Pass the Real Estate Pennsylvania Real Estate Commission RePA_Sales_S Questions and answers with ValidTests

Under49 Pa. Code § 35.291(Reporting of Crimes and Disciplinary Actions), a real estate licensee may face disciplinary action for engaging inunethical conduct, fraud, or incompetence. One of the reasons listed ishabitual intoxication or drug addiction, as thisimpairsthe licensee’s ability toproperly conduct real estate activities.

A felony conviction (Option D - Incorrect) does not automatically result in disciplinebut is reviewed by the Commission.

Failure to pay taxes (Option C - Incorrect) is a federal issue, not a licensing violation.

Car insurance (Option A - Incorrect) is unrelated to a real estate license.

Under49 Pa. Code § 35.241 (Supervision and Operation of Offices),a licensed real estate salesperson must be supervised by a broker or an associate broker designated by the broker.

A broker may assign an associate broker (who has passed the broker exam but does not own the brokerage) to oversee salespersons.

Salespersons cannot work independently; they must work under the direction of a licensed broker or an assigned associate broker.

Why the other answers are incorrect:

Option A (Team Leader):A team leader is not a formal supervisory position under Pennsylvania law unless they are an associate broker or broker.

Option B (Salesperson):A salesperson cannot supervise other salespersons.

Option D (Transaction Coordinator):A transaction coordinator handles paperwork but does not supervise licensees.

Allexclusive listing agreements in Pennsylvania MUST specify their duration in writing.

49 Pa. Code § 35.332 (Exclusive Listing Agreements)states thatall exclusive listings must have a definite start and end date.

Listings without an expiration date are considered illegaland unenforceable in Pennsylvania.

Why the other answers are incorrect:

Option A (Cancellation in 24 Hours):There is no legal requirement for a 24-hour cancellation clause.

Option B (Financing Arrangements):Financing provisionsare not a required part of a listing agreement.

Option C (Signed by Cooperating Broker):A cooperating broker’s signatureis not required. Only the listing broker and seller need to sign the agreement.

In Pennsylvania,any person engaging in brokerage activities (such as negotiating sales or leases for compensation) must hold a real estate licenseunless specifically exempted.

49 Pa. Code § 35.201 (Definitions) & 63 P.S. § 455.304 (Exemptions)allow attorneys to practice real estate without a license ONLY IF the services are incidental to their legal practice.

If an attorney advertises as a real estate broker or regularly engages in real estate transactions beyond legal services, they must obtain a real estate license.

Why the other answers are incorrect:

Option B (Home Builder Selling New Houses):Buildersare exemptwhen selling their ownnewly constructed homes.

Option C (Banks Selling Foreclosures):Banks areexemptunder63 P.S. § 455.304 (a)(5)since they arenot in the business of selling real estate for profit.

Option D (Selling Five Unimproved Lots):Individuals selling their own propertydo not need a license, even for multiple lots.

ThePennsylvania Real Estate Commission (PREC)has the authority toregulate real estate licenses but does not certify real estate appraisers.

Real estate appraisers in Pennsylvania are regulated by the State Board of Certified Real Estate Appraisers, not the Real Estate Commission.

The Commission’s powers include:

Suspending or revoking licensesfor violations.

Imposing finesfor disciplinary actions.

Auditing escrow accountsto ensure compliance with regulations.

Why the other answers are incorrect:

Option A (Suspend or Revoke Licenses):TheCommission has the authority to discipline licensees.

Option B (Impose Fines):TheCommission can fine violators for misconduct.

Option C (Review Escrow Accounts):TheCommission can audit escrow accounts to protect client funds.

If a real estate license is inactive formore than 5 years, the licenseemust retake and pass the licensing examto reinstate their license.

49 Pa. Code § 35.251 (Relicensure Following Revocation or Inactive Status)states that alicensee who has been inactive for over 5 years must complete all initial licensing requirements again, including the exam.

A licensee can keep their license in inactive status indefinitely, but after 5 years, it requires reexamination.

Why the other answers are incorrect:

Option A (2 Years) & Option B (3 Years):Licenseesmay reactivate their license within this period without retaking the exam.

Option C (4 Years):Thelimit is 5 years, not 4.

Under49 Pa. Code § 35.284 (Disclosures of Business Relationships),the Consumer Notice defines five types of permitted relationships between real estate licensees and consumers:

Buyer’s Agent– Represents the buyer and has a fiduciary duty to them.

Seller’s Agent (Listing Agent)– Represents the seller and has a fiduciary duty to them.

Designated Agent– A brokerage firm designates different agents to represent buyers and sellers in the same firm without creating dual agency.

Dual Agent– A licensee represents both the buyer and seller in the same transaction, with mutual consent.

Transaction Licensee– A real estate licensee who provides services but does not represent either party as an agent.

Why the other answers are incorrect:

Option A (Rental Agent):"Rental agent" is not a defined relationship in Pennsylvania law.

Option B (Buyer & Seller Sub-Agent):Sub-agency is no longer common and is not a required disclosure.

Option D (Designated Dual Agent):Dual agency and designated agency are separate concepts.

Under63 P.S. § 455.304 (Exemptions from Licensing Requirements),most individuals selling their own property are exempt from real estate licensing requirements.However, a real estate licensee selling their own real estate must comply with disclosure laws and ethical obligations.

If a real estate licensee sells their own property, they must disclose in all advertising that they are a licensed real estate professionalto avoid misleading the public.

While a non-licensee selling their own property is not covered under real estate licensing laws, a licensed salesperson must adhere to licensing and disclosure laws.

Why the other answers are incorrect:

Option A (Trustee under Court Order):Court-appointed trustees are exempt from real estate licensing requirements.

Option B (Attorney Representing Clients):Attorneys are permitted to handle real estate transactions as part of their legal practice without a real estate license.

Option D (Licensed Auctioneer):Auctioneers selling real estate are regulated under separate auctioneer licensing laws, not real estate licensing laws.

Under49 Pa. Code § 35.285 (Disclosure of Real Estate Affiliations),a licensee selling their own property MUST disclose that they are a real estate licensee in all advertisements and communications.

The disclosure must be made in a clear and conspicuous mannerto inform potential buyers that the seller has professional real estate expertise.

This rule prevents deception and ensures fair dealings in real estate transactions.

Why the other answers are incorrect:

Option A (List Property with Firm):Licenseesare NOT required to list their own propertywith their firm.

Option C (Offer Commission to Brokers):There isno requirement to offer compensationto other brokers.

Option D (Have an Active License):A licensee can still sell their own property even if their license is inactive,but they must disclose their license status.

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.