Real Estate Brokerage SAE - Champion's School of Real Estate 291 Questions with Verified Answers,100% CORRECT

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Real Estate Brokerage SAE - Champion's School of Real Estate 291 Questions with Verified Answers Search Engine Optimization (SEO) - CORRECT ANSWER The process of maximizing the number of visitors t... o a particular website by ensuring the website appears high on the list of results returned by a search engine. Fcebook Live - CORRECT ANSWER Video streaming through facebook. CoStar Database - CORRECT ANSWER Functions much like a residential MLS, connecting commercial agents with brokerages, owners, lenders, property managers, appraisers, and investors. Virtual Reality (VR) - CORRECT ANSWER A computer-generated image or environment that can be interacted with by using special electronic equipment Augmented Reality (AR) - CORRECT ANSWER Provides a modified view of reality for the user Artificial Intelligence (AI) - CORRECT ANSWER A way of describing intelligence exhibited by machines Google Analytics - CORRECT ANSWER A powerful analytic software MLS Systems - CORRECT ANSWER The gold standard in data collection, processing, and dissemination in the real estate industry for years. Millennial Generation - CORRECT ANSWER People reaching young adulthood in the early part of the 21st century What does a consumer want from their brokerage? - CORRECT ANSWER - hyper-personalization - high online ratings - high level customer service - marketing that creates interest - give back to community - deeper relationship with agent Mission Statement - CORRECT ANSWER Announces to the world what the company's long-term goals are, describing the overall purpose of the organization. Value Statement - CORRECT ANSWER Define how a company's work will be accomplished, articulating a set of beliefs and principles that guide the way the company conducts business. Action Plan - CORRECT ANSWER Outlines the steps, approaches and resources that will be used to fulfill the objectives of the company. Operational Planning - CORRECT ANSWER The aspect of planning that encompasses the day-to-day operations of a company. Due diligence - CORRECT ANSWER Analyzing, exploring, investigating and evaluating a business to learn about the business, in order to position themselves to make an educated decision about whether to buy or not buy a business. DBA - CORRECT ANSWER Doing Business As An assumed name or a trade name used instead of the legal name of a business entity. FBN - CORRECT ANSWER Fictitious Business Name An assumed name or a trade name used instead of the legal name of a business entity. Assumed name - CORRECT ANSWER A trade name used instead of the legal name of a business entity. Trade name - CORRECT ANSWER An assumed name used instead of the legal name of a business entity. Sole Proprietorship - CORRECT ANSWER A venture owned by one individual. Partnership - CORRECT ANSWER A type of business entity that has partners General partner - CORRECT ANSWER Responsible for the day to day operations of the business and has full liability limited partnership - CORRECT ANSWER A type of partnership created in Texas by filing a certificate of limited partnership with the Texas Secretary of State Limited partner - CORRECT ANSWER A business partner whose liability is limited to the amount invested in the partnership, having no involvement in the day-to-day operations of the business. limited liability partnership - CORRECT ANSWER Formed by filling a statement with the Texas Secretary of State. a partner is not individually liable for the debts and obligations of the partnership, nor is the partner liable for tortious acts committed by other partners. joint venture - CORRECT ANSWER A group of individuals joining together for a single business venture, combining their funds and talents to carry out one project. When the project or venture is complete, they will dissolve as a group. syndicate - CORRECT ANSWER Two or more parties join together to create and operate a real estate investment corporation - CORRECT ANSWER estate investment Corporation Corporations in Texas are created by filing with the office of the Secretary of State. The corporate entity is comprised of three components: - Shareholders (stockholders) who are the owners of the corporation - A Board of Directors elected by the shareholders who represent the interests of the shareholders - Corporate Officers who are responsible for the overall management of the operation of the business shareholders - CORRECT ANSWER The owners of the corporation. board of directors - CORRECT ANSWER Elected by the shareholders who represent the interests of the shareholders corporate officers - CORRECT ANSWER Corporate officers are responsible for the overall management of the operation of the business. limited liability company - CORRECT ANSWER Formed by filing articles of organization with the Texas Secretary of State and is governed by the Texas Limited Liability Company Act. The limited liability company offers limited liability protection. franchise - CORRECT ANSWER An authorization given by a company to an individual enabling the individual to carry out specific commercial activities as an agent for the company's products. T or F: A limited partner is involved in the day-to-day of the business - CORRECT ANSWER False A partnership may be created by: - CORRECT ANSWER filing documents with the Secretary of State The three main categories that sould be addressed during the planning phases are: operational planning, _______, and time planning. - CORRECT ANSWER budget How much cash reserves do industry experts recommend new brokerages have available for operating expenses? - CORRECT ANSWER 6 months to 2 years Ethics - CORRECT ANSWER Concerned with what is right or wrong, good or bad, fair or unfair, responsible or irresponsible, obligatory or permissible, praiseworthy or blameworthy Ethics refers to the well-rounded standards of right and wrong that prescribe what humans ought to do. usually in terms of: rights, obligations, benefits to society, fairness, specific virtues Ethics refers to the study and development of one's ethical standards, principles that when followed, promote values such as: trust, good behavior, fairness, kindness TRELA - CORRECT ANSWER Enacted in 1939, the Texas Real Estate License Act protects the public against unscrupulous brokers and sales agents. Canons of Professional Ethics and Conduct - CORRECT ANSWER Section 531 of TREC's Rules includes Fidelity, Integrity, Competency, Consumer Information, and Discriminatory practices Consumer information - CORRECT ANSWER The Consumer Protection Notice that is required to be posted in a prominent location in each place of business the broker maintains Discriminatory practices - CORRECT ANSWER Article 5 of the Canons of Professional Ethics and Conduct DTPA - CORRECT ANSWER A Texas consumer protection law that was passed in 1973, allowing an aggrieved consumer to sue a seller of goods or services for damages Goods - CORRECT ANSWER Tangible chattels (real property is tangible when purchased or leased. Under DTPA, the sale of a house is considered a good) Services - CORRECT ANSWER Means work, labor, or repair of goods. Brokerage is a service. Consumer - CORRECT ANSWER An individual, corporation, partnership, or government source who seeks to acquire or purchase the goods or services Producing cause - CORRECT ANSWER Proof that the act or omission was a significant factor in bringing about injury. Knowingly - CORRECT ANSWER With actual awareness of a falsity, deception, or unfairness of an act. If an agent deliberately made a false statement