Pa real estate drill and practice qbank

Which statement is TRUE regarding agency relationships between licensees and consumers? A) An open listing agreement creating an agency relationship between a seller and broker may be an oral agreement. B) If a broker chooses to represent both buyers and sellers under agency relationships, the broker must adopt a policy appointing designated agents. C) All agency relationships must be expressly created by written agreements. D) A broker may not represent both a buyer and seller as an agent in the same transaction.

A) An open listing agreement creating an agency relationship between a seller and broker may be an oral agreement.

How many members of the Pennsylvania Real Estate Commission are required to be licensed real estate brokers at the time of their appointment? A) 9 members B) 5 members C) 6 members D) 11 members

B) 5 members

Rental listing referral agents are licensed to engage in which of the following activities? A) Engaging in commercial property management activities on behalf of more than one employing broker at the same time B) Collecting rental information for the purpose of referring prospective tenants to rental units or locations of rental units C) Showing residential rental units in multifamily housing to prospective tenants D) Collecting rental application fees and security deposits on behalf of an owner of rental property

B) Collecting rental information for the purpose of referring prospective tenants to rental units or locations of rental units

In Pennsylvania, which of the following is legal and will NOT result in a broker's facing suspension or revocation of the broker's license? A) Helping another person cheat on the licensing examination B) Displaying a For Sale sign on a property without the owner's written consent C) Depositing earnest money received into the firm's escrow account D) Being legally declared mentally incompetent

C) Depositing earnest money received into the firm's escrow account

under certain circumstances, which of the following agreements may be oral? A) Exclusive buyer agency B) Exclusive right-to-sell listing C) Open listing D) Exclusive agency listing

C) Open listing

The term broker includes in its definition all of the following activities EXCEPT A) managing real estate. B) performing a comparative market analysis. C) appraising real estate. D) representing yourself as a real estate consultant or counselor.

C) appraising real estate.

In Pennsylvania, representation agreements that obligate the buyer to pay a fee A) are not regulated under the license law. B) must be on specific forms approved by the real estate commission. C) must be in writing. D) are not permitted; only sellers pay fees for real estate services.

C) must be in writing

According to License Law, who is responsible in any office for the activities of the licensees? A) Associate brokers are responsible for the activities of the salespeople they work with B) Salespersons are to be supervised by each other C) The broker licensee must supervise the activities of all licensed salespersons and associate brokers D) Top producing salespersons and associate brokers may be given the responsibility of supervisions

C) The answer is the broker licensee must supervise the activities of all licensed salespersons and associate brokers. It is a Prohibited Act for brokers to not supervise all of their licensees.

Several weeks after a closing, an associate broker received a thank-you letter and a nice bonus check from the seller of the house. The associate broker cashed the check because he felt it was earned. In this situation, which of the following is TRUE? A) The associate broker may accept the money if his broker permits him to do so. B) Accepting the money is allowed if more than 30 days have elapsed since closing. C) The associate broker may accept the bonus because he is licensed as an associate broker. D) Accepting the money is a violation of the License and Registration Act.

D) Accepting the money is a violation of the License and Registration Act.

When does a real estate salesperson's license expire in Pennsylvania? A) May 31 of every even-numbered year B) Two years from the date the license was issued C) Biennially in the month issued D) December 31 of the third year of licensure

D) December 31 of the third year of licensure

Which action on the part of the broker is legal and NOT a violation of the license law? A) Failing to exercise adequate supervision over the activities of licensed salespeople who are independent contractors B) Openly soliciting salespeople or associate brokers employed by competitors to change employing brokers C) Placing a For Sale sign or advertising property for sale without the written consent of the owner D) Failing to specify a definite termination date that is not subject to prior notice in a listing contract

D) Failing to specify a definite termination date that is not subject to prior notice in a listing contract

Whenever the commission is required to satisfy a claim against a licensee with money from the real estate recovery fund, the licensee A) may expect the Pennsylvania Real Estate Commission to foreclose on any property owned by the licensee. B) must agree to a monthly payment schedule in order to maintain an active license. C) may continue engaging in real estate activities under the commission's direct supervision. D) must repay the full amount plus interest to the account for her license to be reinstated.

D) must repay the full amount plus interest to the account for her license to be reinstated.

A buyer has just entered into a contract to buy a time-share interest in a unit from the developer. This new buyer has a right to cancel the contract A) at no time because the buyer has entered into a binding contract. B) within three days from the date the buyer's attorney reviews the documents. C) at any time during the period agreed to by the buyer and developer in the contract. D) within five days from the date the new buyer executed the contract.

D) within five days from the date the new buyer executed the contract.

All of the following are true regarding the real estate recovery fund EXCEPT A)a licensee on whose behalf money has been paid will have his or her license automatically suspended as of the date of payment. B)a licensee on whose behalf money has been paid must reimburse the fund plus interest at 10% per year. C)the recovery fund does not apply to the sale of campground memberships. D)the maximum liability of the fund may not exceed $20,000 for any one claim.

The answer is a licensee on whose behalf money has been paid must reimburse the fund plus interest at 10% per year. There is no requirement that the money must be repaid. It must be repaid in order to reinstate a license. If money is paid from the recovery fund on behalf of a licensee, the license of that person will automatically be suspended as of the effective date of payment. No such license will be reinstated until the licensee has repaid the money in full plus interest at the rate of 10% per year.

The maximum compensation that will be paid from the real estate recovery fund to satisfy claims against a licensee is A) $100,000. B) $25,000. C) $5,000. D) $10,000.

The answer is $100,000. The liability of the recovery fund may not exceed $20,000 for any one claim and may not exceed $100,000 per licensee.

If a licensee has had his license revoked, how many years must he wait before reapplying for licensure? A) 10 years B) 3 years C) 5 years D) 7 years

The answer is 5 years. Any person whose license has been revoked may reapply at the end of a five-year period from the date of revocation. The applicant must meet all of the licensing qualifications of the act, including the examination requirement.

If a licensee has had his license revoked, how many years must he wait before reapplying for licensure? A)3 years B)5 years C)7 years D)10 years

The answer is 5 years. Any person whose license has been revoked may reapply at the end of a five-year period from the date of revocation. The applicant must meet all of the licensing qualifications of the act, including the examination requirement.

Licensing fees required under the Real Estate Licensing and Registration Act are fixed by which of the following? A) Department of State B) Pennsylvania Real Estate Commission C) Appropriations Committee of the state senate D) Professional Licensure Committee of the state house of representatives

The answer is Pennsylvania Real Estate Commission. All fees required under the Real Estate Licensing and Registration Act are fixed by the real estate commission by regulation

The purpose of the license law is to A)ensure that the public interest is protected. B)authorize the Pennsylvania Real Estate Commission to promulgate rules and regulations. C)prevent convicted criminals from engaging in the real estate business. D)generate license and renewal fees for the state treasury.

The answer is ensure that the public interest is protected. The purpose of laws, including licensing laws, is to provide for the good, safety, and welfare of the public. The rationale supporting the validity of the law is the government's responsibility to ensure that the public is protected.

A seller is required to give a buyer a property condition disclosure in all of the following transactions EXCEPT A)when the seller is not assisted by a real estate licensee. B)if the seller was the owner-occupant but has not resided in the property for the past year. C)for a sale of commercial property. D)if the buyer has occupied the property as a tenant of the seller.

