Recovery Fund

Question 1

WHEN BRINGING ACTION IN COURT TO COLLECT A COMMISSION, A BROKER OR SALESPERSON MUST PROVE:

A. THERE WAS A LISTING

B. THEY WERE LICENSED WHEN THE CAUSE OF ACTION AROSE

C. THE PROPERTY WAS SOLD

D. THE PROPERTY WAS LEASED

Answer 1

B.

Question 2

A LICENSED SALESPERSON CAN RECEIVE AN EXTRA BONUS FOR COMPLETING A DIFFICULT SALE FROM THE:

A. ECSTATIC SELLER

B. EMPLOYING BROKER

C. APPRECIATIVE BUYER

D. LENDER

Answer 2

B. EMPLOYING BROKER

Question 3

WHEN A SALESPERSON AND EMPLOYING BROKER HAVE A DISPUTE OVER A COMMISSION, THEIR RECOURSE TO TO THE:

A. RE COMMISSIONER

B. SELLER OF THE PROP

C. CIVIL CRTS

D. RE ADVISORY BOARD

Answer 3

C. CIVIL COURTS

Question 4

AN UNLICENSED ASSTNT MAY BE PAID:

A. A FEE FOR GENERATING LEADS

B. A SALARY WHICH IS NOT BASED ON TRANSACTIONS CLOSED

C. COMMISSIONS BASED ON COMM PROP SALES

D. A QUARTERLY BONUS FOR THE AMOUNT OF TRANSACTIONS CLOSED

Answer 4

B.

Question 5

THE COMMISSIONER MAY ISSUE A CEASE AND DESIST ORDER AGAINST A LICENSEE FOR ALL OF THE FOLLOWING REASONS THAT CONSTITUTE A VIOLATION OF STATUTE OR RULE EXCEPT

A TRANSACTIONS

B ACTS

C CONTRACTS

D PRACTICES

Answer 5

C. CONTRACTS

Question 6

FOR AN OUT OF STATE BROKER TO PERFORM RE SERVICES IN AZ, ALL ARE REQUIRED EXCEPT

A. A WRITTEN AGREEMENT W/ AN AZ BROKER

B. THE AZ BROKER’S AGRMT TO BE LIABLE FOR THE OUT OF ST BROKER’S ACTIVITIES

C. THE OUT OF STATE BROKER’S LICENSE MUST BE ACTIVE IN THEIR STATE

Answer 6

C. OUT OF STATE BROKER’S LICENSE MUST BE ACTIVE IN THEIR STATE

Question 7

AN ESCROW CO. MAY DISBURSE COMMISSIONS DIRECTLY TO A BROKER’S SALEPERSON IF THE

A. SALESPERSON’S LICENSE IS INACTIVE

B. BROKER GIVES WRITTEN AUTH TO THE ESCROW CO. ANNUALLY

C. ESCROW AGENT IS ALSO A LICENSED BRKR

D. ESCROW AGENT RECEIVEW WRITTEN AUTH FROM THE BROKER IN EACH TRANSACTION

Answer 7

D.

Question 8

REGARDING UNLICENSED ASSISTANTS, ALL ARE TRUE EXCEPT

A. THEY MAY BE EMPLOYED BY A SALEPERSON

B. THEY MAY NT BE PAID BASED ON CLOSED TRANSACTIONS

C. THEY MAY ONLY BE EMPLYED BY A BROKER

D. THEIR ACTIVITIES ARE REGULATED BY A SUBSTANTIVE POLICY STATMNT

Answer 8

C. MAY ONLY BE EMPLOYED BY A BROKER

Question 9

ALL OF THE FOLLOWING INDIVIDUALS CAN COLLECT FROM THE rECOVERY FUND EXCEPT

A. BUYER

B. OUT OF STATE RESIDENT

C. LESSEE

D. LICENSEE

Answer 9

D. LICENSEE

Licensee as principa or agent in a RE transaction cannot make a claim against or recover from the Recovery Fund.

• REMEMBER the purpose of the Recovery Fund is to protect harmed customers who:

relied on statements of licensee and where licensee committed fraud or misrepresentation when licensee acted as principal

Question 10

A licensee submits a renewal app to the ADRE. Two weeks later, the licensee is notified that the licensee is missing on continuing ed requirement. The broker would be responsible to compensate the licensee for all of the following transactions except transactions that:

A. closed prior to the licensee’s renewal date

b. closed or were in escrow prior to the licensee’s renewal date

c. were negotiated after the licensee’s renewal date

d. were negotiated on the licensee’s renewal date

Answer 10

C. were negotiated after the licensee’s renewal date

Question 11

Which of the following is not an employment agreement:

a. purchase and sale agreement

b. property management agreement

c. buyer broker agreement

d. listing agreement

Answer 11

A. Purchase and sale agreement

Question 12

Which is not grounds for suspending or revoking a broker’s license?

a. signing a client’s name electronically if the client auth it verbally

b. failing to supervise salespersons in the broker’s employ

c. paying an unlicensed person for clerical services

d. pay a referral fee to a saleperson employed by another broker

Answer 12

C. paying an unlicensed person for clerical svcs

Question 13

If a broker is found to be in violation of a statute or rule, the Commissioner may fine the broker a max of:

a. $500

b. $1000

c. $1000 per violation

d. $5000

Answer 13

C. $1000 PER violation

Question 14

Which of the following would create an agency relationship?

a. commission agreement

b. listing agreement

c. purchase contract

d. rental agreement

Answer 14

B. Listing agreement

Question 15

How much would a licensed RE salesperson have to pay into the RE Recovery Fund at the next renewal when the reserve falls below $600,000?

a. $5

b. $10

c. $15

d. $20

Answer 15

B. $10

REMEMBER:$10 for Salesperson $20 for Broker…License renewal, if Fund drops below $600,000 when reviewed on June 30 each year

Question 16

If an offer is rejected but eventually results in a binding contract, the records must be kept for:

a. one year from the date of rejection

b. five years from closing or termination of the contract

c. one year from the contract date

d. five years from the date of rejection

Answer 16

B. five yrs from closing or termination of the contract

Question 17

MEMORIZE Recovery Fund $$$ Limits (liability)

The licensee’s (broker or salesperson) license is automatically terminated upon payment from the Recovery Fund.

AND

The license may be reinstated after the licensee pays back all the money paid by the Recovery Fund PLUS interest

• $30,000 Maximum PER cause of action-no matter how many people are involved
• $90,000 Maximum PER licensee

Question 18

RECOVERY FUND FEES

REMEMBER ME!!!

When originating a license:

Brokers pay $20 & Salespersons pay $10

When renewing a license, if the fund has dipped below $600,000 on June 30:

Brokers pay $20 & Salespersons pay $10

Answer 18

Originating license: Brokers pay $? and Salespersons pay $?

Renewing a license if fund is below $600,000 on June 30:

Brokers pay ? Salespersons pay?