Real Estate

True

There must always be at least one broker under whose license the real estate activities of the firm are carried out.

The Real Estate Commissioner Determines administrative policy and enforces that policy screens candidates for licensing; prepares subdivision public reports; conducts licensee disciplinary action; investigates nonlicensees performing activities for which a license is required; and regulates nonexempt franchises and real property securities.

What does the Real Estate Commissioner do?

To protect the members of the public with whom real estate licensees come into contact in their business activities.

What is the primary purpose of both the Real Estate Law and the Regulations of the Real Estate Commissioner?

Riparian rights

belong to owners of land bordering a river or other flowing stream. Owners of riparian rights do not own the water but have the right to make reasonable use of it on their own property. If the stream is navigable, the state owns the land under the stream and the riparian landowner's property line is the mean high water line of the stream; otherwise, the landowner's property line is the center of the stream .

Under the Real Estate Law, a real estate salesperson works for a broker as an

employee

a salesperson is always considered the employee of who?

employee of the broker.

The classical definition of property ownership is ownership of

everything below the property in the shape of an inverted pyramid with its apex at the center of the earth and infinite airspace.

In addition to the prelicense education requirements to become a real estate broker, an applicant must also

have been actively engaged as a real estate salesperson for at least two of the preceding five years, or equivalent.

Prepaid Rental Listing Service (PRLS)

is a business that supplies prospective tenants with listings of residential real property on payment of a fee collected at the same time or in advance of when the listings are supplied. Anyone licensed as a real estate broker may conduct a PRLS business without obtaining a separate PRLS license.

The Recovery Account

is another fund financed by license fees. It is available to aid victims of licensee fraud, misrepresentation, deceit, or conversion (theft) of trust funds, who are awarded money damages by a court or as the result of a DRE administrative proceeding that are noncollectible. A maximum of $50,000 per transaction or $250,000 per licensee can be paid from the Recovery Account. Reimbursement to the fund by the offender will be required as part of the disciplinary process.

bulk transfer of goods

is any transfer of a substantial part of the materials, supplies, merchandise, equipment, or other inventory that is not in the ordinary course of the transferor's business. The Uniform Commercial Code protects creditors of the seller in such a transfer by requiring that notice of the transfer be given to the transferor's creditors.

DRE requires that the real estate licensee's identification number appear on

materials used to solicit consumers, including the following: Business cards Stationery websites owned, controlled, and/or maintained by the soliciting real estate licensee Promotional and advertising flyers, brochures, email and regular mail, leaflets, and other marketing or promotional materials designed to solicit the creation of a professional relationship between the licensee and a consumer, or intended to induce a consumer to contact the licensee about any licensed services

A licensee was farming a non-integrated neighborhood which was next to an integrated neighborhood by telling the owners that if minority people moved into their neighborhood, their property values would go down. This is an example of

(a) steering. Quiz Question(b) panic selling. Quiz Question(c) blockbusting. (d) both (b) and (c). Your answer: (D) is correct.Blockbusting or panic selling (or panic peddling) violates federal fair housing laws.

The Real Estate Law DOES NOT require licensing for

(a)the resident manager of an apartment building or complex. (b)the manager of a hotel. (c)a real estate assistant who does not perform acts that require a real estate license. (d)all of the above. (this is the answer)

A license that is not renewed before it expires may be renewed at any time up to two years from the expiration date.

A late renewal fee will be required. After the two-year period, the licensee must qualify for and successfully pass the appropriate real estate examination.

give the salesperson his license and notify the Real Estate Commissioner immediately in writing.

A salesperson tells his broker that he is quitting and plans to go to work for another broker. His present employing broker should

his/her employing broker.

According to the real estate law, a real estate salesperson must work under the supervision of

California's Real Estate Law is found in the

Business and Professions Code

California real estate law originated from

English common law.

False

False or True? In California, a real estate brokerage can not also act as a mortgage loan brokerage.

The diversity of California's population and economy makes the state unique compared to the rest of the country. Which statistic shows the greatest disparity between the state and the nation?

Home values

statement is effective for five years from December 31 of the year filed

How long are DBA's good for?

