Statutory Duties of the Agency Relationship Flashcards
1
Q
Licensees are held to which law in their relationships with the public?
A
Law of agency
2
Q
Licensees are NOT held to ___ law in their relationships with the public
A
Common law
3
Q
Licensees are considered to be representing the consumer they are working with as a(n) ___ for the consumer unless their is a written agreement between the sponsoring broker and consumer providing otherwise.
A
Designated agent
4
Q
What are the 7 statutory duties a licensee has toward their client?
A
1) Performing terms of brokerage agreement between sponsoring broker and client
2) Promoting client’s best interests
3) Obedience (within scope of law)
4) Timely accounting for all money and property received
5) Exercising skill and care
6) Honoring confidentiality
7) Complying with the Act
5
Q
If a licensee is showing properties to various prospects, they must provide ___ to all clients they are representing for this property
A
written disclosure
6
Q
If an agent only shows homes where a higher price would result in a higher commission, is this a conflict?
A
No
7
Q
When is a licensee responsible or liable for any false information passed on to the client from a customer?
A
Only when the licensee knew or should have known the information was false
8
Q
According to the act, licensees must treat all customers ___ and shall not negligently or knowingly give them ___.
A
Treat all customers honestly
Not give them false information
9
Q
Compensation does not determine ___.
A
Agency
10
Q
___ and ___ is required of both the seller and buyer (or landlord and tenant) for dual agency.
A
Written consent and confirmation
11
Q
A licensee may not serve as a dual agent in any transaction in which they have ___.
A
ownership interest
12
Q
Offers of ___ through a MLS are not permitted in Illinois.
A
Subagency
13
Q
A consumer cannot be held ___ for the acts or omissions of a licensee in providing licensed activities for or on behalf of the consumer
A
liable
14
Q
___ may amplify anything in Article 15 by promulgating additional rules at any time.
A
IDFPR
15
Q
___ in the act addresses the licensee’s relationships with the public.
A
Article 15
16
Q
___ in the act specifies that licensees are held to the law of agency in their relationships with the public.
A
Article 15
17
Q
What is the only section of the act that has private right of action?
A
Article 15
18
Q
Article 15 is the only section of the act that has ___.
A
Private right of action
19
Q
Legal actions under article 15 may be forever barred unless commenced within ___ after the person bringing the action knew or should reasonably have known of such act or omission.
A
2
20
Q
In no case, may legal actions be brought after more than ___ years
A
5
21
Q
Matters of structure, surroundings, client representation, dual agency, previous agency, or agent interest in a property may all demand ___.
A
Disclosure
22
Q
If a licensee has knowledge of material facts, they must ___ this.
A
Disclose
23
Q
If a licensee has knowledge of material facts, it must be disclosed UNLESS…
A
it is confidential information
24
Q
A(n) ___ agent must disclose to prospective buyers all latent material adverse facts pertaining to the physical condition of the property that are actually known by the licensee and could not be discovered by a reasonably diligent inspection of the property by the customer.
A
listing
25
A listing agent must ___ to prospective buyers all latent material adverse facts pertaining to the physical condition of the property that are actually known by the licensee and could not be discovered by a reasonably diligent inspection of the property by the customer.
disclose
26
A listing agent must disclose to prospective buyers all latent material adverse facts pertaining to the ____ of the property that are actually known by the licensee and could not be discovered by ___.
physical condition
inspection
27
A licensee will not be liable to a customer for providing false information if the false information was... (2 things)
1) provided to the licensee by the licensee's client
2) licensee did not have actual knowledge that the information was false
28
No cause of action will arise against a licensee if they don't disclose which 4 things?
1) Occupant of property had HIV or any other medical condition
2) The property was the site of an act or occurrence that had no effect on its physical condition
3) Facts on property that is not the subject of the transaction
4) Physical conditions on the property that is NOT the subject of the transaction that do not have any adverse effect on the value of the property that IS subject of the transaction
29
Under federal law, it is illegal to disclose if a property's occupant has had either of which 2 medical conditions?
HIV or AIDS
30
Before a brokerage agreement may be created, a consumer must be informed in writing no later than when beginning to work as a designated agent that a(n) ___ exists and the ___ of the designated agent(s).
Designated agency
name(s)
31
The licensee must discuss with the consumer the sponsoring broker's ___ policy.
Compensation
32
Licensees must disclose in writing that they are not acting as the agent of the customer at a time intended to prevent ___.
disclosure of confidential information
33
The act holds that clients must be made aware of which 3 things?
1) compensation
2) source of compensation
3) sponsoring broker's policy on sharing commission with cooperating brokers
34
The ___ dictates when and with whom earnest money is to be deposited.
