Chapter 1: Law & Related Regulations Flashcards
(146 cards)
1
Q
Real Estate brokerage is governed by both _______ law and ________ law, found in the ____ of Maryland __________, abbreviated as _____.
A
Statutory
Administrative
Code, Regulations
COMAR
2
Q
In addition to statutes and regulations, some aspects of _______ _____ apply to real estate brokerage in MD and is called “the unwritten law.”
A
Common law
3
Q
_________ _______ is not written by a legislative body; rather, it is found in numerous volumes of decisions from courts of appeal.
A
Common law
4
Q
What type of decisions are needed when no relevant statute exists or when an existing statute is challenged as unconstitutional, and arise in cases of ambiguity where uncertainty of language or intent makes a statute difficult to apply?
A
Common law decisions.
5
Q
What takes statutes at their face value and defers to the original intention of their writers?
A
Strict construction
6
Q
In 1965, the U.S, Supreme Court held that the Civil Rights Act of 1866 still applied literally - word for word - and was still the law of the land almost a century after it was written. What is this decision an example of?
A
Strict construction
7
Q
________ are voted into law by legislative bodies.
A
Statutes
8
Q
_______ ______ is handed down by judges.
A
Common law
9
Q
Decisions made by courts of appeal become binding on lower courts within their judicial area. The higher the court of appeal making a decision, the more numerous the courts in which that decision becomes the standard - the ________ - for decisions made later in those lower courts
A
Precedent
10
Q
TheMD Real Estate Commission is one of the largest licensing boards within the Dept of Labor, Licensing, and Regulation, and adopts and enforces regulations to implement the Brokers Act. These regulations are ____________ _____.
A
Administrative law.
11
Q
How many licensing boards are there in MD?
A
18
12
Q
A real estate __________ is defined as an individual who provides the following services:
- for consideration and for another person, selling,
buying, exchanging, or leasing any real estate or
collecting rent its use - for consideration, assisting another person to
locate or obtain for purchase or lease any
residential real estate - engaging regularly in a business of dealing in real
estate of leases or options on real estate - engaging in a business the primary purpose of
which is promoting the sale of real estate through a
listing in a publication issued primarily for
promotion of real estate sales - engaging in the business of subdividing land
located in any state and selling the subdivided lots - for consideration, serving as a consultant for any
of the activities in this list
A
Broker
13
Q
Although MD law generally defines PERSONS as “individuals, receivers, trustees, guardians, personal representatives, fiduciaries, or representatives of any kind and any partnership, firm, association, or other entity,” only _______ ________ may hold Maryland real estate licenses. However, a broker’s license, rather than showing the broker’s actual name, may show the name under which the broker is operating - typically a company name. This is called the broker’s ________ ________
A
natural persons
designated name
14
Q
The Commission issues three levels of license for those delivering real estate brokerage services - what are they?
A
Broker
Associate Broker
Salesperson
15
Q
Who issues branch office certificates and time-share licenses?
A
the Commission
16
Q
How long may a license be kept on inactive status before expiring?
A
4 years.
17
Q
How long are expired licenses held, from the date of their expiration, before they can no longer be reinstated?
A
4 years.
18
Q
Can a person with an inactive or expired license receive compensation from “referral companies”?
A
No
19
Q
Which license covers the following?:
- resident
- nonresident
- reciprocal
- temporary/for commercial only
A
Broker
20
Q
In addition to being licensed, some associate brokers and salespersons may also be _________ manage branch offices.
A
Registered
21
Q
Affiliates, although fully subject to supervision and control by their brokers, can still meet IRS requirements for qualified real estate agent - also called ________ ___________ - and be treated as self-employed from the point of view of income taxation.
A
statutory nonemployee
22
Q
SEction 3508 of the IRS Code specifies that qualified real estate agents may report their income as self-employed persons using Schedule ______.