When a Salesperson Is Discharged

If an employing broker discharges a salesperson for a violation of the Real Estate Law, the broker must immediately file a certified, written statement of the facts with the Real Estate Commissioner.

1917

In What Year did California became the first state to legislate licensing requirements for real estate brokers and salespersons.

What type of background check does the Real Estate Commissioner and Appraisal Commissioner use?

Late child support

Which of the following has had the LEAST influence on California history and the real estate market?

Nature provides an abundance of both benefits and hazards, but cultural, political, and economic forces often have brought about more changes than even the most severe earthquake or fire.

The most heavily weighted subject matter on the salesperson and broker examination is

Practice of Real Estate and Mandated Disclosures.

Every real estate broker must be licensed by the Department of

Real Estate.

"The agreement shall be dated and signed by the parties and shall cover material aspects of the relationship between the parties, including supervision of licensed activities, duties and compensation."

Regulation 2726 of the Real Estate Commissioner

PUEDE

Right of possession Right to control the property's use Right of enjoyment of the property Right to dispose of the property Right to exclude others from the property

Ideally, the business owner should provide profit and loss statements, or at least business tax reports, for the past three years, for review by the buyer's accountant. These documents also are important because the business's income stream and assets will determine the selling price. The agent should be aware of all factors that might influence the soundness of the business as an investment.

The agent should be aware of all factors that might influence the soundness of the business as an investment.

http://leginfo.legislature.ca.gov.

The complete text of all 29 volumes of the California codes, as well as information on bills pending before the California legislature, can be found where?

Which of the following events is arguably the most important single event with respect to the exploration and settlement of the western frontier and California?

The discovery of gold at Sutter's Mill

WHEN A SALESPERSON CHANGES BROKERS

The former employing broker must notify the Department of Real Estate's Sacramento headquarters immediately, in writing. The former employer must return the salesperson's license certificate within three days of termination of employment and sign the Salesperson Change Application, R/E Form 214. R/E Form 214 must be completed by the salesperson and new employer within five days and sent to: California Department of Real Estate PO Box 137003 Sacramento, CA 95813-7003

Spanish settlement of California began with the establishment of

The major impetus to Spanish settlement of California was the establishment of missions.

What is the maximum amount that could be recovered from the Recovery Fund for one salesperson?

The question is asking for the maximum amount that may be recovered, which is for any one licensee's conduct. $50,000 for a single transaction, but $250,000 maximum for any one licensee.

Uniform Commercial Code Requirements

Uniform Commercial Code Requirements — California has adopted the Uniform Commercial Code. The Uniform Commercial Code governs the sale or transfer of goods ordinarily held for sale in the course of business. Goods held for sale by a business probably were obtained on credit from a supplier or manufacturer.

fictitious business name statement

must be filed with the county clerk in the county of the broker's principal business address. The statement is effective for five years from December 31 of the year filed and is commonly referred to as a DBA

A real estate salesperson is supervised by

the employing broker only

business opportunity.

The sale or lease of a business, including all or most of the assets or stock of the business is termed a

Each branch office must be separately licensed and the license must be available for inspection there.

What If a broker maintains more than one place of business?

obtain a DRE license bearing the fictitious business name.

A broker wanted to operate a real estate office under the fictitious name MLB Realty. Before operating under a fictitious name, the broker must

Partnership

A brokerage can be a partnership. Every partner who performs activities that require a real estate license must be licensed as a real estate broker but there can be only one broker partner of record. At least one broker partner must obtain an additional license for each branch office location. The partnership itself needs no separate license.

Corporation

A brokerage may be set up as a corporation, provided that at least one officer of the corporation is a licensed broker and is designated the responsible broker-officer. The corporation must submit the following to DRE: The corporation license application and fee A certificate of status issued by the Secretary of State within 30 days before submission of the application; or the Articles of Incorporation filed with the Secretary of State if a California stock corporation originally filed the articles within six months of the application A statement of officers as filed with the secretary of state

True

A brokerage, whether a sole proprietorship, corporation, or partnership, can do business under a fictitious name as long as the real estate license is in that name.

