Real Estate U Final Exam: Questions with Complete Soluti
m m m m m m m m
ons (2023) m
Articlem12-AmofmthemNYSmRealmPropertymLa
- CorrectmAnsm-m-mPrimarympersonmismtom"protectmthempublic"-minimizing mfraud
- Requiresmamsalespersonmtombematmleastm18myearsmofmage
- Requiresmambroker mtombematmleastm20myearsmofmage
Maintaining mamLicensem-mCorrectmAnsm-
m Placem ofm workm (brokerage) m Pocketm card
GivemnoticemtomNYmDepartmentmofmStatemofmchangeminmname,mstatus,mlocationm(withinm5mdays)
ExemptionsmtomLicensurem-mCorrectmAnsm–
- realmestatemattorney
- governmentmofficial mpertaining mpertaining mtomcourtmormrealmestatemproceeding mduties
- courtmordersmofficial m(trustyminmbankruptcy,mrealmestatemguardian,mexecutor mormadministrator)
"SummarymofmyoumSubmission"m-mCorrectmAnsm–
m Obtainedm after m youm register mfor mthem Newm YorkmStatem Salespersonm exammusing m eAccessNY.mYoum
mustmbring myoum"SummarymofmyourmSubmission"mwithmyoumwhenmtaking mthemStatemexam
Misdemeanor m-mCorrectmAnsm-mAmcrimempunishablembymupmtomamyearminmprisonmand/or mam$1,000mfine
Listing mAgreementm-mCorrectmAnsm-
m contractm betweenm Principlem andm agent,mauthorizing m themagentm tom performm servicesm for mthem pri
ncipleminvolving mthemlatter'smproperty
PocketmCardm-mCorrectmAnsm-
m issuedm bym them departmentm ofm statem tom eachm licensee:containsm them photo,m namem andm businessm
addressmofmlicensee,mand,minmthemcasemofmamrealmestatemsalesperson,mthemnamemandmbusinessmad
dressmofmthembroker mwithmwhommhemormshemiterm-
15smassociatedmandmshallmcertifymthatmthempersonmwhosemnamemappearsmthereonmismamlicensedmr
ealmestatembroker mormsalesperson
- Mustmbemcarriedmbymthemagentmatmallmtimesmwhenmserving masmamsalesperson
Escrow
(notmidealmbcmitmcanmresultminmlegalmconsequencesminmwhichmcasemhasmtombeminmwriting)
https://www.youtube.com/watch?v=-QqtFEkvsBom-mCorrectmAnsm-
m Writtenm agreementm betweenm 2/+m partiesm providing mthatm certainm instruments/m propertym ism plac
edmwithmthirdmpartymandmdeliveredmtompersonmuponmthemfulfillmentmormperformancemofmsomemac
t/condition.
Simple:mAmSeparatemBankmaccountmthatmprotectsmthemintegritymofmthemtransactionm(agreement)mt
hatmanmagentmcreated
,Ex:mAnmagentmwhomcreatedmamlegallymbinding mcontractmwithmbothmbuyer m&msellermandmhasmamescrowmc
ompanymmakemsuremeverymstipulationminmthismRealmPropertymAccountabilitymdocumentmthatmwasmagr
eedmuponmbymbothmpartiesmhasmbeenmmetmbeforemamdealmcanmbemclosed.
According mtomthismdocument,mthembuyer/seller mdon'tmhavemvicariousmliabilitymformthemactionsmofm
ambrokersmagentm?mThismformminformsmthemclientmaboutmdualmagencymandmdetailsmthemrisksmandm
benefitsminvolvedminmthemtransactionm-mCorrectmAnsm-mNYSmDisclosuremForm
NYSmDisclosuremFormmfor mBuyer mandmSeller mRegarding mRealmEstatemAgencymRelationshipmFormm-
m Correctm Ansm -
m Am writtenm explanation,m tom bem signedm bym a mprospectivem buyer m or mseller mofmrealmestate,m explainin
gmtomthemclientmthemrolemthatmthembroker mplaysminmthemtransaction
- Firstmdocumentmtombemsubmittedmtomallmprospectivemclients
- bymlawmthismformmneedsmtombemsignedmatmrealmmeeting m(sombeforemanymvisits/showingsmofmprop
ertymormbrokerage,mormdiscussionmofmlisting mprice,mpurchasempricemamtenantmismablemtomafford,mm
ortgagemtenantmneedsmtomtakemout)
*InmthemcasemwheremclientmrefusesmtomsignmthemDisclosuremForm,mthemagentmshouldmexplainmthatm
themformmismsimplymamdocumentmmeanmtomprotectmthemclientm&mexplainsmthemclientsmrights
*mifmtheremismstillmrefusalmthenmagentmneedsmtomdocumentmtime,mdatemandmclientmnamem
whilemcontinuing mwithmthemmeeting/showing mofmproperty.mAfterwardsmagentmneedsmtomf
affidavit
ill m outm an
m containing m hem sameminformationm andm exactm reasonm for mwhym them clientmrefusesm tom signm them
disclosuremform.
