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Real Estate > Lesson 9 > Flashcards

Lesson 9 Flashcards

1
Q

What is one primary role of the CEA?

A

To regulate and control the practice of estate agents and salespersons.

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2
Q

How does the CEA promote the integrity and competence of estate agents?

A

By enforcing the Code of Practice and the Code of Ethics and Professional Client Care.

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3
Q

What measures does the CEA develop for consumers?

A

Measures to equip consumers with the necessary knowledge to conduct their real estate transactions prudently and with due diligence.

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4
Q

What does the CEA do regarding misconduct in estate agency work?

A

They conduct investigations and disciplinary proceedings related to offenses and unsatisfactory conduct.

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5
Q

What is the role of the CEA in relation to exams and professional development?

A

The CEA administers the examination and continuing professional development framework for estate agents and salespersons.

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6
Q

What does an Estate Agent represent in Singapore?

A

An Estate Agent refers to a company license that is involved in real estate transactions.

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7
Q

Who is a Key Executive Officer in the context of an estate agency?

A

The Key Executive Officer is a registered individual responsible for overseeing the estate agent’s operations.

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8
Q

How is a Salesperson classified in the real estate context?

A

Salespersons are considered individuals licensed to conduct estate agency work.

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9
Q

What is one requirement for businesses involved in estate agency work?

A

The business must be registered with the Accounting and Corporate Regulatory Authority (ACRA)

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10
Q

What naming restriction applies to estate agency businesses?

A

Businesses must not register a name that is similar to existing estate agents.

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11
Q

What type of insurance must estate agencies have?

A

They must be covered under a valid Professional Indemnity Insurance.

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12
Q

Are estate agencies allowed to operate as licensed moneylenders?

A

No, they must not operate as a Licensed Moneylender Business.

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13
Q

What is the minimum age requirement for salespersons in Singapore?

A

Salespersons must be at least 21 years old.

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14
Q

What citizenship status is required for salespersons?

A

They must be Singapore Citizens or Permanent Residents (for at least 10 years).

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15
Q

What are the educational qualifications required for salespersons?

A
  1. Minimum of 4 GCE ‘O’ Level passes or
  2. Workplace Literacy & Numeracy (WPLN) Level 5 or equivalent.
  3. Must have passed the RES examination (within 2 years) or possess equivalent qualifications.
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16
Q

What other criteria must salespersons fulfill?

A

They must fulfill the fit and proper criteria and must not be:
i. A licensed moneylender
ii. An employee, director, or partner of a licensed moneylender

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17
Q

What is the minimum age requirement for a Key Executive Officer (KEO)?

A

A KEO must also be at least 21 years old.

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18
Q

What educational qualifications are required for KEOs?

A

Minimum of 4 GCE ‘O’ Level passes or
WPLN Level 5 or equivalent.
Must have passed the REA examination or possess equivalent qualifications.

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19
Q

What experience is required for KEOs?

A

KEOs must have 3 years of working experience as:
i. A salesperson (with at least 30 property transactions in the last 3 years) or
ii. An executive director, CEO, KEO, partner, or sole proprietor of an estate agent for 3 years.

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20
Q

What responsibilities does a KEO have according to Section 38 of the Estate Agent Act?

A

The KEO is responsible for:
a) Proper administration and overall management of the estate agent business.
b) Supervision of salespersons.

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21
Q

What does proper administration include for an estate agent?

A
  1. Training & supervision of salespersons
  2. Complaints-handling & dispute resolution
  3. Advertising & printing of publicity materials
  4. Protection of confidentiality of clients’ information
  5. Service standards for its operations
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22
Q

What must an estate agent do if there is a vacancy of KEO due to death, resignation, or revocation?

A

They must notify the CEA within one week and appoint another KEO within one month.

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23
Q

Who must fulfill the “Fit & Proper” criteria?

