Commission Rules and Regulations

Question 1

Branch office

Answer 1

a secondary place of business apart from the principal or main office from which real estate business is conducted

Question 2

commingling

Answer 2

mixing/pooling of funds

client funds must be kept separate from brokerage funds

Question 3

duplicate original

Answer 3

an exact copy of a signed original

Question 4

escrow account

Answer 4

an account used for the deposit of all money belonging to other people

Question 5

guilty knowledge

Answer 5

awareness of wrongdoing without any attempt to stop it

Question 6

letter of intent

Answer 6

a nonbinding (usually) recitation of what the parties intend to do, preceding entering into a contract

Question 7

probation

Answer 7

the least severe discipline available to the Real Estate Commission

Question 8

revocation

Answer 8

an act of taking away someones real estate license

most severe punishment for NJ REC

Question 9

suspension

Answer 9

the temporary lifting of a real estate license by the commission

Question 10

trust account

Answer 10

a separate account segregated from a broker’s funds, into which the broker deposits all funds entrusted to the agent by the principal (client).

Question 11

Waiver of Broker Cooperation

Answer 11

Seller’s statement that only one office will be marketing the property

no MLS marketing

Question 12

A salesperson may NOT

Answer 12

1. accept any form of compensation except from his or her supervising broker
2. maintain an escrow account or hold funds belonging to others
3. work for more than one NJ broker at a time

Question 13

Every broker who is a resident of New Jersey must maintain________

Answer 13

a place of business in the state

Question 14

license lending

Answer 14

a practice in which a broker permits his or her license to be used by another person or business entity without actually supervising the business

Question 15

When a client places advance fees of more than $25 with a broker, the broker must give the client an account of how the money is being spent within ______

Answer 15

90 days

Question 16

Clients that make cash deposit must be given ______

Answer 16

a written receipt

Question 17

Any cash deposit of $10,000 or more must be reported to the

Answer 17

Internal Revenue Service

Question 18

Every broker must keep records of trust account activity for at least ______

Answer 18

six years

Question 19

What statement needs to be included in all listing contracts

Answer 19

“As seller you have the right to individually reach an agreement on any fee, commission, or other valuable consideration with any broker. No fee, commission, or other consideration has been fixed by any governmental authority or by any trade association or multiple listing service”

Question 20

Attorney Review Clause

Answer 20

gives the buyer and seller the right to consult an attorney, who may disapprove a contract within three business days of delivery of signed contracts to both parties

required in all sales contracts prepared by licensees

Question 21

All written offers must be forwarded to sellers within ______

Answer 21

24 hours

Question 22

brokers must keep copies of all unaccepted offers to purchase for______

Answer 22

six months from the date of the initial offer

Question 23

Buyer’s brokers

Answer 23

brokers that are retained by buyers to help them find suitable properties

Question 24

Broker as disclosed dual agent

Answer 24

NJ REC allows a broker to represent both parties in a transaction, provided that the broker obtained parties written, informed consent to the dual agency

Question 25

Broker as transaction broker

Answer 25

works with a buyer and/or seller in the sales transaction without representing either. does not promote interests of one party over another

Question 26

what is included in a written Broker-Salesperson Independent Contractor agreement

Answer 26

1. compensation rate paid to the salesperson 2. a broker promise to turn over monies due the salesperson within ten days after a commission is received 3. rate of compensation to be paid the salesperson for transactions that close after the salesperson leaves that broker's firm 4. provision that any future changes to the contract will be binding only if in writing and signed by both parties

Question 27

All ads must indicate ______

Answer 27

the name of the brokerage company followed by a term such as REALTOR, Realist, real estate broker, or real estate agency

Question 28

In advertisements, the licensee's name must appear ______

Answer 28

exactly as it is on the license with the exception of middle name/initial nickname may also be included

Question 29

all ads must specify the property's ________

Answer 29

municipal location

Question 30

any advertisement that refers to a home warranty must state whether _______

Answer 30

inspection is required, if the warranty is mandatory, and whether the purchaser is responsible for the payment of fees in connection with the warranty

Question 31

No advertising may indicate that a property is "sold" until _______

Answer 31

the sale has closed and the title has been transferred

Question 32

commission rebates

Answer 32

money that a broker pays a purchaser/buyer after a sale has closed

Question 33

price-fixing

Answer 33

illegal practice of competing offices agreeing to establish a set commissions rate

Question 34

What are the three actions the REC can take against licensees who have received complaints?

Answer 34

1. place a license on PROBATION 2. suspend a license (SUSPENSION) 3. revoke the license completely (REVOCATION)

Question 35

Fines for violation of REC regulations

Answer 35

first offense = $250 - $5000 second offense = up to $10000 third offense = revocation highest fine is $25000 total!!!!

Question 36

before suspending/revoking a license, the commission must provide the licensee at least _______ advance notice of a hearing

Answer 36

10 days

Question 37

license lending

Answer 37

practice of brokers allowing their licenses to be used by another person without supervising