about the condition of the property, or intentionally did not disclose a known defect Intentionally - CORRECT ANSWER With actual awareness, or flagrant disregard of prudent and fair business practices Statutory defences - CORRECT ANSWER Defenses that arise out of law (statute) National Association of Realtors - CORRECT ANSWER Founded in 1908, is America's largest trade association, representing 1 million members, composed of residential and commercial REALTORS® who are brokers, sales agents, property managers, appraisers, counselors, and others engaged in all aspects of the real estate industry. Price fixing - CORRECT ANSWER Any attempt by a group of brokers or brokerage firms to set the commission rates in their area. Sherman Anti-Trust Act - CORRECT ANSWER Federal law that prevents any combination in restraint of trade. Clayton Act - CORRECT ANSWER Federal law that defines unethical business practices such as price-fixing and monopolies. Texas Free Enterprise and Antitrust Act - CORRECT ANSWER Texas state law that prohibits any attempt to fix prices, limit competition by assigning market areas, or boycotting of discount brokers Illegal boycott - CORRECT ANSWER Prohibits any attempt to fix prices, limit competition by assigning market areas, or boycotting of discount brokers ADA - CORRECT ANSWER Federal law that prohibits discrimination against those with disabilities by denying them the full and equal enjoyment of goods, facilities, accommodations, services, and privileges Penalties for violation of the act are up to $75,000 for the first violation, and up to $150,000 for subsequent violations. Civil Rights Act - CORRECT ANSWER Prohibits discrimination connected to housing. The Civil Rights Act of 1968 with amendments prohibits discrimination based on race, color, religion, national origin, sex, families with children, and disabilities Steering - CORRECT ANSWER The illegal practice of directing buyers into or away from certain areas because of their race, color, or other protected classes Blockbusting - CORRECT ANSWER The illegal practice of inducing homeowners to sell their properties by making representations regarding the entry or prospective entry of minority persons into the neighborhood Substantice discussion - CORRECT ANSWER A discussion about a specific property triggering the need to deliver the Information About Brokerage Services notice. Prospecting laws - CORRECT ANSWER Federal and state laws that govern how a person solicits or advertises by phone, fax, or email Listing agreements - CORRECT ANSWER A contract between a landowner (as principal) and a licensed real estate broker (as agent) by which the broker is employed to sell real estate on the owner's terms within a given time, for which service the landowner agrees to pay a commission Multiple Listing Services - CORRECT ANSWER Site where member firms share their listings with other members Comparative Markey Analysis - CORRECT ANSWER An analysis of data to provide the seller with a range of appropriate list prices for their property and range of offer prices for the buyer RESPA - CORRECT ANSWER Real Estate Settlement Procedures Act ensures that consumers throughout the nation are provided with more helpful information about the cost of the mortgage settlement and are protected from unnecessarily high settlement charges caused by certain abusive practices Controlled business arrangement - CORRECT ANSWER An affiliate relationship of a direct or beneficial ownership interest of more than 1 percent in a provider of settlement services where a lender directly or indirectly refers business to the provider 5 sources of ethical standards - CORRECT ANSWER utilitarian approach the rights approach the fairness of justice approach the common good approach the virtue approach The Utilitarian Approach - CORRECT ANSWER Ethical action produces the greatest balance of good over harm to those who are affected. The Rights Approach - CORRECT ANSWER Individuals have the right to have their moral rights protected and respected, and the right to be told the truth, and not to be injured. The Fairness or Justice Approach - CORRECT ANSWER Ethical action is equal for all, or if not, then fair for some, based on some defensible standard. The Common Good Approach - CORRECT ANSWER Ethical standards and actions embrace common conditions that are important to the welfare (common good) of all. The Virtue Approach - CORRECT ANSWER Ethics are habits that enable us to act accordingly as persons who are truthful, honest, courageous, compassionate, generous, tolerant, and possess integrity, fairness, self-control, and prudence. Ethical Dilemmas - CORRECT ANSWER 1. recognize the issue 2. get the facts 3. evaluate alternative actions 4. make a decision and test it 5. act, then reflect on the decision later Federal Fair Housing Act - CORRECT ANSWER The Federal Fair Housing Act covers the sale and rental of most housing. No one may take any of the following actions based on race, color, national origin, religion, sex, familial status, or handicap in the sale or rental of housing Americans with Disabilities Act - CORRECT ANSWER The Americans With Disabilities Act (ADA) prohibits discrimination against those with disabilities by denying them the full and equal enjoyment of goods, facilities, accommodations, services and privileges. When readily achievable, the ADA requires the removal of architectural and communication barriers. The ADA affects almost all public accommodations. Single-family homes, private clubs, historic buildings, and religious organizations are exempt from the ADA. Truth in Lending Act (TILA) - CORRECT ANSWER Truth In Lending Act (TILA) protects consumers by providing them with complete information regarding loans and the actual cost of borrowing, including interest and all other charges associated with the loan. The law closely regulates the advertising of financial terms. In addition, the law requires lenders to provide the borrower with a full disclosure of the loan costs within three business days of loan application. Real Estate Settlement Procedures Act (RESPA) - CORRECT ANSWER Real Estate Settlement Procedures Act (RESPA) ensures that consumers throughout the nation are provided with more helpful information about the cost of the mortgage settlement and are protected from unnecessarily high settlement charges caused by certain abusive practices. The Act requires mortgage loan originators and servicers of residential loans to provide borrowers with timely disclosures of the nature and costs of the real estate settlement process. RESPA also prohibits abusive practices such as undisclosed referral fees and kickbacks. RESPA is applicable to all "federally related" mortgage loans. Securities Act of 1933 - CORRECT ANSWER Securities Act of 1933 prohibits deceit in the sale of securities and provides for the complete and accurate disclosure of all information to potential investors. Securities can include real estate investments as there is an expectation of profit. The sale or offering of securities must be registered with the Securities and Exchange Commission (SEC) and all material information must be disclosed to shareholders. Sherman Anti-Trust Act - CORRECT ANSWER Sherman Anti-Trust Act prevents any combination in restraint of trade. Commission rates must always be a matter of negotiation between the broker and the client. Any hint that there is a "standard" or "going rate' for commissions in a given market area could be evidence of violation and restraint of trade. Any attempt to boycott a discount real estate broker is a violation. Attempts to limit competition by allocating markets or customers is also