Purchase contract
35
Licensees should immediately provide any earnest money checks to their ___ for proper deposit.
Sponsoring broker
36
The act states that the sponsoring broker's escrow account is to be ___, unless otherwise required by law, or unless specifically required in writing.
non interest bearing
37
When may an escrow account be interest bearing?
When required by law
or
When principals to the transaction require it in writing
38
Special accounts must be separate from ___ and ___ accounts.
personal and other business
39
___ must be made, and a(n) ___ must be kept by the sponsoring broker for any escrow monies received.
Receipts
Duplicates
40
When must earnest money and security deposits be deposited into the escrow account?
Within 1 business day of contract or lease acceptance, unless the contract specifies a different timeframe
41
The escrow must be in a(n) ___ depository.
Federally insured
42
What is the limit on how many escrow accounts one sponsoring broker may maintain?
No limit
43
___ of personal and business funds with escrow funds is prohibitted.
Commingling
44
If there are any disputes between parties regarding escrow money, the sponsoring broker shall...
continue to hold the deposit
45
If there are any disputes between parties regarding escrow money, the sponsoring broker must wait for all parties to sign a ___ on the escrow disposition.
definite agreement
46
If there are any disputes between parties regarding escrow money, the sponsoring broker should not ___ until a definite agreement is signed or a(n) ___ is reached
disburse funds
court decision
47
Sponsoring brokers who accept earnest money must maintain in their office or place of business a(n) ___ system.
book keeping
48
The ___ must always be able to account for client or escrow funds and any pertinent documents.
sponsoring broker
49
If IDFPR requests to view or audit escrow records, the records must be supplied within ___ of the request.
24 hours
50
How long must escrow records be maintained for?
5 years
51
Escrow records for the ___ years must be maintained in the office location.
prior 2
52
The sponsoring broker must report loss or destruction of escrow records to the department within ___ hours by mail or email.
48
53
The sponsoring broker must report loss or destruction of escrow records to ___ within 48 hours by mail or email.
the department
54
The sponsoring broker must report loss or destruction of escrow records to the department within 48 hours by ___ or ___.
mail or email
55
Teams are identified by a name that is different from their ___.
sponsoring broker's name
56
Teams consist of 2 or more licensees who are both supervised by the same ___ and ___.
designated managing broker and sponsoring broker
57
___ names may not include misleading terms such as "company," "realty," "real estate", "agency", "associates," "brokers", "properties," or "property" unless folled by the word ___.
Team
Team
58
when may a team name contain the term's "company," "realty," "real estate", "agency", "associates," "brokers", "properties," or "property"?
If followed by the word "team"
59
Teams represent themselves to the public as being part of a(n) ___ or ___.
Team or group
60
The sponsoring broker's business name must be at least ___ or ___ than the team name or that of the individual licensee in advertisements
equal in size or larger
61
All ads must include which 4 things?
1) licensee's name
2) sponsoring broker's business name
3) City and state of the office
4) City or area of the advertised property
62
Blind ads are ___ by law.
Prohibbited
63
___ ads may never be used to sell or lease real estate
Blind
64
___ ads may never be used in the hiring of licensees
Blind
65
When are blind ads permitted by law to be used in real estate activites?
NEVER
66
Licensees performing duties of a designated managing broker must advertise...
as a designated managing broker
67
Sponsoring brokers must include their ___ and ___ in all advertisements
Business name
Franchise affiliation
68
If a licensee has intent to share or sell consumer information that has been collected via the internet or any other means of electronic communication, they must...
disclose this in a timely manner
69
It is strictly prohibited to advertise a property that is subject to a(n) ___ agreement with a sponsoring broker other than the licensee's own without permission and identifying the listing broker.
Exclusive listing agreement
70
Failing to remove advertising of a listed property within a reasonable time is ___.
prohibitted
71
When must advertising of a listed property be removed after closing?
Within reasonable time
72
Online ads must include which 4 things to be considered properly identified?
1) Licensee name
2) company name
3) company location
4) location of property
73
An electronic advertisement must provide a direct link to display all ___.
required disclosures
74
Which 3 identifiers are required in advertisements in all e-correspondence, bulletin boards, and e-commerce discussion groups?