A
1040C
23
Q
To be recognized as a qualified real estate ________, affiliates must:
- hold an active real estate license
- receive “substantially all” - meaning no less than
90% - of their brokerage remuneration based on
production rather than upon hours worked; and - act pursuant to written contracts with their
brokerage firms stating that they will not be treated
as employees for federal tax purposes.
A
agent
24
Q
_______ (the noun) refers either to a licensed associate broker or a licensed salesperson.
A
Affiliate
25
_______ ________ are individuals who have met the educational, experience, and testing requirements for becoming real estate brokers but who request licenses that authorize them to provide real estate brokerage services only under a broker with whom they affiliate as such.
Associate brokers
26
Despite their education and experience, _______ __________ duties and authority are no greater than those of salesperson.
Associate brokers'
27
__________ and ________ ________ are individuals who aid brokers with whom they are affiliated, in providing real estate brokerage services, and are generally agents of their broker.
Associate brokers and salespersons
28
What is defined as "many interests in real property anywhere" and even includes interest in condominiums, time-share estates, and time-share licenses, as those terms are defined in the Real Property Article, as well as fee and life estates.
Real Estate
29
Are persons acting under a judgment or order of a court subject to the Brokers Act when performing acts of real estate brokerage?
No.
30
Are public officers performing the duties of their office subject to the Brokers Act when performing acts of real estate brokerage?
No
31
Are landlords or owners of any real estate, unless their primary business is providing real estate brokerage services, subject to the Brokers Act when performing acts of real estate brokerage?
No
32
Are persons engaging in a single transaction selling or leasing real estate subject to the Brokers Act when performing acts of real estate brokerage, if they are acting under a power of attorney executed by the owner of that real estate?
No.
33
Are auctioneers who are licensed by various jurisdictions within MD when selling real estate at public actions subject to the Brokers Act when performing acts of real estate brokerage?
No.
34
Are persons acting as receivers, trustees, personal representatives, or guardians subject to the Brokers Act when performing acts of real estate brokerage?
No.
35
Are financial institutions in the leasing or selling of property they have acquired through foreclosure or by receiving a deed or an assignment in lieu of foreclosure subject to the Brokers Act when performing acts of real estate brokerage?
Yes.
36
Are lawyers who are not regularly engaged in the business of providing real estate services and who do not advertise that they conduct such business subject to the Brokers Act when performing acts of real estate brokerage?
Yes.
37
Are homebuilders in the rental or initial sale of homes they have constructed subject to the Brokers Act when performing acts of real estate brokerage?
Yes.
38
Are agents of a licensed real estate broker or of an owner of real estate, while managing or leasing that real estate for that broker or for the property's owner subject to the Brokers Act when performing acts of real estate brokerage?
Yes.
39
Are persons who negotiate the sale, lease, or transfer of businesses when the sale does not include any interest in real property other than the lease for the property where the business operates subject to the Brokers Act when performing acts of real estate brokerage?
Yes.
40
Are owners who subdivide and sell, not more than six, lots of unimproved property they own in any one calendar year subject to the Brokers Act when performing acts of real estate brokerage?
Yes.
41
How many members does the Commission consist of?
9
42
How many of the members of the Commission must hold real estate licenses, where do they need to be chosen from, how long must they have held a license and how long must they have resided in the areas from which they are appointed?
5
```
Eastern Shore
Southern MD
Western MD
Baltimore Metropolitan Area
Baltimore City
```
At least 5 years
43
Who are the four non-licensee members of the Commission? For how long before the appointment must they have not had an ownership interest in, or received compensation from, an entity regulated by the Commission?
Consumers
The year just before their appointment.
44
Who are the members of the Commission appointed by and to whose advice and consent?
the Governor with the advice of the Secretary
the Senate.
45
When to membership terms (which are staggered to ensure regulatory continuity) begin and end?
June 1st
4 years later.
46
Each year, members of the Commission elect form among themselves a ________ to preside at their meetings. This person is covered by a ______ ______.
Chairperson
Surety bond
47
How often does the Commission meet with the majority of the members?
