Chapter 1 Montana License Law exam fully solved & updated

The Board Of Realty Regulation Consists of how many members and how are the members appointed? - answer-7 members and are appointed by the governor What are the Civil and Criminal Penalties for those engaging in real estate without a license? - answer-Guilty of a misdemeanor First Offense will be fined b/t $100-$500 or imprisoned for 90 days or BOTH Subsequent Offense will be fined b/t $500-$2,000 or imprisoned for 6 months or BOTH What is the Real Estate Recovery Account? - answer--Within the state special revenue fund for the use of the board there is a recovery account -Is used to pay claims against licensees that remain unsatisfied - the board maintains a minimum blanca of $100,000 and to maintain this new licensees pay an additional fee of $35 when obtaining initial license. If it is lower than minimum balance assessment will take place to determine how to maintain balance (done by board) Claims against the recovery account? - answer-Applications for claim must be made within 2 years of final judgement, cannot be made for an amount over $25,000, the board will conduct a hearing within 30 days of the application What are the requirements for continuing education for new salesperson license? - answer-they receive an interim license that terminates on Oct. 31st of the year of the initial license date, must complete the "12-hour rookie course" within 120 days following their original licensee issue date Continuing Real Estate Education? - answer-All active licensees must complete board-mandated core education each year along with a 12 hour of continuing real estate education each year. A license may be placed on inactive status by? - answer-1. paying the required fee 2. forwarding the license to the Board for cancellation of active status 3. Submitting a written request that the license be place inactive 4. must renew the inactive license each year to avoid lapse, expiration or termination How do you reactivate an inactive license? - answer-1. filing a change of address application 2. providing evidence of completing 24 hours of continuing education 3. providing evidence of completing the previous license years core course 4. paying the required fee How many days does a Broker have to notify the department of moving addresses? - answer-10 days A salesperson whose license has been cancelled due to termination of association with a supervising broker must? - answer-notify the Board of a new supervising broker relationship or notify board to place on inactive status, pay the required fees within 10 days An existing supervising broker may not transfer temporary supervision of a salesperson for more than how many days? - answer-60 days in a 12-month period What are the disciplinary guidelines the board may impose against a licensee violating any laws or rules? - answer-they may impose any action, the board decides on a case-by-case basis that seems appropriate Where must the board deposit money it receives? - answer-must be deposited in the recovery account What are the 6 Real Estate Activities? - answer-1. creation and improvement 2. management and maintenance 3. demolition 4. investment ownership 5. regulation 6. transfer Persons requiring a Real Estate License? - answer-It is a violation of license law for a person to act as a real estate broker or salesperson, or to advertise as a real estate agent without a license Predetermination for Licensing? - answer-Applicants with prior disciplinary actions, criminal convictions, or deferred sentence may make an application for a predetermination prior to taking the class and exam to see if they can continue. All applicants for broker's license must: - answer-18 years of age, have worked as al license real estate salesperson for two years, or have experience or special education that the board considers equivalent, complete 60 hours of coursework, pass written exam, must apply within 12 months of taking exam All applicants for a salesperson license must: - answer-18 years of age, at least two years of high school, file license application, complete 60 hours of coursework, pass written exam, must apply for license within 12 months How must the license and Pocket card be displayed? - answer-a broker must conspicuously display his or her own license in the broker's place of business, licensees are issued a pocket card that certifies the holder is registered, the period for which fees have been paid, and state the name and address of the salespersons supervising broker What is a supervising broker endorsement? - answer-a broker must complete four hours of continuing education in the area of supervising broker annually, this cannot be placed on inactive status, must complete the four hours or you can not be reinstated Reciprocity - answer-the Board may enter into an agreement with any other state so residents of the other state may obtain a nonresident license in Montana, provided the other state grants Montana licensees the same privleges When do licensees need to renew their license? - answer-must renew his or her license on or before October 31st wether it be active or inactive Deposited Money not otherwise provided for? - answer-when money is received by the Board or the Department and there is no provision for the disposition of the money, the money is deposited in the state special revenue fund for the Board's use The agency relationship of a buyer agent, seller agent, or dual agent continues until whichever of the following happens? - answer-Completion of performance by the agent, the expiration date in the listing agreement or buyer broker agreement, an authorized termination of the listing agreement or buyer broker agreement Upon termination of an agency relationship, a licensee does not have any further duties to the principal except: - answer-account for all money and property of the principal, keep