Chapter 1: Licensing Law

Question 1

Who has to be licensed?

Answer 1

anyone representing others in real estate transactions for compensation.

Question 2

What transactions occur in real estate

Answer 2

sales, purchases, options, exchanges, leases, or rentals

Question 3

Who is exempt from obtaining a real estate license?

Answer 3

1. Property owners acting on their own behalf
2. Attorneys doing R.E. transactions as part of duties
3. Officials appointed by the courts
4. Govt employees doing R.E. for govt. agencies
5. Attorneys-in-fact holding a valid P.O.A.

Question 4

What are the 2 classes of licenses?

Answer 4

Broker and sales agent

Question 5

Full reciprocity?

Answer 5

State recognizes education & experience and will issue a license w/o examination.

Question 6

Partial reciprocity?

Answer 6

State requires person to take the state law portion of the real estate exam

Question 7

Notice of consent?

Answer 7

Allows the non-resident agent to sue residents even though they’re not a resident. It also prevents the R.E. agent from avoiding law suits because they’re a non-resident.

Question 8

Real Estate Board

Answer 8

1. Regulates licenses and protects the public
2. Consists of 5-9 members
3. Not a body of law and has limiting powers
4. Accept, Deny, suspend, revoke licenses

Question 9

IRS Criteria for agent being an independent contractor?

Answer 9

1. Must be licensed as a real estate agent
2. All or (90%) of payment must come from sales
3. Agent must have written agreement from broker that
   he will be treated as an independent contractor

Question 10

What tax form will a broker provide to an agent?

Answer 10

1099-Misc