Franchises

A franchisee is granted the right to engage in the business of offering, selling, or distributing goods or services under a marketing plan or system prescribed in substantial part by a franchisor; The operation of the franchisee's business pursuant to such plan or system is substantially associated with the franchisor's trademark, service mark, trade name, logotype, advertising, or other commercial symbol designating the franchisor or its affiliate; and The franchisee is required to pay, directly or indirectly, a franchise fee.

A mutual water company may be formed when

A mutual water company may be formed when a subdivision is created and is owned by individual lot owners, who are its shareholders. An adequate potable water supply and distribution system for domestic use and fire protection must exist, and other requirements of the Corporations Code, starting at Section 14310, must be met if the mutual water company was created on or after January 1, 1998.

A real estate license is not needed by the following people:

A person who deals only with her own property A corporation that performs any of the specified activities through one of its regular officers, who receives no special compensation for doing so A licensed securities broker or dealer involved in the sale, lease, or exchange of a business opportunity in that capacity Anyone holding a duly executed power of attorney from the owner of property An attorney-at-law rendering services in the performance of his duties as attorney A receiver, trustee in bankruptcy, or person acting under order of any court A trustee selling under a deed of trust Employees of lending institutions, pension trusts, credit unions, or insurance companies, in connection with loans secured by liens on real property or a business opportunity Escrow agents collecting funds in connection with loans secured by liens on real property, when the funds are deposited in the escrow agent's trust account

Sole proprietorship

A real estate brokerage that is a sole proprietorship may be owned by a licensed real estate broker, a salesperson, or a nonlicensee. Real estate activities can only be carried out by or under the authority of a licensed real estate broker, however. No separate formalities are required to start a business as a sole proprietor. For business liability and tax purposes, however, most brokerages choose to incorporate.

only after the name of the employing broker is provided to DRE.

A salesperson's license is activated only when?

Which of the following is required to operate as a Prepaid Rental Listing Service (PRLS) agent?

An advance-fee rental agent collects a fee in advance from prospective tenants to find them suitable rental properties. An advance-fee rental agent must have a Prepaid Rental Listing Service license (PRLS), but real estate brokers are exempt from this license requirement. PRLS contracts must be in writing and approved by the Real Estate Commissioner.

The person selected as commissioner must have been a practicing real estate broker in California for five years or engaged in some form of real estate activity for five of the past 10 years.

What are the requirements to be a Real Estate Commissioner?

The following are not considered solicitation materials under the license number requirement:

Advertisements in electronic media, including radio, cinema, and television ads, and the opening section of streaming video and audio Print advertising in any newspaper or periodical For Sale signs placed on or around a property intended to alert the public the property is available for purchase or lease

The process through which disciplinary action is taken by the Department of Real Estate starts with an audit or an investigation of the licensee's activities or alleged misconduct. What is the next step in the disciplinary process?

An accusation is the next administrative step toward disciplinary action once the investigation has been conducted.

All of the following are grounds for revocation or suspension of a real estate license EXCEPT

accidentally overpaying taxes on a mobile home.

Commingling is one of the greatest single causes for loss of license. Which of the following would NOT be considered commingling?

An exception to this rule is when a check is received from an offeror in connection with an offer to purchase or lease. In this case, the deposit check may be held uncashed by the broker until acceptance of the offer if the following conditions are met: 1) The check by its terms expressly provides that it is not to be negotiated by the broker, or if the offeror has given written instructions to the broker that the check shall not be deposited or cashed until acceptance of the offer; and, 2) The offeree is informed, before or at the time the offer is presented for acceptance, that the check is being so held.

Mortgage Loan Originator (MLO).

Any individual who, for compensation or gain, takes a residential mortgage loan application or offers or negotiates terms of a residential mortgage loan application, must be licensed as a

DBA's needs the following

an original or legible copy of the DBA, showing the "Filed" and "Certified" stamps from the county clerk's office, must be sent to the Real Estate Commissioner.

Before taking the licensing examination, the applicant must successfully complete

Before taking the licensing examination, the applicant must successfully complete three college-level courses in Real Estate Principles, Real Estate Practice, and one course from a designated list.

CMBA stand for

California Mortgage Bankers Association (CMBA)

health, safety, and general welfare.