FirstmMeeting m:mDisclosuremFormm-mCorrectmAnsm-
m Listing m agentm meeting mBuyer:mAgentm needsm tom letm buyer m knowm thatm their m fiduciarym duty/m undiv
idedmloyaltymismtomseller
Buyer magentmmeeting mseller:mAgentmneedsmtomletmseller mknowmthatmtheirmfiduciarymduty/mundividedml
oyaltymismtombuyer
After mInitialmDisclosuremAgentmchangesmtheirmrolesmDUEmTOm:m-mCorrectmAnsm-
m 1.m Initialm Disclosurem withm Buyer:m agentm realizesmlaterm onm thatm them buyer m isminterestedm inm am
propertymthatmthemagentsmbrokeragemismlisting mthenmitmwillmresultminmthemBuyer mAgentmbecom
ingmamDualmAgent
2.mBuyer mbecomesmamcustomer mandmthemagentm&mbrokeragemonlymrepresentmthemseller
Commingling m-mCorrectmAnsm-
m Tom minglem or mmix,mfor mexample,ma m client'sm fundsm inm them broker'sm personal m or m general m account.
NetmListing
(canmbemillegalmsincemitmcanmleadmtomFRAUD)m-mCorrectmAnsm-
m Am pricem belowm whichm anm owner m will mnotm sell mthem property,m andm atmwhichm pricema m broker m will m n
otmreceivemamcommission;mthembroker mreceivesmthemexcessmover mandmabovemthemnetmlisting masmth
embroker'smcommission
,Undermamnetmlisting,mthembroker mcanmoffermthempropertymformsalematmthemhighestmpricemobtainabl
emtomincreasemthemcommission.mThismtypemofmlisting mismillegalminmNYmandmcanmresultminmlicensemlo
ss
Articlem78mProceeding m-mCorrectmAnsm-
m Anm appeal m broughtm forthm becausem ofm a m ruling m bym a m governmentm agency.
allowsmanympersonmtomreviewmamdecisionmofmamadministrativemagencymbymgoing mtomcourtmandmcla
iming mthatmthemagencymactedminmamarbitrary,munfair mormactedmcontrarymtomthemlaw
Kickbackm-mCorrectmAnsm-
m Paymentm bym a m broker m ofm anym partm ofm compensationm tom a m real m estatem transactionm tom anyonem w
homismnotmlicensedmormwhomismnotmexemptmfrommthemlicensemlawm(canmresultminmlicensemloss)
AdministrativemDisciplinem-mCorrectmAnsm-
m Them Departmentm ofm State'sm abilitym tom enforcemlicensem lawsm throughm reprimandm andm denialm
asmwellmasmthemsuspensionmandmrevocationmofmlicenses.
MultiplemListing mServicem(MLS)m-mCorrectmAnsm-
m agreementm bym a m groupm ofm real mestatem brokersm tom bandm together m andm createma mMLSm thatm allow
smeachmofmthemmtomlistmeachmother'smhouses.mUnder mthismarrangement,mthemlisting mbroker mandmt
hemselling mbroker msplitmthemcommissionmfor meachmsale.