A
  1. Estate Agent
  2. Key Executive Officer
  3. Directors or partners of the company
  4. Persons responsible for the management of the company
  5. Salespersons
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24
Q

What are examples of individuals who are not considered “Fit & Proper”?

A
  1. Have been convicted of breaking laws related to estate agents.
  2. Have been involved in dishonesty or fraud.
  3. Have been found guilty of fraud or dishonesty in court.
  4. Are bankrupt or have made an agreement with creditors to pay off debts.
  5. Have been involved in the closure or winding-up of a company, or have had a receiver take control of their assets.
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25
Q

What does “Estate Agency Work” encompass?

A

It means any work done for a client in expectation of a fee, including:
a) Introduction of a third person wishing to acquire or dispose of a property
b) Negotiation for the acquisition or disposition of a property by the client

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26
Q

What are examples of Estate Agency Work?

A
  1. Introducing a third person to the client who wishes to acquire or dispose of a property
  2. Negotiating for the acquisition or disposition of a property
  3. Putting up advertisements for selling or renting out property
  4. Conducting property viewing sessions for buyers or tenants
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27
Q

What are exemptions to Estate Agency Work?

A
  1. Property owners or buyers selling or buying property themselves.
  2. Executors, administrators, trustees, liquidators, or receivers managing someone’s property or estate.
  3. Appraisers who value properties but don’t sell them.
  4. People involved with property mortgages or loans, like lenders or banks.
  5. Solicitors (lawyers) who introduce clients to people buying or selling property, but don’t do the actual estate agency work.
  6. Employees doing property work for their employer under specific instructions.
  7. Government or government bodies involved in property matters.
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28
Q

Who is required to participate in Continuing Professional Development (CPD)?

A
  1. Key Executive Officers (KEO)
  2. Practicing directors or partners
  3. Salespersons
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29
Q

How many minimum CPD credits are required per cycle?

A

A minimum of 6 CPD credits per cycle.

4 Professional Credits + 2 Generic Credits = Quality for Annual Renewal

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30
Q

What is the KEO’s responsibility regarding CPD?

A

The KEO is responsible for monitoring the CPD requirements of salespersons.

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31
Q

Are new salespersons required to fulfill CPD requirements?

A

No, new salespersons are exempt from CPD requirements for their first CPD cycle.

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32
Q

What happens if a salesperson leaves a real estate agency?

A

If they leave for less than 2 years, they must fulfill their CPD credits. If they leave for more than 2 years, they must retake the RES or REA exams.

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33
Q

How many CPD credits are awarded for formal classroom learning?

A

1 CPD credit is awarded for each contact hour of formal classroom learning.

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34
Q

Is there a cap on CPD credits for daily activities?

A

Yes, there is a cap of 2 credits per day for each activity.

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35
Q

What is the registration fee for a salesperson if granted for a full calendar year or part of a year starting on or before June 30?

A

$230

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36
Q

What is the registration fee for a salesperson if granted for part of a calendar year starting after June 30?

A

$115

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37
Q

What is the application fee to register or renew a salesperson’s license?

A

$53.50

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38
Q

What is the application fee for a new estate agent license or for renewing an estate agent license?

A

$107 per estate agent license.

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39
Q

Who collects and transfers the registration or renewal fees for salespersons to the CEA?

A

The Key Executive Officer (KEO) collects all registration or renewal fees on behalf of salespersons.

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40
Q

What is the penalty under S28(2) of the EAA for operating as an estate agent without a license?

A

Penalties include a fine up to $75,000, a jail term not exceeding 3 years, or both. Continuing offenses after conviction may incur a further fine not exceeding $7,500 per day.

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41
Q

What is the penalty under S29(3) of the EAA for a salesperson operating without registration?

A

Penalties include a fine up to $25,000, a jail term not exceeding 12 months, or both.

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42
Q

What happens under S39(2) of the EAA if an estate agent employs or appoints a non-registered salesperson?