confidential all information received during the agency relationship Can a licensed broker pay commission to a licensed broker of another state? - answer-Yes Can a salesperson be associated with more than on supervising broker? - answer-No What must a supervising broker do to a terminated salesperson association? - answer-must return the salesperson license to the Board immediately A saleperson license whose license has been cancelled due to termination of association with a supervising broker must? - answer-notify the Board of a new broker or notify the Board to place on inactive status, pay the required fees within 10 days What must a salesperson do in order to negotiate a listing agreement? - answer-must be reviewed, signed, and dated by the supervising broker What must a salesperson do if their supervising broker has failed to renew or reinstate the broker's expired license or supervising broker endorsement? - answer-must be place be placed on inactive status or transfer to another supervising broker Can a salesperson have temporary association with a supervising broker other than his or her existing supervising broker? - answer-Yes What happens in the event of a death of ones supervising broker? - answer-the salesperson may not practice real estate until the salesperson's license is transferred to a different broker, the salesperson must inform the Board of the death within 10 days, supervision of the salesperson may be transferred to a temporary broker Can a salesperson engage in a "for sale by owner" transaction without the supervision of a broker? - answer-Yes a supervising broker is not responsible or liable for a salesperson's "for sale by owner" transaction, this must be disclosed to the for sale by owner selling the property What are some trust account requirements? - answer--broker is responsible for proper handling of all earnest money or funds received -if a trust account is maintained in an interest-bearing account, the interest is payable to any party as agreed -all trust fund money received must be deposited into a trust account with three days - funds cannot be commingled with broker's personal funds -trust account records may be maintained electronically -broker may keep up to 1,000 of personal funds in account to cover account maintenance charges or minimum balance requirements -trust funds must be retained in the trust account until the transaction is closed or terminated - all records of trust accounts and documents must be maintained for eight years What is property management? - answer-any act performed for compensation in the leasing, renting, subleasing, or other transfer of possession of real estate owned by another, without transfer of title Can a real estate broker or salesperson acting un supervision of a broker act as a property manager without the need to hold a operate license? - answer-Yes The Board requires an applicant for a property manager license to: - answer-complete 30 hours of coursework, pass written exam, at least 18, completed high school, completed application, pay fees How long after October 31st will a non-renewed license lapse expire, or terminate? - answer-Within 45 days What must a property manager do to reactive a license from inactive status? - answer-file a change of address, complete 24 hours of continuing education, pay required fee New property manager must complete what as continuing education? - answer-must complete 12 hours of new license mandatory continuing education to receive a permanent license Montana timeshares? - answer-share the property costs with others in order to guarantee time and the property What is the Montana time share act? - answer-contains all the laws governing timeshare activity in Montana, the board adopts rules to carry out the provisions of the act The rules included in carrying out the Montana time share act are: - answer-registration information, documents acceptable in lieu of registration documents, qualifications for applicants, continuing education requirements for renewal of a timeshare salesperson;s license, additional info included in public offering statements, fees Can a timeshare offering be advertised, offered, or sold without registration? - answer-No What must an application for registration of a timeshare offer do? - answer-must be signed by the developer, and accompanied by the registration fee When must a purchaser of a timeshare agreement cancel or terminate the agreement? - answer-7 days following the receipt of a public offering statement or signing of a timeshare purchase agreement What must a person who offers or sells a timeshare interval provide a prospective purchaser? - answer-a written public offering statement before the purchaser signs an agreement What does the Board of Realty Regulation do? - answer-The Board of Realty Regulation regulates the licensing of applicants and the practice of licensees in Montana to safeguard public interest. How does the Board ensure licensees are conducting real estate business in a professional manner? - answer-To ensure licensees act in the way prescribed, the Board creates the rules and regulations that govern the practice of real estate throughout Montana. List 3 reasons for the Board to suspend or revoke a license. - answer--misleading or untruthful advertising -misrepresenting a client -failing to deposit earnest money -acting as an undisclosed dual agent -offering property for sale without the owner's consent What happens if a person receives any money as a commission or compensation as a consequence of a violation of license law - answer-penalty of not less than the sum of money received and not more than three times the sum received, as determined by the court What happens if a broker or manager fails to comply with the trust account maintenance requirements - answer-the department may issue a citation and the citation must include; the time and date