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 topic, 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, and
• describe the obligations placed on a sales associate who changes employers and/or address.

Key Terms

arbitrationinterpleader
blind advertisementkickback
comminglelimited liability company
conflicting demandslimited liability partnership
conversionlimited partnership
corporationlitigation
depositmediation
earnest moneyostensible partnership
escrow accountprofessional association (PA)
escrow disbursement orderpoint of ontact information
general partnershipsole proprietorship
good-faith doubttrade name

Overview

This unit describes the legal requirements broker must observe in the operation of the 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.