State Topic Tester- VA Transaction Recovery Fund

In a single transaction, what is the maximum amount that a person can collect from the Transaction Recovery Fund due to licensee misconduct?

(virginia real estate transaction recovery fund) The maximum payment to a person is always $20,000 (whether this is for a single transaction or multiple transactions). If multiple persons have filed a claim against the licensee, the Board may institute a maximum total amount for all claimants The correct answer is: $20,000

If the named licensee is involved in multiple transaction violations, what is the maximum that a person may collect from the Transaction Recovery Fund?

(virginia transaction recovery fund) A single person can collect a maximum of $20,000 from the Fund, whether it is for a single transaction or multiple transactions. The correct answer is: $20,000

If a judgment has been awarded to a claimant, what must the claimant do before the Board will authorize payment from the Transaction Recovery Fund?

(virginia transaction recovery fund) After the claimant has obtained a judgment, he must pursue all legal avenues for reimbursement. This would include a legal attempt to seize and sell all of the respondent's assets. Then, and only then, is the claimant eligible for payment from the Fund. The correct answer is: The claimant must have gone after any assets and property belonging to the debtor

When the Transaction Recovery Fund balance falls below a statutory minimum, it results in:

(virginia transaction recovery fund) Assessments are imposed upon all licensees, whether they are active or inactive. The Board may assess up to $20 from licensees in a 2 year period to bring the Fund back to the minimum balance. The correct answer is: An assessment from all licensees to restore the fund to the minimum balance

Which of the following persons may file a claim and collect from the Virginia Transaction Recovery Fund?

(virginia transaction recovery fund) Basically, anyone involved in the real estate industry cannot claim or collect from the Fund. This includes brokers, salespersons, developers, and lenders. The Fund is intended to protect consumers, not persons involved in the field. The correct answer is: A consumer that has been defrauded in a real estate transaction

Kathy the Consumer has filed a claim for payment from the Transaction Recovery Fund. The reason for the claim is to reimburse a loss sustained after a salesperson made a gross misrepresentation. In order for Kathy to collect, she must have already:

(virginia transaction recovery fund) Before an eligible claim can be filed for payment from the Fund, the claimant must take all legal steps for possible reimbursement. As such, Kathy should have already gone to court and obtained a final judgment (no possibility for another appeal). She has no reason or cause to sue the local Association of Realtors. It is probable that Kathy named the broker in her suit, but that is not required. The correct answer is: Filed a claim against the salesperson in a court of competent jurisdiction

Claims for payment from the Transaction Recovery Fund are filed with the:

(virginia transaction recovery fund) Claims are submitted to the Real Estate Board, but a claimant is only eligible for payment after she has exhausted all other legal avenues for recovery through the court system. The correct answer is: Real Estate Board

A license may be suspended without benefit of a hearing:

(virginia transaction recovery fund) Disciplinary action can be taken against a licensee (without a hearing) for failure to pay an assessment to the TRF within 30 days of the 2nd notice. The correct answer is: For failure to pay an assessment to the TRF

New licensee applicants are required to pay into the Transaction Recovery Fund. If necessary, the Board may reassess licensees:

(virginia transaction recovery fund) If the Fund falls below the $400,000, the Board may assess licensees an additional $20 each. This assessment can only be requested once during a two year period (which always ends on June 30th). The correct answer is: $20 in a two year period

If the Transaction Recovery Fund falls below a statutory minimum, licensees may be assessed to restore the Fund. What is the maximum that one licensee may be assessed during a two-year period?

(virginia transaction recovery fund) If the TRF Funds falls below the statutory minimum, the Board may re-assess licensees for no more than $20 within a two year period. The correct answer is: $20

When a claim is paid from the Transaction Recovery fund, which of the following statements is true?

(virginia transaction recovery fund) Once a claim is paid, the claimant subrogates his rights to the Board in order to allow for collection from the licensee. You may file a claim for as much as you want, but $20,000 is the most one person can collect. If multiple parties file against a licensee in a single transaction, their collective claims may not exceed $50,000. The correct answer is: The claimant assigns his rights to the Board, to the extent of the amount of money paid by the Fund

If the Board has authorized payment from the Transaction Recovery Fund, what is the effect for the licensee who committed the misconduct?

(virginia transaction recovery fund) Once a payment is made from the Fund, the person's license is revoked without benefit of a hearing. The correct answer is: The license will be automatically revoked

If a payment is made on a broker's behalf from the Transaction Recovery Fund, what action does the Board take?

(virginia transaction recovery fund) Payment from the Fund results in automatic license revocation for the person named in the complaint. The correct answer is: Automatically revoke the broker's license

Harry is a broker. He works out a deal with Larry (a developer), Darrell (a contractor), and Tony (a mortgage banker). The deal states that Harry will sell all of the houses that Darrell built on Larry's land. After that, Tony would handle the mortgages of any buyers through his bank. Harry sells three houses, then runs off with all the funds. Larry, Darrell, and Tony all file claims for payment from the Transaction Recovery Fund. Who is most likely to collect?

