Weichert Test 1

Real Estate Commission

- 8 members made up of 5 brokers and state residents for past 10 years, 2 members of the public, 1 government designee, for 3 year terms

probation, suspension, revocation

10 days notice of violations; fines of $250 (first violation-max $5000, each additional $10,000) up to $50,000; 3 strikes your out rule; commission can revoke for forgery, burglary, robbery, and theft, murder, kidnapping, robbery, criminal conspiracy; minimum revocation if guilty knowledge is 5 yrs; appealed to NJ Superior Court; can get license revoked for accepting any commission/consideration from anyone except employing broker

Salesperson/SLWRERC Requirements

18 years old, high school education, evidence of good moral character, 75 hour prelicensing course, pass exam, SSN for child support, sponsored by licensed real estate broker

Broker Requirements

18 yrs old, high school education, evidence of good moral character, served 3 years full-time as salesperson, requires 150 study consisting of 90 hour general broker prelicensing course, 30 hours prelicensing ethics/agency law, disclose SSN for child support purposes, pass state exam

PETE

4 governmental powers: Police Power, Eminent Domain, Taxation, Escheat

New Jersey Real Estate Commission

Administrator of real estate licenses, operating within Dept of Banking and Insurance

Open Listing

An agreement between an owner and many brokers. Whichever broker produces a ready willing, and able buyer, a commission is due. However, the owner still has the right to sell his/her property and is not obligated to pay a commission to anyone.

Tenancy in Common

Co-ownership of property in which each party owns an undivided interest that passes to his or her heirs at death.

Commingling

Illegally mixing deposits or monies, collected from a client, with one's personal or business account;broker can leave a nominal amount in to account to cover service charges

Guaranty Fund

Reimburses people defrauded or badly served by licensees in real estate transactions; party must get court judgment, naming REC in suit; if unable to collect judgment they may apply to guaranty fund within 6 yrs (spouse of licensee can't bring action against licensee); each salesperson contributes $10 and each broker $20 at initial issuance of license; max payment for single claim is $20,000 per offense (license revoked until fund reimbursed with interest)

Jones v. Mayer (1968)

Supreme Court Case which prohibits racial discrimination in any real estate transaction (residential or commercial)

Exclusive Agency Listing

The owner employs only one broker but retains the right to personally sell the property, and thereby not pay a commission. However, if any other real estate company sells the property, the listing broker is still entitled to the commission stipulated.

CERCLA

act that established Superfund to clean up uncontrolled hazardous waste sites and spills; landowner liable when release or threat has occured on his property, regardless if it was due to his actions or those of others; liability includes cleanup of neighboring properties also; landowner not responsible can see reimbursement from previous owners, other parties, or Superfund

Tacking

adding successive periods of continued uninterrupted usage by different parties to reach prescriptive period

place of business

broker must maintain place of business in state; in home must have a separate entrance; can't be in home of associate; must have full-time supervision of managing broker or broker-salesperson; name of broker "Licensed Real Estate Broker" displayed on exterior and license of broker/associates displayed in office

broker/salesperson relationship

brokers pays commission to agent within 10 days of check cleared; if agent quits brokerage, broker pays all monies within 30 days of termination

attorney review

buyer/seller attorney can disapprove of contract within 3 days of signed contract

unlicensed secretary/assistant

can't show property, answer questions a/b property, make cold calls, discuss/explain contract, make calls for rent, host open houses when not with licensee can answer phone/forward calls, process/submit/change listings in MLS, place signs on property, schedule appointments, set up files and track documents, have keys made, write/place ads, type contracts, keep records and deposit earnest money/security deposits/rent, follow up on loan apps

Federal Fair Housing Act of 1968

contains title VIII; unlawful to discriminate based on race, color, religion, national origin; 1974 amendment added sex and 1988 amendment added disabilities (includes AIDS); protects alcoholics and those in rehab but not drug addicts; does not protect discrimination based on marital status; $21,039 first violation, 2nd $52,596, further $105,194

broker required experience

continuously employed on full-time basis as salesperson during 3 years immediately preceding application (40 hrs per week, between hrs of 10-8, and not employed elsewhere except on part time basis for no more than 25 hours a week)