citation was issued, name, title, mailing address, and signature of person missing citation, reference to rule or statute violated, information regarding the person receiving the citation, info, regarding the procedures the follow to pay the fine, and the amount of the fine What is the civil fine for failure to comply with trust account maintenance requirements? - answer-50$ for each violation What are the steps take for violation of trust account maintenance? - answer--person who issues citation is authorized to collect the fine and deposit proceeds in the state special revenue account -person who is issued citation may pay the fine or file a written dispute of the violation with Board within 5 business days of date issued -person who refused to sign and accept and does not file written dispute is demonstrating unprofessional conducts Significant violations shall be forwarded to the complaint screening panel and include what? - answer--an excessive number of violations in a single audit -repeat violations -a single, severe violation How does the Board decide on the disciplinary action? - answer-case-by-case basis and by considering; the seriousness of the infraction, the detriment to the health and safety and welfare of the people of Montana, any past of pending disciplinary actions relating to the licensee What are some methods of discipline the Board might use on a licensee in violation of license law? - answer-The board may: -revoke -place licensee on probation -order the licensee to complete training -limit the licensee's scope of practice Explain the process when a person obtains a final judgment in court against a licensee - answer-the person may file an application with the Board for a payment from the recovery account for any actual and direct losses that remain unpaid on the judgement What are the requirements for the applicants filing claims against the recovery account? - answer--made within 2 years of the final judgment -served certified mail -filed with the board -filed with the Board along with an affidavit of service Application for payment from the account may not be made for? - answer-a judgment that has been satisfied, an amount over 25,000 for any one licensee, attorney fees and exemplary or punitive damages What is a motion to dismiss an application? - answer-A licensee may request the Board to dismiss the application at any time if it appears that the application is without merit , the Board will give an applicant at least 10 days written notice of any motion to dismiss Explain a Hearing on an Application. - answer-Within 20 days of the filing of the affidavit of service, the Board will conduct a hearing upon the application, upon motion of either party the Board will continue the hearing up to 60 days and may continue the hearing as it feel appropriate What happens at the hearing of an application? - answer-The Board will determine the truth of the allegations made in the application and any supporting material that is challenged by the licensee What are the steps if the Board determines the claim for an application is valid? - answer-the Board will enter an order requiring payment from the recovery account for whatever sum, it considers due Where must the money go that the Board receives? - answer-directly in the recovery account and allocated exclusively for the purposes provided in the statues Subrogation Rights - answer-Once a payment is made from the recovery account, the Board assumes all rights of a creditor to the amount paid. Any amount and interest recovered by the Board on the judgement must be deposited in the recovery account What are the effects of repayment to fund? - answer-Nothing in the statues regarding the recovery account limits the authority of the Board to take disciplinary action against any licensee under other provisions of license law, if a licensee repays the recovery account in full it will not change the effect of any other disciplinary action taken by the Board under the provisions of the statues. How is the recovery account funded? - answer-To maintain the recovery account, all initial licenses come with an additional fee of $35 payable to the recovery account What is the maximum sum payable from the recovery account against a single licensee? - answer-$25,000 When must an application for payment from the recovery account be made? - answer-within 2 years of the date of the final judgement What is the difference between a routine application and a non routine application? - answer-a routine application is a complete application which shows compliance with board rules and no disciplinary issues. All other complete applications are non routine. What kind of application will the board review? - answer-non routine applications containing criminal convictions and charges, other unprofessional conducts, or application discrepancies True or False. Misdemeanor traffic convictions not involving alcohol or drugs will not cause an application to be considered non routine? - answer-TRUE What are some application discrepancies? - answer-Failure to accurately and completely respond to a question on the application form. The department may treat an application as routine under this subsection if the department receives an adequate explanation for such a failure. The department may, but is not required to, submit an otherwise routine application for board review if:questions arise whether the applicant meets all requirements for licensure, including the demonstration of good moral characterinconsistencies, irregularities, or other matters of concern, including but not limited to allegations of unlicensed practice, exist in the application or related documentation Can corporations, partnerships, and associations be licensed in themselves? - answer-No, a corporation or a partnership can act as a licensee only if every officer or partner engaging in real estate holds a