Practice of Real Estate

Question 1

Seven Federal protected classes

Answer 1

Race, color, religion, sex, disability, familial status, and national origin. Some courts have upheld that discrimination based on sexual identity is protected under the prohibition of discrimination
based on sex.

Question 2

The Civil Rights Act of 1866

Answer 2

Prohibits housing discrimination based on race or color. There are no exemptions under this law. It is never legal to discriminate on the basis of race. This act protects the rights of U.S. citizens to buy, sell convey, inherit, and possess property. The act failed to have an immediate impact on discrimination because no agency was assigned to enforce it.

Question 3

Federal Fair Housing Act when enacted and other name. What it does.

Answer 3

Title VIII of the Civil Rights Act of 1968 is the Fair Housing Act. This act prohibits housing discrimination based on race, color, national origin, and religion.

Question 4

Housing and Community Development Act of 1974 added what?

Answer 4

The Housing and Community Development Act of 1974 added sex to the list of protected classes.

Question 5

The Equal Credit Opportunity Act (ECOA) year and what it does.

Answer 5

1974: It requires lenders to give consumers equal access to credit. The act prohibits discrimination based on race, color, religion, national origin, sex, marital status, or age with respect to granting credit and requires lenders to respond to all loan applications within 30 days, giving reasons for any application rejections.

Question 6

Fair Housing Amendments Act 1988 did what?

Answer 6

Extended fair housing protection to cover familial status and disability and provides remedies to victims of housing discrimination. It requires that owners make reasonable accommodations to property rules, policies, and practices to provide persons with disabilities appropriate access. Familial status references protection given to persons under the age of 18 living with a parent or guardian. The coverage extends to pregnancy or the process of taking custody of a child/children.

Question 7

The Housing for Older Persons Act year and what it did.

Answer 7

1995: It provided exceptions for housing specifically designed for seniors. The exception allows those who live in senior developments in which at least 80% of the units are occupied by at least one person who is 55 or older to discriminate on the basis of age. They may not discriminate on the basis of any other protected class.

Question 8

Mrs. Murphy exemption

Answer 8

Owner-occupied buildings with no more than four units may be exempt from fair housing laws (except race). The exemption is disallowed if the owner uses discriminatory advertising or if a licensee becomes involved in the transaction in any way. Similarly, roommates who share a rental unit may show preference when selecting a roommate, but not when advertising for one.

Question 9

Puffery

Answer 9

In Advertising: Statement that appears to a reasonable person as an exaggeration that wouldn’t be relied on. Puffing is permissible (though perhaps not wise).

Question 10

Misrepresentation in advertising

Answer 10

A statement, photo, or ad that a reasonable buyer would consider to be reliable but isn’t. accurate. Misrepresentations, even when unintentional, can lead to a voidable contract. Licensees must use caution to avoid misrepresentations in advertising. Omission of a material fact is considered intentional misrepresentation

Question 11

Negligent misrepresentation in adverising

Answer 11

A statement made by a person who should have known it to be false; becomes fraud when it’s intentional.

Question 12

The Federal Trade Commission Act

Answer 12

Protects consumers from unfair and deceptive advertising.

Question 13

Who implements The Federal Trade Commission Act?

Answer 13

FTC

Question 14

Penalties for unfair and deceptive advertising

Answer 14

The FTC determines the severity of penalties based on the violation’s severity. Penalties range from a cease-and desist order (which becomes effective immediately) to corrective advertising, civil penalties, consumer and other monetary remedies, and informational remedies.

Question 15

How often must agents check DNC lists?

Answer 15

Every 31 days and drop any disconnected, registered, or reassigned phone numbers from their contact lists.

Question 16

How long can agents call past clients who are on DNC list?

Answer 16

Licensees may call consumers with whom they have had an established business relationship for 18 months after the last interaction.

Question 17

What are the penalties for calling people on DNC list?

Answer 17

Those who violate the DNC may be subject to penalties of more than $40,000 per violation/separate call.

Question 18

What IRIS form must independent contracts fill out?

Answer 18

Licensees who choose independent contractor status must complete a W-9 for IRS reporting purposes.

Question 19

The Sherman Act’

Answer 19

The Sherman Act’s primary purpose is to prevent monopolies that would cause a restraint of trade.

Question 20

The Clayton Act

Answer 20

The Clayton Act supports the Sherman Act by prohibiting mergers that would result in a monopoly.

Question 21

What federal agency investigates antitrust violations and penalizes violators?

Answer 21

The Federal Trade Commission, created by the Federal Trade Commission Act.

Question 22

Price fixing

Answer 22

Antitrust violation: Price fixing or collusion between competitors (brokers) to fix contract terms, services, or products at a specific price or level, such as suggesting there’s a “standard” fee for broker compensation.

Question 23

Market Allocation

Answer 23

Antitrust violation: Market allocation involves an agreement between brokers to divide up the market and then refrain from competing for
business.

Question 24

Tie-in arrangements

Answer 24

Antitrust violations: Tie-in arrangements include providing a service dependent on the customer/client obtaining (or not obtaining) another service from a specific provider.

Question 25

Group boycotting

Answer 25

Antitrust violation: Group boycotting is an agreement between two or more parties who conspire to not do business with a particular person
or company.

Question 26

Per se violation

Answer 26

A per se antitrust violation is one in which the competing firms agreed to violate antitrust laws. A per se violation means that authorities don’t need to make any additional inquiries about the violation to impose penalties. The fact that collusion existed is enough.

Question 27

Name five antitrust violations

Answer 27

Price fixing
Market Allocation
Tie-in arrangements
Group boycotting
Per Se violation

Question 28

Antitrust violation penalties

Answer 28

Up to $1 million and 10 years in prison;
For corporations, penalties may be as much as $100 million.
Under certain circumstances, penalties may be increased to a fine of twice the perpetrator’s gain or the victim’s loss. Brokerage firms found guilty of violations may be subject to court-ordered supervision for up to 10 years.