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REAL ESTATE PRACTICE EXAM
Terms in this set (33)
Which agency enforces fair housing law?
The Office of Fair Housing and Equal Opportunity provides administration and enforcement of federal fair housing laws.
One of the following licensee's actions would constitute commingling. Which is it?
Cynthia deposited her client's earnest money check into the firm's operating account. $
Commingling occurs when funds in or intended for a trust account are intermixed with operating or personal funds.
Which of these is an example of practicing within your area of competence?
Researching the property tax amount that a client will pay on the home he's purchasing. $
As a licensee, you're expected to be an expert in real estate, not home inspections or the tax-related or legal implications of a purchase or sale. Property tax amounts are a matter of public record, and researching them is within your wheelhouse.
Which of the following is the most common type of buyer representation agreement?
Exclusive right-to-represent agreement $
An exclusive right-to-represent agreement is the most popular form of a buyer representation agreement because it gives the licensee the sole right to represent the buyer.
Which of these represents puffery?
Kevin's MLS remarks note that the condo has the city's "most beautiful twilight view of downtown and the bay. $
Kevin's ad is the best example of puffery. Katherine's ad is fraudulent, and Kim's is in poor taste but probably true.
Title VIII of which law prohibits discrimination in the sale, rental, and financing of housing?
Civil Rights Act of 1968 $
itle VIII of the Civil Rights Act of 1968 is also referred to as the Fair Housing Act of 1968, prohibits discrimination in the sale, rental, or financing of housing based on race, color, national origin, and religion.
Which of these is an example of antitrust violations common to real estate?
Tie-in arrangements, market allocation agreements, and group boycotting $
In addition to price fixing, antitrust violations include tie-in arrangements, market allocation agreements, and group boycotting.
What does CAN-SPAM Act stand for?
Controlling the Assault of Non-Solicited Pornography and Marketing Act $
CAN-SPAM Act stands for the Controlling the Assault of Non-Solicited Pornography and Marketing Act.
What does the Federal Trade Commission regulate?
The Federal Trade Commission Act includes rules to encourage truthful, non-deceptive, and fair advertising, and require advertisers to have evidence to back up any claims made
Which of these is NOT an example of price fixing?
Jake's firm agrees to charge all clients a listing commission of between 2% and 2.5%. $
Any agreement (formal or informal) between competing firms to fix prices or standardize listing terms or commission splits, etc., is considered price fixing.
Which of these is an example of conversion of funds?
Monica used funds from the firm's trust account to pay her firm's rent. $
Conversion means that a licensee or brokerage firm uses trust funds for personal or operating purposes.
Which of these statements best represents what happens after a federal fair housing complaint is made?
A fair housing specialist will review the complaint. $
After an initial complaint is made, a fair housing specialist will review it to determine if a violation has occurred. If there's a potential violation, the specialist will help the consumer file an official complaint.
Which type of communication does the CAN-SPAM Act outlaw?
Email marketing with no "unsubscribe" option $
All email marketing communication must include an "unsubscribe" option.
What is the relationship between a policies and procedures manual and the broker's obligation to supervise agents?
Brokers who enforce policies and procedures outlined in an effective PPM have proof of efforts to properly train and supervise agents. $
Krening Realty has been found guilty of running deceptive ads. Which of these statements about the potential penalty is NOT true?
Krening's broker may face jail time. $
Violations of a cease and desist order may result in penalties of more than $41,484 for each day a deceptive ad runs; civil penalties may be in the millions, depending on the violation. Violators may be required to run corrective or informational ads.
Which of the following is true about tie-in arrangements?
They're an antitrust violation. $
Tie-in arrangements are anti-trust violations that involve predicating the delivery of one service on the consumer purchasing a second service from a recommended business.
Which act created the Office of Fair Housing and Equal Opportunity under the Department of Housing and Urban Development?
Federal Fair Housing Act of 1968 $
The federal Fair Housing Act of 1968 created the Office of Fair Housing and Equal Opportunity under the Department of Housing and Urban Development. HUD enforces Title II related to public housing, housing assistance, and housing referrals.
Unauthorized practice of law and acting outside the scope of one's expertise are similar issues. Which of the following circumstances specifically relates to the unauthorized practice of law?
Writing contract addenda or additional provisions that cover unfamiliar circumstances $
All of these actions are outside the scope of a real estate license. Writing contract addenda or additional provisions that cover unusual circumstances falls into the category of unauthorized practice of law, since a licensed attorney should do that.
Trenton is a real estate licensee who's suspected of discriminating against women who are interested in buying a condo in his building. HUD sends four clients his way, each with equivalent credit scores and employment histories. Two are male and two are female. What investigative technique is HUD using?
Paired testing $
The Telephone Consumer Protection Act is overseen by _______.
The Federal Communications Commission $
Which act provides consumers with remedies if they become victims of discrimination in the sale, rental, or financing of housing
Fair Housing Amendments Act of 1988 $
The Perfect Home brokerage firm was found guilty of running deceptive ads. The Federal Trade Commission might require all of the following EXCEPT ______.
Letters of apology to all affected consumers $
Which of these scenarios is a violation of federal fair housing laws?
Miguel follows his client's request to only show him properties where the neighborhood is mainly Hispanic. $
Which of these statements accurately describes finance- and housing-related legislation?
The Fair Housing Act of 1968 prohibited discrimination in the sale, rental, and financing of housing based on race, color, religion, or national origin. $
From a buyer's perspective, what is the primary benefit of signing a buyer agency agreement?
It ensures a higher level of service. $
Sam is an independent contractor licensee working for B & L Realty. Since Sam is an independent contractor, what supervisory responsibility does Sam's broker have?
Sam is considered an employee for licensing law purposes, but he's still an independent contractor for IRS purposes. $
Ramon and Bill are victims of fair housing discrimination. Which of the following must have occurred if their landlord violated specific terms of the Fair Housing Act?
They were refused an apartment because Ramon is from Nicaragua. $
The two real estate firms in one small town, Vineyard Realty and Homestead Homes, agree to charge the same commission rate to avoid the possibility of clients selecting a firm based simply on price. What specific federal legislation prohibits this?
The Sherman Antitrust Act of 1890 $
The Sherman Antitrust Act of 1890 expressly prohibits collusive acts that result in an unreasonable restraint of trade or reduced competition.
Serena just finished making a buyer presentation to Mark and Debbie Calhoun. Now that they understand the difference between being customers and being clients, they're anxious to be represented. What is one of their duties as buyers represented by an agent?
Notifying Serena of any material changes $
Which of these is a TRUE statement regarding truth in advertising violation penalties?
The Federal Trade Commission determines the severity of the penalty based on the severity of the violation. $
Belinda is a licensee whose client asked her to draft an addendum containing complicated terms that even Belinda doesn't fully understand. Belinda should ______.
Avoid unauthorized practice of law $
Licensees must avoid unauthorized practice of law. Drafting contractual paperwork with uncertain terms would be a violation.
To best prevent risk associated with licensee non-compliance with real estate-related federal regulations, brokerage firms should do which of the following?
Include a review of related federal legislation in the policies and procedures manual and provide appropriate training. $
Which of these is an example of blockbusting?
A real estate agent approaches a homeowner as soon as a demographic shift starts to occur in her neighborhood and convinces her that she needs to sell now, or she'll never be able to sell. $
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