Real Estate Ethics Review Flashcards
For most of us, our ethics relates to individual moral values that have been influenced by our
Parents
Peers
School experiences
All of the above
All of the Above
The first Code Of Ethics was adopted in
1908
1913
1925
1974
1913
Since its inception, the REALTOR® Code of Ethics has required
Respect for other brokers’ exclusive relationships with clients
Cooperation among REALTORS®
Only a
Both a and b
Both a and b
The current Code Of Ethics is comprised of “Duties to:
Clients, Consumers and MLS Participants
Clients, Customers and Consumers
REALTORS®, Appraisers and the Public
Clients & Customers, the Public and other REALTORS®
Clients & Customers, the Public and other REALTORS®
The Code of Ethics has been amended over 40 times since 1913 because
The real estate business changes and evolves
The REALTORS® Political Action Committee (RPAC) has voted to do so
State and Federal laws have mandated the changes
The original charter calls for amendments every two years
The real estate business changes and evolves
REALTORS®
Urge the exclusive representation of clients
Willingly share the fruits of their experience
Strive to eliminate practices which may damage the public
All of the above
All of the above
In any instance where the Code of Ethics and the law conflict, which takes precedence?
The Code of Ethics
The Law
Decided by an administrative law judge
Decided by a majority vote of the local REALTOR® Board of Directors
The Law
When entering into a listing contract REALTORS® must advise sellers/landlords of
Company policies regarding compensation and cooperation
The fact that buyer agents will represent them if there is compensation offered
Possible dual agency if a an agent from another firm brings a buyer client
All of the above
Company policies regarding compensation and cooperation
SOP 3-6 essentially makes all accepted offers
Confidential
A material fact
Unconditional
Contractual
A material fact
REALTOR® websites must disclose the firm’s name and state(s) of licensure in a readily apparent manner.
True
False
True
Posting a rant on FaceBook about how a cooperating agent never showed up at a scheduled appointment to show your listing
Is okay if it’s true
Is fine if the agent hits reply and offers an explanation
May be a violation of Article 15 of the COE
May be a violation of Article 17 of the Code of Ethics
May be a violation of Article 15 of the COE
REALTOR® Alex checks the MLS for new listings and then mails a letter to the owners touting his sales excellence and track record. This action is
Super marketing and speaks to his success
Commonly known as “farming” and is very popular among new agents
Most likely tortious interference with the contract of another broker
A violation of Article 15 of the Code of Ethics
Most likely tortious interference with the contract of another broker
When Sandra Salesperson previews new listings or open houses she follows up with a letter to the owner asking that they consider hiring her if and when the current listing expires. This is
A great marketing idea
Legal since she’s not interfering with the current listing contract
A violation of Article 16 of the COE
A misdemeanor
A violation of Article 16 of the COE
When Sandra Salesperson previews new listings or open houses she follows up with a letter to the owner asking that they consider hiring her if and when the current listing expires. This is
A great marketing idea
Legal since she’s not interfering with the current listing contract
A violation of Article 16 of the COE
A misdemeanor
A violation of Article 16 of the COE
When acting as buyer broker, at first contact with a ‘For Sale By Owner’ it’s a good idea to
Pretend you’re a buyer to get the info you need
Disclose that you’re calling on behalf of your buyer client
Try to get the listing
All of the above
Disclose that you’re calling on behalf of your buyer client
According to SOP 3-2, any change in compensation offered for cooperative services must be communicated to the other REALTOR®
Within 10 days after submission of offers
Prior to the REALTOR® submitting an offer to purchase the property.
At least 10 days prior to closing
In writing by certified mail
Prior to the REALTOR® submitting an offer to purchase the property.
Who is responsible for enforcing the REALTOR® Code of Ethics?
The Grievance Committee at local Boards
The Arbitration Committee
The Board of Grievance at the state association
Boards and Associations of REALTORS®
Boards and Associations of REALTORS®
Who appoints members of the Grievance Committee?
The Executive Officer at the Board or Association of REALTORS®
The REALTOR® membership at large
The President of the Board or Association of REALTORS®
The Professional Standards Committee
The President of the Board or Association of REALTORS®
The Professional Standards Committee is appointed by
The Executive Officer at the Board or Association of REALTORS®
The REALTOR® membership at large
The President of the Board or Association of REALTORS®
The Grievance Committee
The President of the Board or Association of REALTORS®
Salespeople, before deciding to file an ethics complaint, should
Read the NAR Code of Ethics and Arbitration Manual
Consult with their manager or principal broker
Consider if it’s worth the time and effort
Write down the pros and cons of complaining about other REALTORS®
Consult with their manager or principal broker
The party who makes the complaint is called the
Complainant
Respondent
Prevailing party
Protestor
Complainant
The party who “wins” in an ethics or arbitration hearing is called the
Complainant
Winner
Prevailing party
Non-prevailing party
Prevailing party
Arbitration is not about wrongdoing.
True
False
True
Ethics complaints generally are not heard at the local board or association if the parties are from the same firm.
