Unit 8 practice activity
List of phone numbers from consumers who want to limit telemarketing calls
National Do Not Call Registery
An individual who is licensed to buy, sell, exchange, or lease property for others, and to charge a fee for those services
Real estate broker
Unsolicited junk email
Spam
Practical applications of the articles of the REALTOR® Code of Ethics
Standards of practice
Price-fixing, which is the practice of setting prices for products or services rather than letting competition in the open market establish those prices, is legal. T/F
False
Real estate license laws do not include disciplinary systems. T/F
False
States' licensing rules and regulations do NOT have the same force and effect as statutory law.
False
The Institute of Real Estate Management (IREM) is affiliated with the National Association of Real Estate Brokers (NAREB).
False
Has completed the requirements of the REALTOR® Institute
GRI
Two or more businesses conspiring against another business
Group boycotting
Providing product or service to customer only if customer buys another product or service as well
Tie-in arrangement
A real estate broker is licensed to buy, sell, exchange, or lease real property for others and to charge a fee for those services. T/F
True
A real estate broker's compensation is specified in the contract with the client. T/F
True
ARELLO promotes state licensing standards. T/F
True
All 50 states regulate the activities of real estate professionals. T/F
True
Group boycotting, allocation of customers or markets, and tie-in agreements are all prohibited acts under the Sherman Antitrust Act.
True
Laws cannot guarantee an ethical or moral marketplace. T/F
True
Many trade organizations serve the real estate business. The largest is the National Association of REALTORS® (NAR). T/F
True
Real estate license laws are intended to protect the public. T/F
True
The purpose of the Electronic Signatures in Global and National Commerce Act (E-Sign) is to make contracts (including signatures) and records legally enforceable, regardless of the medium in which they are created.
True
A sales associate working under a written contract who receives most of her income from production rather than hours worked
Independent contractor
Allows MLS members equal rights to display MLS data
Internet Data Exchange
Sets basic rules for entering an enforceable contract using electronic means
Uniform Electronics Transactions Act
Laws that prohibit price fixing and tie-in agreements
antitrust laws
Setting commission rate among competitors for services
price fixing
The broker who starts an uninterrupted chain of events that results in the sale of a property
procuring cause
A person who is licensed only to perform real estate activities on behalf of a broker
sales associate
Internet tools to facilitate the creation and sharing of information
social media
Has an established Code of Ethics that REALTORS® must subscribe to
NAR
A sales associate can carry out all the same activities as a real estate broker. T/F
False
A sales associate's compensation is determined by the client. T/F
False
Agreement between real estate professionals to divide market and not compete with each other's business
Allocation of customers
The business of bringing parties together
Brokerage
Affiliate designation of NAR specializing in residential property
CRS
A form of compensation computed as a percentage of the total sales price of a property
Commission
An analysis performed to assist a seller in pricing a property
Comparative Market Analysis (CMA)
If a state licensing authority's regulations conflict with statutory law, the regulations will prevail. T/F
False
Transactions conducted through email or fax
Electronic contracting
A system of moral principles, rules, and conduct
Ethics
A real estate assistant would never be required to have a real estate license. T/F
False
Member of the National Association of REALTORS®
REALTOR
Member of the National Association of Real Estate Brokers
Realtist
Established by the National Association of Real Estate Brokers
Realtist Code of Ethics
In real estate, a sales associate is always A) an independent contractor. B) a combination office manager, marketer, and organizer with a fundamental understanding of the real estate industry, who may or may not be licensed. C) a licensee who performs real estate activities on behalf of a broker. D) an employee of a licensed broker.
The answer is a licensee who performs real estate activities on behalf of a broker. While the sales associate may be treated as an independent contractor for income tax purposes, the sales associate must still work directly under the broker.
If present at the time the transaction closes, a broker is considered to be the procuring cause of a sale. True False
The answer is false. A broker is considered the procuring cause of a sale if the broker started an uninterrupted chain of events that resulted in the sale.
A real estate sales associate is licensed to buy, sell, exchange, or lease real property for others, and to charge a fee for those services. True False
The answer is false. A real estate broker is licensed to buy, sell, exchange, or lease real property for others and to charge a fee for those services.
Only a few states regulate the activities of real estate licensees. True False
The answer is false. All 50 states, the District of Columbia, and all Canadian provinces license and regulate the activities of real estate professionals.