The answer is for a sale of commercial property. A property condition disclosure form is not required in the sale of commercial property. A disclosure is required even if a licensee is not involved (for sale by owner) by an absentee owner and if the buyer was a tenant in the property

Which of the following is TRUE regarding a broker's escrow account? A) If a dispute arises between the parties over entitlement to the money that is held in escrow, the broker retains the money in escrow until the dispute is resolved. B) The account must be an interest-bearing account if the funds will be held for more than six months. C) As long as all parties to the transaction agree in writing, the broker's escrow duty may be waived. D) Funds received must be deposited in the broker's escrow account by the end of the next business day following their receipt by the salesperson involved in the transaction.

A) If a dispute arises between the parties over entitlement to the money that is held in escrow, the broker retains the money in escrow until the dispute is resolved. The answer is if a dispute arises between the parties over entitlement to the money that is held in escrow, the broker retains the money in escrow until the dispute is resolved. If a dispute arises, the broker retains the escrow until the dispute is resolved. A broker's duty to escrow may not be waived or altered by agreement between the parties to the transaction, between the broker and the parties, or between the broker and other brokers involved in the transaction. If the money is expected to be held in escrow for more than six months, the broker is encouraged to deposit the money into an interest-bearing account. However, most escrow accounts do not bear interest.

How long must a real estate broker keep records relating to real estate transactions? A) Three years following consummation of the transaction B) One year from the date the property was listed with the broker C) Indefinitely D) Until the transaction closes and title passes from the seller to the buyer

A) Three years following consummation of the transaction The answer is three years following consummation of the transaction. License law requires the broker to keep records relating to a real estate transaction for three years following consummation of the transaction.

If an agreement of sale is conditioned on the ability of the buyer to obtain mortgage financing, all of the following must be included in the agreement EXCEPT A) a copy of the buyer's credit report. B) the type of mortgage. C) the nature and extent of assistance that the broker will render to the buyer. D) the deadline for the buyer to obtain the mortgage loan.

A) a copy of the buyer's credit report.

When a salesperson applies for a real estate license, the employing broker is responsible for A) submission of a sworn statement certifying that she will actively train and supervise the applicant. B) verifying that the candidate is a U.S. citizen. C) payment of the initial fee to the real estate recovery fund on behalf of the licensee. D) issuing an official transcript verifying completion of the educational requirement.

A) submission of a sworn statement certifying that she will actively train and supervise the applicant.

How many times per year may the Commission conduct a routine inspection of the main or branch office of a broker? A) No more than four times a year B) Once a year C) As often as necessary D) No more than once a month

A) No more than four times a year

Real estate licensing is required in order to engage in the A) sale of time-share interests. B) sale of property by an individual acting as a trustee in a bankruptcy proceeding. C) negotiation of leases by employees of a public utility. D) sale of real estate by a licensed auctioneer at a bona fide auction.

A) The answer is sale of time-share interest. A time-share salesperson's license is required to sell time-shares. Employees of a public utility, trustees in bankruptcy, and licensed auctioneers are all exempt from licensing requirements.

Who of the following is subject to disciplinary action by the Pennsylvania Real Estate Commission? A) Campground membership salesperson B) Employees of a real estate appraisal firm C) Elected officers of a banking institution handling real estate transactions for the bank D) Attorney-in-fact rendering services under an executed and recorded power of attorney

A) campground membership salesperson

A couple visited a time-share property and received a A couple visited a time-share property and received a gift of a portable color television for signing a purchase agreement for a time-share interest that day. Four days later, the couple decided not to go through with the transaction. Under what circumstances may they void the contract? A) Because it is illegal to offer promotional prizes and gifts as an inducement, the purchase agreement is void. B) The couple may cancel the purchase agreement until midnight of the fifth day following the purchase, and they may keep the portable color television. C) The couple is bound to the terms of the purchase agreement and does not have the right to cancel the purchase. D) Although the couple may cancel the purchase agreement, they must return the portable color television.

B) The couple may cancel the purchase agreement until midnight of the fifth day following the purchase, and they may keep the portable color television.

If a licensed salesperson, without the knowledge or consent of the employing broker, violates requirements regarding delivery of a Consumer Notice at the initial interview, what are the consequences? A) Unless the consumer files a written complaint with the commission, neither the broker nor the salesperson is subject to disciplinary proceedings. B) The salesperson may have her license suspended or revoked. C) As long as the Consumer Notice is signed by the parties prior to entering into an agreement of sale, there is no violation. D) The broker will have her license suspended or revoked for failing to exercise supervision over the licensed salesperson.

B) The salesperson may have her license suspended or revoked.

A salesperson is discussing the possibility of listing a seller's home for sale. Before the agreement is signed, the salesperson should provide the seller with information concerning the A) common or typical rate of commission charged by brokers in the area. B) broker's policies regarding cooperation with other brokers, including the sharing of fees. C) approximate number of times the house will be advertised for sale. D) inclusion of an automatic renewal clause in the broker's exclusive listing agreement.

B) broker's policies regarding cooperation with other brokers, including the sharing of fees.

In Pennsylvania, the real estate license law is administered by the A) Department of State. B) real estate commission. C) state association of REALTORS® . D) Department of Housing and Urban Development.

B) real estate commission. The answer is real estate commission. The Pennsylvania Real Estate Commission has the power and authority to administer and enforce the license law. The Pennsylvania Association of REALTORS® is a trade association whose members are licensees. The Department of Housing and Urban Development generally handles fair housing, not licensing, issues.

When a licensed broker changes his or her place of business, all of the following are true EXCEPT A) the new office location must comply with the terms of the license law. B) the commission will issue a new license immediately because the broker is already licensed. C) all licensees registered at that location must make application to the commission for a current license at the new location. D) the broker's license may be suspended or revoked if the commission is not notified of the change.

B) the commission will issue a new license immediately because the broker is already licensed.

A broker advertises his production or position in the market, what must be included in the advertisement? A) Number of licensed branch offices that the broker maintains in the market B) Municipality that the market comprises C) Number of cooperating brokers that engage in business in the market D) Dollar volume of sales transactions written in the market

B) The answer is municipality that the market comprises. Advertisements by a broker about production or position in the market must identify the municipality that the market comprises.

Three weeks before Ned begins his real estate prelicense class, he offers to help his neighbor sell her house. The neighbor agrees to pay him a 5% commission. The seller accepts an offer while Ned is taking the class and closes the day he passes the examination. The neighbor refuses to pay him the agreed commission. Can Ned sue to recover payment? A) Yes, while the statute of frauds forbids recovery on an oral agreement for the conveyance of real property, the law permits enforcement of an oral commission contract under these facts. B) Yes, because Ned was formally enrolled in a course of study intended to result in a real estate license at the time an offer was procured and accepted, the commission agreement is binding. C) No, real estate salespersons must have a permanent office in which their license is displayed in order to collect a commission from a seller. D) No, license law prohibits lawsuits to collect commissions unless the injured party was properly licensed at the time the agreement was reached.

D) The answer is no, license law prohibits lawsuits to collect commissions unless the injured party was properly licensed at the time the agreement was reached. License law prohibits the filing of any suit or action claiming compensation for any act for which a license is required if the person filing suit was not duly licensed at the time of offering to perform such act or service.

In order to keep the cost of operating a business low, a broker plans to operate a brokerage office from home. In this case, which of the following statements BEST applies? A) The broker can choose any location to operate a brokerage since the Commission does not regulate the location, provided other office requirements are satisfied. B) Operating a brokerage from a private residence is never allowed; it is a violation of the law and grounds for disciplinary action against the licensee. C) Operating a brokerage from a private residence is allowed, provided the entrance to the office is separate from the entrance to the residence. D) Only cemetery brokers can operate a brokerage from a private residence if the property is located on cemetery grounds.