a violation. Any attempt by a group of brokers or brokerage firms to set the commission rates in their area would be considered illegal price-fixing. Texas Free Enterprise and Anti-Trust Act - CORRECT ANSWER Texas Free Enterprise and Anti-Trust Act prohibits any attempt to fix prices, limit competition by assigning market areas, or boycotting of discount brokers. An illegal boycott is an agreement among two or more competitors not to do business with another competitor for the purpose of inducing the other competitor to change its business practices. The state law is enforced by the Texas Attorney General. Canons of Professional Ethics and Conduct: fidelity - CORRECT ANSWER A real estate broker or salesperson, while acting as an agent for another is a fiduciary. Special obligations are imposed when such fiduciary relationships are created. They demand: That the primary duty of the real estate agent is to represent the interests of the agent's client, and the agent's position, in this respect, should be clear to all parties concerned in a real estate transaction, that however, the agent, in performing duties to the client, shall treat other parties to a transaction fairly; That the real estate agent be faithful and observant to trust placed in the agent, and be scrupulous and meticulous in performing the agent's functions; That the real estate agent place no personal interest above that of the agent's client. Canons of Professional Ethics and Conduct: integrity - CORRECT ANSWER A real estate broker or salesperson has a special obligation to exercise integrity in the discharge of the license holder's responsibilities, including employment of prudence and caution so as to avoid misrepresentation, in any way, by acts of commission or omission. Canons of Professional Ethics and Conduct: competency - CORRECT ANSWER It is the obligation of a license holder to be knowledgeable as a real estate brokerage practitioner. The license holder must: be informed on local market issues and conditions affecting real estate in the geographic area where a license holder provides services to a client; be informed on national, state, and local issues and developments in the real estate industry; exercise judgment and skill in the performance of brokerage activities; be educated in the characteristics involved in the specific type of real estate being brokered by others. Canons of Professional Ethics and Conduct: discriminatory practices - CORRECT ANSWER No real estate license holder shall inquire about, respond to or facilitate inquiries about, or make a disclosure of an owner, previous or current occupant, potential purchaser, lessor, or potential lessee of real property which indicates or is intended to indicate any preference, limitation, or discrimination based on the following: (1) race; (2) color; (3) religion; (4) sex; (5) national origin; (6) ancestry; (7) familial status; or (8) disability. T or F: An informal TREC proceeding requires a public member of TREC and at least 2 TREC staff members with regulatory experience - CORRECT ANSWER True T or F: The ADA covers the sale and rental of most housing in the country - CORRECT ANSWER False A TREC disciplinary panel consists of: - CORRECT ANSWER 3 commission members T or F: you can hold a brokerage and sales agent license at the same time - CORRECT ANSWER false All of the following are statutory defenses under the DTPA, except: - CORRECT ANSWER a. written information drafted by the real estate agent b. written information relating to the good or service from another source c. written information relating to a particular good or service from another source d. written information concerning a test required a. written information drafted by the real estate agent If an agent deliberately made a false statement about the condition of the property, the agent could: - CORRECT ANSWER be liable for up to three times the amount of money lost by the consumer The NAR Code of Ethics is organized into the Preamble, Articles, and ___________. - CORRECT ANSWER standards of practice NARS was founded in _______ becoming the largest trade association in the United States - CORRECT ANSWER 1908 The association of Realtors may take a variety of actions when it is determined one of it's members has violated the Code of Ethics, including: - CORRECT ANSWER suspension of membershoip The Code of Ethics and Standards of Practice address how Realtors should treat customers, clients, the public, and - CORRECT ANSWER other realtors Accredited Buyer's Representative (ABR) Designation - CORRECT ANSWER Show your buyers that you are an expert in the field with the designation that is solely dedicated to the buyer's representative. Accredited Luxury Home Specialist (ALHS) Designation - CORRECT ANSWER Give your clients confidence that you have been well trained in selling their luxury homes with the designation that gives you an edge on the high end real estate market. Certified Home Marketing Specialist (CHMS) Designation - CORRECT ANSWER Help your clients prepare their homes for sale with this designation dedicated to marketing dialogue and staging techniques. Marketing Strategy and Lead Generation - CORRECT ANSWER Employ a creative and memorable marketing approach to generate leads, while clearly communicating services and value based on the buyer's needs and expectations. Military Relocation Professional (MRP) Designation - CORRECT ANSWER Learn to help our military professionals relocate. NAR's Green Designation - CORRECT ANSWER Learn the principles of green as well as green building trends and practices. New Home Construction (NHC) Designation - CORRECT ANSWER Discover how the development and new-home sales process work and the type of services the buyer needs. Pricing Strategy Advisor (PSA) Certification - CORRECT ANSWER Improve your skills in creating CMAs, pricing properties, understanding home values, and working with appraisers. Seller Representative Specialist (SRS) Designation - CORRECT ANSWER Gain the necessary knowledge to apply methods, tools, and techniques to provide support and services that sellers want. Real Estate Negotiation Expert (RENE) Certification - CORRECT ANSWER Hone your negotiation techniques to be a skillful advocate for your clients. Seniors Real Estate Specialist (SRES) Designation - CORRECT ANSWER Counsel senior clients through the major financial and lifestyle transitions involved in relocating, refinancing, or selling the family home. Texas Real Estate Broker Designation - CORRECT ANSWER Obtain the only designation the general public recognizes. TREC Rules - CORRECT ANSWER Rule 535.2(i)(2): All sales agents conducting real estate activities must have an active real estate license. Rule 535.2(i)(4): A broker is required to make certain that any sales agent they sponsor has been notified about changes to the Texas Real Estate License Act and Texas Real Estate Commission rules including promulgated contract forms and educational requirements Rule 535.2(i)(5): In addition to completing statutory minimum continuing education requirements, each sponsored sales agent receives such additional educational instruction the broker may deem necessary to obtain and maintain, on a current basis, competency in the scope of the sponsored sales agent's practice subject to the Act Sales Agent Apprentice Education (SAE) Requirements: A sales agent is required to have completed a total of 18 semester hours (or 278 credit hours) of qualifying education along with the non-elective TREC Legal Update courses prior to the end of their first license term. TREC CE Rules: TREC CE rules require all license holders to take a four hour Legal Update I course