True
False
True
The Ombudsman’s role is to
Provide enhanced communication and problem solving
Adjudicate complaints in a quick, informal fashion
Determine if an ethics violation has even occurred
All of the above
Provide enhanced communication and problem solving
The screening committee who looks at complaints is called the
NAR Screening Committee
Professional Standards Committee
Professional Screening Committee
Grievance Committee
Grievance Committee
The Ethics Hearing Panel is comprised of members of the Professional Standards Committee.
True
False
True
Before deciding on authorized discipline, the Ethics Hearing Panel
Determines if the non-prevailing party has had previous offenses
Takes a 24 hour recess to discuss its options
Builds an additional cases for monetary damages
Queries the membership to find out if other members have had issues with this person.
Determines if the non-prevailing party has had previous offenses
The real purpose of authorized discipline in an Ethics Hearing is to educate the respondent and to vindicate the Code of Ethics.
True
False
True
The NAR requires mandatory mediation before any arbitration hearing may be held.
True
False
False
When two or more brokers each believe the sales commission should go them, this kind of case ensues at the board:
Civil
Ethical
Criminal
Procuring cause
Procuring cause
Agents who believe they were the procuring cause of a closed sale should
File a complaint
Request mediation at the local board
Contact their attorney
Consult with their principal broker
Consult with their principal broker
There is no predetermined rule of entitlement in
The SOP 11-1
An ethics hearing
A procuring cause case
Real estate
A procuring cause case
In the Pathways to Professionalism, Respect for Property includes
In wintry weather, bring a snow shovel to clean off walkways
Allow unaccompanied access to a home that buyer is already in contract to buy
When showing property keep, all members of the group together
All of the above
When showing property keep, all members of the group together
The Pathways to Professionalism is
Voluntary
Not all-inclusive
Not able to be used as an ethics complaint
All of the above
All of the above
In May of 1908 a group of real estate men in the Chicago area formed
The National Association of REALTORS®
The National Real Estate Group
The National Association of Real Estate Exchanges
The National Council of Real Estate
The National Association of Real Estate Exchanges
The National Association of REALTORS® is
America’s largest trade association
Bound by a strict Code of Ethics
Comprised of members who are engaged in various real estate activities
All of the above
All of the above
Since its inception in 1913 the REALTOR® Code of Ethics has required
Membership dues
Adherence as a membership rule
Arbitration of contractual disputes among members
All of the above
Arbitration of contractual disputes among members
To further support and amplify many of the Articles of the Code of Ethics, there are
Standards of Application
Standards of Performance
Standards of Use
Standards of Practice
Standards of Practice
The Golden Rule is an aspirational concept noted in
Article 1
Article 10
The Preamble
The Prologue
The Preamble
Before 1900 there were no real estate license laws in the US.
True
False
True
The term REALTOR® is synonymous with “real estate licensee.”
True
False
False
Article 1 of the Code of Ethics reminds us of the fiduciary duties REALTORS® owe their clients as well as the obligation to
Protect and promote the interests of customers
Treat all parties honestly
Follow the Golden Rule
Treat customers and clients equally
Treat all parties honestly
Per SOP 1-13 buyer agents need to advise buyer client prospects that
The duty of confidentiality does not necessarily extend to sellers
Advertising costs are built into the buyer broker fee
Being a customer instead of a client gives a buyer more freedom
All of the above
The duty of confidentiality does not necessarily extend to sellers
Article 3 of the COE does not include the obligation to share
Commissions
Fees
Compensation
All of the above
All of the above
According to SOP 3-6, REALTORS® must disclose all accepted offers to
Only others from their own MLS
Appraisers who ask for comps as long as the appraiser is a REALTOR®
The local assessor’s office
Any broker seeking cooperation, even from another area
Any broker seeking cooperation, even from another area
Article 12 of the COE states that REALTORS® shall be honest and truthful in their real estate communications and shall present a true picture in their
Advertising
Marketing
Other representations
All of the above
All of the above
Standard of Practice 15-2 includes the duty to not repeat false or misleading statements about other REALTORS®
In letters
Online
In person
All of the above
All of the above
When REALTORS® are contacted by the client of another REALTOR® regarding the creation of an exclusive relationship to provide the same type of service, and REALTORS® have not directly or indirectly initiated such discussions, they may discuss the terms upon which they might enter into a future agreement.
True
False
True
Without a termination agreement that states otherwise, REALTORS® who leave their current firm cannot
Continue to sell real estate in the same territory
Ask other agents to leave the firm to start a new brokerage company
Induce current clients to cancel their exclusive contracts with the firm
Sell real estate for a minimum of 6 months
Induce current clients to cancel their exclusive contracts with the firm
Article 10 of the REALTOR® COE includes how many protected classes?
6
7
8
9
9
When REALTORS® prepare opinions of real property value or price they must be knowledgeable about the type of property being valued.