- MLSmcreatesmamDualmAgencymwheremthembuyersmagentmbecomesmamsubmagentmofmbothmthemb
uyer mandmseller m(onlymifmtheremismconsentmwriting)
DualmAgencym-mCorrectmAnsm-mRepresenting mbothmpartiesmtomamtransaction
- Bothmthemseller(landlord)mandmbuyer(tenant)mmustmgivemtheir mconsentminmwiring mfor mthemcreat
ionmofmDualmAgency
Ex:mAsmsoonmasmthembrokeragemstartsmshowing mthemapartmentmitmneedsmtomgetmtheminformedmcon
sentmfrommlandlordmthatmthemsalesmpersonnelmaremgonnambothmrentmthemapartmentmonmbehalfmof
m them landlordm andm bring m tenantsm tom leasem it
Risk:
- Undividedmloyalty
- Failing mtomdisclosemthemDualmAgencymrelationshipmviolatesmthemNYmStatemRealmPropertymlaw
Benefits:
- Agentsmgetsmhigher mcommission
- Permitsmlisting mofmpropertiesmviamMLSmproviding mgreater mexposuremtompotentialmbuyers
RealmEstatemAppraiser m-mCorrectmAnsm-
m Am practitioner m whom hasm them knowledgem andm expertisemnecessarym tom estimatemthem valuem ofmreal
m property.
- actsmindependentlymofmthembuying mandmselling mpartiesminmamtransactionminmorder mtomarrivemat
m them fair m valuem ofm anm assetm withoutm bias.
Agentm-mCorrectmAnsm-
m Onem whom undertakesm tom transactm somem businessm or m tom managemsomemaffair mfor manother m bym au
thoritymofmthemlatter
, Broker'smAgentm-mCorrectmAnsm-
m Am broker'sm agentm ism anm agentm thatm cooperatesm or mismengagedm bym am listing m agentm or m a m buyer'sm a
gentm(butmdoesmnotmworkmformthemsamemfirmmasmthemlisting magentmormbuyer'smagent)mtomassistmth
emlisting magentmormbuyer'smagentminmlocating mampropertymtomsellmormbuy,mrespectively,mformthemlisti
ngmagent'smseller mormthembuyer magent'smbuyer.
Sub-agentm-mCorrectmAnsm-mAnmagentmofmampersonmalreadymacting masmanmagentmofmamprincipal
Fiduciarymdutiesm(OLDmCAR)m-mCorrectmAnsm-
m Am personm whom onm behalf m ofm or m for m them benefitm ofm another m transactsm business,m handlesm money
m or m propertym notm them person'sm own;m suchm relationshipm impliesm greatm confidence m andm trust
-OBIDIENCE
-LOYALTY
-
DISCLOSURE:m(agentmdoesn'tmhavemtomdisclosemschoolmzonemunlessmclientmrequiresmit,mtrafficmflow
,measemofmtransportation,mreasonmseller mismselling)
-CONFIDENTIALITY
-
ACCOUNTABILITY:magentmmustmnotmmodify/changemfinancial mtermsmofmdealmandmmustmactminmbestmin
terestmofmtheir mclient
-
REASONABLEmCARE:magentmmustmactmcompetentlymandmnotminmamnegligentmmanner mbcmagentmca
nmbemheldmliablemformtheirmmistakes.
ReasonablemCarem-mCorrectmAnsm-m-
m Agentm will m wantm tom getm amcopym ofm themPropertym Inspectionm Reportm asm partm ofm them duem diligenc
emprocess
- Agentmneedsmtomhavemanmunderstanding mofmtheir mclientsmfinancialmsituationmandmtheir mabilit
ymtomtakemoutmammortgage.
NOTE:mBemawaremofmanymlawsuitsmormlackmofmfundsmformamspecificmbuilding
Ex:
- bemwaremofmbuyer mqualifications
- Buildingsmassessments
- pending mormimpending mlitigations
- don'tmplacemmultiplemcontractsmonmmultiplempropertiesmatmonemtimem(msellermagentmcan'tmputmo
utm5mdifferentmcontractsmonm1mspecificmproperty)minsteadm(madvisemallmclientsmthatmtheremaremoth
ermpending moffersmtomseemwhichmclientmwillmraisemtheir moffer)
UndividedmLoyaltym-mCorrectmAnsm-
m "Onem ofm them dutiesm anm agentm owesm tom them client,m undividedm loyaltym meansm them agentm put
smthemclient'sminterestsmaheadmofmallmothers,mincluding mthemagent'smown.