license What is and what are the requirements for a predetermination for licensing? - answer-An applicant with prior disciplinary actions, open legal matters, a criminal conviction, or a deferred sentence may make an application for a predetermination prior to completing the examination and pre license education course. -The predetermination is to determine whether the applicant's qualifications, other than examination and education, are sufficient for licensure. -The predetermination is voluntary and not a requirement. -Application for predetermination is made to the Board on Board-approved forms, accompanied by an application fee. -Approval of a predetermination application is valid for 90 days. What is and how does one receive a supervising broker endorsement? - answer-is issued to any broker completing the supervising broker pre-endorsement course, and must meet the education and experience required as prescribed for brokers. How does a broker maintain a supervising broker endorsement? - answer-a broker must complete four hours of board-approved continuing education in the area of supervising broker each year. True or False. The Board may allow a salesperson to temporarily associate with a broker holding a supervising broker endorsement who is not the supervising broker listed on the salesperson's pocket card - answer-TRUE From who must an applicant for a salesperson license get a recommendation before he or she will receive a license? - answer-from a license broker with a supervising broker endorsement who is to employ the applicant What must all new sales licensee do within 120 days following their original license issue date? - answer-complete the mandatory new license continuing education requirement, known as the "12-hour rookie course" What are the requirements of the continuing Real Estate Education? - answer-All active licensees are required to complete a Board-mandated core education course each year. In addition to the Board-mandated core education course, each active licensee is required to complete a minimum of 12 hours of continuing real estate education every year. -The required hours must be in real estate-related courses approved by the Board. -A course completed after the renewal deadline will result in a late renewal and penalty regardless of when the licensee submits the renewal application. -The Board determines certain topics from which at least four hours of required education must be completed. -No carry over hours are allowed. -The course provider must supply each licensee with a course completion certificate and student evaluation form, and must verify attendance of each licensee. Inactive licenses - answer-A broker or salesperson may place his or her license on inactive status by: -Paying the required fee -Forwarding the license to the Board for cancellation of active status -Submitting a written request that the license be placed inactive Salespersons must also forward a release from their supervising broker. A licensee whose license is on inactive status: -must keep the Board informed of any changes of residency or mailing address during the period of time the real estate licensee remains on inactive status. -must renew the inactive license each renewal period to avoid a lapse, expiration, or termination of the license. -does not need to report continuing education until converting the license to active status. -may not engage in real estate activity. Changing license from inactive to active status. - answer-A broker or salesperson may return his or her inactive license to active status by: -Filing a change of address application -Providing evidence of completing 24 hours of continuing education within the preceding 24 months -Providing evidence of completing the previous license year's core course -Paying the required fee Reciprocity - answer-The Board may enter into an agreement with any other state so residents of the other state may obtain a nonresident license in Montana, provided the other state grants Montana licensees the same privileges. How long does a suspended license last for? - answer-1 year How long is a revocation? - answer-permanent What are the schedule of fees? - answer-The Board requires a fee for licensing services. Fees are charged by the Department and paid into the state special revenue fund for the Board's use, with the exception of examination fees, which are payable to the national testing service under contract with the Board What happens to money that is received by the Board or the Department and there is no provision for the disposition of the money? - answer-the money is deposited in the state special revenue fund for the Board's use Does a license on inactive status need to be renewed? - answer-Yes, inactive licenses must be renewed or they will expire or terminate What are some exceptions to dual agency relationships? - answer--A dual agent must disclose to a buyer or seller any adverse material facts known to the dual agent, regardless of any confidentiality considerations -A dual agent must not disclose the following information without the written consent of the person to whom the information is confidential: * that the buyer is willing to pay more than the offered price *that the seller is willing to accept less than the purchase price that the seller is asking for the property *factors motivating either party to buy or sell The agency relationships of a buyer agent, seller agent, or dual agent continues until whichever of the following happens first: - answer--completion of performance by the agent -the expiration date in the listing agreement or buyer broker agreement -an authorized termination of the listing agreement or buyer broker agreement Upon termination of an agency relationship, a licensee does not have any further duties to the principal, except as follows: - answer--to account for all money and property of the principal -to keep