and a four-hour Legal Update II course created for and approved by TREC to satisfy the 8 hours of legal topics on continuing education required by the Act. A broker or a designated broker of a business entity, who sponsor one or more sales agents during their current license period, or a delegated supervisor of one or more license holders for a period of six months or more during the supervisor's current license period must also attend a 6-hour Continuing Education (CE) Broker Responsibility course. In addition to TREC's minimum education requirements, brokers may require additional education or training of the agents that they sponsor. Background Checks: Many sponsoring brokers require a background check for all employees with access to the office, including e In order to renew an active broker or sales agent license past the first renewal, the license holder must complete 18 hours of continuing education including ___________ hours of Legal Update. - CORRECT ANSWER 8 All sales agents in their first renewal period must complete________ hours of SAE courses along with 8 hours of Legal Update - CORRECT ANSWER 90 A broker is required to advise a sponsored sales agent ________ of the sales agent's authorizes activities - CORRECT ANSWER in writing Fiduciary duties and responsibilities - CORRECT ANSWER OLDCAR: Obedience Loyalty Disclosure Confidentiality Accounting Reasonable Care Advantages of Buyer Agency Only and Seller Agency Only (No Intermediary) - CORRECT ANSWER Firms that practice Buyer Agency Only or Seller Agency Only do not have to worry about unintentional dual representation. Brokers do not have to act as Intermediary or make appointments. Agents are only responsible for giving advice and opinion to the buyer or seller, avoiding conflicts of interest that may occur when representing both sides of a transaction. Disadvantages of Buyer Agency Only and Seller Agency Only - CORRECT ANSWER Many buyers do not want to sign a Buyer's Representation Agreement because they do not want to pay a commission to a Buyer's Agent. Agents can only list properties for sellers, or have buyers sign Buyer's Representation Agreements, limiting the firm to either the selling side only or listing side only commission. Intermediary Advantages - CORRECT ANSWER The brokers and associates can work with both sellers and buyers, under listing contracts and/ or buyer representation agreements. Using the Intermediary process, in-house sales may be performed, widening the firm's client base. Some buyers like to work with listing agents because they think that they are more motivated to get an offer accepted because they will collect both the buyer and seller side of the commission. Intermediary Disadvantages - CORRECT ANSWER The broker must remain neutral: the broker must create as much transparency as possible and cannot do anything that may be construed as giving an advantage to one party over another, making negotiations difficult even with Intermediary with Appointments. All documentation must be in order, all disclosures made correctly, and great caution taken. You are the listing agent for the seller and are also under a buyer's representation agreement with the buyer who is paying you on a daily basis for your time. Can you accept this payment from the buyer who would like to buy your listing? - CORRECT ANSWER Yes, you can accept the daily fee from the buyer and the commission on the sale from the seller with the written disclosure and permission from both parties. What is your agency relationship or status under this type of sale? The agency status is intermediary without appointments. Your neighbor tells you about another neighbor who is interested in buying your listing. Your neighbor asks you "if the sale goes through, can I receive a finder's fee"? What do you tell them in order to be within compliance of the law? - CORRECT ANSWER "I am not allowed to pay a commission to someone who is not licensed; however, I can pay you a flat fee of $50. This amount is all the law allows." You are purchasing a property for your spouse's company and you are the buyer's agent. Do you need to disclose anything about your relationship on the offer to purchase? - CORRECT ANSWER Yes, you must disclose that you are a principal in the transaction as well as the buyer's agent and you must disclose your relationship with the buyer-client if it is a spouse, child or parent of the agent. The buyer's agent discovers the listing broker's license has expired and the sale is going to closing soon. Is the listing broker allowed to receive a commission? What is the status of the buyer's agent's commission? - CORRECT ANSWER The listing broker is not allowed to receive a commission as the broker is considered not licensed. The listing broker in the listing agreement agrees to split his or her commission with the selling broker. The selling broker would need to get a separate agreement from the seller on how they are going to get paid as the listing broker's license is expired. The listing agent has a pocket listing and the seller is not aware his property was not placed on the MLS. Is this a violation? - CORRECT ANSWER Yes, it is a violation as it constitutes conduct which points to dishonest dealings, bad faith and untrustworthiness. A pocket listing is one in which the agent leaves the listing off MLS and may only advertise it in his brokerage office. To perform this type of action, the agent must have the written permission of the seller. This is also called an Exclusive Agency listing. This action, done without the seller's knowledge, is also an example of placing the agent's interest above that of the client-seller. The buyer's agent gives the seller's agent the option money and the seller's agent does not physically give it to the seller, but rather, puts it in his file. The transaction does not go through to closing. The seller's agent gives the check back to the buyer's agent to give to the buyer. Did the seller's agent do anything wrong? - CORRECT ANSWER Yes, he disbursed money before the transaction was consummated or terminated and the option money should have been delivered to the seller. However, if he had the written permission of the seller to perform this action, then there would be no problem. The Disclosure of Relationship with Residential Service Company should be included: - CORRECT ANSWER In a transaction when the broker receives compensation from the residential service company Can Spam Act of 2003 - CORRECT ANSWER The Can Spam Act (Public Law No. 108-187) of 2003 is a commonly used name for the Federal law more formally known as the "Controlling the Assault of Non-Solicited Pornography and Marketing Act of 2003." The law took effect on January 1, 2004. When sending out emails with advertisements, brokers and their agents must comply with the Federal CAN-SPAM Statute governing e-mail solicitations. The statute applies to any email that contains advertising. The statute prohibits: the falsification of routing or sending information in any e-mail; and any false, misleading or deceptive statements in the subject line. The CAN-SPAM statute provides that the sender's message must contain clear and conspicuous notice that the message is an advertisement or solicitation. The statute also requires the sender's message to include a valid physical postal address and requires that emails containing advertisements must contain unsubscribe features. The statute requires that it be honored in ten days and also requires that the unsubscribe feature remain active for 30 days after the message is sent. Each separate email in violation of the CAN-SPAM Act is subject to penalties of up to __________. - CORRECT ANSWER $16,000 Housing for older persons is exempt from the prohibition against familial status discrimination if: - CORRECT ANSWER HUD has determined that it is specifically designed for and occupied by elderly persons under a federal, state, or local government program or It is occupied solely by persons who are 62 or older It houses at least one person who is 55 or older in at least 80 percent of the occupied units, and adheres to a policy that demonstrates an intent to house persons who are 55 or older. Elements of a Listing Agreement - CORRECT ANSWER In most states a broker must provide to a seller certain disclosures prior to entering into a listing agreement. These disclosures often address such issues as: Agency relationships Brokerage fees Property condition Relationships with buyers Market value of the property being listed Local market conditions Additionally, a listing agreement should provide the broker with specific authorizations and instructions including: Permission to place a sign on the property Permission to place a lock box on the property Permission to advertise the property on the Internet Other provisions regarding showing times and instructions Statute of Frauds - CORRECT ANSWER is a body of law that requires that certain contracts be in writing in order to be enforceable Types of Listing Agreements - CORRECT ANSWER Exclusive Right to Sell: Real estate brokers recommend this listing which grants an exclusive right to sell the property during the listing term. A commission is paid even if the property is sold by the owner. Exclusive Agency: In an exclusive agency listing, the seller agrees to list the property with only one broker during the listing term, with the provision that the seller can sell the property himself or herself, without payment of a commission Open Listing: The open listing gives the seller the right to list the property with multiple competing brokers and to sell the property personally without liability for payment of a commission. Net Listings: the seller establishes a minimum acceptable net price According to the Statute of Frauds, all listings must be in writing to be _______________. - CORRECT ANSWER enforceable A(n) _______________ allows the seller to list the property with multiple competing brokers and to sell the property personally without the liability for payment of a commission. - CORRECT ANSWER open lisitng The Multiple Listing Service - CORRECT ANSWER Shares listings of member firms with each other Increases the inventory of properties for sale among member brokers Is used by agents to prepare a Comparative Market Analysis RESPA Section 8: Prohibition against Kickbacks and Unearned Fees - CORRECT ANSWER prohibits any person who, pursuant to any agreement or understanding, gives or receives a fee or a thing of value (including payments, commissions, fees, gifts, or special privileges) for the referral of settlement business. Payments in excess of the reasonable value of goods provided or services rendered are considered kickbacks. RESPA Section 8: no referral fees - CORRECT ANSWER No person may give and no person may accept any fee, kickback or other thing of value pursuant to any agreement or understanding, oral or otherwise, that business incident to or part of a settlement service involving a federally related mortgage loan shall be referred to any person. A business entity (whether or not in an affiliate relationship) may not pay any other business entity or the employees of any other business entity for the referral of settlement service business. RESPA Section 8: no split charges except for actual services performed - CORRECT ANSWER No person may give and no person may accept any portion, split, or percentage of any charge made or received for the rendering of a settlement service in connection with a transaction involving a federally related mortgage loan other than for services actually performed. A charge by a person for which no or nominal services are performed or for which duplicative fees are charged is an unearned fee and violates this section. The source of the payment does not determine whether or not a service is compensable. Nor may the prohibitions of this part be avoided by creating an arrangement wherein the purchaser of services splits the fee. Transactions exempt from RESPA include loans: - CORRECT ANSWER 1. Secured by parcels of 25 acres or more, whether or not the property is improved. 2. For which the primary purpose is business, commercial, or agricultural. However, a business purpose loan made to one or more persons, acting in an individual capacity (natural persons) to acquire, refinance, improve, or maintain a one-to-four family residential property used or to be used to rent or lease to other persons is a covered transaction. 3. Temporary loans, such as construction loans. (The exemption does not apply, and the transaction becomes covered by RESPA, if the loan is used as, or may be converted to permanent financing by the same bank. A lender's commitment for permanent financing is covered by the regulation. Any construction loan with a term of two years or more is covered by the regulation, unless it's made to a bona fide contractor. Bridge or swing loans are not covered by the regulation). 4. Secured by vacant or unimproved property when none of the loan proceeds will be used to construct a one-to-four family residential structure. If the proceeds will be used to locate a manufactured home or construct a structure within two years from the date of settlement, the loan is covered. 5. For the assumption of existing mortgages in which the lender has no right to approve subsequent persons as borrowers. Conversions of federally related mortgage loans to different terms consistent with the original mortgage instrument, as long as a new note is not required, are also exempt. Examples include transactions involving the renewal of:Single payment loans with no change in terms.Loans on which the APR is lowered, with a corresponding reduction in payment.Loans involving a court-ordered agreement.Workout arrangements of a problem loan.Loans on which optional insurance is added. 6. Secondary market transactions. A bona fi T or F: The Good Faith Estimate and the HUD-1 replaced the Loan Estimate and the Closing Disclosure in 2013 - CORRECT ANSWER False T or F: Kickbacks are allowed by RESPA if the broker discloses it to TREC. - CORRECT ANSWER False How many of each recently sold, recently listed and recently expired properties similar to the subject property should an agent include in a CMA? - CORRECT ANSWER 3 Which body of law requires certain contracts be in writing in order to be enforceable? - CORRECT ANSWER Statute of Frauds Supply and demand - CORRECT ANSWER The primary determinants of real estate values business plan - CORRECT ANSWER A set of instructions to guide you down the road to success in your business by making better decisions mission statement - CORRECT ANSWER Announces to the world what the company's long term goals are, describing the overall purpose of the organization marketplace - CORRECT ANSWER The geographic area a business covers marketing plan - CORRECT ANSWER The written document that describes advertising and marketing efforts of a company over time pricing strategy - CORRECT ANSWER Determining what to charge for services and product T or F: Georgia and Florida are two of the states that have seen an increase in residential in-flows since 2017 - CORRECT ANSWER true Supply can be restricted by: - CORRECT ANSWER land costs construction (labor and material) costs taxation economics local government building codes and zoning ordinances Ad valorem