m m m m m m m m
ons (2023) m
Articlem12-AmofmthemNYSmRealmPropertymLa
- CorrectmAnsm-m-mPrimarympersonmismtom"protectmthempublic"-minimizing mfraud
- Requiresmamsalespersonmtombematmleastm18myearsmofmage
- Requiresmambroker mtombematmleastm20myearsmofmage
Maintaining mamLicensem-mCorrectmAnsm-
m Placem ofm workm (brokerage) m Pocketm card
GivemnoticemtomNYmDepartmentmofmStatemofmchangeminmname,mstatus,mlocationm(withinm5mdays)
ExemptionsmtomLicensurem-mCorrectmAnsm–
- realmestatemattorney
- governmentmofficial mpertaining mpertaining mtomcourtmormrealmestatemproceeding mduties
- courtmordersmofficial m(trustyminmbankruptcy,mrealmestatemguardian,mexecutor mormadministrator)
"SummarymofmyoumSubmission"m-mCorrectmAnsm–
m Obtainedm after m youm register mfor mthem Newm YorkmStatem Salespersonm exammusing m eAccessNY.mYoum
mustmbring myoum"SummarymofmyourmSubmission"mwithmyoumwhenmtaking mthemStatemexam
Misdemeanor m-mCorrectmAnsm-mAmcrimempunishablembymupmtomamyearminmprisonmand/or mam$1,000mfine
Listing mAgreementm-mCorrectmAnsm-
m contractm betweenm Principlem andm agent,mauthorizing m themagentm tom performm servicesm for mthem pri
ncipleminvolving mthemlatter'smproperty
PocketmCardm-mCorrectmAnsm-
m issuedm bym them departmentm ofm statem tom eachm licensee:containsm them photo,m namem andm businessm
addressmofmlicensee,mand,minmthemcasemofmamrealmestatemsalesperson,mthemnamemandmbusinessmad
dressmofmthembroker mwithmwhommhemormshemiterm-
15smassociatedmandmshallmcertifymthatmthempersonmwhosemnamemappearsmthereonmismamlicensedmr
ealmestatembroker mormsalesperson
- Mustmbemcarriedmbymthemagentmatmallmtimesmwhenmserving masmamsalesperson
Escrow
(notmidealmbcmitmcanmresultminmlegalmconsequencesminmwhichmcasemhasmtombeminmwriting)
https://www.youtube.com/watch?v=-QqtFEkvsBom-mCorrectmAnsm-
m Writtenm agreementm betweenm 2/+m partiesm providing mthatm certainm instruments/m propertym ism plac
edmwithmthirdmpartymandmdeliveredmtompersonmuponmthemfulfillmentmormperformancemofmsomemac
t/condition.
Simple:mAmSeparatemBankmaccountmthatmprotectsmthemintegritymofmthemtransactionm(agreement)mt
hatmanmagentmcreated
,Ex:mAnmagentmwhomcreatedmamlegallymbinding mcontractmwithmbothmbuyer m&msellermandmhasmamescrowmc
ompanymmakemsuremeverymstipulationminmthismRealmPropertymAccountabilitymdocumentmthatmwasmagr
eedmuponmbymbothmpartiesmhasmbeenmmetmbeforemamdealmcanmbemclosed.
According mtomthismdocument,mthembuyer/seller mdon'tmhavemvicariousmliabilitymformthemactionsmofm
ambrokersmagentm?mThismformminformsmthemclientmaboutmdualmagencymandmdetailsmthemrisksmandm
benefitsminvolvedminmthemtransactionm-mCorrectmAnsm-mNYSmDisclosuremForm
NYSmDisclosuremFormmfor mBuyer mandmSeller mRegarding mRealmEstatemAgencymRelationshipmFormm-
m Correctm Ansm -
m Am writtenm explanation,m tom bem signedm bym a mprospectivem buyer m or mseller mofmrealmestate,m explainin
gmtomthemclientmthemrolemthatmthembroker mplaysminmthemtransaction
- Firstmdocumentmtombemsubmittedmtomallmprospectivemclients
- bymlawmthismformmneedsmtombemsignedmatmrealmmeeting m(sombeforemanymvisits/showingsmofmprop
ertymormbrokerage,mormdiscussionmofmlisting mprice,mpurchasempricemamtenantmismablemtomafford,mm
ortgagemtenantmneedsmtomtakemout)
*InmthemcasemwheremclientmrefusesmtomsignmthemDisclosuremForm,mthemagentmshouldmexplainmthatm
themformmismsimplymamdocumentmmeanmtomprotectmthemclientm&mexplainsmthemclientsmrights
*mifmtheremismstillmrefusalmthenmagentmneedsmtomdocumentmtime,mdatemandmclientmnamem
whilemcontinuing mwithmthemmeeting/showing mofmproperty.mAfterwardsmagentmneedsmtomf
affidavit
ill m outm an
m containing m hem sameminformationm andm exactm reasonm for mwhym them clientmrefusesm tom signm them
disclosuremform.