A

Penalties include a fine up to $25,000, a jail term not exceeding 12 months, or both. Continuing offenses after conviction may incur a further fine not exceeding $2,500 per day.

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43
Q

What is the consequence of a salesperson operating without a written agreement with the estate agent as per S41(3) of the EAA?

A

Penalties include a fine up to $25,000, a jail term not exceeding 12 months, or both. Continuing offenses may incur a further fine not exceeding $2,500 per day.

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44
Q

What penalty is enforced under S40(3) of the EAA for making false representations regarding employment or authority as a salesperson?

A

The penalty is a fine not exceeding $5,000.

45
Q

What are the penalties for submitting false documents or making misleading statements in any application under S33(6) of the EAA?

A

Penalties include a fine up to $50,000, a jail term not exceeding 3 years, or both.

46
Q

What penalties exist for submitting false documents in registration applications per S34(7) of the EAA?

A

Penalties include a fine up to $50,000, a jail term not exceeding 3 years, or both.

47
Q

What is the rule regarding a salesperson acting for estate agents according to EAA S40?

A

A salesperson shall not act for more than one estate agent at any one time and making false representations regarding such relations is an offense leading to fines up to $5,000.

48
Q

What does no dual representation mean?

A

No salesperson or estate agent shall represent both the vendor and purchaser, or both landlord and tenant for the same property.

49
Q

What are the implications of dual representation according to Regulation 5?

A

It is an offense punishable by a fine up to $25,000, a jail term of up to 12 months, or both.

50
Q

Can two salespersons from the same estate agent represent different parties in the same transaction?

A

Yes, but they must inform their respective clients in writing that they are from the same estate agent and obtain consent before proceeding.

51
Q

If a salesperson introduces a buyer to a developer, under what conditions can they collect a fee from the developer?

A

If they are not representing the buyer or if they represent the buyer but have a commercial agreement with the developer, without collecting any fees from the buyer.

52
Q

Can a salesperson act for both a tenant and an absentee landlord in renewing a lease?

A

No, that would be dual representation; the salesperson can only represent one party in the lease renewal.

53
Q

If a buyer and seller appoint the same salesperson for a transaction, is that considered dual representation?

A

Yes, the same salesperson cannot act for both parties; however, they can assist the other party with paperwork, provided they do not act for them and have consent from their primary client.

54
Q

What happens if a salesperson collects a management fee from a landlord while representing a tenant?

A

Dual representation is prohibited. If the management agreement does not include estate agency work, the salesperson can represent both but must disclose the conflict of interest to the tenant and get consent.

55
Q

Can a salesperson handle paperwork for a direct buyer making an offer on the seller’s property?

A

Yes, as long as the salesperson has the seller’s consent and does not collect any commission or fees from the buyer.

56
Q

If a transaction party gives the salesperson an “ang bao” as a goodwill gesture, what might this imply?

A

Accepting additional payments could violate the dual representation prohibition, so the circumstances must be carefully evaluated.

57
Q

What does the Code of Ethics and Professional Client Care state regarding soliciting additional payments?

A

It prohibits salespersons from soliciting any rewards, commissions, or fees from anyone who did not engage their services.

58
Q

What is prohibited regarding referrals to moneylenders by estate agents or salespersons?

A

They shall not introduce, refer, or recommend a client to any moneylender or suggest the use of their services.

59
Q

Can estate agents or salespersons receive benefits from moneylenders?

A

No, they cannot receive any commission, reward, fee, or payment from any moneylender in relation to moneylending transactions.

60
Q

What are the penalties for violating the no referrals to moneylenders regulation?

A

Offenders may face a fine of up to $25,000, a jail term of up to 12 months, or both.

61
Q

According to the Professional Service Manual, can estate agents or salespersons lend money to clients?

A

They cannot lend or advance money to their clients, except for rental stamp duties to be reimbursed later.

62
Q

What are estate agents and salespersons prohibited from holding in property transactions?

