State Business Conduct and Practices

How long does a licensee have to respond to a Missouri Real Estate Commission's written request? 10 days 30 days 60 days One week

30 days Licensees have 30 days to respond to the commission's written request. Failure to do so is sufficient grounds for MREC to take disciplinary action against the licensee.

Jayden, a Missouri broker, has just received a check for an earnest money deposit. Missouri law requires her to deposit the earnest money into a special account. How many days does she have to do make the deposit? 10 banking days 15 banking days Five banking days Three banking days

10 banking days Earnest money must be deposited within 10 banking days from the date the contract is executed.

Missouri licensees who fail to respond to the commisison's written request or inquiry within ____ days may face disciplinary action. 14 30 365 60

30 Licensees have 30 days to respond to the commission's written request. Failure to do so is sufficient grounds for MREC to take disciplinary action against the licensee.

Goren received a written request from the Missouri Real Estate Commission. He's under investigation for a law violation. How much time does he have to provide a written response? 30 days 60 days 90 days Six months

30 days

Penny made an offer on a property. The seller countered Penny's original offer. What must happen next in order to have a binding contract? Nothing. The contract became binding when the seller made a counter-offer. Penny accepts the seller's counter-offer. Penny accepts the seller's counter-offer, then the seller must accept. Penny must re-submit her offer according to the seller's terms.

Penny accepts the seller's counter-offer.

In which one of these scenarios does a binding contract exist (meaning that offer and acceptance has occurred)?

Quincy received a seller's counter-offer and agreed to all the terms

Missouri broker Zeus represents buyer Jeff, who's purchasing a residential property from seller Alfred, whose agent is broker Sam. Who is responsible for delivering the closing statements to the parties?

Sam must deliver the closing statements to both Jeff and Alfred.

Missouri designated broker Stacy forms a listing agreement with owners Gail and Henry Macke. Which of the following parties must sign this agreement? Stacy and either Gail or Henry Stacy, Gail, and Henry Stacy, Gail, Henry, and the notary Stacy, one of Stacy's licensees, Gail, and Henry

Stacy, Gail, and Henry

A Missouri real estate licensee is advertising a residential property for sale. What information MUST be included in the ad? The broker's name, address, and phone number The broker's name and phone number The licensee's name and phone number The licensee's name and phone number and the broker's name and phone number

The broker's name and phone number Advertisements must contain the brokerage name and phone number. These two pieces of information are required in all real estate advertising.

In Missouri, who determines the amount of earnest money the buyer should offer? The buyer The buyer's agent The seller The seller's agent

The buyer Licensees shouldn't decide the amount of earnest money a buyer should offer, or that a seller should accept. They can discuss ordinary practice, but the buyer should determine the amount.

A real estate license is required ______.

When performing real estate activities for others, for compensation of any kind

Andy is representing his fiancée in a Missouri real estate transaction. Does he have any special disclosure requirements?

Yes, because he has a personal interest in the property.

Jamie, a Missouri licensee, is employed by a company that also owns a title company, to whom he refers clients. This is known as ______. A conflict of duties A conflict of interest A controlled business arrangement Controlled compensation

A controlled business arrangement This is a controlled business arrangement which must be disclosed in writing, using MREC-mandated language written in at least 10-point type. It must also be signed by all parties to the transaction.

Which of the following elements is required in a Missouri buyer representation agreement? A clear description that unmistakably identifies the property being purchased A description of the type of property the buyer seeks The property's complete address The property's legal address

A description of the type of property the buyer seeks

In Missouri, a licensee can't pay a commission or other valuable consideration unless there's ______ for that payment or there's a contractual relationship with the licensee. A proven debt A reasonable cause A written disclosure A written invoice

A reasonable cause When the licensee seeking compensation showed a property to the consumer that the consumer ultimately bought after joining in a brokerage relationship with another licensee, a reasonable cause is said to exist.

When a sales contract doesn't cover the terms needed by the parties, which of the following actions is a licensee allowed to take? Add a standard addendum using standard language. Draft an amendment using whatever language is needed to capture the missing terms. Hire an attorney and invoice the client. Terminate the contract on the client's behalf.

Add a standard addendum using standard language.