D) The answer is operating a brokerage from a private residence is allowed, provided the entrance to the office is separate from the entrance to the residence. Operating a brokerage from a private residence is regulated by licensing laws and allowed, provided certain conditions are met. There are no special regulations that govern the operation of cemetery brokers that does not apply to real estate brokers.

If a licensed salesperson or associate broker desires to change employment from one licensed broker to another, what is required in order for the licensee to conduct activities on behalf of the new employing broker? A) The salesperson or associate broker must provide a current state police criminal record check with the application for license transfer. B) The previous employing broker and prospective employing broker must agree to the license transfer before the commission will issue the new license. C) The salesperson or associate broker may not engage in any activity on behalf of the new employing broker until a new license is received from the commission. D) The salesperson or associated broker must notify the commission in writing no later than 10 days after the intended date of change, pay the required fee, and return the current license.

D) The answer is the salesperson or associated broker must notify the commission in writing no later than 10 days after the intended date of change, pay the required fee, and return the current license. Whenever a licensed salesperson or associate broker desires to change employment from one licensed broker to another, the salesperson must notify the commission in writing no later than 10 days after the intended date of change, pay the required fee, and return the current license.

In Pennsylvania, which of the following would need to be operated by a licensed real estate broker? A)A partnership selling a building owned by the partners B)A licensed attorney acting under a power of attorney to convey real estate C)A resident apartment manager employed by an owner when showing apartments to prospective tenants D)A property management company that employs leasing agents for the purpose of negotiating leases

The answer is a property management company that employs leasing agents for the purpose of negotiating leases. Managing real estate is an activity included in the definition of a real estate broker provided in the license law, so a company will need a license. Licensed attorneys, partnerships acting as owners of property, and resident managers employed by owners of multifamily residential properties are excluded from the license law.

Which licensee is NOT required to satisfy mandatory continuing education requirements to renew the license? A)An individual licensed as a rental listing referral agent B)A licensed broker acting as broker of record for a corporation holding a broker's license C)An associate broker employed to teach prelicensing real estate classes at a community college D)An individual holding a salesperson's license who assists a broker in managing commercial properties

The answer is an individual licensed as a rental listing referral agent. Continuing education is required of individuals holding either a broker's or salesperson's license. The requirement does not apply to cemetery brokers, cemetery salespeople, builder-owner salespersons, time-share salespeople, campground membership salespeople, or rental listing referral agents.

Which statement is TRUE regarding agency relationships between licensees and consumers? A)All agency relationships must be expressly created by written agreements. B)If a broker chooses to represent both buyers and sellers under agency relationships, the broker must adopt a policy appointing designated agents. C)An open listing agreement creating an agency relationship between a seller and broker may be an oral agreement. D)A broker may not represent both a buyer and seller as an agent in the same transaction.

The answer is an open listing agreement creating an agency relationship between a seller and broker may be an oral agreement. Agency relationships may be created either orally or in writing. A written agreement is necessary when the broker is providing a service for a fee. Brokers may represent buyers and sellers in the same transaction with written consent from both parties.

Following the death of a broker with a sole proprietorship, the deceased broker's estate should A)continue to take new listings until another broker is chosen to operate the business. B)close the deceased broker's business and terminate any pending agreements. C)appoint another broker to supervise the termination of the deceased broker's business. D)continue to hire new licensees to help operate the business.

The answer is appoint another broker to supervise the termination of the deceased broker's business. Within 15 days after the death of a broker with a sole proprietorship, the deceased broker's estate will notify the Commission that the estate has appointed another licensed broker to supervise the termination of the deceased broker's business. The deceased broker's business does not have to close (provided another broker has been assigned) and can continue to service pending agreements. During the termination period, the appointed broker may not take new listing agreements or hire new licensees.

The Pennsylvania Real Estate Commission may assess an additional fee against licensees in order to increase the balance in the real estate recovery fund if A) the number of new license fees during a biennial renewal period drops below $25,000. B) during any one year the amount paid from the fund exceeds $500,000. C) the Department of State determines that available funds appear insufficient to satisfy outstanding claims. D) at the beginning of a biennial renewal period, the balance in the fund is less than $300,000.

The answer is at the beginning of a biennial renewal period, the balance in the fund is less than $300,000. The commission may reassess each licensee an amount not to exceed $10 if, at the commencement of a biennial renewal period, the balance in the recovery fund is less than $300,000.

Statements of estimated costs and returns must A)be presented to the parties prior to execution of an agreement of sale. B)include a disclosure indicating who the broker that prepared the statements represents. C)be signed by the seller and buyer upon receipt. D)be an exact representation of all costs to be incurred by the party for whom they were prepared.

The answer is be presented to the parties prior to execution of an agreement of sale. Statements of cost and return must be presented prior to entering into an agreement of sale. They are expected to be as accurate as may be reasonably expected of a person having knowledge of real estate sales. There is no requirement for signatures or disclosures of agency representation

Statements of estimated costs and returns must A) be presented to the parties prior to execution of an agreement of sale. B) include a disclosure indicating who the broker that prepared the statements represents. C) be signed by the seller and buyer upon receipt. D) be an exact representation of all costs to be incurred by the party for whom they were prepared.

The answer is be presented to the parties prior to execution of an agreement of sale. Statements of cost and return must be presented prior to entering into an agreement of sale. They are expected to be as accurate as may be reasonably expected of a person having knowledge of real estate sales. There is no requirement for signatures or disclosures of agency representation.

Which candidate for licensure is required to take the standard real estate salesperson's license examination and score a passing grade but is NOT required to complete any mandatory education requirement prior to taking the exam? A)Builder-owner salesperson applicant B)Campground membership salesperson license applicant C)Rental listing referral license applicant D)Cemetery salesperson applicant

The answer is builder-owner salesperson applicant. A builder-owner salesperson applicant must take and pass the salesperson's examination but has no mandatory education requirement. Campground membership and cemetery salesperson applicants have no examination requirement. Rental listing referral applicants have both an education and an examination requirement.

Brokers must supervise all licensees EXCEPT A)campground membership salespersons. B)time-share salespersons. C)salespersons. D)builder-owner salespersons.

The answer is builder-owner salespersons. Builder-owner salespersons are licensed under and are employees of Registered Builders. Salespersons, campground-membership salespersons, and time-share salespersons must be licensed with and be supervised by a broker

Rental listing referral agents are licensed to engage in which of the following activities? A)Collecting rental information for the purpose of referring prospective tenants to rental units or locations of rental units B)Engaging in commercial property management activities on behalf of more than one employing broker at the same time C)Collecting rental application fees and security deposits on behalf of an owner of rental property D)Showing residential rental units in multifamily housing to prospective tenants

The answer is collecting rental information for the purpose of referring prospective tenants to rental units or locations of rental units. A rental listing referral agent is defined as an individual or entity that owns or manages a business that collects rental information for the purpose of referring prospective tenants to rental units or locations of rental units. Rental listing referral agents are not authorized to show rental units, collect fees or security deposits, or engage in property management activities.

