Ethical Practices and Fair Housing Flashcards
Which of the following is NOT a protected class under Maryland’s Fair Housing Act?
a. Familial status
b. Sex
c. Employment status
d. Marital status
(c) Employment status
Employment status is not protected under Maryland’s Fair Housing Act. However, this does not necessarily allow discrimination based on employment status if that discrimination has a disparate impact on protected class.
A Maryland real estate licensee must protect the public against
a. counterfeit funds.
b. robbery.
c. fraud.
d. larceny.
(c) fraud
Licensees have an obligation to protect the public from fraud in real estate transactions, but they do not have a duty to protect the public from the other crimes listed.
A real estate licensee’s primary obligation to a client
a. is the obligation of absolute fidelity.
b. is an obligation to be honest.
c. is an obligation to be fair.
d. is an obligation to exercise reasonable care.
(a) is the obligation of absolute fidelity.
A real estate licensee’s primary obligation to a client is the obligation of absolute fidelity also expressed as the duty to protect and promote the interests of the client. Under the NAR Code of Ethics, the primary obligation is “to protect and promote the interests of their client.”
A real estate licensee must be informed on
a. modern construction technology.
b. current market conditions.
c. current property inspection techniques.
d. real property and income tax law.
(b) current market conditions.
Modern construction technology, current property inspection techniques, and income tax law are beyond the expertise of a real estate licensee. However, a licensee is required to keep current on market conditions.
All real estate documents
a. must be signed by a broker.
b. must be signed by a branch manager.
c. must be signed by a licensee.
d. may be signed in the name of a group or team.
(c) must be signed by a licensee.
All real estate documents must be signed by a licensee. It is not necessary to always be the broker or associate broker.
For the protection of all parties a real estate licensee must ensure that all financial obligations relating to the real estate transaction are
a. reviewed by an accountant.
b. in writing.
c. balanced correctly.
d. are posted correctly in a journal.
(b) in writing.
Financial obligations in a real estate transaction are important and sometimes involve significant sums of money. Maryland requires these transactions to be evidenced in writing.
What type of agency relationship must not be interfered with by other licensees during its term, according to Maryland’s Code of Ethics?
a. Single agency
b. Dual agency
c. An open listing
d. An exclusive listing
(d) An exclusive listing
Negotiations concerning property listed exclusively with one broker must be carried on solely with the
listing broker.
When buying on the licensee’s own behalf, the licensee’s status must be disclosed in writing to the seller. Further, a licensee is considered to be acting on the licensee’s own behalf when the licensee is acting on behalf
a. of a close friend.
b. of a former spouse.
c. of a former client.
d. of a member of the licensee’s immediate family.
(d) of a member of the licensee’s immediate family.
Real estate activities undertaken by a licensee on the licensee’s own behalf are closely regulated. A licensee working on behalf of a member of the licensee’s immediate family is considered to be the same as acting on the licensee’s own behalf.
Maryland’s housing discrimination law is enforced by the
a. Maryland Commission on Civil Rights.
b. HUD.
c. Equal Rights Commission.
d. Attorney General.
(a) Maryland Commission on Civil Rights.
Maryland’s housing discrimination law is enforced by the Maryland Commission on Civil rights. The US
Fair Housing Act is administered by the Department of Housing and Urban Development (HUD).
A sign giving notice that a property is for sale requires
a. a broker’s consent.
b. the property owner’s consent.
c. the existence of an exclusive listing agreement.
d. consent from the local city council.
(b) the property owner’s consent.
To place a for sale sign on a property a real estate licensee needs the owner’s consent.
Which of the following is considered by the Maryland Real Estate Code of Ethics to be a possible violation of a licensee’s obligation to protect and promote the interest of a client?
a. Failure to obtain the property disclosure statement before an offer is made
b. Failure to provide a client with an appraisal
c. Failure to provide a client with a zoning map
d. Failure to identify environmental hazards
(a) Failure to obtain the property disclosure statement before an offer is made
The Maryland Code of Ethics specifically states, “Unexcused failure to ensure that a prospective purchaser has the real property disclosure statement or disclaimer statement in hand before the submission of an offer to purchase may be considered a violation of the licensee’s obligation to protect and promote the interests of the licensee’s client when this failure could result in a contract becoming void or voidable.”
It is illegal to refuse to sell a residential property to someone based on the fact that
a. the buyer cannot afford the property.
b. the buyer cannot obtain a loan.
c. the buyer has children.
d. the buyer’s offer is too low.
(c) the buyer has children.
Having a child under the age of 18 years in the household is a protected class called familial status. It is illegal to refuse to sell to someone because the buyer has children. Unless there is some specific exemption, for example, developments set aside for older people under the Housing for Older Persons Act.
When may a licensee accept compensation from more than one party to a transaction?
a. Never
b. When the licensee is giving all parties a discount
c. When all parties have full knowledge that compensation is being paid by more than one party
d. During a rescission
(c) When all parties have full knowledge that compensation is being paid by more than one
party
To receive compensation from more than one party to a transaction requires the full knowledge of all parties. This is part of Maryland’s Real Estate Code of Ethics.
The negotiations of a buyer’s broker concerning property subject to an exclusive listing should be carried on
a. with the listing broker.
b. with the seller exclusively.
c. with the seller and the listing broker as a mediator.
d. only with the buyer and seller present.
(a) with the listing broker.
When a property is subject to an exclusive right to sell listing, a buyer’s broker can only negotiate with the listing broker according to ethical code. This includes a salesperson acting on behalf of the listing broker.
When a real estate salesperson is preparing a competitive market analysis which includes property in which the salesperson has an interest, then the salesperson must
a. disclose the interest to the Real Estate Commission.
b. ensure that the client is not aware of such interest.
c. disclose the interest to his or her broker.
d. disclose the interest to the client.
(d) disclose the interest to the client.
It is always important for a licensee to be extra careful when dealing in some way with the client’s own property. When using personally owned property in a CMA, the client must be informed.
