a judgment for $110,000. The license holder has declared bankruptcy and TREC has agreed to pay out of the recovery trust account on behalf of the license holder. How much will TREC pay?

$50,000

The Texas Real Estate License Act was passed in:

1939

Requirements for obtaining a broker license in Texas include:

4 years of experience out of the past five and 3600 points

Which of the following about TREC is FALSE?

6 TREC members are public and 3 TREC members are brokers

A buyer has submitted an offer to purchase a seller's property without receiving the seller's disclosure of property condition. How many days does the buyer have to terminate the offer once he receives the disclosure?

7

All approved CE classes include:

8 hours of legal update

What are the requirements to become a licensed broker in TX?

900 hours of education + 3600 points, in addition to 4 out of the past 5 years active real estate salesperson licensure

Which of the following actions is NOT a violation of the Texas Real Estate License Act?

A broker offers a guaranteed buy back of a property for a set price, if the purchaser is not happy with the investment after a two-year period of ownership

Which of the following statements about multiple offers is true?

A broker with multiple offers must present all offers, but there is no required order of presentation

What is the criminal penalty for engaging in the real estate brokerage business in Texas without firstbecoming licensed by TREC?

A fine of not more than $4,000

A Texas broker may pay a commission to:

A foreign broker who doesn't negotiate in Texas

Marcos was a Texas licensed Real Estate Sales agent for some time. He then chose to become inactive and TREC has been holding his license in inactive status. He now wishes to activate the license. What will he have to do?

Apply through a broker and take an 18-hour continuing education course if necessary

Disclosure of agency must be given:

At first substantive dialogue

An unlicensed assistant can:

Call a prospect and schedule an appointment

An appointed associate under Intermediary:

Can give advice and opinions to one party to the transaction

TREC has the power to order witnesses to appear and/or produce records of documents for its investigations and hearings. This is called subpoena power. If a license holder fails to respond to a subpoena, what can TREC do?

TREC can file suit with the Attorney General to enforce the subpoena.

TREC rules require a license holder to disclose his dual role if he is representing himself in a transaction. TREC also requires a license holder to disclose if his client is his:

Spouse, child or parent

A sales agent or broker must disclose if he is representing his:

Spouse, parent or child only

In the event of a conflict between the statutory duties of Intermediary and the common law duties of dual agency of a broker, which takes precedence?

Statutory Intermediary

Who is responsible for filling in the effective date of the real estate sales contract?

The broker

What is required in order for a broker to act as an intermediary?

The broker must have the written permission of the seller and the buyer, including information on how the broker is to be paid

A broker has a verbal listing agreement with a seller. The seller has agreed to sign a written listing agreement but has not done so yet. What is true?

The broker's status at this time is that of a volunteer

A buyer under contract has had an inspection performed and doesn't want the property. What are the options to back out?

The buyer can back out during a due diligence or option clause in the contract.

When must the option fee be delivered?

The buyer must pay the seller the option fee within 3 days of the effective date of the contract

A buyer is unable to obtain credit approval as described in the Third Party Financing Addendum for Credit Approval. If the buyer provides the seller with written notice within the agreed-to number of days, which of the following is FALSE?

The buyer will lose his earnest money

John has listed the property at 17 Oak St. The sellers have received and accepted an offer from the buyers. The buyers have received the survey and it shows an encroachment that the sellers did not previously disclose. The buyers are not willing to purchase the property in this condition. What action on the part of the buyers must be taken?

The buyers have the number of days mentioned in the contract to address survey problems with the sellers

An agent switched brokers in the middle of a sale where the house is already under contract. What is true?

The first broker is the primary broker for the transaction.

According to the TREC One to Four Family Residential Contract, who is responsible for paying the owner policy of title insurance?

The party stipulated in the contract

Which of the following is true and demonstrates the difference between the role of a Broker-Intermediary and the role of a Sales Agent-Appointee?

The sales agent may give advice and opinions to one party in the transaction

John sold his waterfront property to some buyers and provided the Notice of Coastal Area Property. The house on the property was behind the vegetation line at the time of the sale. Several months after the sale, a hurricane caused a considerable amount of beach erosion and the structure is now seaward of the vegetation line. What is true?

The state can force the removal of the structure

A young married couple buys a single-family home in Texas. They close on and move into the house on March 2nd. Which of the following is FALSE?

They are immediately eligible for the Homestead exemption on the property