Megan's Law

contract must include Megan's Law statement advising purchaser/lessee that county prosecutor has list of known sex offenders in area and that they can obtain info from county prosecutor after sale/lease has closed; licensee not allowed to inquire or give info regarding presence of convicted sex offenders in neighborhood; buyer's broker can suggest client check NJ State Police website

Civil Rights Act of 1866

covered race/color only

Termination of Agency Relationship

death of either party, suspension of agency license, destruction/condemnation of property, expiration of contract, mutual agreement, renunciation by agent, revocation by principal, bankruptcy, completion/fulfillment of contract; seller/buyer can end agreement anytime but broker might still be entitled to reimbursement for expenses

commission

earned when there's an agreement (meeting of minds; seller accepts buyer's offer); received after transaction closed

Puffing

exaggeration of a property's benefits; not illegal as long as offered as opinion and not trying to deceive

exceptions to licenses

experience requirement for broker and broker-salesperson waived for honorably discharged vet with service wound/disability; waive education requirement for licensed broker from another state; someone previously licensed as NJ broker within 5 yrs; someone who's taken equivalent real estate courses in college; NJ attorney; applicants who took equivalent prelicensing course in another state

regulation of non-marine waters and wetlands in NJ

falls under DEP(state) under Division of Water Resources, not EPA(federal); NJ Wetlands Act-DEP regulates certain activities in areas designated wetlands and non-marine waters

Escheat

forfeiture of a decedent's property to the state/county under state law in the absence of heirs; dies intestate

ad valorem tax

general tax based on the value of the property being taxed; "according to value"

Real Estate License Act

governs real estate licenses under Title 45

broker-salesperson

has fulfilled all requirements of broker yet chooses to work as salesperson

Lead Based Paint Disclosure

homes pre-1978, disclosure form MUST be attached with real estate sales or lease agreements; signed by buyer/seller/agents that pamphlet was given; purchases given 10 days to conduct risk assessment/inspection and not bound by contract until 10 days expired

mold

identify and remedy cause of problem (1st action); NJAR's Sellers Property Condition Disclosure Statement includes question regarding mold/remediation

backup offers

if buyer asks to be next in line if the seller's deal falls through, agent passes offer along to seller and advises in writing to consult attorney regarding how to proceed

acting as dual agent

if friend made offer for seller but said don't tell seller they'll go higher; ask sell if they want to counter offer w/o disclosing conversation

encroachments

illegal extension of a building or some other improvement, such as a wall or fence, beyond the boundaries of the owner's land on to another's; disclosed by physical inspection/survey

Special Assessment

improvement tax paid by only owners who benefit from it; taxes for streets, lights, curbs, sidewalks; tax spread across parcels that benefit and not always equally but based on who benefits most/least

duty of care (buyer's agent)

inform buyer of problems with property, market value, financing options, negotiate best price, monitor purchase

real estate license

issued on biennial term that expires on June 30 of odd years

Life Estate

limited to the life of a specific person; A gives to B as long as B lives, so upon B's death it goes back to A/heirs

salesperson leaves broker

listings stay with broker; broker pays salesperson commissions due within 30 days

Lis Pendens

litigation pending; recorded legal document giving constructive notice of possible future legal action relating to title (foreclosure suit); establishes priority for later lien but isn't a lien itself (puts cloud on title until lawsuit settled)

escrow

money over $25 must be deposited, money must be deposited into trust within 5 days; over $10,000 must be reported to IRS within 90 days; checks made out broker's escrow not to individual

NJ Law against Discrimination complaints

must be filed within 180 days; AG has 45 days to attempt conciliation; orders enforced under superior court/appealed there; 1st offense $10k, 2nd $25k, 3rd $50k; defying AF $500 + year in jail

Attorney General memorandum on discrimination

must be given to homeowner at time of listing; have owner read and initial copies (not required)

written offer

must be given to seller within 24 hours by agent

broker documents

must keep copies of unaccepted offers for 6 months from initial offer; copies of contracts of sale/listing agreements kept for 6 years; bills, records of payment to agents/cooperating brokers, bank statements, canceled checks, deposit slips kept for 6 yrs; NJ REC can review documents without notice

commissions

negotiable, can be percent of sale price or flat fee

Dominant

neighbor that benefits from easement

contract

once signed, client entitled to duplicate original immediately; must include Attorney General's Memorandum regarding NJ Law against Discrimination, attorney review clause, statement about seller's rights to negotiate commission or fees with broker

