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Pennsylvania Real Estate Commission PA Salesperson State Exam Sample Questions (Q14-Q19):
NEW QUESTION # 14
If a client requests to list their home for much more than the comparable market analysis (CMA) recommends, what is the duty of the salesperson?
- A. Refuse the listing because accepting the listing would violate the Pennsylvania Real Estate Licensing and Registration Act
- B. Advise the client as to the reason it is in their best interest to list the property closer to the comparable market value
- C. Provide the client financial advice as to how they can invest their assets to earn the amount they would like to receive
- D. Require the seller to receive an appraisal before listing the property
Answer: B
Explanation:
Areal estate licensee has a fiduciary duty to provide honest, professional advice to their clients, including pricing strategies based oncomparative market analysis (CMA).
* Under 49 Pa. Code § 35.292 (Duties of Licensees Generally), a licensee must act in the best interest of the client, which includes providing realistic pricing guidance.
* If a seller insists on listing at an inflated price, the agent should educate them on the risks, such as longer market time and reduced buyer interest.
* While the agent cannot force a seller to list at a lower price, they must ensure that the client makes an informed decision.
Why the other answers are incorrect:
* Option A (Require an Appraisal):CMAs are typically sufficient for pricing; an appraisal is only required in specific cases (e.g., lender requirements).
* Option B (Refuse the Listing):Overpricing is not illegal, so there is no licensing violation in accepting the listing.
* Option D (Providing Investment Advice):Real estate licensees are not financial advisorsand should not offer investment strategies.
NEW QUESTION # 15
The Commission, after obtaining the facts of a verified complaint against a licensee, holding a hearing, and finding that licensee guilty, may:
- A. Make the licensee take up to 20 hours of ethics training.
- B. Levy a fine of $2,000 - $5,000 if this is the licensee's first offense.
- C. Imprison a licensee for no more than 90 days.
- D. Suspend or revoke a license and/or levy a fine of $1,000 or less.
Answer: D
Explanation:
Under63 P.S. § 455.305 (Civil Penalty Provisions),the Pennsylvania Real Estate Commission has the authority to suspend or revoke a license and impose fines of up to $1,000 per violation.
* The Commission can impose fines but does not have authority over criminal penalties such as imprisonment.
* Suspension or revocation is a common penalty for severe violations, including fraud, misrepresentation, or mismanagement of client funds.
Why the other answers are incorrect:
* Option A ($2,000 - $5,000 Fine):The fine limit for first offenses is typically $1,000 per violation.
* Option C (20 Hours of Ethics Training):Training may be recommended but is not an official penalty imposed by the Commission.
* Option D (90-Day Imprisonment):The Commission does not have authority to impose jail sentences.
NEW QUESTION # 16
What is the status of a person's real estate license after a claim has been paid from the Real Estate Recovery Fund to settle a claim against that licensee?
- A. Reinstated
- B. Inactive
- C. Active
- D. Suspended
Answer: D
Explanation:
Under63 P.S. § 455.803 (Real Estate Recovery Fund), if the Pennsylvania Real Estate Commissionpays out money from the Real Estate Recovery Fund due to a licensee's misconduct, the license is automatically suspended.
* A suspended license means the person cannot legally practice real estate until they reimburse the Recovery Fund for the full amount paid, plus interest.
* This is a consumer protection measure to ensure that licensees who cause financial harm cannot continue practicing until restitution is made.
* Once repayment is made, the licensee must apply for reinstatement, which is not automatic and may require a hearing.
Why the other answers are incorrect:
* Option A (Active):The license does not remain active after a payout from the fund.
* Option B (Inactive):"Inactive" means the licensee voluntarily stopped practicing, which is not the case here.
* Option C (Reinstated):Reinstatement does not occur automatically; the licensee must repay the fund and petition for reinstatement.
NEW QUESTION # 17
Which of the following conditions MUST be met before a licensee participates in the sale of real property in which the licensee has an ownership interest?
- A. The licensee must provide written disclosure of the ownership interest to all parties.
- B. The percentage of the licensee's ownership interest must be stated on the sales contract.
- C. The Pennsylvania Real Estate Commission must be notified of the transaction.
- D. The listing agreement must identify the licensee's name and status as a licensee.
Answer: A
Explanation:
Under49 Pa. Code § 35.283 (Disclosure of Interest),a real estate licensee must disclose in writing if they have a direct or indirect ownership interest in a property they are selling or purchasing.
* This disclosure ensures transparency and prevents conflicts of interest.
* Failure to disclose ownership interest could be considered fraudulent and result in disciplinary action by the Pennsylvania Real Estate Commission.
Why the other answers are incorrect:
* Option A (Commission Notification Required):TheCommission does not need to be notifiedunless a violation occurs.
* Option B (Listing Agreement Disclosure):Disclosure isnot required in the listing agreementbut must be made to all parties.
* Option D (Percentage of Ownership on Contract):The specificpercentage of ownership is not required to be on the contract; general disclosure is sufficient.
NEW QUESTION # 18
A salesperson who operates as an independent contractor for a broker is seldom in the office. Earnest money deposits received by this salesperson:
- A. May be held by the salesperson for 3 business days.
- B. May be kept temporarily in an escrow account opened by the salesperson.
- C. Should be returned to the buyer to transmit to the broker.
- D. Should be transmitted promptly after receipt to the broker.
Answer: D
Explanation:
Under49 Pa. Code § 35.324 (Handling of Deposits and Escrow Money), all earnest money deposits must be promptly transmitted to the employing broker for deposit into an escrow account.
* A salesperson cannot hold earnest money or maintain an escrow account on their own.
* Brokers are responsible for ensuring that all escrow funds are properly handled and protected from commingling.
Why the other answers are incorrect:
* Option A (Salesperson Holding Escrow Funds):Salespersons are prohibited from maintaining independent escrow accounts.
* Option C (Holding Funds for 3 Days):Earnest money must be turned over to the broker as soon as possible; salespersons cannot hold it for any period.
* Option D (Returning to Buyer for Transmission):Earnest money must go directly to the broker, not back to the buyer.
NEW QUESTION # 19
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