(virginia transaction recovery fund) People who regularly deal in real estate transactions are not eligible for payment from the Transaction Recovery Fund. This includes real estate agents, bankers, developers, and contractors. The correct answer is: No one

If the Board honors a claim and authorizes payment from the Transaction Recovery Fund, the claimant subrogates his rights to the Board. The Board now has the right to:

(virginia transaction recovery fund) The Board can only seek to recover the amount paid from the Fund on behalf of the licensee. The court ordered judgment could include other damages. The correct answer is: File a claim against to the licensee to recover the amount paid from the Fund

The Real Estate Board can re-assess licensees if the Transaction Recovery Fund's balance falls below:

(virginia transaction recovery fund) The Board may assess all licensees (active and inactive) if the Fund balance dips below $400,000. The correct answer is: $400,000

Which of the following statements is true if a broker has repaid the amounts awarded from the Transaction Recovery Fund?

(virginia transaction recovery fund) The Real Estate Board has the right to refuse issuance of a license to any person who has EVER had his license suspended or revoked. When a claim is paid, the broker's license is automatically revoked by law. The fact that the broker repaid the fund is immaterial. The correct answer is: The Real Estate Board could withhold issuance of a new license, forever

A consumer may file a Transaction Recovery Fund claim for a loss sustained as the result of a licensee's fraudulent act. In order to receive payment, this claim must be in connection with:

(virginia transaction recovery fund) The Transaction Recovery Fund is ONLY used to pay claims arising from real estate transactions. The correct answer is: A real estate transaction

The purpose of the Transaction Recovery Fund is to:

(virginia transaction recovery fund) The law and regulations are silent on the actual purpose of the Transaction Recovery Fund. However, the Act does state that when a person receives an award for damages as a result of a licensee's improper or dishonest dealing, a consumer may file a claim for recovery of such losses. After proper investigation, the Board may authorize a payment from the Transaction Recovery Fund in order to offset the losses sustained. The correct answer is: Reimburse financial losses caused by licensee misconduct

What is the maximum amount that can be paid from the Transaction Recovery Fund for claims against the same licensee during a two year period?

(virginia transaction recovery fund) The maximum amount that any one person can claim from the Fund is always $20,000. However, if multiple claimants file against the licensee from a single transaction, the maximum paid to all claimants would be a total of $50,000 during any 2-year period. If the licensee is involved in multiple transactions, the maximum that the Fund will pay to all claimants is $100,000 during any 2-year period. The correct answer is: $100,000

The minimum balance of the Virginia Real Estate Transaction Recovery Fund is:

(virginia transaction recovery fund) The minimum balance of the Transaction Recovery Fund is $400,000. If the Fund dips below that amount, the Board may assess licensees up to $20 in a two year period. The correct answer is: $400,000

A real estate license could be suspended without investigation if the licensee:

(virginia transaction recovery fund) The only instance where your license can be suspended or revoked without a hearing is in relation to the Transaction Recovery Fund. Specifically, a license will be suspended if you fail to pay your assessment, and it will be revoked if you cause payment from the Fund. The correct answer is: Does not pay the Transaction Recovery Fund assessment

Kerra the Consumer has filed a claim for payment from the Transaction Recovery Fund. Which of the following statements must be incorrect?

(virginia transaction recovery fund) There is no requirement to sue the Association of Realtor--in fact, there is no reason to sue them if she's trying to get a TRF payment. All of the other answers are correct statements. The correct answer is: Kerra filed suit against the local Association of Realtors

Which of the following persons could file a claim for payment from the Transaction Recovery Fund?

(virginia transaction recovery fund) This is a trick question. All the listed persons COULD FILE a claim, but none would be able to collect. When a claim is filed, the first step is to determine whether the claimant is eligible to receive payment from the Fund. Remember that consumers are the only ones eligible to collect under the Act, and only if they have been injured by a real estate licensee. The correct answer is: All of the above

An award from the Transaction Recovery Fund will result in:

(virginia transaction recovery fund) Upon payment of a claim, the Real Estate Board REVOKES the license of the person named in the complaint. The Board may impose a maximum fine of $2,500 per violation (ex. improper or dishonest conduct), but it cannot order a prison sentence. The correct answer is: Automatic revocation of the real estate license

Which of the following statements about the Transaction Recovery Fund is correct?

(virginia transaction recovery fund) When necessary, the Board may assess active and inactive licensees in order to restore the Fund. If the claim is deemed to be valid, the respondent's license is revoked, not suspended. A licensee must also repay the Fund (plus interest), but there is no requirement to sell one's personal belongings in order to satisfy the debt. The correct answer is: A claimant may collect up to $20,000

If a person wants to make a claim from the Transaction Recovery Fund, where should this claim be filed?

(virginia transaction recovery fund) You can ONLY file a claim with the Real Estate Board. However, a claimant must first obtain a final judgment against the licensee from a court of competent jurisdiction. The correct answer is: The Real Estate Board