taxes - CORRECT ANSWER taxes on real property are referred to as ad volorem taxes (according to value) demand for real estate can be affected by: - CORRECT ANSWER growth in employment transportation systems personal preference the availability of credit federal government policy You should keep an eye on your competition: - CORRECT ANSWER advertising and marketing campaigns open houses the type of agent your competitors attract compensation plans for agents web and social media presence services offered pricing market share closing gifts T or F: one of the benefits of homeownership discussed in the book is safety from crime - CORRECT ANSWER false T or F: Austin is the MSA with the largest net gain in out-of-state residents - CORRECT ANSWER false T or F: personal preferences in real estate are purely subjective values that affect the value of real estate - CORRECT ANSWER true T or F: as residential properties become scarce, land costs tend to decrease - CORRECT ANSWER false T or F: growth in employment is the primary driver of demand - CORRECT ANSWER true T or F: brokers should pay attention to how their comeptitors advertise and recruit new agents for their firms - CORRECT ANSWER true T or F: all small businesses have two areas of consideration for "top of mind thinking" daily: revenue and expenses - CORRECT ANSWER true T or F: 97% of entrepreneurs actually write down their goals - CORRECT ANSWER false T or F: half-hour planning periods work well for many agents and successful salespeople - CORRECT ANSWER true Razing single-family homes and developing the lots as multifamily housing is due, in large part, to _______. - CORRECT ANSWER land cost risk management policy - CORRECT ANSWER Policies in place to protect business from risk social media policy - CORRECT ANSWER A policy that extends to all uses of social media in connection with real estate business policy and procedures manual - CORRECT ANSWER Sets boundaries so sales agents know exactly how to operate in the brokerage office identity theft - CORRECT ANSWER The fraudulent acquisition and use of a person's private identifying information used for financial gain loss control - CORRECT ANSWER An integral part of risk management that focuses on strategies to reduce and prevent loss fair and accurate credit transactions act (FACTA) - CORRECT ANSWER Federal law designed to protect consumers against unfair credit reporting practices and protect credit privacy errors and omissions insurance - CORRECT ANSWER A contract between an insurance company and the broker Written risk management policies should include - CORRECT ANSWER listing and contract files TREC rule 535.2(i) - CORRECT ANSWER sets forth the minimum requirements necessary in a Policies and Procedures Manual TREC rule 535.2(h) - CORRECT ANSWER states: (h) except for records destroyed by an "Act of God" such as a natural disaster or fire not intentionally caused by the broker, the broker must, at a minimum, maintain the following records in a format that is readily available to the Commission for at least four years from the date of closing, termination of the contract, or end of a real estate transaction: (1) disclosures; (2) commission agreements such as listing agreements, buyer representation agreements, or other written agreements relied upon to claim compensation; (3) substantive communications with parties to the transaction; (4) offers, contracts, and related addenda; (5) receipts and disbursements of compensation for services subject to the Act; (6) property management contracts; (7) appraisals, broker price opinions, and comparative market analyses; and (8) sponsorship agreements between the broker and sponsored sales agents. TREC rule 535.2(i)(7) - CORRECT ANSWER All trust accounts, including but not limited to property management trust accounts, and other funds received from consumers are maintained by the broker with appropriate controls in compliance with §535.146. TREC rule 535.2(c) - CORRECT ANSWER A broker is responsible for the proper handling of trust funds placed with the broker and must comply with §535.146 of this title. TREC rule 535.146 - CORRECT ANSWER Maintaining Trust Money TREC rule 535.2(i)(8) - CORRECT ANSWER Records are properly maintained pursuant to subsection (h) of this section. T or F: TREC requires sponsoring brokers to provide a written policies and procedures manual informing agents of the scope of their activities - CORRECT ANSWER true T or F: identity theft has not been a significant issue for most businesses since FACTA was passed in 2003 - CORRECT ANSWER false T or F: in texas, a sale agent is allowed to maintain a trust account separate from that of their sponsoring broker - CORRECT ANSWER false T or F: documentation regarding a trust account must be maintained for only two years from the date the document was created or received by the broker - CORRECT ANSWER false T or F: records can be maintained in either paper file or electronic format - CORRECT ANSWER true T or F: There is an eight-year statute of limitations for a lawsuit to be filed against a broker or sales agent in texas - CORRECT ANSWER true T or F: it is ok for a broker to deposit trust money in his/her personal account - CORRECT ANSWER false T or F: only brokers and real estate license holders can be authorized to withdraw or transfer money from any trust account - CORRECT ANSWER true T or F: employers could be liable for statutory damages if their employees' identity is stolen from the company - CORRECT ANSWER true T or F: TREC requires brokers to include dress code and telephone etiquette in their policies and procedures manual - CORRECT ANSWER false The license act requires in 1101.355 a business entity to carry at least $1 million for each occurance of errors and omissions insurance if the designated broker of the entity owns less than _______ of the entity. - CORRECT ANSWER 10% What are 3 requirements of FACTA? - CORRECT ANSWER 1. all information obtained from a consumer credit report must be destroyed before discarding it 2. mortgage lenders must provide the credit score they used to determine the interest rate on a loan regardless of whether the loan is approved or not 3. businesses can only list the final 5 digits of a credit card number on a printed credit card receipt What kind of penalty much be levied against an employer if employees' personal information or identity is stolen from the employer? - CORRECT ANSWER class action law suits fixed expenses - CORRECT ANSWER Overhead costs that typically don't change such as payroll, rent, dues and license fees, car payments, etc. variable expenses - CORRECT ANSWER Expenses that can change based on the transaction such as advertising expenses, printing, signs, etc profit - CORRECT ANSWER A financial gain, especially the difference between the amount earned and the amount spent in buying, operating, or producing something. loss - CORRECT ANSWER An amount of money lost by a business or organization. revenue - CORRECT ANSWER Monies that flow through a business as gross earnings before expenses and taxes are taken out or removed projected cash flow - CORRECT ANSWER A breakdown of the money that is expected to come in and out of a business. balance sheet - CORRECT ANSWER A statement of the assets, liabilities, and capital of a business or other organization at a particular point in time, detailing the balance of income and expenditure over the preceding period. financial forecasting - CORRECT ANSWER An estimate of future financial outcomes for a company business loans - CORRECT ANSWER Borrowing money to fund a business small business association - CORRECT ANSWER Provides financial assistance