FirstmMeeting m:mDisclosuremFormm-mCorrectmAnsm-
m Listing m agentm meeting mBuyer:mAgentm needsm tom letm buyer m knowm thatm their m fiduciarym duty/m undiv
idedmloyaltymismtomseller
Buyer magentmmeeting mseller:mAgentmneedsmtomletmseller mknowmthatmtheirmfiduciarymduty/mundividedml
oyaltymismtombuyer
After mInitialmDisclosuremAgentmchangesmtheirmrolesmDUEmTOm:m-mCorrectmAnsm-
m 1.m Initialm Disclosurem withm Buyer:m agentm realizesmlaterm onm thatm them buyer m isminterestedm inm am
propertymthatmthemagentsmbrokeragemismlisting mthenmitmwillmresultminmthemBuyer mAgentmbecom
ingmamDualmAgent
2.mBuyer mbecomesmamcustomer mandmthemagentm&mbrokeragemonlymrepresentmthemseller
Commingling m-mCorrectmAnsm-
m Tom minglem or mmix,mfor mexample,ma m client'sm fundsm inm them broker'sm personal m or m general m account.
NetmListing
(canmbemillegalmsincemitmcanmleadmtomFRAUD)m-mCorrectmAnsm-
m Am pricem belowm whichm anm owner m will mnotm sell mthem property,m andm atmwhichm pricema m broker m will m n
otmreceivemamcommission;mthembroker mreceivesmthemexcessmover mandmabovemthemnetmlisting masmth
embroker'smcommission
,Undermamnetmlisting,mthembroker mcanmoffermthempropertymformsalematmthemhighestmpricemobtainabl
emtomincreasemthemcommission.mThismtypemofmlisting mismillegalminmNYmandmcanmresultminmlicensemlo
ss
Articlem78mProceeding m-mCorrectmAnsm-
m Anm appeal m broughtm forthm becausem ofm a m ruling m bym a m governmentm agency.
allowsmanympersonmtomreviewmamdecisionmofmamadministrativemagencymbymgoing mtomcourtmandmcla
iming mthatmthemagencymactedminmamarbitrary,munfair mormactedmcontrarymtomthemlaw
Kickbackm-mCorrectmAnsm-
m Paymentm bym a m broker m ofm anym partm ofm compensationm tom a m real m estatem transactionm tom anyonem w
homismnotmlicensedmormwhomismnotmexemptmfrommthemlicensemlawm(canmresultminmlicensemloss)
AdministrativemDisciplinem-mCorrectmAnsm-
m Them Departmentm ofm State'sm abilitym tom enforcemlicensem lawsm throughm reprimandm andm denialm
asmwellmasmthemsuspensionmandmrevocationmofmlicenses.
MultiplemListing mServicem(MLS)m-mCorrectmAnsm-
m agreementm bym a m groupm ofm real mestatem brokersm tom bandm together m andm createma mMLSm thatm allow
smeachmofmthemmtomlistmeachmother'smhouses.mUnder mthismarrangement,mthemlisting mbroker mandmt
hemselling mbroker msplitmthemcommissionmfor meachmsale.