Zeus, a designated broker in Missouri, has provided written authorization for his affiliated licensees to enter into brokerage agreements on his behalf. Which of the following does this mean? All of Zeus's affiliated licensees who enter into a brokerage agreement with a principal can sign that agreement on Zeus's behalf. Zeus has broken the law, because it's illegal for designated brokers to authorize affiliated licensees to act on their behalf. Zeus's affiliated licensees can meet the principals and verbally make the agreement, but Zeus has to sign the written agreement. Zeus's affiliated licensees can sign brokerage agreements on their own behalf.

All of Zeus's affiliated licensees who enter into a brokerage agreement with a principal can sign that agreement on Zeus's behalf.

Andre is a Missouri broker whose license was suspended when one of the salespersons working in his brokerage committed a violation. This is mostly likely because ____________.

Andre either knew about the violation or is guilty of failure to supervise

Which of the following is a true statement about branch offices in Missouri? Branch offices must be operated under the same name and license as the main office. Brokers may only operate one main office and four branch offices at a time. Each branch office must be operated only under the direct supervision of the principal licensed broker. Only brokers with at least 10 years' experience may operate more than five branch offices at a time.

Branch offices must be operated under the same name and license as the main office.

Stefan is an unlicensed assistant for the Ace Team at Acme Realty in Missouri. Which of these activities can he perform? Calculate commissions for team members. Explain listing information to a client. Host an open house. Solicit business for the team.

Calculate commissions for team members. Unlicensed assistants can't perform any activities that require a real estate license. Prohibited activities include hosting open houses, showing homes, explaining listing information to a consumer, and soliciting business, among others.

Carter is the principal broker of a Missouri real estate branch office. Kathleen, a broker-salesperson, was appointed the supervising broker for the branch office. Holly, a salesperson at the branch office, has three active listings. To whom do the listings belong? Carter as the principal broker Holly as the licensee acting as the seller's agent Kathleen as the supervising broker The Missouri Real Estate Commission

Carter as the principal broker Listings are the property of the principal broker of the firm.

A Missouri licensee has several tasks to perform for seller clients. One of which is to ______. Advise sellers on the property conditions they shouldn't disclose to the buyer Communicate all offers and counter-offers to the sellers Disclose to the sellers that if the property doesn't sell within 60 days, the asking price must be lowered Ensure an implied agency agreement is in place

Communicate all offers and counter-offers to the sellers. One of a licensee's tasks is to communicate all offers and counter-offers to the seller. This goes to the duties of disclosure, accounting, and reasonable skill and care.

You're a Missouri real estate broker supervising 24 licensees. What's the most effective way for you to protect your firm from lawsuits? Develop, implement, and train firm members on policies and procedures. Make timely use of your attorney. Obtain errors and omissions insurance. Train your sales staff on effective negotiation skills.

Develop, implement, and train firm members on policies and procedures.

Missouri real estate salesperson Aaron owns 1% of the title company that he refers all of his clients to. What must he do when referring this title company? Complete a referral slip for the title company Disclose his ownership interest verbally Disclose his ownership interest verbally and obtain his client's signature on the disclosure. Obtain a compensation agreement from the title company

Disclose his ownership interest verbally and obtain his client's signature on the disclosure.

The following charges are part of a Missouri real estate transaction: sales price, appraisal fee, earnest money, and buyer's new loan. What item(s) would be listed as a buyer's credit on the closing statement? Appraisal fee, earnest money, and buyer's new loan Earnest money and buyer's new loan Earnest money only Sales price only

Earnest money and buyer's new loan Credits are the deposits or consideration (i.e., money) the buyer puts into the transaction. Debits are charges that the buyer will have to pay. In this example, the buyer put in earnest money and a new loan to cover the charges.

When it comes to earnest money in Missouri, which of these statements is true? Earnest money is rarely the subject of lawsuits against real estate licensees. Earnest money must be placed in escrow. The amount of earnest money is non-negotiable between the buyer and seller. The seller dictates the amount of earnest money in the MLS listing.

Earnest money must be placed in escrow

Regarding their employment classification, unlicensed assistants are most often ______. Dependent contractors Employees Independent contractors Unpaid interns

Employees Because unlicensed assistants may not work on commission, they must be paid a salary.

Janice wants to sell her Missouri townhome, and her neighbor is considering buying it. While waiting to find out if her neighbor is going to buy, Janice wants to market her home and receive the best representation possible. What type of listing agreement will save Janice the cost of a commission if her neighbor does ultimately decide to buy?

