Virginia Law and Regulations Flashcards

Virginia Law and Regulations Flashcards Standards of Conduct Continued..Financial Records and Escrow ManagementMust keep financial and escrow records for a required amount of time.Retention Period - 3 years from closing or contract ratification.Accounting - Must account for and timely remit all trust moniesBoard RequestsMust submit financial records to the Board within 10 days.Board InquiriesNon-financial requests. Must respond within 21 days.. Ben and Jerry are communicating for the first time via instant messages. Ben is a licensee and Jerry is interested in locating property in Ben's area. Ben suggests that he may be able to help. Which of the following disclosures must Ben make?1. Ben must disclose his firm name, city, and state2. Ben must disclose his user name3. Ben must disclose his email address4. Ben is not required to make any disclosures because instant messages are not advertisements

• Ben must disclose his firm name, city, and

stateExplanation: Ben must disclose his firm name, city,

and state since Board regulations now cover instant messages. These disclosures must be viewable on the main page or no more than one click away from the main page.Standards of Conduct: Improper Comissions Improper CommissionsClient Referral Fees - Broker-to-Broker only.Service Referral Fees - Fee must be acknowledged in writing by the parties.Transaction Information Referral FeesNon-confidential information only.Permitted with the Principal Broker's written consent.Net Listings - Prohibited in Virginia.

The Real Estate Board regulates:1. the wording contained

in standard exclusive right-to-sell listing agreements2. the size of "For Sale" signs placed on private property3. the real estate licensing examination4. real estate sales commissions

3. The real estate licensing examinationExplanation: The

Real Estate Board regulates the format, scheduling, and administration of the real estate licensing exam. The other choices are outside the Board's authority.Licensee ConsequencesLicensee ConsequencesFailure to pay assessment fee = automatic suspensionPayment from TRF claim = automatic revocationLicensees may NOT reapply until amount due (plus interest) has been repaid to the Fund.Associate BrokerA licensed broker other than the person designated as principle broker at a firm Standards of ConductThe Board may fine, suspend, or revoke any license for violating the Standards of Conduct.Firm Conduct - Firms must properly seek and maintain firm and individual licenses.Disclosures - All licensees must make proper disclosures.Disclosure of InterestDisclosure of Brokerage RelationshipDual Agency/Designated Agency

Firm LicensesBroker Owned Sole Proprietor - no application needed unless the broker wishes to operate multiple locations.All Other Firms - must put in an application and be registered to do business in the State.Branch Offices - All branch offices must be licensed.Fictional Names - Firms may operate under a trade name, unless it is a non-broker owned firm.Which of the following persons must be licensed when selling real property for others?1. a trustee, appointed by a court2. a receiver in a bankruptcy proceeding3. an executor of a will4. an appraiser

4. An AppraiserExplanation: An appraiser acting as an

appraiser needs an appraiser's license. However, an appraiser selling real estate for others must be licensed. A trustee, executor, and receiver could qualify for an exception to the license law. We do not know whether an exception applies or not under these facts, but that fact that one could apply makes "appraiser" the best answer.License ExemptionsFor Sale by OwnerPower of AttorneyCourt OrderLicensed Attorneys (while acting on behalf of a client)Salaried Rental Agents (only showing a property)No firm license needed if sole proprietor broker has a single location.Advertising RestrictionsStatement or promotion related to licensed activity in any medium (Internet, phone, tv, signs, etc.).Supervision - Must be reviewed by broker; must include firm's name.DisclosuresConventional Media - firm name and address; licensee name (if applicable).Electronic Media- firm name, city, and state; licensee name (if applicable). All disclosures must be viewable on the main page or no more than one click away from the main page VREB Lack of AuthorityThe Board may not arbitrate disputes between licencees, and the Board may not establish commission rates or standardized agreements (such as sales contracts) ClientPerson who has entered a brokerage relationship with a licensee Independent ContractorLicensee who enters into a brokerage agreement with a client, which specifically states that the licensee is acting as an independent contractor and not as an agent. An Independent contractor has the obligations agreed upon by the parties in the brokerage agreement , as well as some of the duties that a standard agent has towards a client.Supervising BrokerEither the broker appointed by the principle broker to supervise the associate brokers and salespersons, or the broker appointed by the principal broker to supervise a designated agent/representative Inactive StatusA broker/salesperson who is not under the supervision of a principal/supervising broker, not active with a firm, and prohibited from performing any acts of brokerage

Sole Proprietor (Principle Broker Owner) Brokerage firm that DOES NOT require a firm license, as long as the individual broker/owner is licensed. Principal broker owners operate under legal or fictitious names as approved by the board FirmPartnership, association, corporation, llc, or sole proprietorship (principal broker owner) engaged in the sale of real estate on behalf of others for profit. Firms must be licensed Sole Proprietor (Non Broker Owner)Brokerage firm that requires a firm license, but which may be owned by an unlicensed individual under specified circumstances The Virginia Real Estate Board (VREB)VA State government body authorized to regulate the real estate profession in VA Regulantone salesperson or broker who is regulated by the board RepresentationRepresentationStandard Agent - performs all duties required by Virginia law, plus any additional duties listed in the brokerage agreement.Limited Service Agent - doesn't perform one or more of the duties that are expected of a standard agent. These exceptions must be clearly identified in the brokerage agreement.Independent Contractor - not subject to the usual agency duties that are required by Virginia law. Only performs the duties specifically listed in the brokerage agreement.Commencement - when client "engages" licensee.Termination - upon completion, termination, mutual agreement, breach, or if no consent to a disclosed dual agency.Actively EngagedOne with an active license, engaged in at least 40hrs per week in regulated real estate activity Standards of Conduct Continued..Improper Dealing - Licensees must treat clients and customers in a fair and honest manner.Misrepresentation/Omission - Licensees are prohibited from making any misrepresentations or omissions related to a transaction.Delivery of Instruments - Licensees must promptly deliver signed documents, notify parties of any material changes, and return requested documents to the rightful owner.Advertising - Licensees must follow advertising rules.Discussed on the next few slides.Individual LicensesPersonal Attributes - diploma, 18 yrs old, experience (brokers only)Prior Convictions - misdemeanors, felonies, sanctions?Education - pass an approved course and take PSI exam.

• If a broker repays the amount awarded to an aggrieved

consumer from the Transaction Recovery Fund with interest, which of the following is true?1. his or her license

must be reinstated2. the Real Estate Board could withhold issuance of a new license, forever3. he or she must wait for at least 30 days to reapply for a license4. he or she could be reinstated as a salesperson, but NOT as a broker, for a period of 2 years

• the Real Estate Board could withhold issuance of a new

license, foreverTrap: This question requires that you

evaluate the difference between the "must" and "could"