California exercises its police power to promote the public

Division 4 of the Business and Professions Code.

California legislation has been compiled into a series of books called codes. What is commonly referred to as the Real Estate Law is?

A licensee must take 45 hours of continuing education in order to renew the license. The 45 hours must include

Every four years licensees must complete 45 hours of continuing education. Part of the 45 hours must include 18 hours in the category of consumer protection, plus coverage of Agency, Ethics, Fair Housing, Trust Fund Handling, Risk Management, and Management & Supervision.

Mobile home dealer

If the real estate agent displays or offers for sale two or more registered mobilehomes at the agent's place of business, the agent must also be licensed as a mobilehome dealer.

Restricted license

In certain circumstances, such as a violation of the Real Estate Law, the Real Estate Commissioner may decide to issue a restricted license. The restriction imposed could: limit the length of the license term; require (for a salesperson) employment by a particular real estate broker; or contain some other condition, such as the filing of surety bonds for the protection of persons with whom the licensee does business.

A sales contract or promissory note secured by real estate in the following cases: Purchase, sale, or exchange of such an obligation with a member of the public (consumer) Servicing of such an obligation by agreement with a member of the public

In what ways can a real estate agent can act as a principal (party to the transaction) in a transaction?

www.bre.ca.gov.

Information about the California Department of Real Estate, including the current status of all real estate licensees, can be found where?

In the sale of a business, bulk transfer laws pertain to

Inventory

A real estate brokerage

Is a business in which real estate license-related activities are performed under the supervision of a real estate broker. A real estate brokerage may consist of only one broker of record and no employees.

real property/real estate

Land Fixtures (attachments) to land Anything incidental or appurtenant to land Anything immovable by law

Land

Land is the soil, the material that makes up what is called earth. Land includes the substances beneath the surface that extend to the center of the earth. These include oil, gas, and water, and they may be many times more valuable than the surface itself. Land also includes the airspace above the earth's surface for an indefinite distance upward.

Littoral rights

Littoral rights belong to owners of land bordering a still body of water, such as a lake. Owners of littoral rights have the right to make reasonable use of the water on their own property.

The Real Estate Law permits a real estate agent to handle transactions involving a mobilehome (termed a manufactured home in federal regulations discussed in Unit 14). The home must be registered in compliance with the Health and Safety Code. If it is, the agent can perform the following activities:

MANUFACTURED / MOBILEHOMES

No. The broker cannot delegate primary responsibility for all brokerage activities, which must be lawfully authorized.

May a broker-salesperson agreement transfer responsibility for all brokerage activities to the salesperson?

Mineral rights

Mineral rights refer to the right to remove substances from the land, usually from beneath the surface. The term includes solid minerals, such as gold, coal, iron, and gravel from the soil as well as riverbeds.

Real Estate Law allows a licensed real estate broker to represent others in the purchase or sale of a business.

Real Estate Law allows a licensed real estate broker to represent others in the purchase or sale of a business.

The Real Estate Law permits a real estate licensee (broker or salesperson) to represent someone else in any of the following transactions involving real property or a business opportunity.

Selling or offering to sell, including soliciting prospective sellers Purchasing or offering to purchase, including soliciting prospective purchasers Exchanging Soliciting or obtaining property listings for sale or exchange Leasing, renting, or offering to lease or rent Selling, purchasing, or exchanging leases Filing an application for purchase or lease involving land owned by the state or federal governments

A real estate agent can represent someone else in any of the following acts involving

Soliciting borrowers or lenders for loans Negotiating loans Servicing loans (collecting payments or performing other services for borrowers or lenders)

By the governor and serves at the governor's discretion.

The Real Estate Commissioner is appointed by whom?

Part 1 covers licensing. Part 2 covers transactions and includes the Subdivided Lands Law.

The Real Estate Law has two parts:

The broker's principal place of business.

The broker's license must be available for inspection by the commissioner (or the commissioner's representative) at? the broker's principal place of business.

4 years

The full term for a broker's or salesperson's license is four years. To renew the license for an additional four years, the licensee must successfully complete 45 hours of continuing education (CE).

