Unit 8: Real Estate Brokerage

The listing broker splits commissions with the cooperating broker on a 60:40 basis with 60% retained by the listing company. The cooperating (selling) brokerage splits with the selling salesperson with 70% to the salesperson. What does the selling salesperson earn if the sales price is $295,000 and the negotiated commission rate was 5.5%?

$4,543 The answer is $4,543. $295,000 × 0.055 × 0.4 × 0.7 = $4,543.A brokerage firm that hires salespersons as independent contractors should supply them with

Sherman Antitrust Act

1890 law banning any trust that restrained interstate trade or commerce

A consumer on the National Do Not Call Registry may be contacted by a real estate professional if the consumer made an inquiry within the last

3 month's

A home sells for $325,000 and the brokerage firm receives $19,560 in commission. What was the commission rate paid by the seller?

6% The answer is 6%. $19,560 ÷ $325,000 = 0.06 = 6%.

Do Not Call Registry

A federal program that allows homeowners to register their residential phone numbers in order to eliminate with some exceptions unsolicited phone calls from telemarketers.

All of the following are true except A) commissions are typically set by the MLS and boards of REALTORS® and then finalized by the brokerage firm. B) commissions may be set by the brokerage firm and then negotiated by a company broker or salesperson with a buyer or seller. C) a group of brokerage firms cannot make agreements to avoid using a certain title company. D) a group of brokerage firms may not make agreements to only list properties in certain territories.

B) commissions may be set by the brokerage firm and then negotiated by a company broker or salesperson with a buyer or seller. Commissions may not be set by law, the MLS, or anyone outside the brokerage firm. Doing so is a violation of the Sherman Antitrust Act. The brokerage firm may set commissions and policies that allow company brokers or salespersons to then negotiate commissions with buyers and sellers.

Do brokers set their own commissions

Conspiring between businesses to establish fixed fees or prices for services is price-fixing and is illegal, so brokerages must set their own commissions.

A brokerage firm that hires salespersons as independent contractors should supply them with

a contract that states salespersons pay their own taxes and set their own hours

Which statement is TRUE about the do-not-call registry law?

it should be followed by all real estate professionals

Real estate agents need to know who is required to sign each document, the importance of marketable title, how ownership issues may impact title transfer, and the essential elements of deeds and contracts because agents must

know what makes documents valid to avoid unnecessary delays

Which of the following is NOT an appropriate listing for most first-year agents?

multi tenant retail property

The amount of commission paid to a brokerage is established by

negotiation between the brokerage and its clients Each individual brokerage establishes its own commission rate, but brokerages cannot collude to establish a fixed rate.

Conspiring between businesses to establish fixed fees or prices for services is illegal and known as

price fixing and is prohibited by Sherman antitrust act