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UNIT 5—REAL ESTATE BROKERAGE ACTIVITIES

You can expect to see twelve questions on the end-of-course exam and twelve questions on the state exam from this unit. This is one of the most important units in the course, making up 12% of the exam questions.

Learning Objectives

After successfully completing this unit, you will be able to

  • identify the requirements for real estate brokerage office(s) and the types of business entities that may register,
  • explain what determines whether a temporary shelter must be registered as a branch office,
  • list the requirements related to sign regulation,
  • list the requirements related to the regulation of advertising by real estate brokers,
  • explain the term immediately as it applies to earnest money deposits,
  • describe the four settlement procedures available to a broker who has received conflicting demands or who has a good-faith doubt as to who is entitled to disputed funds,
  • list the rule requirements for the handling of advance fees,
  • explain the rule regarding the advertisement of rental property information or lists or negotiation of rentals,
  • describe the obligations placed on a sales associate who changes employers and/or address,
  • describe the regulations regarding lien rights for unpaid sales commission, and
  • contrast the features and requirements of the various types of business organizations.

Key Terms

arbitrationkickback
blind advertisementlimited liability company
comminglelimited liability partnership
conflicting demandslimited partnership
conversionlitigation
corporationmediation
depositostensible partnership
earnest moneypersonal assistant
escrow accountprofessional association (PA)
escrow disbursement orderpoint of contact information
failure to account and deliversole proprietorship
general partnershipteam advertising
good-faith doubttrade name
interpleader

Overview

This unit describes the legal requirements for brokers who operate a brokerage firm. It helps sales associates to understand their duties concerning the operations of a brokerage firm including office signs, branch offices, advertising, team advertising, earnest money deposits, and rental property lists. The unit also describes the different entities available to brokers for operating their businesses.