Which of the following is a mandatory provision in an agreement of sale negotiated by a broker between a buyer and seller? A) Zoning classification in the case of residential property sales B) Dates for payment and conveyance C) Payment of the brokerage commission D) Earnest money deposit to be held by the listing broker

The answer is dates for payment and conveyance. Date for payments and conveyance must be addressed in the contract. Earnest money deposits are not required as part of an agreement of sale. The broker's commission is not an issue in an agreement of sale between a buyer and seller. Zoning classification must be provided in the case of properties other than those zoned for residential use.

A licensed broker is employed by the owner of a residential multifamily housing complex to serve as the property manager. One of the broker's duties is to collect rent due from the tenants. When the rents are collected, the broker should A) immediately deliver the rents to the owner of the complex for deposit in the owner's business account. B) deposit them into her personal or business account to cover the cost of repairs and maintenance at the complex. C) deposit the rents into her escrow account because they are the property of the owner. D) deposit rents received into a rental management account that is separate from the broker's escrow account and general business account.

The answer is deposit rents received into a rental management account that is separate from the broker's escrow account and general business account. License law provides that a broker involved in property management activities on behalf of a lessor be required to maintain a separate rental management account for such deposits. The broker should not deposit rents in either an escrow account or the broker's general business account.

A broker received an earnest money deposit from a buyer. Under Pennsylvania law, the broker should A) deposit the money in an existing escrow account in which all earnest money received from buyers may be held at the same time. B) immediately (or by the next business day) deposit the earnest money in the broker's personal interest-bearing checking or savings account. C) open a special, separate escrow account that will contain funds for this transaction only, separate from funds received in any other transaction. D) hold the earnest money deposit in a secure place in the broker's real estate brokerage office until the transaction closes.

The answer is deposit the money in an existing escrow account in which all earnest money received from buyers may be held at the same time. Brokers are required to maintain a separate custodial or escrow account separate from any business or personal account. The broker is required to keep records of all funds deposited into the account. There is no requirement to maintain a separate account for each deposit.

During a showing to a prospective buyer, the listing agent noticed a small, damp water stain on the ceiling that was still dripping after last night's rainstorm. The stain was not there the day the listing agreement was obtained. The property disclosure form makes no mention of any defects that would cause the stain. If a licensee notices material defects not disclosed in the property disclosure statement, which of the following actions must the licensee take? A) Disclose to the buyer, in writing, all material defects that are not disclosed in the property disclosure statement and which the licensee has actual knowledge of. B) Notify the buyer that there is no need for concern since the seller did not indicate in the property disclosure statement that there is a leak. C) Verbally disclose to the buyer all material defects that are not disclosed in the property disclosure statement and which the licensee has actual knowledge of. D) Conduct an independent investigation to confirm if there are any other material defects in the property before making any disclosures.

The answer is disclose to the buyer, in writing, all material defects that are not disclosed in the property disclosure statement and which the licensee has actual knowledge of. Verbal disclosure alone does not satisfy the disclosure requirement of known material defects discovered by a licensee. Notifying the buyer that there is no need for concern would constitute a licensing violation for failure to disclose known material defects. Licensees are not required to conduct an independent investigation to confirm that the seller's disclosures on the property disclosure statement are accurate

A broker acting as a transaction licensee would be in violation of the real estate commission's rules and regulations if the broker engaged in which of the following activities? A)Providing assistance with document preparation B)Disclosing to a buyer that the seller will accept a price less than the asking/listing price C)Advising the consumer about compliance with laws pertaining to real estate transactions without rendering legal advice D)Keeping the consumer informed about the transaction and the tasks to be completed

The answer is disclosing to a buyer that the seller will accept a price less than the asking/listing price. A transaction licensee owes the duty of limited confidentiality and may not disclose to a buyer that the seller will accept a price less than the asking/listing price of the property. Providing assistance with document preparation, advising the consumer about compliance with laws pertaining to transactions, and keeping the consumer informed about tasks to be completed are all general duties of all licensees.

An individual wants to sell her own house. In this situation, she A)must first obtain a real estate license issued by the Pennsylvania Real Estate Commission. B)may sell her house without obtaining a real estate license only if she is a licensed attorney. C)may obtain a temporary real estate license in order to legally sell her house. D)does not need a real estate license to sell her house herself.

The answer is does not need a real estate license to sell her house herself. Owners of real estate conducting business with respect to their own property are not required to be licensed. They are excluded from licensure

An unlicensed individual acting as a real estate consultant negotiated a sale of property and was unable to collect the agreed fee from the seller. The unlicensed individual A) has no recourse under the law because a person who holds himself out as a real estate consultant is required to have a broker's license. B) may file a lawsuit for breach of contract in the court of common pleas in the county where the land is located. C) may record a judgment against the owner if the contract contained a confession of judgment clause. D) may seek compensation from the real estate recovery fund for the unpaid fee.

The answer is has no recourse under the law because a person who holds himself out as a real estate consultant is required to have a broker's license. This person has no recourse. License law prohibits the filing of suits seeking recovery for conduct engaged in, in violation of the license law. The terms consultant, counselor, agent, or finder are all directly included in the definition of a broker.

A salesperson receives an offer on a property currently listed exclusively with another broker. The salesperson approaches the seller with the offer and a new listing contract, recommending that the seller terminate the current listing and list with his company in order to keep everything "in house." The salesperson A)should transfer his license to the broker who has the property listed for sale in order to avoid any potential conflict. B)should have referred the buyers to the listing broker, who should have written and presented their offer. C)is acting in the best interests of the sellers, who should cancel the current listing so that they can accept the offer without unnecessary complications. D)has violated the license law by inducing the seller to break the current exclusive-listing contract in order to substitute a new one, which would result in a personal gain to the salesperson.

The answer is has violated the license law by inducing the seller to break the current exclusive-listing contract in order to substitute a new one, which would result in a personal gain to the salesperson. The salesperson has violated license law and ethical business practices that prohibit inducing a party to break a contract for the purpose of substituting a new one when such substitution is motivated by the personal gain of the licensee.

All of the following are mandatory provisions of a sales contract EXCEPT A) describing the purpose of the real estate recovery fund. B) identifying the rate or amount of commission to be paid to the broker. C) identifying the capacity in which the broker is engaged in the transaction. D) a statement of the zoning classification of the property, except in cases where the property is zoned solely or primarily to permit single-family dwellings.

The answer is identifying the rate or amount of commission to be paid to the broker. There is no statutory or regulatory requirement for the rate or amount of the broker's compensation to be disclosed in an agreement of sale. Mandatory provisions of an agreement of sale include disclosure to the parties regarding the role of the broker, the existence of the recovery fund, and the zoning classification of property.

All of the following are mandatory provisions of a sales contract EXCEPT A)a statement of the zoning classification of the property, except in cases where the property is zoned solely or primarily to permit single-family dwellings. B)identifying the rate or amount of commission to be paid to the broker. C)identifying the capacity in which the broker is engaged in the transaction. D)describing the purpose of the real estate recovery fund.

The answer is identifying the rate or amount of commission to be paid to the broker. There is no statutory or regulatory requirement for the rate or amount of the broker's compensation to be disclosed in an agreement of sale. Mandatory provisions of an agreement of sale include disclosure to the parties regarding the role of the broker, the existence of the recovery fund, and the zoning classification of property.

When is the Pennsylvania Real Estate Commission required to suspend a licensee's license? A)If the licensee fails to perform as promised in a guaranteed sales plan B)If any amount of money had been paid from the real estate recovery fund to settle a claim against the licensee C)If the licensee is found liable in a civil trial for illegal discrimination D)If the licensee commingles others' money or property with his own

The answer is if any amount of money had been paid from the real estate recovery fund to settle a claim against the licensee. While the conduct addressed in each choice could cause a license to be suspended, the only issue that requires an automatic suspension of the license is when the commission pays money from the recovery fund to settle a claim against a licensee.