Transaction Broker

one who facilitates a transaction without functioning as an agent; has no agency duties and doesn't represent buyer or seller but works with both w/o representing either

servient

owner that serves neighbor relating to easement

exemptions from having real estate license

owners, attorneys, trustees, executors, legal guardians, anyone handling real estate for court, banks and trusts, insurance companies, estate sales handled by court/state assigned executor

Fee determinable

ownership "as long as"; an event can terminate or for nonoccurence of specified event; if this happens land reverts to owner A or his heirs; if owner A's land goes to Owner B, owner B is remainderman (3rd party)

broker

person authorized to operate a real estate business, to hire salepersons, and to charge public for services

Sherman Antitrust Act

price fixing or allocation of markets can by finded by max of $1 million and 10 years in prison (misdemeanor); in civil suit, person who suffers loss can recover triple value of actual damages plus attorney fees

condemnation

process in which government takes real estate for public use, offering just compensation

broker who goes out of business

provide name and address where past records available for 6 years

Radon

radioactive gas from decay of uranium in rocks, can lead to lung cancer; remediation recommended if levels measure 4 picocuries (PCI) or more; odorless, colorless, tasteless; impossible to detect w/o testing; reduced by installing ventilation/exhaust fans; NJ State Law says seller must reveal to buyer results of radon testing/mitigation; NJ REC says agents have duty to keep confidential info about radon test results/mitigation until contract is entered into

Tenancy in severalty

real estate ownership by only one; passes to devisees

Avoiding Misrepresentation and Deceit

refer all questions to expert sources; if buyer asks if neighborhood is loud and seller told you it was, you should say "according to the seller..."; never present opinion as fact; if buyer asks if fireplace works and it hasn't been used in 10 years, recommend they have it inspected rather than saying it works

continuing education (not required for SLWRERC)

renewal on July 1 in odd-numbered years; all broker, broker-salesman, salesman must complete 12 hours continuing education before 2 year license renewal by April 30 (completion between May 1-June 30 subject to additional $200 fee); 2 hrs ethics, 6 hrs core topics, 4 hours generic

Disclosed Dual Agency

representing both the buyer and seller in the same transaction with the informed consent of both

universal agent

represents client in all matters w/o prior permission

general agent

represents client in range of matters under a scope of authority

exemptions to Fed Fair Housing Act

sale/rent of family home owned by person who doesn't own 3+ homes and not using broker; rental of room in owner occupied 1-4 family home; dwelling unit owned by religious group; private club not open to public; housing for elderly exempt if person 62+ or if 80% of units occupied by one person 55+

SLWRERC

sales person licensed with a real estate referral company; activities restricted to making referrals and not any other real estate activities

license fees

salesperson $160, SLWRERC $160, Broker $270, Broker-salesperson $270, branch office $150, corps $270; renewal fees $100 for salesperson/SLWRERC and $200 for broker

broker license suspended/revoked

salesperson's licenses suspended until end of the current license period; salesperson free to affiliate with another broker and can obtain reissued license at no charge

Title 11

sets rules and regulations by Real Estate Commission

liability under Superfund

strict, joint and several, and retroactive, meaning each of individual owners responsible personally and without excuse for total damages to injured party, not limited to current owner but all who have owned site previously

licensing procedure

successfully complete course and state exam and receive score report; submit score report to real estate commission while submitting request for criminal check and sending certified check, cashiers check, or money order for $160; complete fingerprinting and consent to criminal history check for $66.05

Easement in Gross

the right to use land for a specific, limited purpose unrelated to any adjacent parcel (power company owning an easement on boundary lines)

a contract

voluntary agreement between legally competent parities to perform/refrain from performing legal act, supported by legal consideration

inverse compensation

when owner brings suit against government for taking property without eminent domain compensation

salesperson

works under sponsoring broker, doing business in name of the broker, receiving compensation from that broker