Exclusive agency With an exclusive agency agreement, only one broker lists the property. If that broker or any other broker or agent sells the property, the seller owes a commission to the listing agent as agreed in the agency agreement. However, if the owner finds a buyer, no listing fee is owed.

Which of the following advertising activities could a Missouri real estate licensee legally perform? Entering any buyers who make an offer on a property into a lottery Giving a free magnet to anyone who attends an open house Holding a contest for anyone who enters into a listing agreement during the quarter Offering a prize to the first buyer who puts in an offer on a new listing

Giving a free magnet to anyone who attends an open house

Broker Hal wants to open a new on-site leasing office in an office building. He signs the lease and moves into the office, hiring office staff. Three months later, he realizes he's never notified the MREC about the new office. Which of the following is true of this situation? Hal was never required to register this office with the MREC, because it's not considered a branch office. He must immediately send written notification of the new branch office to the MREC. Because he acted to correct the violation, the MREC may waive the penalty. He's violated the MREC rules by not getting pre-approval for a branch office before opening it, as well as not registering that office once it was established. He's violated the MREC rules by not registering the new branch office. He could face penalties for every day the violation continued, up to a maximum of $25,000.

Hal was never required to register this office with the MREC, because it's not considered a branch office. Project sales, leasing, and management offices that are maintained on-site in various buildings, projects, complexes, and developments aren't required to be registered as branch offices.

Which of the following tasks would require a real estate license? Assemble closing documents Calculate a commission check Host an open house Place a for-sale sign in a front yard

Host an open house Administrative tasks are fine, but anything that involves activities normally performed by a licensee (such as meeting with the public to show real estate) would require a license.

Broker Katia instructs her licensees to use the exclusive listing agreement created by Missouri REALTORS®. Assuming she is acting within the law, which of the following is true in this situation? Katia has received special permission from the MREC to use this form. Katia is a current member of Missouri REALTORS®. Katia is a current or former member of Missouri REALTORS®. The MREC requires all Missouri licensees to use Missouri REALTORS® contracts and forms.

Katia is a current member of Missouri REALTORS®. A Missouri broker in a transaction may use the current standardized forms of a trade association, provided that the forms were prepared or approved by an attorney for a trade association to which the broker is a current member.

Shane is no longer practicing real estate, but he has his Missouri broker's license, so he keeps his business going, and collects fees for allowing licensees to use his license. Is this an appropriate business model?

No, because Shane's shirking his supervisory responsibilities. Shane's shirking his responsibility to supervise, he's not directly involved in the business and can't develop a business solely on collecting fees from licensees.

Missouri licensee Jim is sole owner of three houses. He lists one for sale on Craigslist under the "For Sale by Owner" section, with his name and cell number, and his sponsoring broker's name and phone number. Is this permitted by law?

No, because licensees may not list any properties they own as "for sale by owner." Jim's mistake here was indicating that this property was for sale by owner. He posted it in the FSBO section of Craigslist, and he didn't disclose his licensed status. Both of these were big mistakes.

Davis is a Missouri real estate licensee. He's great at form completion, and decides to charge his clients a separate fee for each form he completes. Under what circumstances may he do this? If he discloses his fees in writing in advance If he discloses his fees in writing in advance, and obtains his client's signature If he obtains verbal approval None

None Per 4 CSR 250-8.140 Standard Forms, you may not make a separate charge for completing any standardized forms and you may not prepare those forms for persons in transactions in which you're not acting as a broker.

Maura is a principal broker in Missouri. She's opening a small branch office where Jamison (broker-salesperson) and Nancy (salesperson) will work. Who can Maura appoint to supervise the branch office?

Only Jamison Branch offices must operate under the "direct supervision of a licensed broker, broker-salesperson, broker-partner, broker-associate, or broker-officer of the principal licensed broker."

As a licensed Missouri real estate salesperson, how may Ken receive his compensation? Directly from clients Directly from clients and other agents to whom he gives referrals Through his designated broker Through his designated broker and directly from clients

Through his designated broker Missouri salespersons must receive all compensation through their designated brokers. Only a real estate broker may conduct real estate activities for direct compensation.

What is the purpose of a listing agreement? To bind the seller to one agent To guarantee a sale To guarantee payment for the listing agent To spell out the agreement between the listing broker and the seller

To spell out the agreement between the listing broker and the seller The listing agreement spells out the contractual agreement between the seller and the listing broker. There's no guarantee of payment because the agreement may expire before the property sells.