A selling broker negotiates a sale of property listed by a cooperating broker, who is responsible for assuming the duties regarding escrow of the buyer's deposit check? A) The listing broker representing the seller is required to hold the deposit in her escrow account. B) The selling broker is required to hold the buyer's deposit in escrow if acting as the buyer's agent. C) The rules of the local multiple listing service dictate which broker will hold the escrow deposit. D) If the buyer gives the sales deposit to the listing broker rather than to the selling broker, the listing broker assumes the escrow duty.

The answer is if the buyer gives the sales deposit to the listing broker rather than to the selling broker, the listing broker assumes the escrow duty. In cooperating broker transactions, the duty to escrow funds can be the responsibility of either broker. Rules of the commission provide that if the buyer gives the deposit to the listing broker rather than to the selling broker, the listing broker assumes the escrow duty. All parties must have a full disclosure as to which broker is holding the deposit in escrow.

Which of the following could be construed as the unauthorized practice of law? A)Informing the buyer of the broker's personal opinion of the condition of the seller's title to the property B)Making sure that the written agreement of sale includes a statement as to whether the broker is the agent of the seller or the agent of the buyer C)Providing each party with a written estimate of reasonably foreseeable expenses associated with the sale before the agreement of sale is executed D)Keeping copies of all documents involved in the transaction on file for three years after consummation of the transaction

The answer is informing the buyer of the broker's personal opinion of the condition of the seller's title to the property. Opinions regarding condition of title to the property being sold could constitute the practice of law and should be avoided. Mandatory requirements and disclosures are addressed in the law, requirements regarding estimates of cost and return are addressed, and records must be maintained for three years.

A licensed salesperson receives an earnest money deposit check from a buyer at the time the buyer makes an offer to purchase property listed by another broker. The seller is unavailable, so the offer will not be presented for four days. What procedure should be followed regarding the earnest money deposit check? A)If written permission of both buyer and seller has been obtained, the broker may refrain from depositing the check pending the seller's acceptance of the offer. B)Because the duty to escrow funds does not begin until the agreement of sale is signed by all parties, the salesperson may keep the check in the file with the offer to purchase until the offer is presented. C)The selling broker must deliver the earnest money check to the listing broker, who will be responsible for depositing it. D)The salesperson is responsible for immediately depositing the check into the company escrow account.

The answer is if written permission of both buyer and seller has been obtained, the broker may refrain from depositing the check pending the seller's acceptance of the offer. Rules of the commission provide that the broker is responsible for depositing money into an escrow account by the end of the next business day following its receipt in the office where the escrow records are maintained. However, if the money is in the form of a check under an offer to purchase, the broker may, with the written consent of both buyer and seller, refrain from depositing the check pending the sellers' acceptance of the offer.

A broker signs a three-month listing agreement with a seller. The agreement contains the following clause: "If the property has not been sold after three months from the date of this signing, this agreement will automatically continue for additional three-month periods thereafter until the property is sold." In Pennsylvania, this clause is A) legal because the renewal periods are for less than one year. B) illegal. C) illegal if there are more than three renewal periods. D) legal because it contains a reference to a specific time limit.

The answer is illegal. This clause is illegal in Pennsylvania because commission rules and regulations prohibit the use of automatic renewal clauses in exclusive listing agreements.

Which of the following people must have a real estate broker's license in order to transact real estate business? A) Owners of a six-unit building who manage it personally, collect rents, and show the apartments to prospective tenants B) Managers of large apartment buildings who are directly employed by the owner and who show apartments to prospective tenants as part of their regular duties C) Individuals who have power of attorney to negotiate the sale of their parents' residence D) Individuals who negotiate the sale of entire businesses, including their stock equipment and buildings, for a promised fee Which of the following people must have a real estate broker's license in order to transact real estate business?

The answer is individuals who negotiate the sale of entire businesses, including their stock equipment and buildings, for a promised fee. Negotiating the sale of real estate for another in return for a fee is a license-required activity. Residential multifamily property managers who are employed directly by the owner, persons holding power of attorney, and owners conducting real estate business with regard to their own property are excluded from the license law.

Some people and situations are exempt from the provisions of the Pennsylvania Real Estate License Act. What people are NOT exempt and must hold a real estate license? A) Individuals who are employed directly by an owner as resident property managers for an apartment complex B) Property owners who sell or lease their own property C) Individuals who receive compensation from sellers or landlords for procuring prospective buyers or renters of real estate D) Licensed auctioneers handling the sale of real estate at a bona fide auction

The answer is individuals who receive compensation from sellers or landlords for procuring prospective buyers or renters of real estate. Individuals who undertakes to promote the sale, exchange, purchase, or rental of real estate or who represents themself to be a real estate consultant, counselor, agent, or finder are required to hold a broker's license. A for sale by owner or for rent by owner is exempt, as are a resident manager and a licensed auctioneer at a bona fide auction.

A broker listed a small office building. Because the property is in excellent condition and produces a good, steady income, the broker's salesperson has decided to purchase it as an investment. If the broker's salesperson wishes to buy this property, the salesperson must A) have a third party purchase the property on the salesperson's behalf so that the owner does not learn the true identity of the purchaser. B) obtain permission from the Pennsylvania Real Estate Commission. C) resign as the broker's agent and make an offer after the owner has retained another broker. D) inform the owner in writing that the salesperson is a licensee of the listing broker when making an offer.

The answer is inform the owner in writing that the salesperson is a licensee of the listing broker when making an offer. The licensee must disclose in writing the licensee's intention or true position if the licensee purchases any property that has been listed with the licensee's office.

Which of the following could be construed as the unauthorized practice of law? A) Keeping copies of all documents involved in the transaction on file for three years after consummation of the transaction B) Making sure that the written agreement of sale includes a statement as to whether the broker is the agent of the seller or the agent of the buyer C) Providing each party with a written estimate of reasonably foreseeable expenses associated with the sale before the agreement of sale is executed D) Informing the buyer of the broker's personal opinion of the condition of the seller's title to the property

The answer is informing the buyer of the broker's personal opinion of the condition of the seller's title to the property. Opinions regarding condition of title to the property being sold could constitute the practice of law and should be avoided. Mandatory requirements and disclosures are addressed in the law, requirements regarding estimates of cost and return are addressed, and records must be maintained for three years.

Every licensed broker is required to A) keep transaction records for three years. B) employ at least one salesperson. C) maintain escrow account records for five years. D) become a member of the local association of REALTORS® .

The answer is keep transaction records for three years. Brokers must maintain records of transactions for three years following consummation of the transaction. There is neither a requirement addressing number of employees nor a requirement that a licensee affiliate with any professional organization.

Under what circumstance may real estate licensees perform a comparative market analysis for a consumer? A)Licensees under contract to act as a buyer's agent may perform a comparative market analysis for the purpose of determining the offering price for a specific parcel of real estate in an identified market at a specified time. B)Licensees may perform a comparative market analysis only if they are an unbiased, disinterested third party, acting with impartiality and independence. C)Licensees representing a seller-client may prepare a comparative market analysis for an unrepresented buyer in order to assist the buyer in determining an offering price. D)Licensee may perform a comparative market analysis for a seller-client only after the licensee and seller have entered into an exclusive listing agreement.