Once a month.
48
When does the Commission meet constitution a quorum?
By appointment
49
Are Commission meetings open to the public?
Yes.
50
How can a member of the public be allowed to speak in a Commission meeting?
With 10 day's advance written notice.
51
Who is the Commission's executive director appointed, and serve at the pleasure, of?
The Secretary.
52
Is the Commission's executive director a member of the Commission?
No.
53
Can the executive director be the chairperson of the Commission?
No.
54
Who's title does this describe?
"A State employee who is covered by a surety bond, attends and participates in the monthly meetings, directs the day-to-day operations of the Commission, and supervises its office staff and field inspectors between monthly meetings."
The Executive Director of the Commission.
55
Who is empowered to investigate complaints of unlicensed brokerage activity?
The Commission
56
Who is empowered to investigate complaints about licensee behavior?
The Commission
57
Who is empowered to conduct hearings and administer oaths?
The Commission
58
Who is empowered to issue subpoenas for attendance of witnesses or production of evidence?
The Commission
59
Who is empowered to take depositions?
The Commission
60
Who is empowered to seek injunctions (in certain circumstances)?
The Commission
61
Where are the General Regulations and Code of Ethics found?
in COMAR (The Code of MD Regulations at 09.11).
62
What addresses a licencee's relations with the client, the public, and with other licensees?
The Code of Ethics
63
The MD Code of Ethics is quite different from the C ode of Ethics of the NAR. However, the two codes are complementary in that neither __________ the other.
Contradicts
64
Must the Commission investigate any written, sworn complaint alleging that an unauthorized person has provided real estate brokerage services?
Yes
65
The Commission has statutory authority to hold hearings on the complaints of unauthorized brokering and to impose a financial penalty not to exceed $_______ for the first proved violation, $_______ for a second, and $_______ for a third or subsequent violation.
$5,000
$15,000
$25,000
66
The Commission, among other things:
1. after hearings, reprimands and/or ______
licensees who have violated laws or regulations;
2. collects fines and pays them into the General
Fund of the _____
3. submits an _____ ______ to the Secretary
4. adopts regulations and a code of ethics to
implement ____ __.
5. convenes hearing boards (panels) of ____
members, at least one of whom must be a
________ member and one a _________ from
among the commissioners; and
6. maintains and administers a ______ ______ to
reimburse members of the public as much as
$________ for actual losses caused by licensees
and their employees.
1. fines
2. state
3. annual report
4. Title 17
5. Three, consumer, licensee
6. Guaranty Fund, $25,000
67
To qualify for a _________ license, an applicant must:
- be of good character and reputation and at least
18 years of age;
- have completed a 135-hour course in real estate,
including 3 clock hours of real estate ethics -
approved by the Commission.
- have been licensed as real estate salespersons
actively and lawfully for at least three years; and
- have passed the XXXX pre-licensing examination
broker
68
How many hours of courses in real estate must a broker have to qualify for his/her license. Three of those hours must be of real estate _______.
135
ethics
69
Who does the Commission waive the education and experience requirements for, for the broker license?
Applicants who are qualified to practice law in MD.
70
Except for applicants who are qualified to practice law in MD, broker education requirements are in addition to the ____ hours salesperson requirement they may have previously met.
However, an individual who has been engaged in real estate practice as a licensed broker in another state for at least ___ of the ____ years immediately preceding submission of application is considered to have satisfied the broker educational requirements.
60
3 of the 5
71
To qualify for the associate real estate broker license, what 2 things must an applicant do?
1. meet the education and experience requirements
2. obtain written commitment from a licensed broker
to accept him/her as an associate broker
72
To qualify for issuance of the _______ license, an applicant must:
- be of good character and reputation
- be at least 18 years of age
- successfully complete a basic 60-hr course in real
estate-including 3 clock hours of real estate ethics
- pass the required examination; and
- obtain written commitment from a broker to accept
the applicant as a XXXX of the firm
salesperson
73
How many hours of real estate course must an applicant successfully complete to qualify for issuance of license? Three of those hours must be in real estate ______.