The practice of illegally setting standard prices for products or services is called a tie-in agreement. True False
The answer is false. Price-fixing is the practice of competitors setting prices for products or services. A tie-in agreement is an agreement to sell one product only if the buyer also purchases another product.
A broker who owns a realty agency does not permit his sales associates to agree to more than a 5% commission in any transaction. After reading a newspaper article about this realty agency's policies, the broker of another realty agency decides to also adopt the 5% maximum. Based on these facts, which of these statements is TRUE? A) Both brokers engaged in illegal price-fixing. B) Neither broker has committed an antitrust violation. C) Although the first realty agency's policy is legal, the second realty agency's adoption of the same maximum commission may constitute an antitrust violation if both brokers are in the same real estate market. D) The first realty agency's policy is price-fixing and violates the antitrust law.
The answer is neither broker has committed an antitrust violation. Brokers must independently determine commission rates or fees for their own firms. Because the second agency's broker learned about the first agency's policies from a public source, the newspaper, and did not discuss the policy with the first agency, neither broker has committed an antitrust violation.
Real estate trade associations offer professional training to members, who must follow a code of ethics. True False
The answer is true. Real estate trade associations have a long history of advancing the real estate profession, particularly by establishing a code of ethics to which members must comply.
All of these are requirements for independent contractor status used by the Internal Revenue Service EXCEPT A) a substantial portion of the individual's income is based on sales production rather than hours worked. B) a written agreement that specifies that the individual will not be treated as an employee for tax purposes. C) specific hours stated in a written agreement. D) a current real estate license.
The answer is specific hours stated in a written agreement. The real estate broker may require an employee to follow rules, such as working a certain number of hours, but the broker may not do so if treating the affiliated sales associate as an independent contractor.
A real estate broker had a listing agreement with a seller that specified a 6% commission. The broker showed the home to a prospective buyer. The next day, the buyer called the seller directly and offered to buy the house for 5% less than the asking price. The seller agreed to the price and informed the broker in writing that no further brokerage services would be required. The sale went to closing six weeks later. Based on these facts, which of these statements is TRUE? A) The broker was the procuring cause of the sale and is entitled to the full 6% commission. B) Under the facts stated, the broker is not the procuring cause of this sale but is still entitled to a commission. C) While the broker was the procuring cause of the sale, the seller properly canceled the contract; without a valid employment agreement in force at the time of closing, the broker is not entitled to a commission. D) The broker is entitled to a partial commission, and the buyer is obligated to pay it.
The answer is the broker was the procuring cause of the sale and is entitled to the full 6% commission. Because the broker introduced a ready, willing, and able buyer to the seller prior to the seller's cancellation of the listing agreement, the broker is entitled to the commission.
Why have real estate license laws been put into effect? A) To establish maximum levels of competency and a moral marketplace B) To prevent licensees from engaging in profit-making activities C) To protect licensees from lawsuits D) To protect the public and establish standards of professionalism
The answer is to protect the public and establish standards of professionalism. Real estate license laws protect the public by ensuring a standard of competence and professionalism in the real estate industry.
A real estate sales associate is an individual who is licensed to perform real estate activities on behalf of a licensed broker. True False
The answer is true. A real estate sales associate is any person licensed to perform real estate activities on behalf of a licensed real estate broker; the broker is fully responsible for the actions performed in the course of the real estate business performed on behalf of the broker.
Price-fixing, group boycotting, and allocation of markets are three examples of antitrust violations. True False
The answer is true. Antitrust laws prohibit monopolies and any contracts, combinations, and conspiracies that unreasonably restrain trade, such as price-fixing, group boycotting, allocation of customers or markets, and tie-in agreements.
The amount of a broker's compensation is always negotiable. True False
The answer is true. Because the real estate industry is subject to antitrust laws, the amount of a broker's compensation is always negotiable and may not be set or determined by a multiple listing association or any professional organization.
The Internal Revenue Service has established criteria for determining whether a sales associate is classified as an employee or a nonemployee for income tax purposes. True False
The answer is true. The Internal Revenue Service (IRS) has established three requirements needed to establish a nonemployee status for tax purposes: (1) the individual must have a current real estate license, (2) the individual must have a written contract with the broker specifying that the individual will not be treated as an employee for federal tax purposes, and (3) a substantial portion of the individual's income as a real estate professional must be based on sales production and not on the number of hours worked.
Real estate license laws set up a disciplinary system to enforce the acceptable standards of conduct and practice for licensees. True False
The answer is true. The real estate license laws not only set standards for conduct and practice, but they also enforce those standards.