The answer is licensees under contract to act as a buyer's agent may perform a comparative market analysis for the purpose of determining the offering price for a specific parcel of real estate in an identified market at a specified time. A comparative market analysis may be prepared by a contracted buyer's agent for the purpose of determining the offering price for a specified piece of real estate in an identified real estate market at a specified time

All of the following statements regarding the Pennsylvania Real Estate Commission are true EXCEPT A)the commission makes and enforces the rules by which real estate licensees must abide. B)the examinations that must be taken by applicants for real estate licensing are administered by an independent testing company rather than by the commission. C)members of the commission are selected by the state association of REALTORS® . D)the commission must submit annual reports to legislative committees in the state senate and house of representatives.

The answer is members of the commission are selected by the state association of REALTORS®. Members of the real estate commission are appointed by the governor, not the state association of REALTORS®. The commission prescribes subjects for testing, but the department contracts with a professional testing service to write and administer exams. The commission also promulgates rules and regulations and reports to legislative committees.

In Pennsylvania, representation agreements that obligate the buyer to pay a fee A)must be on specific forms approved by the real estate commission. B)are not permitted; only sellers pay fees for real estate services. C)must be in writing. D)are not regulated under the license law.

The answer is must be in writing. The Real Estate Licensing and Registration Act establishes that any agreement between a broker and a principal, whereby the consumer is obligated to pay a fee, must be in writing and signed by the consumer. This includes brokerage agreements: seller listing and buyer representation.

In Pennsylvania, an exclusive right-to-buy contract A) is illegal. B) may run for an indefinite period of time. C) must be indicated as such in the buyer agency agreement. D) requires the signature of the principal only.

The answer is must be indicated as such in the buyer agency agreement. The Real Estate Licensing and Registration Act requires the nature of the service to be provided must be set forth in a written agreement between the consumer and the licensee and establishes requirements for the written agreement. An exclusive right-to-buy contract must be in writing and contain a specific termination date.

An airline pilot told a broker about some friends who were looking for a new home. The broker contacted the friends and eventually sold them a house. When may the broker pay the airline pilot a referral fee? A)As soon as the broker begins working with the buyer prospect B)Only after the sale closes C)As soon as a valid sales contract is signed by the parties D)Never, because a broker may not pay a referral fee to an unlicensed individual

The answer is never, because a broker may not pay a referral fee to an unlicensed individual. The broker may thank the airline pilot. Brokers are prohibited from sharing fees with or paying compensation to an unlicensed person.

When a person obtains a final judgment against a licensee and seeks payment from the real estate recovery fund, what is the time frame for making application for payment from the fund? A) At any time after termination of the proceeding because no specific time frame is provided by law B) Within six months of the date of the violation that resulted in the judgment being issued C) Within 30 days of the initial decision of the court directing the licensee to pay compensation D) No more than one year after the termination of the proceedings, including reviews and appeals, in connection with the judgment

The answer is no more than one year after the termination of the proceedings, including reviews and appeals, in connection with the judgment. License law provides that an aggrieved person who has been awarded a judgment by a court of competent jurisdiction must make application to the recovery fund no more than one year after the termination of the proceedings, including reviews and appeals.

A real estate salesperson has been working with buyer-clients and helps them negotiate for their dream home. The buyer then asks the salesperson if she can help them secure a mortgage loan. The salesperson knows a lender that pays a fee for referring purchasers to them. Can the salesperson refer the buyers to this lender in order to collect the referral fee? A)Yes, if the lender offers the best interest rates and terms available in the market B)Yes, if the salesperson and the buyers have previously entered into a written buyer agency agreement C)No, because the salesperson would be violating the license law by accepting compensation from someone other than her employing broker D)No, unless the salesperson first discloses the referral fee to the buyers

The answer is no, because the salesperson would be violating the license law by accepting compensation from someone other than her employing broker. License law prohibits a licensee from accepting compensation from anyone other than the licensee's employing broker

A real estate broker has signed an agency agreement with a tenant who is looking for an apartment to rent. The broker does not charge a fee to prospective tenants but, rather, receives compensation from landlords. The broker tells a landlord that the prospective tenant could probably pay a somewhat higher rent than the landlord is asking. In this situation, the licensee A)violated the fiduciary duties owed to the tenant. B)appropriately disclosed to the landlord under these circumstances. C)owes the fiduciary agency duties to the landlord, who pays the broker's fee. D)has no duty of confidentiality because the licensee is not charging a fee to prospective tenants.

The answer is violated the fiduciary duties owed to the tenant. By entering into an agency agreement with a prospective tenant, the broker assumes full fiduciary responsibilities without regard for the issue of compensation. The broker has not operated in a manner consistent with the best interest of his client.

A salesperson's licensed assistant worked late nights and weekends to help ensure the successful completion of a difficult transaction. The assistant's extra work included making several phone calls to the prospective buyers and encouraging them to accept the seller's counteroffer. Largely because of the assistant's efforts, the sale went through with no problem. The salesperson wants to pay the assistant a percentage of the commission "because the assistant has really earned it." Under Pennsylvania law, the salesperson may A)directly compensate the assistant in the form of a commission under the circumstances described here. B)not pay the assistant a cash commission but is permitted to make a gift of tangible personal property. C)directly pay a commission to the assistant only if the assistant is an independent contractor. D)not directly pay a commission to the assistant under the facts presented here because it would be a violation of the license law.

The answer is not directly pay a commission to the assistant under the facts presented here because it would be a violation of the license law. License law prohibits licensees from accepting a commission or any valuable consideration for the performance of any act specified in the act from anyone except the licensed real estate broker with whom they are affiliated

A broker who wishes to place a For Sale sign on a listed property must first A) get permission from the neighbors and the local governing body. B) secure an exclusive-listing contract from the seller. C) obtain the written consent of the owner of the property. D) sell the property.

The answer is obtain the written consent of the owner of the property. The broker must obtain the written consent of the owner before erecting a For Sale or For Rent sign on property. The broker does not have to gain permission from the neighbors or local governing body to sell the property. It is permissible to have signs on open listings as well as on exclusives. Written consent, however, is always required.

What are the procedures that salespersons must follow when they decide to terminate the affiliation with an employing broker and affiliate with a different broker? A)Do nothing, because the employing broker is responsible for notifying the Pennsylvania Real Estate Commission of the change B)Return their license with the properly completed change of employer form and payment of the required fee C)Give the broker an official letter of termination that the broker may send to the Pennsylvania Real Estate Commission D)Return all transaction records and prospect leads to the employing broker

The answer is return their license with the properly completed change of employer form and payment of the required fee. License law stipulates that when a licensed salesperson desires to change employing brokers, the salesperson must notify the commission in writing, pay the required fee, and return his or her current license.

A broker personally owns a ten-unit residential property. The broker hires an unlicensed individual for the purpose of managing and maintaining the property. The unlicensed individual may legally perform which of the following activities? A) Negotiate terms or conditions of occupancy with current or prospective tenants B) Supervise and direct a branch office of the broker located at the property C) Show apartments to prospective tenants and provide information on rental amounts and leasing determination D) Enter into leases on behalf of the owner

The answer is show apartments to prospective tenants and provide information on rental amounts and leasing determination. An individual directly employed by the owner of multifamily residential property for the purpose of managing or maintaining the property is exempt from provisions of the license law. So long as the owner retains the authority to make decisions, the employee may show apartments and provide information on rentals. Unlicensed employees may not negotiate terms or conditions, nor may they enter into leases on behalf of the owner.