A licensee cannot lead an owner of real property, during listing negotiations, to believe that the licensee is precluded from charging less than the commission or fee quoted

The law requires licensees to inform prospective clients that real estate commissions are negotiable. Licensees cannot imply that the law, DRE regulations, or the rules of an organization, such as an association of real estate licensees requires a certain amount of commission to be charged.

Primary function is to enforce the real estate law.

The real estate commissioner is appointed by the Governor and charged with what?

The applicant for a real estate salesperson's license must complete how many college-level courses before taking the licensing examination?

Three

a real estate broker or real estate salesperson.

To represent someone else in a real estate transaction in California, you must be licensed by DRE as what ? a real estate broker or real estate salesperson,

True

True or False? A real estate salesperson (often referred to as a sales associate or associate licensee) can act only under the control and supervision of a responsible broker; that is, the real estate broker by whom the salesperson is employed.

Underground water rights

Underground water rights belong to landowners, who have a right of correlative use of the water under their land. They may withdraw only water for which they have a beneficial use on their own property. Underground water that is not confined to a defined stream is percolating water. The water table (groundwater level) is the upper limit of percolating water below the earth's surface, at a depth of a few feet or hundreds of feet

A large, densely populated metropolitan area, consisting of a number of major urban areas is referred to as a(n)

Urban development generally has been concentrated in coastal and central valley areas. Eventually, Los Angeles and San Diego will form one continuous urban area, or megalopolis.

the sales usually are treated as separate, concurrent transactions.

When real property is sold at the same time...

Which of the following individuals are exempt from the real estate licensing requirements?

Which of the following individuals are exempt from the real estate licensing requirements? Quiz Question(a) A person selling his or her own property. Quiz Question(b) An attorney-at-law rendering services in the performance of his or her duties as attorney. Quiz Question(c) Anyone holding a duly executed power of attorney from the owner of property. (d) All of the above. Your answer: (D) is correct.None of these activities requires a real estate license.

The Real Estate Commissioner, administers the Real Estate Law in California. Every state has a similar department or agency responsible for enforcing laws concerning real estate licensees.

Who heads the The California Department of Real Estate (DRE),

Real Estate Education and Research Fund

research in land use and real estate development is made possible at both public and private universities and research entities throughout the state. The fund is financed by a fixed percentage of license fees.

Mortgage Loan Originator (MLO)

s of January 1, 2011, a licensee who acts as a residential Mortgage Loan Originator (MLO) must register annually on the Nationwide Mortgage Licensing System & Registry (NMLS), found at www.nmls.org, and meet other requirements. The federal and state registration requirements for mortgage loan brokers, lenders, branches, and originators are detailed in Unit 8, Financing Real Estate. All DRE licensees who conduct MLO activities for residential property of one to four units must obtain an MLO license endorsement that is attached to the real estate license and renewed annually.

license renewals

the renewal applicant must complete 45 clock hours of education, including at least 18 hours related to consumer protection in addition to separate three-hour courses in the following: Ethics, Professional Conduct, and Legal Aspects of Real Estate Agency Relationships and Duties in a Real Estate Brokerage Practice Trust Fund Accounting and Handling Fair Housing Risk Management

Agent Jones has an offer on a listing contingent on the buyer's uncle approving the property since he will be financing the loan. Agent Jones hasn't discussed this with the buyers, but assures the seller that there will be no problems regarding the uncle. After the seller accepts the offer, the buyers tell the agent that the uncle is out of town and they don't know when he will return. By failing to explain the meaning and probable significance of the contingency in the offer, the agent has engaged in

unlawful conduct.By failing to explain the potential risks concerning the contingency in the offer, the listing agent has engaged in "unlawful conduct" according to the Real Estate Commissioner. An agent must explain the meaning and probable significance of any contingency in an offer that he/she knows or reasonably believes may affect the closing date of the transaction, or the timing of the vacating of the property by the seller or its occupancy by the seller.

Fixtures

— A fixture is anything, including improvements, that is attached or affixed to land. A fixture can be attached by its roots (trees or shrubs) or imbedded in the land (walls). A fixture might also be something permanently resting on the land, such as a building. A building would include all things customarily considered permanently attached to it, such as siding, plaster, nails, doors, and windows.