60
Ethics
74
How long, after passing both General and State parts of the examinations must a broker/salesperson applicant apply for the licensure?
Within 1 year.
75
Salesperson, associate broker, and broker applicants who are not residents of the State must submit to the Commission their _________ _______, which allows them to be served with official documents without the server's having to travel to a foreign (out-of-state) jurisdiction to present them.
irrevocable consent
76
Who is a person licensed by a jurisdiction other than MD to provide real estate brokerage services there?
A nonresident real estate broker.
77
Who are individuals who are licensed, not by the Commission but by another state, to provide real estate brokerage services under a nonresident real estate broker-in this context, a broker who has complied with detailed requirements for a temporary license to perform acts of brokerage involving MD commercial property?
Nonresident real estate salespersons (and associate brokers).
78
Can a nonresident real estate broker be partnership, joint venture, LLC, or corporation?
Yes
79
Can a nonresidential real estate broker be an individual?
Yes
80
What is the amount of the original license fee for Brokers?
$190
81
What is the amount of the Guaranty Fund Assessment for brokers?
$20
82
What is the amount of the total original fees for brokers?
$210
83
What is the amount of the renewal or exchange of license fee for a broker?
$190
84
What is the amount of the original license fee for associate brokers?
$130
85
What is the amount of the Guaranty Fund Assessment for associate brokers?
$20
86
What is the amount of the total original fees for associate brokers?
$130
87
What is the amount of the original license fee for sales person?
$90
88
What is the amount of the Guaranty Fund Assessment for salespersons?
$20
89
What is the amount of the total original fees for sales persons?
$110
90
What is the amount of the renewal or exchange of license fee for salespersons?
$90
91
What is the amount of the renewal or exchange of license fee for associate brokers?
$130
92
What is the amount of the 5 year Certificate of License History?
$25
93
What is the amount of the Full Certificate of License History?
$75
94
What is the amount of the Broker Business Address Change?
$5
95
What is the amount of the Broker Business Name Change (for each license under broker)?
$25
96
What is the amount of the Branch Office License?
$25
97
What is the amount of the Personal Name Change?
$25
98
How much is it to Reactive Inactive License?
$50
99
What is the amount of the Reinstatement of License/Late Fee?
$150
100
How much is it to Transfer to Another Broker?
$25
101
How much is the fee to Time-Share?
$100
102
How much is it to Duplicate License or Pocket Card?
$25
103
How much is it for Dishonored Check?
$25
104
Is the Guaranty Fund initial assessment paid on renewals?
No (unless needed to replenish the fund, which has happened only once in the past 30 years)
105
What states have Maryland signed reciprocity agreements with?
Pennsylvania and Oklahoma.
106
What 2 documents show the following:
- name of the licensee
- designated name of the licensed real estate broker
with whom a salesperson or associate broker is
affiliated,
- date the license will expire, and
- licensing registration number of the licensee
License certificates and pocket cards
107
Who may only provide brokerage services in the name of the broker under whom they are licensed?
associate brokers and salespersons
108
Performing any act of real estate brokerage while holding only an inactive license is a violation of law, a misdemeanor punishable initially by a fine as much as $_____, and by as much as a ___-year(s) imprisonment; ____ year(s) and a fine of $_____ for a second conviction; and ____ year(s) and as much as $_____ for a third or subsequent violation.
$5K, 1-yr
$15K, 2-yr
$25K, 3-yr
109
A broker may operate more than one real estate company, but for each additional real estate brokerage company, he/she must obtain a _______ _______.
separate license
110
Reinstatement of a license that has expired due to nonrenewal is possible within a _____-year period following the date of its expiration.
3
111
Does timely renewal, late renewal, or non-renewal of a license affect the power of the Commission to bring charges for prior acts or conduct?
No
112
What 3 things does an affiliate need to do to transfer their affiliation from one broker to another?
