Unit #1 - Business of Real Estate Vocab

Question 1

Associate Licensee

Answer 1

Also known as a SALES ASSOCIATE can only act under the control and supervision of a responsible broker (employed by)

Question 2

Blind Advertising

Answer 2

Or false advertising is when any form of marketing is advertised under false information. A licensee must disclose that the property is offered through a licensed real estate agent.

Question 3

Broker-Officer

Answer 3

Operating as a corporation, the individual broker serves as the company’s licensed designated broker-officer. The broker will be the corporation’s corporate officer responsible to the public and DRE for the operations of the business and the supervision of its employees — including other licensees.

Responsible for supervision of employees and corporations’ responsibility to the DRE and public.

Question 4

Bulk Transfer of Goods

Answer 4

CA has adopted the Uniform Commercial Code meaning a bulk transfer of goods is any transfer of a substantial part of materials, supplies, merch, equipment or the inventory that is not in the ordinary course of the transferees business.

Ex: Business Bankruptcy & Avoiding Taxes.
Avoid having to give the assets to creditors or transferring them for less than they are worth.

Question 5

Business and Professions Code

Answer 5

CA legislation has been compiled into a series of books called CODES. Real Estate Law is Division 4 of the Business and Professions Code.

The BPC deals specifically with laws that govern the actions of professions as they go about their business. (Licensing and transactions)

Question 6

Business Opportunity

Answer 6

Ex:

• Selling or offering to sell including soliciting prospective sellers.
• Purchasing or offering to purchase including soliciting prospective purchasers.
• Exchanging.
• Soliciting or obtaining property listings for sale or exchange.
• Leasing, renting or offering to lease or rent
• Selling, purchasing, or exchanging leases
• Filing an application for purchase or lease involving land owned by the state or federal governments

Question 7

California Dept of Real Estate (DRE)

Answer 7

Headed by the Real Estate Comissioner, administers the Real Estate Law in California. Every state has a similar dept or agency responsible for enforcing laws concerning licensees.

Administer & uphold laws in their respective states.

Question 8

Caveat Emptor

Answer 8

Buyers protections from sellers and real estate agents. Latin for “let the buyer beware”

Question 9

Certificate of Status

Answer 9

Issued by the secretary of state within 30 days before submission of the application; or the Articles of Incorporation filed with the secretary of state if a California stock corporation originally filed the articles within six months of the application.

A document issued by the state that proves your entity exists and is in compliance with all state requirements.

Question 10

Codes

Answer 10

CA legislation has been compiled intto a series of books called codes.

Question 11

Fictitious Business Name Statement

Answer 11

A brokerage can do business under a fictitious name as long as the real estate license is in that name. This must be filed with the county clerk in the county of the broker’s principal business address.

A fictitious name is any name other than that of a real estate licensee.

Question 12

Franchise

Answer 12

A business model where an individual or company licenses the use of the franchisor’s trademark and offers services to customers at a fixed location or through remote services.

Question 13

Manufactured Home

Answer 13

Also known as a mobilehome. Real Estate agents are permitted to handle transactions but the home must be registered in compliance with the Health and Safety Code.

Question 14

Mobilehome Dealer

Answer 14

If the real estate agents displays or offers two or more registered mobilehomes at the agents place of business, the agent must also be licensed as a mobilehome dealer. Obtained from the Dept. of Housing and Community Development (HCD), are in the Health and Safety Code.

Question 15

Mortgage Loan Originator (MLO)

Answer 15

An individual who takes a residential mortgage loan application or offers or negotiates terms of a residential mortgage loan for compensation or gain.

Question 16

Prepaid Rental Listing Service (PRLS)

Answer 16

A business that supplies prospective tenants with listings of residential property on payment of a fee collected at the same time or in advance of when the listings are supplied. ANYONE with a real estate license as a broker may conduct PRLS business without separate license.

Property management.

Question 17

Real Estate Broker

Answer 17

A real estate broker is a real estate agent who continues their education and successfully receives a state real estate broker license. Unlike real estate agents, brokers can work independently and start their own brokerage and hire other real estate agents.

Question 18

Real Estate Brokerage

Answer 18

The aspect of the real estate business that involves activities relative to property management or a real estate sale, exchange, purchase, lease.

Question 19

Real Estate Education and Research Fund

Answer 19

Research in land use and real estate development is made possible at both public and private universities and research entities throughout the state. Funded by a fixed percentage of license fees.

Question 20

Real Estate Law

Answer 20

A series of books called codes. Division 4 of the Business and Professions Code. It has two parts (licensing, transactions and includes the Subdivided Lands Law.)

Question 21

Real Estate Salesperson

Answer 21

Individuals who are licensed to help people buy, sell, and rent real estate. They are ultimately responsible for bringing buyers and sellers together and are paid a commission—usually a percentage of the property’s sale price. Can only function under a real estate broker.

Question 22

Recovery Account

Answer 22

Another fund financed by license fees. It is available to aid victims of licensee fraud, misrepresentation, deceit, or conversion (theft) or trust fund, who are awarded money damages by a court or result of a DRE proceeding that are noncollectible. maximum of 50,000 per 250,000 per licensee.

Question 23

Regulations of the Real Estate Commissioner

Answer 23

Real Estate Licensees are also subject to the Regulations of the Real Estate Commissioner, which serve to clarify and interpret the Real Estate Law. Force and effect of law.

Primary purpose is to protect the members of the public.

Question 24

Restricted License

Answer 24

In certain circumstances, such as violation fo the Real Estate Law, the Real Estate Commissioner may decide to issue a restricted license.

Possible restrictions:

• Limit length of license term
• Require employment by a particular real estate broker
• Contain some other condition, such as the filing of surety bonds for the protection of persons with whom the licensee does business

Question 25

Sales Associate

Answer 25

Or Real Estate Salesperson can only act under control and supervision of a responsible broker.

Question 26

Uniform Commercial Code

Answer 26

CA has adopted the Uniform Commercial Code. Governs the sale or transfer of goods ordinarily held for sale in the course of business. Goods held for sale by a business probably were obtained on credit from a supplier or manufacturer.