1) licensee's name
2) company name
3) company location
75
Online ads may not ___ of another sponsoring broker or MLS without permission
frame the website
76
Online ads may only frame the website of another sponsoring broker or MLS with ___.
permission
77
Online ads may not frame the website of another sponsoring broker or MLS with the intent or effect of ___.
deceiving the consumer
78
Online ads may not employ ___ or ___ URLS or domain names
deceptive or misleading
79
Links to listing information from other websites are permitted without ___ unless the website's owner requires otherwise.
approval
80
Websites must be ___ and kept ___
updated periodically
kept current
81
All electronic advertising requires posting the ___ and ___ of a physical office.
city and state
82
All electronic advertising requires posting the ___ to the virtual office's ___.
direct link
website
83
If a licensee is selling or leasing their own property, they must use either the term "___" or "___" in all advertising on listing sheets
Broker owned
or
Agent owned
84
If a licensee is selling or leasing their own property, they must use either the term "broker owned" or "agent owned" unless...
The real estate firm's sign is used in the yard and the firm's services are being used
85
If a licensee is selling or leasing their own property, and the real estate firm places sign on the front lawn, where are the term's "broker owned" or "agent owned" required to be used?
All written advertising, and all online ads
86
If a licensee is selling or leasing their own property, and the real estate firm places sign on the front lawn, where are the term's "broker owned" or "agent owned" NOT required to be used?
on the yard sign
87
When is it permitted by IDFPR for a licensee to list their own personal real estate with a firm other than the one they work for?
If the licensee's sponsoring broker approves
88
If a licensee advertises to personally purchase or lease real estate, they must do what before initiating a transaction?
disclose license status
89
Licensees may not list their name or otherwise advertise their name to the general public through any medium of advertising as being in real estate without also listing...
their sponsoring broker's business name
90
Licensees may only receive compensation from...
their sponsoring broker
91
Sponsoring brokers may only compensate...
licensees they sponsor
92
What is the only exception to a sponsoring broker compensating a broker who is sponsored by someone else?
If the licensee was formerly employed by them, and the commission was earned while working for them
93
Sponsoring brokers may directly compensate ___ in a cooperative commission agreement.
other sponsoring brokers
94
Sponsoring brokers may directly compensate other sponsoring brokers in (a)n ___.
a cooperative commission agreement
95
All forms of compensation must be ___.
disclosed
96
Ownership interest must be disclosed if the licensee refers a client to a service in which the licensee holds ___% ownership interest
greater than 1%
97
It is illegal to compensate ___ or ___.
unlicensed persons
anyone being held in violation of the act
98
Who can sue for commission in Illinois?
Licensed sponsoring brokers
99
Funds from sellers or buyers always pass through the ___.
sponsoring broker
100
Who compensates managing brokers?
Sponsoring brokers
101
The check at closing is written to...
The sponsoring broker
102
Is it legal for a licensee to offer cash, gifts, prizes, awards, coupons, merchandise, rebates, or chances to win a game to consumers as a legitimate approach to gather business?
Yes
103
It is ___ for a licensee to share commission compensation with a principal to a given transaction.
Legal
104
A licensee may not ___ to an unlicensed person who is not or will not become a party to a real estate transaction in exchange for a referral of real estate services.
compensate
105
Any payment of referral fees or compensation must be in strict accordance with the ___ act.
Real Estate Settlement Procedures Act (RESPA)
106
If a licensee does not wish to be paid directly, what can they legally do in order to receive compensation from their sponsoring broker?
Set up an entity
107
If a licensee sets up an entity for the purpose of receiving compensation, does the entity need to be licensed?
No
108
If a licensee sets up an entity for receiving compensation, it must be either owned ___ or with their ___ (with specific limitations).
solely
or with their spouse
109
If a licensee sets up an entity to receive commissions, their spouse can also hold ownership in the entity if...
The spouse and licensee are both licensed & sponsored by the same sponsoring broker
OR
Spouse is not licensed
110
If a licensee sets up an entity to receive commissions, and their spouse is not licensed, can the spouse jointly own that entity?
Yes
111
Any person who offers a guaranteed sales plan must provide what 2 details before entering the brokerage agreement?
1) purchase price
2) conditions of the plan in writing
112
Any person who offers a guaranteed sales plan must offer evidence of ___ to satisfy the agreement's purchase commitment
sufficient financial resources
113
Any person who offers a guaranteed sales plan must market the listing in the same manner in which...
the sponsoring broker would market any other property
114
Any person who offers a guaranteed sales plan must not ___ until the brokerage agreement has ended or otherwise terminated.
purchase the property
115
Any person who offers a guaranteed sales plan must not purchase the property until...
the brokerage agreement has either ended or terminated
116
If a licensee fails to perform on a guaranteed sales plan in strict accordance with its terms, they are subject to ___ as well as a fine of $___ paid to the ____.
penalties for violating the act
$25,000
injured party