A

They shall not hold or handle any money for or on behalf of any party in property transactions related to the sale, purchase, or lease of property in Singapore.

63
Q

What are the penalties for holding transaction monies?

A

Violators may face a fine of up to $10,000, a jail term of up to 6 months, or both, with a further fine not exceeding $500 per day for continuing offenses.

64
Q

What exceptions allow estate agents to handle money?

A

They may deliver a crossed account payee cheque or cashier’s order drawn in favor of another party or receive remuneration for management or repairs under a written contract.

65
Q

Can estate agents or salespersons use their own money to pay for option fees or deposits for HDB leases?

A

No, they are not allowed to use their own money for these payments.

66
Q

Can a property agent collect rent in cash while the landlord is overseas?

A

Yes, but only if they have written authorization or a management contract with the landlord, and this applies only to private property rentals—not HDB rentals.

67
Q

Can property agents pay for bills and repairs in cash and then deduct those amounts from the rent?

A

Yes, but only if they have written authorization or a management contract with the landlord, and this applies only to private property rentals—not HDB rentals.

68
Q

What are estate agents and salespersons prohibited from using regarding council symbols?

A

They cannot use any name, symbol, mark, or representation that is identical to or resembles that of the Council.

69
Q

What is prohibited in terms of internet domain names and email addresses for estate agents?

A

They must not use internet domain names, web addresses, or email addresses that incorporate characters or symbols of the Council, which may cause confusion.

70
Q

What are the penalties for violating the rules regarding council symbols and representations?

A

Offenders may face a fine of up to $10,000, a jail term of up to 6 months, or both, with additional fines for continuing offenses.

71
Q

What must salespersons and estate agents display when conducting estate agency work?

A

They must display their estate agent card.

72
Q

What are the penalties for not displaying the estate agent card?

A

Failing to display the card can result in a fine of up to $10,000 or a jail term of up to 6 months.

73
Q

What should salespersons do if someone requests to see their estate agent card?

A

They must show their card and allow the person to record any relevant information from it.

74
Q

What is the purpose of the Public Register of Estate Agents and Salespersons?

A

It allows the public to verify whether a real estate agent is licensed, if a person is registered as a salesperson, any disciplinary actions taken, awards conferred, and if a salesperson has completed relevant transactions.

75
Q

What are the consequences of failing to comply with the Codes or applicable laws?

A

It may constitute unsatisfactory professional conduct and lead to disciplinary actions, including sanctions and financial penalties.

76
Q

What sanctions can be imposed for breaches of the codes?

A

Possible sanctions include financial penalties (up to $100,000), demerit points, and suspension or revocation of the license or registration.

77
Q

What must agents give clients before asking them to sign any document?

A

Sufficient time to read the document.

78
Q

What must agents do before their clients sign a document?

A

Explain the meaning and consequences of the provisions of the document.

79
Q

What should agents inform clients about if there is any doubt regarding a document?

A

Agents must inform the client and advise them to seek appropriate professional advice

80
Q

What is the obligation regarding copies of signed documents?

A

Agents must give a copy of the document to every client immediately or as soon as possible after signing.

81
Q

What must agreements concerning financial obligations ensure?

A

They must be in writing and record the exact agreement between the parties concerned.

82
Q

What is required concerning signatures from parties involved in a transaction?

A

Agents must procure all signatures of joint vendors, landlords, buyers, or tenants.

83
Q

What must agents avoid when asking someone to sign an agreement?

A

They must not ask anyone to sign if essential information (property address, price, dates, names, or commission) is omitted or left blank.

84
Q

What should an estate agent or salesperson ensure regarding language and communication?

A

Any information or explanation should be conveyed to the client in a language or dialect that the client understands.

85
Q

What must estate agents and salespersons do regarding client information?

A

They shall not disclose or use any confidential information relating to the client.

86
Q

When is disclosure of confidential information permitted?