programs, including guaranteed loan programs, bonding programs, and venture capital programs, setting loan guidelines. conventional loans - CORRECT ANSWER Loans made by banks 4 Cs of credit - CORRECT ANSWER A borrower's cash, collateral, commitment, and character that determine the borrower's creditworthiness general operating budget - CORRECT ANSWER An integral part of the company's structure, serving as a road map and helping the company to project income and expenses and then allocate resources accordingly gross income - CORRECT ANSWER Commissions, referral fees, and service fees obtained before taxes and other expenses are subtracted operating expenses - CORRECT ANSWER Outgoing costs including both fixed and variable costs net income - CORRECT ANSWER What is left of compensation after taxes and other expenses are subtracted typical up-front brokerage expenses include - CORRECT ANSWER furniture utilities franchise fees rent signage equipment leases the most common source of government funding is the ______ - CORRECT ANSWER small business administration Small business owners may have a better chance of securing a conventional loan from _______ - CORRECT ANSWER small community banks lease - CORRECT ANSWER A written or oral contract between a landlord (lessor) and a tenant (lessee) that transfers the right to exclusive possession and use of the landlord's real property to the lessees for a specified period of time for a stated consideration leasehold estate - CORRECT ANSWER A tenants' right to occupy real estate during the term of a lease. tenancy for years - CORRECT ANSWER A leased interest in property for a certain, exact period of time and for a specified consideration periodic tenancy - CORRECT ANSWER An interest in leased property that continues from period to period estate at will - CORRECT ANSWER An estate that gives the lessee the right to possession until the estate is terminated by either party tenancy at sufferance - CORRECT ANSWER The tenancy of a lessee who lawfully comes into possession of a landlord's real estate, but continues to occupy the premises improperly after his or her lease rights have expired. The lessee is not paying rent. gross lease - CORRECT ANSWER A lease of property under which a landlord pays all property charges regularly incurred through ownership, such as repairs, taxes, insurance, and operating expenses. Most residential leases are gross leases. net lease - CORRECT ANSWER A lease requiring the tenant to pay not only rent, but also all costs incurred in maintaining the property, including taxes, insurance, utilities, and repairs percentage lease - CORRECT ANSWER A lease commonly used for commercial property, whose rental is based on the tenant's gross sales at the premises; it generally stipulates a base monthly rental plus a percentage of any gross sales above a certain amount right of first refusal - CORRECT ANSWER A clause in a lease in which the tenant has the right to match or better any offer the landlord may receive on the property if the property should ever become available for purchase before the property can be sold to someone else. sale and leaseback - CORRECT ANSWER A transaction in which an owner sells his or her improved property and, as a part of the same transaction, signs a long-term lease to remain in possession of the premises hoteling - CORRECT ANSWER A reservations-based concept that allows employees to reserve a workstation on an as-needed basis to save space for the broker by sharing space by the sales agents cloud storage - CORRECT ANSWER Paperless storage of documents and other data using remote servers T or F: the landlord may dispose of the tenant's abandoned property within 14 days after the property has been stored by the landlord - CORRECT ANSWER false T or F: the landlord shall refund the security deposit to the tenant no later than 60 days after the date the tenant surrenders to premises and provides notice of forwarding address - CORRECT ANSWER true T or F: the landlord is not obligated to return a tenant's security deposit until the tenant gives the landlord his/her forwarding address in writing - CORRECT ANSWER true Which of the following facilities would typically offer tenants a triple net lease? - CORRECT ANSWER a. office park b. strip center c. industrial d. all b. strip center Which of the following is included in facilities management? - CORRECT ANSWER a. building signage b. preventative maintenance c. janitorial services d. all d. all branding - CORRECT ANSWER Graphics that create name recognition through color, font, and style marketing plan - CORRECT ANSWER The written document that describes advertising and marketing efforts of a company over time marketing objectives - CORRECT ANSWER Defining the market, the industry, your opportunities, issues, and solutions are basic to the marketing plan. multi-channel marketing - CORRECT ANSWER A marketing strategy in which the sales agent uses multiple platforms, "channels" to reach the customer. direct marketing - CORRECT ANSWER Marketing directly to your intended audience through the use of yard signs, classified advertising and print media, display advertising, radio-TV advertising (new home shows), and mailers. TREC Safe Harbor Policy - CORRECT ANSWER On signs or any other type of advertising, a broker's name, the brokerage name, or an assumed name has to be at least 50% of the largest item of contact information. AIDA - CORRECT ANSWER used for newspaper/magazine advertising attention interest desire action leadership - CORRECT ANSWER The action of leading a group of people or an organization change - CORRECT ANSWER Change is constant; therefore real estate brokers must always be willing to re-evaluate the direction and goals of the company. company culture - CORRECT ANSWER A set of shared values, goals, attitudes, and practices that characterize an organization. motivation - CORRECT ANSWER Energizing, directing and sustaining employee and sales agent efforts balance - CORRECT ANSWER Includes caring for spiritual needs, health needs, family, and work. training - CORRECT ANSWER Teaching of employees and sales agents to establish and maintain a productive and supportive company culture and motivate team members to do their best. mentoring - CORRECT ANSWER A supportive learning relationship between a caring individual who shares knowledge, experience, and wisdom with another individual who is ready and willing to benefit from this exchange, to enrich their career coaching - CORRECT ANSWER A performance-driven approach to improve the professional's on-the-job performance management styles - CORRECT ANSWER The particular way a manager accomplishes business objectives management structures - CORRECT ANSWER How a company organizes its management hierarchy 3 types: 1. divisional - larger companies; separate based upon different market areas, services, and products 2. functional - works good for smaller firms; groups each segment of the company according to their purpose 3. matrix - hybrid of divisional and functional Which of the following is not one of the three tests of the tax equity and fiscal responsibility act for specifying that a sales agent is an independent contractor? - CORRECT ANSWER a. the sales agent must have a written contract with the broker stating the agent is not an employee b. the sales agent must attend required meetings c. the sales agent must hold a real estate license d. the sales agent must be paid on a commission basis b. the sales agent must attend required meetings The state of Texas and the federal government have anti-employment discrimination laws that apply to employers of _______________ or more employees. - CORRECT