1. apply to the Commission
2. obtaining a commitment from the new broker
3. submit a statement confirming termination of
prior relationship (either from themselves or that
broker)
113
When are license expiration date reminders and renewal application forms for brokers and their affiliates mailed to brokers' offices?
No less than 30 days before they expire.
114
What 3 things does the license expiration reminder notices state?
1. expiration date
2. dates by which the Commission must receive the
renewal applications
3. amount of the renewal fees
115
Continuing education for license renewal is measure in ____ ______, with credit allowed only for approved, individual courses of no less than ____ hour(s) and no more than ____ hours in length.
clock hours
1.5 hr
6 hrs
116
What are the basic requirement for all levels to renew a license (classes)?
3 hrs local, state & federal legislative & regulatory updates
1.5 hr fair housing
3 hrs Cod of Ethics, Flipping *& Predatory Lending
3 hrs Principles of Agency *& Agency Disclosure
3 hrs of Requirements of Broker Supervision (brokers, branch managers, and team leaders)
1.5 hr electives
117
Exceptional to the basic requirement for all levels of license, what are the requirements for licensees who are qualified to practice law in the state and those who hold graduate degrees from accredited colleges or universities - and are not brokers, branch mgrs or team leaders, to renew their license (classes)?
7.5 hrs:
legislative update
fair housing
ethics
3 hours Agency & Agency Disclosure
118
What is this the definition of?:
"(1) real property improved by five or more single-family units; (2) improved and unimproved real property zoned for commercial, industrial, or nonresidential use by the local zoning authority of the county or municipality in which the property is located; and (3) unimproved real property zoned for improvement as multifamily units by the local zoning authority of the county or municipality in which the property is located [but does not include]: (1) property zoned for agricultural use; or (2) single-family units including a condominium or co-op unit, for sale or for lease, or otherwise conveyed or to be conveyed on a single basis."
nonresidential property
119
A person who has made false claims of educational completion may be given _____ month(s) to complete the missing education requirements, pay a $______ penalty for the false application, as well as a $______ reinstatement fee. Their names, their ________, and their fines are then displayed on the Commissions Web site for several years.
one
$1,500
$150
violations
120
When licensees complete each unit of study, the training institution that conducted the course issues certificates of completion to each student stating the:
1. number of _____ _______
2. _____ and _______ of the course taken
3. _____ _______ of the subject category, and
4. names of the _________ and/or the ________
presenting the teaching
1. clock hours
2. name, date
3. code letter
4. teacher, organization
121
The Commission may waive continuing education requirements for licensees who show ____ ________ for being unable to meet the requirement.
good cause
122
When, unless reactivated, does an inactive license expires?
3 year from the date it's placed on inactive status.
123
Subject to the three-year limitation, licensees may renew their licenses while on inactive status, but-from and after ________ __, ____- they must meet current continuing education requirements.
October 1, 2011
124
What licensees currently on inactive status:
1. must meet current CE requirements to renew and
within what time frame from date of inactive
status?
2. can stay inactive for 4 years and need no CE?
1. Those that went inactive after October 1, 2011
| 2. Those that went inactive before October 1, 2011
125
What must brokers on inactive status do to reactivate?
Request reactivation and pay the $50 reactivation fee.
126
What is the payment to replace a license certificate or pocket card?
$25
127
What is the cost to change firm name?
$25
128
A person receiving a reissued license of a deceased real estate broker may hold and use that license for as long as ______ year(s) without meeting the 135-hour educational requirement.
4
129
The license certificates and pocket cards of an affiliate must be returned to the Commission by the affiliate's broker:
- on the request of an _______
- on the ______ of an affiliate
- after a _______ before the Commission and on finding that the license of an affiliate is to be suspended or revoked
- affiliate
- death
- hearing
130
In the event of an affiliate's termination (discharge) a broker must:
1. Mail ________ to the licensee
2. Submit _______ _______ and copy of _____
_________ to the Commission
3. Return the _______ ___________ to the Comm.
1. Notice
2. written notice, notice to licensee
3. license certificate
131
After reviewing the content of a complaint against a salesperson, the Commission may refer it for investigation, if it appears an infraction has occurred. A complaint not referred for investigation is considered dismissed. Within _____ days of such dismissal, any member of the Commission may file an exception disagreeing with the dismissal.
