Laws & Rules

Question 1

What are the main ways that license laws ensure consumer protection?

Answer 1

They establish requirements, define activities, and set standards.

Question 2

Sally’s a first-time homebuyer. She’s a little nervous about finding a good real estate agent—she’s read about a lot of scams out there. What exists in real estate with the main purpose of protecting consumers like Sally?

Answer 2

License laws

Question 3

New Illinois licensee Sara is creating her first print real estate ad. She’s included her name, her email address, and her main office telephone number in it. What’s missing from her ad?

Answer 3

Her broker’s or brokerage’s name

Question 4

Bert is a sponsored broker in Illinois who’s selling his own house. Since he’s acting as his own broker, which of these rules must he follow?

Answer 4

He can use a For Sale by Owner yard sign, but it must say “agent owned.”

Question 5

First Choice Realty is a favorite among new licensees because it has a strong training program. Who has the ultimate legal responsibility for this program at First Choice?

Answer 5

Jerilyn, the sponsoring broker

Question 6

Gregory is a salesperson at Gardner Homes. Linda is his sponsoring broker. Which of the following best describes what is legally required regarding Gregory’s license?

Answer 6

Linda has Gregory’s license available for viewing

Question 7

The written agreement with a client/customer establishes how the compensation is to be made and also establishes all of the following EXCEPT for which of these?

Answer 7

The broker’s split of the commission

Question 8

Illinois broker Antonio was thrilled to close on a listing that had been on the market for six months. He made the sale based on a referral. Antonio can pay a referral fee to which of the following people who provided the referral?

Answer 8

His licensed sales assistant

Question 9

Adam is an Illinois licensee that works for rental finding service. He’s working with a landlord, Trendmaker Apartments. He just located a tenant for one of the apartments, and the tenant has signed a lease. Which of these statements is true?

Answer 9

Upon entering into a lease contract, the tenant must be provided with specific information regarding the unit and the owner.

Question 10

Larry created a land trust agreement naming Renken Properties, Inc., as the trustee and himself as the beneficiary. Which of these statements is true?

Answer 10

Larry retains complete control of the property during the trust’s term.

Question 11

Which one of these best describes the purpose of homestead laws?

Answer 11

To protect a portion of a homeowner’s ownership interest against some types of liens

Question 12

Which of these about the Illinois Timeshare Lien and Security Interest Act is true?

Answer 12

This act permits timeshare managers to place liens against timeshare interests for unpaid assessments.

Question 13

Which of these is an example of commingling?

Answer 13

Cynthia deposited her client’s earnest money check into the firm’s operating account.

Question 14

Annette recently moved out of the 18-unit apartment building she’d been in for two years. She was careful to leave her apartment clean and in good repair when she left, but the landlord retained her security deposit anyway. He also refused to respond to her demands to return it. Does Annette have any options left?

Answer 14

Yes. She can file suit in small claims court.

Question 15

Which of the following statements about document delivery, storage, and retention is NOT true?

Answer 15

Documents prepared and signed electronically must be printed and stored in hard-copy format for the full retention period.

Question 16

Sam is a salesperson at Happy Home Realty doing his monthly file and desk cleanup. He is packing up closed transaction files to send to the firm’s records manager. He’s permitted to send all the files EXCEPT ______ to off-site storage under a five-year retention plan.

Answer 16

The previous year’s escrow account ledger

Question 17

Nicholas is working with a buyer client who wants a special clause added to his purchase contract. How should Nicholas handle this?

Answer 17

Instruct the client to hire an attorney to draft the clause.

Question 18

Which of the following is an unauthorized practice of law?

Answer 18

Interpreting the legal consequences of a client’s actions

Question 19

Carlene sold her house to Todd for $492,500. She lives in in a city that charges a $.10 transfer tax. How much transfer tax will be owed on this transaction?

Answer 19

$837.25
Transfer taxes in Illinois are calculated on every $500 (or portion thereof) of the sales price. The state charges a $.50 tax, each county charges $.25, and various municipalities and other government entities may also impose a transfer tax. Carlene’s city government charges a $.10 tax, so her total transfer tax rate is $0.85 on a sale of $492,500. To calculate the tax owed, divide the sales price of $492,500 by $500, then multiply by the tax rate. $492,500 ÷ $500 = 985 × .85 = $837.25.

Question 20

Which of the following is true of most government or government-sponsored affordable housing loan programs?

Answer 20

They target mainly first-time homebuyers and low- to moderate-income borrowers.

Question 21

Marcus died intestate (without leaving a will). His wife, Elaine, and two children, Patrick and Rhonda, are in the line of succession to inherit his estate. According to Illinois law, how will the property be distributed?

Answer 21

Elaine receives 50% and the children each receive 25%.

Question 22

Carissa died intestate (without leaving a will). She has no spouse and no children. Her father preceded her in death. Her mother and two sisters are alive. Carissa’s estate is worth $500,000. How will the estate be distributed?

Answer 22

Carissa’s mother gets 50% and her siblings split the remaining 50% equally.

Question 23

Citywide Development is planning a new subdivision called Leydan Rock. Each lot will be two acres, and the entire subdivision will include 32 residential lots. Which of these statements about this subdivision and the Illinois Plat Map Act is FALSE?

Answer 23

Citywide must get the subdivision plat commissioned and certified by the clerk and recorder of the county where the subdivision is located.

Question 24

Joe’s a developer in Illinois who recently purchased land from another developer, part of which is a recorded subdivision named Blue Acres. Although Joe plans to subdivide the undeveloped lots within Blue Acres further, no additional streets or access points will be required. The other portion of land is an undeveloped four acres that Joe plans to develop into a subdivision named Green Acres. Under the Illinois Plat Act, which of the following statements is true?

Answer 24

Joe must certify and record only Green Acres through the Illinois Registered Land Surveyors Association.

Question 25

Thelma took advantage of the Illinois Senior Citizens Real Estate Tax Deferral Program for three years before she was forced to move to an assisted living facility. She and her family have decided to sell the property. What happens now?

Answer 25

The deferred amount may be collected when the property is sold.

Question 26

Ivan qualifies for and takes advantage of the Illinois Senior Citizens Assessment Freeze Homestead Exemption. Which of these is true?

Answer 26

Ivan’s tax bill may go up even with the exemption in place if he makes property improvements.

Question 27

The Illinois Human Rights Act prohibits discriminatory practices in housing, employment, credit transactions, public accommodations, and more. What’s another provision under this law?

Answer 27

Anyone who testifies for the person filing the complaint or assists in his discrimination complaint is protected from retaliation.

Question 28

Martin is a property manager who wants to fill a vacant apartment. He needs to avoid discrimination based on which set of protected classes?

Answer 28

A combination of federally, state, and locally protected classes

Question 29

Ronna is out knocking on doors to try to secure listings. She’s careful to avoid any homes with brokerage “For Sale” signs. One homeowner, Sabrina, says she’s been thinking of selling, and when Ronna describes her services, Sabrina agrees to list the property. A few weeks later, Ronna gets a letter saying she’s being sued for tortious interference because Sabrina had signed a listing agreement with another broker. Which of these statements is most likely true?

Answer 29

If Ronna didn’t know that Sabrina had already signed a listing agreement, she’s not guilty of tortious interference.

Question 30

Marvin had been wooing a homeowner in his neighborhood for months, trying to get a listing agreement. When, Carla, the homeowner, finally decides to list the property, she does so with Ramone, another broker. Is this tortious interference?

Answer 30

No, because no listing agreement was in place.