An individual directly employed by the owner of residential multifamily buildings is exempt from licensing requirements when A)preparing and entering into leases on behalf of the building's owner. B)showing apartments to prospective tenants and explaining building rules and regulations. C)negotiating terms or conditions of occupancy with current tenants. D)holding money belonging to tenants other than on behalf of the building's owner.

The answer is showing apartments to prospective tenants and explaining building rules and regulations. Unlicensed individuals directly employed by an owner of residential multifamily buildings for the purpose of managing or maintaining the property are not required to be licensed, but the scope of activities they may perform is limited. They may show apartments, provide information on rental amounts, and explain building rules and regulations. Unlicensed individuals may not prepare and enter into leases, negotiate terms or conditions, or hold money belonging to tenants.

A salesperson remains inactive without renewing her license for over five years. Before the license will be reissued, the applicant must A)complete 14 hours of mandatory continuing education with no exam requirement. B)complete 60 hours of coursework and pass the salesperson's license exam. C)successfully complete the employing broker's training program. D) submit to and pass the salesperson's license examination.

The answer is submit to and pass the salesperson's license examination. Any persons who remain inactive for a period of five years without renewing their license must, prior to having a license reissued, take and pass the examination pertinent to the license for which the person is reapplying. There is no education or training requirement as a condition to reactivating a license on inactive status for more than five years.

Which of the following is a requirement of the commission regarding an escrow account maintained by a licensed Pennsylvania real estate broker? A) The account must be maintained in a federally insured bank, savings association, or credit union. B) The account must be used exclusively for deposits of earnest money deposits and rental payments being held on behalf of a consumer. C) The account must designate the broker or licensed employee of the broker as trustee. D) The account must provide for withdrawal of funds without prior notice.

The answer is the account must provide for withdrawal of funds without prior notice. Rental payments may not be deposited in the broker's escrow account. The escrow account must be maintained in a federally or state-insured bank or recognized depository, must designate the broker as trustee, and must provide for withdrawal of funds without prior notice.

An associate broker is not satisfied with her present real estate company and has decided to change employing brokers. Before the associate broker may begin actively selling for the new company A) the associate broker must take her current license to the new brokerage and notify the commission within three days of the transfer to a new location. B) the new employing broker must notify the commission of the change, pay the required fee, and send in the proper forms before the associate broker may perform any activities on behalf of the new employing broker. C) the associate broker must notify the commission no later than 10 days after the intended date of change, pay the required fee, and return her current license to the commission. D) the first broker must transfer the associate broker's license to the new office.

The answer is the associate broker must notify the commission no later than 10 days after the intended date of change, pay the required fee, and return her current license to the commission. When licensees change employing brokers, they are required to notify the commission in writing no later than 10 days after the intended date of change, pay the required fee, and return their current license. The associate broker maintains a copy of the notification sent to the commission as a temporary license pending receipt of the new current license.

A listing broker offers a $500 bonus to any salesperson who sells a particular listing within the next 30 days. Which of the following is TRUE? A) The seller must give his consent in writing to the broker allowing him to offer the bonus. B) A bonus for selling property must be paid to the salesperson directly by the seller rather than the broker. C) The broker may only pay the bonus to a salesperson who is employed by the listing broker. D) The broker may directly pay the bonus to a salesperson employed by another broker with the consent of the other broker.

The answer is the broker may only pay the bonus to a salesperson who is employed by the listing broker. License law prohibits licensed brokers from paying compensation to anyone other than their licensed employees or another broker, and it prohibits a salesperson from accepting compensation from anyone other than his or her employing broker.

A licensed broker receives an earnest money deposit from a buyer and promptly deposits it in an interest-bearing account opened at a local bank in the name of the seller. The buyer is provided with the account number, verification of the deposit, the seller's name, and the name of the bank. Which of the following statements is TRUE? A) The broker acted properly by providing all information about the deposit to both parties to the transaction. B) The broker should have opened the account in the names of both the buyer and the seller. C) The deposit must be available to be withdrawn by either the buyer or seller upon proper written notice to the bank. D) The broker should have deposited the funds in an escrow account maintained in her name and identifying the broker as trustee.

The answer is the broker should have deposited the funds in an escrow account maintained in her name and identifying the broker as trustee. The broker must maintain an escrow account at a bank or recognized depository designating the broker as trustee. The broker is responsible for holding the escrow deposit pending consummation or termination of the transaction.

In what circumstance may a violation of the license law on the part of a salesperson be grounds for the suspension or revocation of the employing broker's license? A) The broker's license is only subject to suspension or revocation if the broker participated with the salesperson in violating the license law. B) Because the salesperson is employed by the broker, the broker's license is always subject to suspension or revocation as a result of any violation on the part of the salesperson. C) Only the licensee actually found to have violated the license law may have a license suspended or revoked, so the broker's license may not be suspended or revoked because of the salesperson's misconduct. D) The broker's license is subject to suspension or revocation if it can be shown that the broker had actual knowledge of the violation committed by the salesperson.

The answer is the broker's license is subject to suspension or revocation if it can be shown that the broker had actual knowledge of the violation committed by the salesperson. License law provides that the broker may have his or her license suspended or revoked only if the broker had actual knowledge of the violation or if the conduct of the salesperson demonstrated a course of dealing that could serve as prima facia evidence of knowledge on the part of the broker.

A salesperson has engaged in activities that constitute several violations of the Pennsylvania Human Relations Act, including blockbusting and discrimination on the basis of disability. The salesperson has also cashed a $25,000 earnest money check from a prospective buyer and used the proceeds to buy a new car. The salesperson's employing broker was unaware of all of these activities. What is the impact on the employing broker's license when the salesperson's violations are brought to the attention of the Pennsylvania Real Estate Commission? A)The salesperson's employing broker will be required to pay any fine imposed against the salesperson out of her personal funds. B)The salesperson's employing broker will be held liable for the Human Relations Act violations only. C)The employing broker might not have her license revoked as a result of the salesperson's violations. D)The salesperson's actions are legally the responsibility of the employing broker, who will be subject to the same disciplinary action as the salesperson regardless of whether she knew the violations had occurred.

The answer is the employing broker might not have her license revoked as a result of the salesperson's violations. License law provides that the employing broker might not be liable for a violation committed by a licensee employed by the broker. If the broker had actual knowledge, or if the licensee engaged in a course of dealing that the broker should have been aware of, liability could accrue to the employing broker.

Which statement is TRUE regarding the broker's escrow account? A)The escrow account may designate the broker's company attorney as trustee of the account. B)The escrow account must be an interest-bearing account. C)Upon written request of the commission, the broker must provide a letter authorizing release of records pertaining to the account. D)Brokers acting as property managers may deposit rents collected into the escrow account until they can be paid to the building owner.

The answer is upon written request of the commission, the broker must provide a letter authorizing release of records pertaining to the account. Commission rules require the broker to provide a letter authorizing the release of records pertaining to the escrow account. A broker's escrow account is required to designate the broker as trustee. If money is expected to be held in escrow for more than six months, the broker is encouraged to deposit the money into an interest-bearing escrow account. The general, recognized practice is that escrow accounts do not bear interest. Rents must be deposited in a rental management account maintained by the broker, not in the broker's escrow account

Question ID: 1186285 A salesperson has engaged in activities that constitute several violations of the Pennsylvania Human Relations Act, including blockbusting and discrimination on the basis of disability. The salesperson has also cashed a $25,000 earnest money check from a prospective buyer and used the proceeds to buy a new car. The salesperson's employing broker was unaware of all of these activities. What is the impact on the employing broker's license when the salesperson's violations are brought to the attention of the Pennsylvania Real Estate Commission? A) The salesperson's employing broker will be held liable for the Human Relations Act violations only. B) The employing broker might not have her license revoked as a result of the salesperson's violations. C) The salesperson's employing broker will be required to pay any fine imposed against the salesperson out of her personal funds. D) The salesperson's actions are legally the responsibility of the employing broker, who will be subject to the same disciplinary action as the salesperson regardless of whether she knew the violations had occurred.