confidential all information received during the course of the agency relationship that was made confidential at the principals request What are some exceptions to confidentiality of the principal? - answer--Subsequent conduct by the principal that authorizes disclosure -Disclosure of adverse material facts that concern the principal's property -The ability of the principal to perform on a purchase offer -Disclosure required by law or to prevent a crime -Information being disclosed by someone other than the broker or salesperson -The disclosure of information being reasonably necessary to defend the conduct of the broker or salesperson and their employees and subagents What kind of disclosure is formed when a buyer agent and seller agent considers becoming a dual agent - answer-An initial disclosure What kind of disclosure is formed when a buyer agent and seller agent considers becoming a dual agent and has already given the buyer or seller the initial disclosure - answer-A subsequent disclosure (a change in a relationship described in an initial disclosure) When should a seller's agent make disclosure of agency to a prospective buyer? - answer-At the start of negotiations Is a broker liable for a misrepresentation made by the broker's subagent? - answer-Only if the broker has actual knowledge of the misrepresentation, the subagent is employed by the broker, or the misrepresentation initially arose from the broker True or False. A licensed broker may pay a commission to a licensed broker of another state provided the nonresident broker does not conduct services for which a fee, compensation, or commission is paid in Montana. - answer-True When must a broker notify the department of a change in his/her designated address? - answer-!0 days of moving and must pay the required fees True or False. A salesperson can be associated with more than one supervising broker - answer-False, a salesperson may not be associated with more than one supervising broker True or False. A salesperson may not perform services for a broker with a supervising broker endorsement other than the one designated on the salesperson's license. - answer-True. What must a salesperson shoes license has been cancelled due to termination of association with a supervising broker do? - answer-Notify the Board of a new supervising broker relationship or notify the Board to place license on inactive status, and pay the required fees within 10 days once the Board has received the termination notice What will happen to a license that is cancelled? - answer-it will remain cancelled until transferred to new broker or placed on inactive status What happens when a salesperson's association with a supervising broker is terminated? - answer-the supervising broker must return the salesperson's license to the Board with a letter noting the termination immediately What happens if a salesperson supervising broker has failed to renew or reinstate the broker's expired license or supervising broker endorsement? - answer-must request to be placed on inactive status or transfer license to another broker within 10 days The written transfer of supervision must be provided to the Board no later than how many business days prior to the effective beginning date of the temporary transfer of supervision - answer-Three business days If a trust account is maintained in an interest bearing account, the interest is payable to whom? - answer-any party as agreed, could be payable to the broker, principal, third party, or any other person as designated by agreement, if it is payable to the broker, it must be identified in the agreement as payment for services performed. How quickly must trust fund money received be deposited into the trust account? - answer-within THREE DAYS, unless otherwise agreed How much money can a broker keep in the trust account of his own personal funds. - answer-$1,000 of his or her personal funds to cover account maintenance charges or minimum balance requirements If personal funds are help in a trust account what must be kept? - answer-a chronological ledger showing all deposits and disbursements of personal funds How long must all trust account records and real estate related documents be maintained? - answer-Eight Years what must a licensee do if information in an internet ad changes once the ad is active? - answer-update the material within seven days of the material change True or False. Except for new licensees, all active and inactive licenses will be required to renew their licenses by October 31st each year - answer-TRUE How long will a non-renewed property management license lapse, expire terminate? - answer-45 days To reactivate a license on inactive status, the property management licensee must do all of the following: - answer--File a change of address application. -Provide evidence of completing 24 hours of continuing education within the preceding 24 months. -Pay the required fee. Each property manager must maintain a trust account into which what must be deposited? - answer-all deposits, rent payments, or other trust funds received by the property manager What chapter of Montana license law contains all the laws governing timeshare activity in Montana and what is it often referred to as? - answer-Chapter 53, "Montana Timeshare Act" Can a timeshare offering be advertised, offered or sold in Montana if it is not registered? - answer-No, it must be registered to be advertised offered or sold How does one register a timeshare? - answer-must be signed by the developer and accompanied bu the registration fee. Timeshare offerings will not be registered unless the developer files a complete application What does a complete timeshare offering application contain? - answer--financial statements that disclose the current financial condition of the developer -statement disclosing any fees in excess of the stated price per unit to be charged to