30
132
If an exception is not filed, the dismissal is considered a _____ decision of the Commission. This means that any party aggrieved by the decision may then appeal to the appropriate court; only THESE decisions may be appealed.
final
133
Before the Commission takes any final action on a complaint, it gives the individual against whom the action is contemplated an opportunity for a hearing before the Commission or a hearing board.
At least ____ days before the hearing, the hearing notice is served personally on the individuals against whom complaints have been made, or it is sent by certified mail to their last known addresses.
10
134
The Commission establishes two or three real estate hearing boards - often called _______ - each consisting of _____ Commission members.
At least one member of each panel must be a __________ member, and at least one must be a __________ member.
panels
3
professional
consumer
135
The Commission (or one of its hearing panels) may order a final public hearing on any complaint that has been filed with the Commission or on any other matter for which a hearing may be required.
Before deciding to hold hearings, a panel will meet PRIVATELY to:
- review __________ and consider whether they
provide a reasonable basis for disciplinary
hearings, and
- review _______ against the Guaranty Fund to
determine what further action to take.
- complaints
| - claims
136
The Code of Maryland Regulations (COMAR) provides for four types of hearings:
1. ________ hearings
2. Applications for ________
3. Revocation or ________ of licenses
4. ________ against the Guaranty Fund
1. Judicial
2. Licensure
3. Suspension
4. Claims
137
The Commission may summarily order the suspension of a licensee who:
1. fails to account ________ for any funds held in
trust;
2. on demand, fails to display to the Commission all
________ and books, and fails to account for any
______ held in trust;
3. has been ________ of a ____
4. fails, within _____ days after the conviction or within _____ days following release from incarceration as a result of the conviction, whichever is later, to disclose to the Commission that the licensee has been convicted of a crime as defined above.
1. promptly
2. records
3. convicted, crime
4. 10; 10
138
Whenever a licensee's license is revoked or suspended and a stay is not ordered by the Commission or a court, the Commission notifies that:
1. ________
2. ________
3. MD association of _______
4. local _______ or association of Realtors and the
Realtist organization in the area of the licensee's
office.
1. licensee
2. broker
3. realtors
4. board
139
What is the maximum reimbursement for any claim to the Guaranty Fund?
$25K
140
A claim against the Guaranty Fund musst:
1. be in writing and under _____
2. state the ______
3. state the ______
4. be accompanied by ________ that supports the
claim
1. oath
2. amount
3. facts
4. documentation
141
An any claim hearing, who is the burden of proof on?
The claimant.
142
A person may not recover from the Guaranty Fund any loss that relates to:
1. the purchase of any interest in a _______ partner-
ship that invests in real estate,
2. a _____ venture that is promoted by a real estate
licensee for the purpose of investment in real
estate, or
3. the purchase of ________ paper secured by real
estate
1. limited
2. joint
3. commercial
143
How are buyers informed that they are protected by the Guaranty Fund?
The language is included in the sales contract.
144
The Commission must act promptly upon receiving claims by:
1. forwarding _____ to licensees and/or unlicensed
employees alleged to be responsible and to their
brokers;
2. requiring a written _________ within 10 days from
each of those individuals (this 10-day period is
shorter than the 20 days required for response to
other inquiries from the Commission)
3. ________ the claim and any responses to the
claim, and;
4. conduct an ________
1. copies
2. response
3. reviewing
4. investigation
145
The misdemeanor penalty for knowingly making a false statement or material misstatement of fact about a Guaranty Fund matter is a fine and/or __________.
imprisonment
146
Does the Commission has power to impose a sentence of imprisonment?
no