True
False
True
NAR’s Code of Ethics imposes duties on
Real estate professionals who choose to become REALTORS®
Only real estate salespeople and brokers who join NAR
All real estate licensees
All members of the NDRC
Real estate professionals who choose to become REALTORS®
The Grievance Committee is comprised of members of the
REALTOR® board or association
REALTOR® board and members of the community
Professional Grievance Association
Local board, the local Chamber of Commerce and the local community
REALTOR® board or association
When members are selected to serve on the Professional Standards Committee, final approval and confirmation is made by
The Executive Officer at the Board or Association of REALTORS®
The REALTOR® membership at large
The Board of Directors of the Board or Association of REALTORS®
The Grievance Committee
The Board of Directors of the Board or Association of REALTORS®
What often resolves questions, differences and concerns among REALTORS®?
Open, constructive discussion
Private, legal advice
Threats of filing a complaint
All of the above
Open, constructive discussion
Dispute resolution processes are
Quicker
Less costly
More informal
All of the above
All of the above
In an ethics or arbitration hearing the accused party is called the
Complainant
Perpetrator
Respondent
Non-prevailing party
Respondent
The party who “loses” in an ethics or arbitration hearing is called the
Complainant
Loser
Prevailing party
Non-prevailing party
Non-prevailing party
The types of hearings that can be afforded to REALTORS® are
Ethics and Arbitration
Ethics and Sanctions
Ethics and Depositions
Ethics and Summary Proceedings
Ethics and Arbitration
Who can file an ethics complaint?
Salespeople who are REALTORS®
Brokers who are REALTORS®
The public
All of the above
All of the above
As of January 1, 2016 Ombudsman Services must be offered to members, clients and consumers.
True
False
True
Ombudsman Services
Are at the discretion of the local board or association of REALTORS®
Have been mandatory since January 1, 2016
Are available to only REALTOR® members
Must be purchased from the American Bar Association
Have been mandatory since January 1, 2016
The Grievance Committee does not
Attend Professional Standards training
Rule on the alleged violation
Have to be REALTOR® members
All of the above
Rule on the alleged violation
After an ethics hearing is complete the hearing panel
Goes into a closed session
Prepares a findings of fact
Votes on who is the prevailing party
All of the above
All of the above
Authorized discipline in an Ethics case can include a
Letter of reprimand, suspension from MLS and monetary damages
Letter of warning, probation for up to one year, and a fine of up to $5,000
Letter of warning, probation for up to one year, and a fine of up to $15,000
None of the above
Letter of warning, probation for up to one year, and a fine of up to $15,000
If a non-prevailing party in an Ethics Hearing has had recent, prior offenses
The Hearing Panel refers the discipline to the Board of Directors
The Board of Directors must evaluate the possibility of expulsion from membership
The Hearing Panel will assess stiffer penalties
The President of the Board of Directors helps decide on the discipline
The Hearing Panel will assess stiffer penalties
The real purpose of authorized discipline in an Ethics Hearing is to
Teach a lesson to the non-prevailing party
Restore faith in the Code of Ethics
Separate the ethical members from the non-ethical ones
Educate the respondent and to vindicate the Code of Ethics
Educate the respondent and to vindicate the Code of Ethics
A principal broker may file an arbitration complaint against
REALTOR® principal broker from another firm
REALTOR® principal brokers in more than one firm
A REALTOR® firm itself
All of the above
All of the above
In an Arbitration complaint, if the parties agree to mediate but then cannot reach a resolution
The case is deemed void
The parties must default to splitting the commission equally
The parties may choose to arbitrate
The decision is rendered by a majority vote of the Board of Directors
The parties may choose to arbitrate
The Professional Standards Hearing Panel’s function is to conduct a full “due process” hearing with
Sworn testimony
Documentary evidence
Witnesses
All of the Above
All of the Above
Procuring cause is a very complicated issue, and there are no “precedents” since every single case is different
True
False
True
In Procuring Cause Arbitration Hearings there are no appeals except in regard to due process.
True
False
True
In an arbitration hearing the party who is not successful in being awarded the money is the
Non-prevailing party
Loser
Perpetrator
Unsub
Non-prevailing party
In a procuring cause arbitration hearing
Brokers may wind up splitting the monies in dispute
Agents may attend with their broker’s permission
The prevailing party may appeal
All of the above
Agents may attend with their broker’s permission
Knock and announce yourself loudly before entering any closed room demonstrates Respect for the Public.
True
False
True
Which of these statement applies to Respect to Peers in the Pathways to Professionalism?
Notify the listing broker if there seems to be inaccurate information on a listing
Follow MLS deadlines for inputting new listings
Remove your shoes in homes that have white carpeting
Share your lockbox e-key with agents who don’t have one
Notify the listing broker if there seems to be inaccurate information on a listing
The NAR list of recommended, professional courtesies is called
Pathways for REALTOR® Practices
Pathways for REALTORS®
Pathways to Professionalism
Pathways to Positive Practice
Pathways to Professionalism
The Pathways to Professionalism includes
Respect for Self
Respect for Country
Respect for Property
Respect for Fed Regs
Respect for Property
The REALTOR® Code of Ethics
Protects the buying and selling public
Protects the general public
Promotes a competitive real estate market place
All of the above
All of the above