ANSWER 15 According to anti-employment discrimination laws, a person who is _______________ and older may not be discriminated against based on age alone. - CORRECT ANSWER 40 The _______________ of the Texas Workforce Commission investigates allegations of discrimination and enforces the State and Federal laws in Texas. - CORRECT ANSWER Civil Rights Division _______________ states that a Texas worker cannot be forced to join a labor union. - CORRECT ANSWER Texas Workers Bill of Rights An unlicensed agent may not _______ - CORRECT ANSWER Telemarket for listings An owner or human resource director should always __________ after interviewing for a job candidate. - CORRECT ANSWER hire when a decision it reached It is best to retain sales agents through: - CORRECT ANSWER positivity What does the text suggest a brokerage with a high turnover rate for sales agents should do? - CORRECT ANSWER implement a montoring program REALTOR - CORRECT ANSWER A registered trademark term reserved for the sole use of active members of local REALTOR® associations affiliated with the National Association of REALTORS® Orientation Program - CORRECT ANSWER An implemented plan to help new employees and sales associates learn the policies and procedures of a company Controlled business agreement - CORRECT ANSWER An affiliate relationship of a direct or beneficial ownership interest of more than 1 percent in a provider of settlement services where a lender directly or indirectly refers business to the provider Cultural Diversity - CORRECT ANSWER The existence of a variety of cultural or ethnic groups within a company or society Retention - CORRECT ANSWER Keeping sales agents at the company instead of having them leave to work for another broker Termination - CORRECT ANSWER The ending of the relationship between the broker and the sales agent Productivity Management - CORRECT ANSWER Measuring the results from the use of available systems and tools for prospecting activities CRM - CORRECT ANSWER Contact Relationship Manager, a tool used to automate prospecting tasks and manage leads Geographic farming - CORRECT ANSWER A particular area that may include neighborhoods that a sales agent or broker markets for the solicitation of business Management plan - CORRECT ANSWER A schedule of activities that creates the ability to measure accomplished tasks _________ are an important way to offer a platform for advice and encouragement for agents - CORRECT ANSWER Business meetings Incremental evaluation - CORRECT ANSWER Evaluations that take place at pre-determined intervals, such as monthly ongoing evaluation - CORRECT ANSWER Takes place consistently throughout each week to help business owners monitor, assess, and analyze specific assets of their firms preventative controls - CORRECT ANSWER A type of financial control through assignment of duties, authorization, and verification, and access to equipment, cash, and other assets detective controls - CORRECT ANSWER A type of financial control that includes performance reviews, reconciliation of financial records, audits, inventories, and other investigative activities business activity management - CORRECT ANSWER A process that can help brokerage owners to recognize, define, and analyze critical risks, and opportunities data retention plan - CORRECT ANSWER A set of policies for handling sensitive information using protocols that meet federal, state, and local legal requirements information management - CORRECT ANSWER Systems that allow businesses to collect, store, organize retain, and communicate information lean mangement - CORRECT ANSWER The evaluation of a brokerage's structure to improve efficiency to maximize what it is that customers value about your business, always with an eye out for cost reduction vertical expansion - CORRECT ANSWER Growth through adding specialty departments horizontal expansion - CORRECT ANSWER Growth by enlarging the company through adding branch offices organic growth - CORRECT ANSWER Referred to as true growth, involves expansion through the company's own resources such as energy, personnel, creativity, and reputation inorganic growth - CORRECT ANSWER Growth by adding additional businesses from the outside to produce company growth merger - CORRECT ANSWER Growth by bringing two or more companies together, combining their assets acquisition - CORRECT ANSWER Growth through one company buying another company venture capital - CORRECT ANSWER Investment from outside resources used to grow or start a company mentor - CORRECT ANSWER An experienced agent who guides a newer agent through their first year of real estate comprehensive database - CORRECT ANSWER A list of properties and property owners within a geographical region time blocking - CORRECT ANSWER Separating periods of time for different activities intermediary brokerage - CORRECT ANSWER Brokerages that will represent both parties in a transaction caveat emptor - CORRECT ANSWER Let the buyer beware fair housing - CORRECT ANSWER Federal, state, and local laws that ensure the public has unobstructed access to housing CCIM - CORRECT ANSWER Certified Commercial Investment Member designation for commercial real estate agents who want to further their business practices through education and networking opportunities IREM - CORRECT ANSWER Institute of Real Estate Management is an international community of real estate managers dedicated to ethical business practices, maximizing the value of investment real estate, and promoting superior management through education and information sharing SIOR - CORRECT ANSWER Society of Industrial and Office Realtors is a professional organization that is affiliated with NAR ICSC - CORRECT ANSWER International Council of Shopping Centers is designed to advance the shopping center industry and to promote its role in the commercial distribution of consumer goods and services BOMA - CORRECT ANSWER Building Owners and Managers Association is an association of building owners, managers, developers, leasing professionals, corporate facility managers, asset managers, and providers of the products needed to operate commercial properties NARPM - CORRECT ANSWER The National Association of Residential Property Managers is an organization of managers of single-family and small multifamily properties diplomacy - CORRECT ANSWER The ability to handle clients and situations in a sensitive and effective way What are the requirements to being a real estate broker? - CORRECT ANSWER With a TREC-Approved college Bachelor degree and four years of active experience in the Real Estate industry, you may only need one more 30-hour course to meet the Texas Broker license education requirements. 360 Experience Points in 4 years of the last 5 years30 Points for each closed purchase or sale of a residential property (single-family, condo, multi-family, apartment unit lease)30 Points for each closed purchase or sale of a farm and ranch property (with residence, improved, or unimproved)50 Points for each closed purchase or sale of a commercial property (apartment with 5+ units, office, retail space, hotel, etc)Other Broker point opportunities available - View Qualifying Experience Report Form 900 Total Education Hours270 Hours of core real estate coursesAll approved QE, SAE, and MCE courses taken to dateA college Bachelor's degree will count for 630 hours towards your Broker's licenseOne Texas Real Estate Brokerage (30-Hours) course Without TREC-Approved college bachelor's degree, you need to have a total of 900 course hours. All previous Texas Real Estate courses will count towards your 900 hours. [Show More]

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