A

Disclosure is allowed only with the client’s consent or if permitted by law.

87
Q

To whom can confidential information be disclosed?

A

Disclosure may only be made to the appropriate person and only to the extent necessary for the permitted purpose.

88
Q

What critical information must salespersons disclose to other parties?

A

They must disclose information about:
i. Loan shark harassment
ii. Bankruptcy issues
iii. Recent unnatural deaths in the property
iv. Divorce proceedings
v. Material defects affecting property value
vi. Unauthorized additions or alterations
vii. Lodged caveats
viii. Minimum occupation period for HDB resale flats

89
Q

What is required of estate agents regarding estate agent cards?

A

Estate agents must issue identification cards to all their salespersons, maintaining proper records of all cards issued.

90
Q

What system must estate agents have for handling claims and complaints?

A

A documented system for receipt and investigation of claims and complaints against estate agents or salespersons.

91
Q

What is the timeframe for investigating claims and complaints?

A

All claims and complaints must be investigated and a report submitted within 2 weeks, or longer if allowed by the Council.

92
Q

How long must estate agents retain documents and records?

A

Estate agents must retain originals or copies (including electronic forms) for at least 5 years.

93
Q

What types of documents must estate agents retain?

A

They must retain documents related to:
a) Applications for license and registration of salespersons
b) Estate agency agreements
c) Property transaction documents (e.g., sale agreements, lease documents)
d) Documents evidencing payment of transaction monies
e) Powers of attorney and letters of authorization
f) Declarations of conflicts of interest
g) All documents related to claims or complaints.

94
Q

What is the Letter of Censure (LOC) disciplinary regime?

A

It is a key amendment under the Estate Agents (Amendment) Act 2020, operational from 30 July 2021, allowing CEA to impose financial penalties for minor breaches by real estate salespersons and estate agents.

95
Q

What is the maximum financial penalty that CEA can impose under the LOC regime?

A

CEA can impose penalties of up to $5,000 per case.

96
Q

What is the Dispute Resolution Scheme in relation to estate agents?

A

It addresses disputes between clients and licensed estate agents arising from the estate agency agreement.

97
Q

If action is initiated by the estate agent, what options does the client have regarding mediation or arbitration?

A

The client can choose not to proceed with mediation or can opt directly for arbitration without mediation.

98
Q

What is the requirement for estate agents and salespersons during dispute resolution proceedings?

A

They must attend every hearing of the dispute resolution proceeding.

99
Q

Can an estate agent or salesperson face further discipline even if a dispute resolution is ongoing?

A

Yes, they remain liable for further investigation or disciplinary action regardless of the state of any dispute resolution proceeding.

100
Q

How long does the client have to choose a mediation centre?

A

The client has 4 weeks to decide on a mediation centre.

101
Q

What happens if the dispute is unresolved after 6 weeks of mediation?

A

The parties can proceed to arbitration for final settlement

102
Q

What if the estate agent initiates arbitration?

A

The client must respond within 3 weeks; if there is no response, no arbitration occurs.

103
Q

What is the requirement for the selection of the arbitration centre?

A

The selection and approval of the arbitration centre by the client are irrevocable.

104
Q

How are costs for mediation covered under the Dispute Resolution Scheme?

A

The estate agent and the consumer each pay 50% of the mediation costs.

105
Q

How are costs allocated for arbitration under the Dispute Resolution Scheme?

A

The estate agent pays a minimum of 50% of the costs, while the consumer pays a maximum of 50%.

106
Q

Who determines the actual apportionment of costs in arbitration?

A

The actual apportionment is determined by the arbitrator.

107
Q

Under what condition can an arbitrator order a consumer to pay up to 100% of the arbitration costs?

A

If the claim is deemed frivolous, vexatious, or an abuse of process.

108
Q

Who is responsible for paying for legal representation in dispute resolution processes?

A

Fees for legal representation are payable by the respective parties involved.

Real Estate (19 decks)

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