Fee Simple Absolute

The maximum possible estate or right of ownership of real property, continuing forever; indeterminable period and inheritable

employee

broker can require employed agent to adhere to regulations such as working hours, office routine, dress; employer withholds taxes from wages; less independence for agent and more control by broker

license lending

broker can't let associate broker/another person use business entity/license without supervising business

standards of care

broker held to higher standard than agent

Innocent Landowner Immunity

A clause of the Superfund Amendments and Reauthorization Act that establishes the criteria by which to judge whether a person or business could be exempted from environmental liability

Joint Tenancy

A form of co-ownership that includes the right of survivorship; death of one joint tenant means one less person in group; remaining tenants receive deceased owner's share not his heirs; based on unity of time, title, interest, possession-all required; one person can sell, but others have a joint tenancy, new owner is tenant in common

Asbestos

A long, thin, fibrous silicate mineral with insulating properties, which can cause cancer when inhaled; contained it has little risk but disturbed it becomes friable and must be contained through encapsulation; was used in tile, siding, roofs, and insulation.

Temporary Broker's License

A temporary license issued to a salesperson on death or incapacity of a licensed broker or broker-salesperson; salesperson must have 3 years experience

Easement by Prescription

An easement acquired by continuous, open, and hostile use of the property for the period of time prescribed by state law; must have adverse use for 20 years continuous

Fiduciary Responsibilities

COALD (Care, Obedience, Accounting, Loyalty, Disclosure)

Reciprocity

NJ doesn't recognize licenses issued in other states; nonresident who doesn't live in NJ can obtain NJ license after qualifying in usual way and filing irrevocable consent to be sued

4 Unities of Joint Tenancy

PITT: Possession, Interest, Time and Title. All four must exist simultaneously

Equal Housing Opportunity Poster

Poster should be displayed in office, as part of Federal Fair Housing Act and obtained through HUD; HUD considers failure to display poster as evidence of discrimination; NJ poster if required in all offices and apartment complexes; failure punishable by $100 or more

eminent domain

Power of a government to take private property for public use.

Procuring Cause

The actions by a broker which result in the owner being able to make a sale.

Real Estate Advertising

ads must indicate name of brokerage, followed by terms REALTOR, Realtist, real estate broker, or real estate agency, licensee name must appear exactly as it is on license; ad that includes salesperson's full name must include real estate company and phone number or link to brokerage website; if ad includes licensee's home phone, it must identify as "home" and include office phone; ad must include property location specifically (can't say "in the vicinity of"); include name of MLS service; can't promise financing and loan terms must include words "to qualified buyer"; if you offer something free it must be free; can't offer free appraisals; can't say "sold" in ad ir sign

Fiduciary

agent acts in interest of client with trust and confidence; doesn't end at closing; TRUST AND CONFIDENCE

independent contractor

agent responsible for paying own taxes and insurance, not required to work certain hours or attend meetings; can deduct expenses such as license renewal fees, car mileage, advertising, cell phone; more independence for agent and less control by broker; doesn't include covenant to arbitrate

Care

agent, as expert, liable to client due to negligence/carelessness; must be knowledgeable about all aspects of property to arrive at listing price, investigate all material facts, assist owner with negotiating, advise seller; breach of duty could include failure to let seller know how property condition affects value or navigate transaction thru closing; failing to present offer before expiration or not mentioning in contract fixtures/property desired by a party; neglecting property for another, improper handling of escrow

rental referral company

apartment listed but not advertised to public must check availability every 3 days; if advertised availability check daily

application timeframe

app must be submitted within 1 yr of the date candidate successfully completed prelicense course or course must be taken again

NJ Law Against Discrimination

applies to all real property; includes protection based on marital status and gives 45 days for conciliation; protects race, color, national origin/ancestry, religion, sex, gender, marital status, family status, disabilities, liability for armed forces; limited exemptions for rental properties allowed for certain housing for one sex and religious-based organizations to discriminate on basis of religion, as well as owner-occupant to discriminate except for rate

special agent

authorized to represent a person in one specific capacity and nothing else (most common relationship)

duty of care (seller's agent)

be knowledgeable ab property to set price, discover/investigate material facts, aid owner to negotiate offer, advise sale