The answer is the employing broker might not have her license revoked as a result of the salesperson's violations. License law provides that the employing broker might not be liable for a violation committed by a licensee employed by the broker. If the broker had actual knowledge, or if the licensee engaged in a course of dealing that the broker should have been aware of, liability could accrue to the employing broker.

Which requirement must be met in order for an individual to be issued a real estate license? A) The individual must be financially solvent and have an acceptable credit rating. B) The individual must have a reputation for honesty, trustworthiness, integrity, and competence to transact business. C) The individual must certify that he or she has not been convicted of a felony or misdemeanor within the three years immediately preceding application for licensure. D) The individual must be a U.S. citizen.

The answer is the individual must have a reputation for honesty, trustworthiness, integrity, and competence to transact business. Licenses will be granted only to, and renewed only for, persons who bear a good reputation for honesty, trustworthiness, integrity, and competence to transact business. Citizenship is not required for licensure. A candidate must disclose details of convictions, but the disclosure does not preclude the possibility of licensure. Financial solvency is not required as a condition of licensure.

An advertisement by a licensee that offers prizes, certificates, or gifts may contain all of the following EXCEPT A) the odds of winning or receiving each prize, certificate, or gift. B) a description of each prize, certificate, or gift offered. C) the location of the office at which the prize, certificate, or gift may be claimed. D) the fair market value of each prize, certificate, or gift offered.

The answer is the location of the office at which the prize, certificate, or gift may be claimed. An advertisement that offers prizes, certificates, or gifts must contain the fair market value of each prize, certificate, or gift; a description of each prize, certificate, or gift; and the odds of winning each prize, certificate, or gift.

If a licensed salesperson, without the knowledge or consent of the employing broker, violates requirements regarding delivery of a Consumer Notice at the initial interview, what are the consequences? A) as long as the Consumer Notice is signed by the parties prior to entering into an agreement of sale, there is no violation. B)The salesperson may have her license suspended or revoked. C)Unless the consumer files a written complaint with the commission, neither the broker nor the salesperson is subject to disciplinary proceedings. D)The broker will have her license suspended or revoked for failing to exercise supervision over the licensed salesperson.

The answer is the salesperson may have her license suspended or revoked. The salesperson's failure to provide the Consumer Notice at the initial interview is a violation of the license law. Licensees are subject to disciplinary action by the commission, including possible suspension or license revocation.

An individual who holds a salesperson's license issued by another jurisdiction wants to obtain a Pennsylvania salesperson's license. Which requirement must be met? A) The individual must score a passing grade on both parts of the Pennsylvania salesperson's license examination. B) The salesperson's license issued by another jurisdiction must have been active within five years prior to the submission of a properly completed application. C) The individual must prove that the license issued by another jurisdiction has been put on inactive status by that jurisdiction. D) The individual must establish legal residency in Pennsylvania.

The answer is the salesperson's license issued by another jurisdiction must have been active within five years prior to the submission of a properly completed application. An individual holding a salesperson's license issued by another jurisdiction must prove that this license has been active within five years prior to submission of the application. The applicant is required to pass only the Pennsylvania portion of the license exam. It is possible to hold active licenses in more than one state simultaneously, and residency is not a requirement for licensure.

In Pennsylvania, when a broker is listing a home and asks the seller to complete a property condition disclosure, which of the following statements is TRUE? A) The seller should be advised that disclosure of known property conditions is required by Pennsylvania statute called the Real Estate Seller Disclosure Act. B) The required disclosures cover a narrow range of structural conditions only. C) The disclosures are optional, and the seller may avoid liability by refusing to make any disclosures about the condition of the property. D) An agent should assist the seller by providing advice regarding which property conditions to disclose and which to ignore.

The answer is the seller should be advised that disclosure of known property conditions is required by Pennsylvania statute called the Real Estate Seller Disclosure Act. The property condition disclosure requirements pertain to most residential transactions and cover a broad range of issues affecting the property. The licensee should advise the seller of the disclosure requirements and the seller's obligation to comply with requirements of the statute.

A property owner wants to list his property for sale with a broker but does not want to sign an exclusive listing contract. May the broker accept an oral open listing? A)Yes, as long as the licensee provides the seller a written memorandum stating the terms of the agreement B)No, because the statute of frauds requires that listing agreements be in writing in order to be enforceable C)Yes, as long as the parties agree that the licensee is not acting as an agent of the seller in the transaction D)No, because commission rules require that all contracts and agreements be in writing

The answer is yes, as long as the licensee provides the seller a written memorandum stating the terms of the agreement. Commission rules provide for oral open listings with sellers provided certain conditions are met. Oral open listings may be used to create an agency relationship. The statute of frauds does not apply to listing contracts.

May a licensed real estate salesperson collect a referral fee for construction, repair, or inspection services utilized by a consumer as a result of the licensee's referral? A) No, because the real estate licensee may never receive compensation from anyone other than the employing broker B)Yes, if the licensee provides the consumer with a written disclosure of the referral fee or commission at the time the licensee first advises the consumer that the service is available or when the licensee first learns the consumer will be using the service C)Yes, but only if the licensed salesperson is also an owner or employee of the firm providing the construction, repair, or inspection service D)No, because the consumer is required to independently select providers of services related to the real estate transaction

The answer is yes, if the licensee provides the consumer with a written disclosure of the referral fee or commission at the time the licensee first advises the consumer that the service is available or when the licensee first learns the consumer will be using the service. A licensee who provides insurance, construction, repair, or inspection services that are utilized by the consumer must provide the consumer a written disclosure of the financial interest (including a referral fee or commission) that the licensee has in the service. The disclosure must be made when the licensee first advises the consumer that the service is available or when the licensee first learns that the consumer will be utilizing the service. In certain circumstances, a licensee may accept fees paid directly to the licensee.

Failure to include which of the following in an agreement of sale would give a buyer the option to void the agreement without a requirement of court action? A) Specific date for possession and closing B) Zoning classification of the property if the agreement is for a commercial building C) Complete and accurate legal description of the property D) Mortgage contingency if the buyer is securing financing

The answer is zoning classification of the property if the agreement is for a commercial building. Although all four options may be important issues to address in an agreement of sale, commission rules specifically address the issue of the zoning classification. The zoning classification, unless the property is zoned for single-family housing, must be included or the buyer has the option of voiding the agreement with no requirement of court action.

When advertising an individual property for sale, the broker must also include A) a statement or logo affirming the broker's commitment to nondiscriminatory business practices. B) the price of the property being advertised. C) the business name of the broker as designated on the license. D) the name and business phone number of the listing salesperson or associate broker.

c) the business name of the broker as designated on the license

The maximum compensation that will be paid from the real estate recovery fund to satisfy claims against a licensee is A) $5,000. B) $10,000. C) $25,000. D) $100,000.

he answer is $100,000. The liability of the recovery fund may not exceed $20,000 for any one claim and may not exceed $100,000 per licensee