Ch 1 - Licensing Laws Flashcards
- A person or legal entity authorized to operate independently in conducting a real estate brokerage business
- A business licensed to conduct real estate brokerage
Broker
- A competent and disinterested person who is authorized to act in another person‘s place
Attorneys in fact
A notice of consent or consent to suits and services
Consent notice
A person just entering the real estate business and who may not operate independently and must be under the direct supervision of a licensed broker
Salesperson
A broker who manages an office
Managing Broker
A regulatory legal entity formed to regulate licensees and to protect the public
Real estate board
The practice of mutual exchanges of privileges
Reciprocity
A warning or proviso of specific stipulations, conditions, or limitations
Caveat
True or false:
The salesperson must work under the broker as an independent contractor
False - they could be an employer
True or false:
The real estate board is a body of law and has unlimited powers
False - The real estate board has limited powers
True or false:
A salesperson may not operate independently and must be under the direct supervision of a licensed broker
True
True or false:
All licenses are under the direct control of the broker and are posted in a conspicuous location in a firm’s main office
True
True or false:
A salesperson can except compensation from anyone
False - salesperson cannot accept compensation for the vast majority of transactions from anyone other than his or her broker
True or false:
States that observe partial reciprocity don’t require the individual to take the state law portion of the real estate exam
False - they do require the individual to take the state law portion of the licensing exam
True or false:
Most states requires that those engaged in representing others in real estate transactions for compensation are licensed
True
True or false:
Virginia requires appraisers and mortgage bankers to also hold a real estate license
False - Virginia does not
Is the real estate sales associate and employee of the broker or an independent contractor?
Could be either
What are the two classes of licenses?
Broker and salesperson
In Virginia, each place of business at each branch office must be supervised by a…
Supervising broker
What do the below have in common:
- property owners acting on their own behalf
- attorneys only if conducting real estate transactions as part of their duties for a client
- officials appointed by the courts
- Government employees dealing in real estate for government agencies
- Attorneys in fact holding a valid power of attorney from an owner may facilitate the transaction
All can sell real estate without licensure
What is the role of a managing broker?
Serves to boost the morale or output of the office; serves as a liaison to the community, provides educational information and ensures agents are aware of any industry developments
What is the most important control mechanism held by the real estate board?
The ability to deny licenses and to suspend or revoke licenses
Where do all means of compensation to salespeople and associate brokers come from?
A principal broker or sole proprietor
True or false:
The IRS cannot treat real estate sales associates as independent contractors unless these three requirements are fulfilled:
- Associate must be licensed as a real estate agent
- Almost all (90%) of the associates payment for services as a real estate agent must be directly related to sales and not to hours worked
- A written agreement must exist between the associate and the broker stating that the associate will be treated as an independent contractor for tax purposes
True