- MLSmcreatesmamDualmAgencymwheremthembuyersmagentmbecomesmamsubmagentmofmbothmthemb
uyer mandmseller m(onlymifmtheremismconsentmwriting)
DualmAgencym-mCorrectmAnsm-mRepresenting mbothmpartiesmtomamtransaction
- Bothmthemseller(landlord)mandmbuyer(tenant)mmustmgivemtheir mconsentminmwiring mfor mthemcreat
ionmofmDualmAgency
Ex:mAsmsoonmasmthembrokeragemstartsmshowing mthemapartmentmitmneedsmtomgetmtheminformedmcon
sentmfrommlandlordmthatmthemsalesmpersonnelmaremgonnambothmrentmthemapartmentmonmbehalfmof
m them landlordm andm bring m tenantsm tom leasem it
Risk:
- Undividedmloyalty
- Failing mtomdisclosemthemDualmAgencymrelationshipmviolatesmthemNYmStatemRealmPropertymlaw
Benefits:
- Agentsmgetsmhigher mcommission
- Permitsmlisting mofmpropertiesmviamMLSmproviding mgreater mexposuremtompotentialmbuyers
RealmEstatemAppraiser m-mCorrectmAnsm-
m Am practitioner m whom hasm them knowledgem andm expertisemnecessarym tom estimatemthem valuem ofmreal
m property.
- actsmindependentlymofmthembuying mandmselling mpartiesminmamtransactionminmorder mtomarrivemat
m them fair m valuem ofm anm assetm withoutm bias.
Agentm-mCorrectmAnsm-
m Onem whom undertakesm tom transactm somem businessm or m tom managemsomemaffair mfor manother m bym au
thoritymofmthemlatter
, Broker'smAgentm-mCorrectmAnsm-
m Am broker'sm agentm ism anm agentm thatm cooperatesm or mismengagedm bym am listing m agentm or m a m buyer'sm a
gentm(butmdoesmnotmworkmformthemsamemfirmmasmthemlisting magentmormbuyer'smagent)mtomassistmth
emlisting magentmormbuyer'smagentminmlocating mampropertymtomsellmormbuy,mrespectively,mformthemlisti
ngmagent'smseller mormthembuyer magent'smbuyer.
Sub-agentm-mCorrectmAnsm-mAnmagentmofmampersonmalreadymacting masmanmagentmofmamprincipal
Fiduciarymdutiesm(OLDmCAR)m-mCorrectmAnsm-
m Am personm whom onm behalf m ofm or m for m them benefitm ofm another m transactsm business,m handlesm money
m or m propertym notm them person'sm own;m suchm relationshipm impliesm greatm confidence m andm trust
-OBIDIENCE
-LOYALTY
-
DISCLOSURE:m(agentmdoesn'tmhavemtomdisclosemschoolmzonemunlessmclientmrequiresmit,mtrafficmflow
,measemofmtransportation,mreasonmseller mismselling)
-CONFIDENTIALITY
-
ACCOUNTABILITY:magentmmustmnotmmodify/changemfinancial mtermsmofmdealmandmmustmactminmbestmin
terestmofmtheir mclient
-
REASONABLEmCARE:magentmmustmactmcompetentlymandmnotminmamnegligentmmanner mbcmagentmca
nmbemheldmliablemformtheirmmistakes.
ReasonablemCarem-mCorrectmAnsm-m-
m Agentm will m wantm tom getm amcopym ofm themPropertym Inspectionm Reportm asm partm ofm them duem diligenc
emprocess
- Agentmneedsmtomhavemanmunderstanding mofmtheir mclientsmfinancialmsituationmandmtheir mabilit
ymtomtakemoutmammortgage.
NOTE:mBemawaremofmanymlawsuitsmormlackmofmfundsmformamspecificmbuilding
Ex:
- bemwaremofmbuyer mqualifications
- Buildingsmassessments
- pending mormimpending mlitigations
- don'tmplacemmultiplemcontractsmonmmultiplempropertiesmatmonemtimem(msellermagentmcan'tmputmo
utm5mdifferentmcontractsmonm1mspecificmproperty)minsteadm(madvisemallmclientsmthatmtheremaremoth
ermpending moffersmtomseemwhichmclientmwillmraisemtheir moffer)
UndividedmLoyaltym-mCorrectmAnsm-
m "Onem ofm them dutiesm anm agentm owesm tom them client,m undividedm loyaltym meansm them agentm put
smthemclient'sminterestsmaheadmofmallmothers,mincluding mthemagent'smown.
