Unit 3

Question 1

Does the trade name need to be larger than the broker name on advertising?

Answer 1

No.

Question 2

What must appear on all advertising?

Answer 2

The firm’s name as registered with the Commission

Question 3

Is a broker’s name, phone # and email required to be on adverting?

Answer 3

No.

Question 4

Who is required to have reasonable supervision?

Answer 4

Broker’s with 2+ years of active experience

Question 5

Who is required to have a high level of supervision?

Answer 5

Broker’s with 2- years of active experience

Question 6

What must an office manual have?

Answer 6

The written office manual must have a method for designating brokers and what brokerage relationships are allowed to be offered in the brokerage firm

Question 7

True or false? All contracts have to be reviewed before they go in a file?

Answer 7

True. Once executed.

Question 8

What kind of supervision is and is not required for high level supervision?

Answer 8

• Attending, training, or being available to answer questions for all closings
• Does not require attending broker’s meeting with clients or mentoring them

Question 9

Who can be left in charge when an employing broker leaves town?

Answer 9

Another qualified broker (not an unlicensed individual, such as an office manager)

Question 10

What two ways can you be a licensee?

Answer 10

Independent contractor or employee

Question 11

Describe an independent contractor

Answer 11

-No income taxes or payroll taxes
-Must have a signed independent contractor agreement
=No set schedule or paid vacation

Question 12

Describe an employee

Answer 12

• A broker supervised by an employing broker may be an employee for federal income tax purposes
• The employing broker must withhold federal income tax and payroll taxes, such as Social Security from the paycheck of an employee license.

Question 13

True or false? You can pay a referral fee to out-of-state inactive licensees?

Answer 13

• False. Only to active licensees with a business office.

- You can pay for a name, and only a name, and has performed no activities requiring a license.

Question 14

What is it to rebate a commission?

Answer 14

Give back money in negotiation (i.e. if you agree to do more work for them so you get paid for that too)

Question 15

What is a commission negotiation or renegotiation?

Answer 15

A licensee may rebate a commission to a buyer or a seller as part of the broker’s service. Payment to buyer should be disclosed to the seller and should comply with RESPA and HUD.

Question 16

Can a licensee pay a fee to an unlicensed person for brokerage functions?

Answer 16

No.

Question 17

What can an unlicensed assistant NOT do?

Answer 17

• Negotiating
• Independently drafting or filling in legal docs/contracts
• Offering opinions, advice, or interpretations

Question 18

What CAN an unlicensed assistant do?

Answer 18

• Hold open houses and hand out brochures (can’t give info about price, advice, or confidential info)
• Prepare a market analysis (can’t give opinion of value)
• Measure sf of property (must disclose method)
• Sign checks on a trust account if authorized by responsible broker
• Perform clerical duties
• Distribute info on listed properties when info is prepared by the broker
• Fill in a contract and deliver it (without providing advice or opinions)
• Drive a buyer to a property

Question 19

How many levels of appraiser licensing is in CO?

Answer 19

4

Question 20

Who typically hires the appraiser?

Answer 20

The lender

Question 21

CMA

Answer 21

Comparative market analysis

Question 22

BPO

Answer 22

Buyers Price Opinion

Question 23

Are you an appraiser if you do a CMA or a BPO

Answer 23

No.

Question 24

What is Rule E-42?

Answer 24

Brokers doing a CMA or BMO that is not being used as part of a listing or buyer representation agreement must state that they are not appraisers

Question 25

What is Rule E-13?

Answer 25

• Also known as sign crossing
• A licensee cannot negotiate a sale, exchange, lease, or listing contract with an owner who has an active listing contract with another licensee

Question 26

What must be written on all marketing that goes out to a neighborhood with a listing in it?

Answer 26

“This marketing is not intended to list the property for sale.”

Question 27

If an owner of a property for sale approaches a licensee without the licensee initiating the contact, what should the licensee do?

Answer 27

A broker may negotiate and sign a listing agreement that begins after the expiration or termination date of the existing listing agreement.

Question 28

Who must be made aware of seller concessions?

Answer 28

Lender, appraiser and MLS. RE Commission and title company don’t

Question 29

Seller-assisted down payments are also called what?

Answer 29

Seller concessions

Question 30

What should you do in the event of a seller-assisted down payment?

Answer 30

• Note seller-paid costs on all appropriate docs
• Advise all parties to seek legal advice
• Add to MLS in the seller concessions tab, that the seller contributed to closing costs, etc.
• Provide both the lender and the appraiser with the Contract to Buy and Sell, which will state in the additional provisions or the Financing Provisions paragraph, the seller contributions.

Question 31

True or false? You do not need to notify your employing broker of out-of-state referral fees?

Answer 31

False. All money must go through the brokerage firm