purchasers -copies of all timeshare instruments -copy of the public offering stmt -an irrevocable consent to service of process signed by developer -any other info. the Board may require What are some examples of alternative filing documents for timeshare offerings? - answer-in place of documents required to be filed with the application, the Board may accept a public offering statement filed with an agency of the US or another state What must a developer do if a material change in a timeshare offering occurs? - answer-the developer must file an amendment to the documents filed, with the applicable fee Registration requirements for timeshare offerings do not apply to? - answer--An offer, sale, or transfer of not more than two timeshare interests by a timeshare owner in a 12-month period -A gratuitous transfer of a timeshare interest -A sale under court order -A sale by any government or governmental agency -A sale by forfeiture, foreclosure, or deed in lieu of foreclosure -A sale of a timeshare offering already registered in Montana or a sale of all timeshare units or timeshare intervals in the timeshare offering to any one purchaser -A transfer of a timeshare interest by a timeshare owner other than the developer or the developer's agent unless the transfer is made for the purpose of avoiding the provisions of this chapter Who is responsible for administering the Montana Timeshare Act? - answer-The Board adopts rules to carry out the provisions of chapter 53- The Montana Timeshare Act How can one offer timeshare intervals in a project? - answer-a person must be licensed as a timeshare salesperson and affiliated with at least one registered timeshare project How does one obtain licensure as a timeshare salesperson? - answer--Be at least 18 years of age. -Be a high school graduate or equivalent. -Complete an application. -Be of good reputation and competent to transact the business of a timeshare salesperson in the best interests of the public. -Pay the applicable fee. -Complete a Board-approved course of education related to the timeshare industry. What procedures does one have to go through if they change affiliation with a timeshare project? - answer-he or she must notify the Department of the change of affiliation within 10 days, must designate the new license affiliation and pay the required fees What happens if someone is no longer affiliated with a timeshare project? - answer-he or she must notify the Board that the license is inactive and pay the required fees What must a person who offers or sells a timeshare interval do with a prospective purchaser? - answer-provide the prospective purchaser with a written public offering statement before the purchaser signs an agreement for the purchase of a timeshare When can a purchaser angel a timeshare purchase agreement? - answer-within 7 days following receipt of a public offer statement or signing of a timeshare purchase agreement After cancelling a purchase agreement the purchaser will receive what? - answer-a refund of any consideration paid by providing written notice of the cancellation to the developer or developer's agent either by certified mail or personal delivery What happens if the purchaser does not receive the public offering statement? - answer-the agreement is voidable by the purchaser until the purchaser receives the public offering statement and for 7 days after receipt A developer may not sell, lease, assign, or otherwise transfer the developer's interstate's in a project unless the transferee agrees in writing to: - answer--honor the purchaser's right to use and occupy the timeshare unit -honor the purchaser's right to cancel -comply with Montana time share law Each purchaser of a timeshare contract whose interests may be affected must be given what? - answer-written notice of a transfer immediately after the transfer is made The parties to a timeshare agreement must deal with each other in what? - answer-good faith, a developer may not require a purchaser to agree to a release, waiver, or any other provision that relieves a person from a duty imposed by this chapter To whom might the Board pass evidence for criminal proceedings against licensees violating timeshare law or rules? - answer-To the Attorney general or the proper prosecuting attorney, who can institute criminal proceedings What is consideration? - answer-includes money compensation, change of free services, or any other valuable good or service that person expects to be paid What is a real estate commission? - answer-state license laws provide for the establishment of a real estate regulatory entity to administer and enforce licensing legislation The state real estate commission has the authority to? - answer--oversee the licensing process -administer all aspects of the license laws -receive and deliberate on consumer complaints -handle problems between licenses Montana's laws and rules governing timeshares describe an "offering" as what? - answer-An inducement to encourage a person to acquire a timeshare interest. What are the 3 elements that a broker must satisfy in order to claim a commission. - answer-These are; the buyer, the signed contract between buyer and seller, and a closing. A signed listing agreement is NOT necessary for a broker to be entitled to a commission. What is a statutory Broker and who do they represent in a transaction? - answer-is not the agent of the buyer or the seller, but is obligated to them to disclose any adverse material facts that concern a property and are known to the statutory broker. Who creates and passes the statutes and laws that govern real estate in Montana? - answer-the legislature What governs the relationships between licensees and their clients? - answer-Montana real estate license law What is the license renewal fee for a salesperson and a broker in Montana? - answer-$150 for a salesperson's license, $175 for a broker's license.