REAL ESTATE PRACTICE
By Michael Lustig
Copyright 2011 Real Estate License Services, Inc.
Smashwords Edition
REAL ESTATE PRACTICE
Textbook and Student Workbook, Combined
Course
by Correspondence.
For Qualification For a California Real Estate
Broker
License or to Extend a California Real Estate Sales
License (D.R.E.Approval #1225-90)
New Department of Real Estate Rules Allow You to Avoid All Quizzes and to Go Straight to Your Final Exam, Which is Open Book! You May Suggest Your Own Test Administrator Also! For Details, Please Turn This Page and Read the Student Instructions/General Information Page.
REAL
ESTATE LICENSE SERVICES
5059 Newport Avenue, #209
San
Diego, CA 92107
(619) 222-2425
Includes “Student Instructions,” Quiz Questions and Answers, and Page References for the Quiz Questions for the Course “Real Estate Practice.” Please Read and follow the complete “Student Instructions” just after this page.
Copyright 2011, 2003, 2000, 1991, 1990, 1989, 1988, 1987, 1983 Real Estate License Services, Inc. Copyright registered. All rights reserved. No part of this material may be reprinted, reproduced, transmitted, stored in a retrieval system, placed in a computer or on the Internet, or otherwise utilized, in any form or by any means electronic or mechanical, including photocopying or recording, now existing or hereinafter invented, nor may any part of this course be used for teaching without permission from the copyright holder.
STUDENT INSTRUCTIONS/GENERAL INFORMATION
The California Department of Real Estate DOES NOT REQUIRE COMPLETION OF QUIZZES OR ESSAYS PRIOR TO YOUR FINAL EXAM. Study the "Written Assignment" questions based on the chapter readings as well as the answers with page references that are on the following page. YOU DO NOT NEED TO SEND IN ANY "WRITTEN ASSIGNMENT" ANSWERS. To complete this course, just study the practice questions and answers, take the final exam online or on paper and, if on paper, make sure the final exam question sheets and completed Scantron answer forms are returned to us along with the completed "Certification of Test Administrator." THE FINAL EXAM IS OPEN BOOK. If you have any questions, please call (619) 222-2421.
1) This course consists of text reading and a final examination.
2) Practice questions ("Written Assignments") covering most of the chapters in the book are based on the text reading in each chapter. Answers to those practice questions (with page references) are included for your convenience and may be found on the page after this page. The "Written Assignments" are for your practice only. NO QUIZ QUESTIONS ARE REQUIRED PRIOR TO YOUR FINAL EXAM.
3) The minimum time limit to complete one course is 20 days from the date of enrollment. The maximum time limit to complete one course is six (6) months from the date of enrollment. Two three (3) month extensions may be obtained (see section below on Extensions and Re-enrollments). Under no circumstances can your enrollment last beyond twelve (12) months.
FINAL EXAMINATION: When you are ready to take the final test, please fill out the form "Request To Take Final Exam." You may mail it to Real Estate License Services, 5059 Newport Ave., #209, San Diego, California 92107, or fax to (619) 222-8593. Real Estate License Services will arrange for your final examination online or with a test administrator. If your final exam is not online, you may suggest who your test administrator will be. The examination consists of 100 multiple choice questions and you must complete it within 150 minutes (2.5 hours). When you finish the test, If your final exam is not online, turn it in to the test administrator, who will mail it to Real Estate License Services. The questions used for the final exam must be mailed to Real Estate License Services along with the answers.
GRADING OF THE FINAL EXAM AND ISSUING OF CERTIFICATES: A passing grade is based on a minimum passing score of 60% on the final examination. Only the final examination grade is used in determining the student's overall grade. Students will be assigned a letter grade, but the grading system reflects the 60% passing requirements.
% OF POINTS = GRADE
100% - 90% = A
89% - 80% =
B
79% - 70% = C
69% - 60% = D
59% - 0%
= Fail. In this case the course would have to be repeated and passed
in order to receive credit.
An official certificate of your course grade will be mailed to you within two weeks after receipt of your completed final examination if taken with a test administrator. Additional certificates are $15.00 each.
REFUNDS: Students may apply in writing to REAL ESTATE LICENSE SERVICES, mailing address, 5059 Newport Ave., #209, San Diego, California 92107 within 15 days from the date of enrollment and cancel and receive a refund for the full tuition. All REAL ESTATE LICENSE SERVICES materials must be returned in good condition at the time of cancellation; the materials should not be soiled, torn or marked upon. Refunds are not allowed if any work has been submitted.
EXTENSIONS AND RE-ENROLLMENTS: If the course has not been completed within six (6) months of enrollment, the student may receive an extension of three (3) months by paying an extension fee of $35.00. If at the end of that three month extension the student still has not completed the course, a second three (3) month extension may be obtained by paying an additional fee of $30.00. IN NO CASE MAY THE PERIOD OF ENROLLMENT EXTEND BEYOND TWELVE (12) MONTHS. If the student has not completed the course within 12 months from the original date of enrollment, the enrollment expires and no further extensions are allowed. The student must re-enroll and begin the course over again in order to complete the course. The student may re-enroll under such circumstances for a discounted re-enrollment of $40.00 per course.
TRANSFERS: Courses may be transferred to another person by paying a transfer fee of $30.00 per course. Transfers are not allowed if any work has already been submitted.
REAL ESTATE PRACTICE
To finish this course, you need to do the following:
1. Quizzes are NOT required. Included below are the answers to the questions at the end of each chapter. Page references for topics in each question and answer are also listed. Read the book and study the questions and answers. You may take your final exam 18 days after having possession of the textbook.
2. When you are ready to take the final exam, please fill out the form "Request To Take Final Exam," and fax to (619) 222-8593 or mail to: Real Estate License Services, 5059 Newport Ave, #209, San Diego, CA 92107. Real Estate License Services will arrange for your final exam online or with a test administrator.
Answers with Page References to Practice Questions at the end of Each Chapter in the Textbook:
TABLE OF CONTENTS
Chapter 3 OWNERSHIP OF REAL PROPERTY
Chapter 5 AGENCY AND THE TRANSFER OF PROPERTY
Chapter 8 TITLES AND INSURANCE
Chapter 10 LEASEHOLD RELATIONSHIPS
Chapter 14 PROPERTY MANAGEMENT
Chapter 15 REAL ESTATE INVESTMENTS
PREFACE
The practice of real estate has gone through many changes over the years. With the various legal modifications and professional refinements that have occurred in recent years, it is critical that all real estate agents keep current. This book will provide you with the latest information to enable you to better practice your profession.
Please be advised of the following. This book is not meant as a substitute for expert legal or business advice. Also, specific laws, regulations and requirements are subject to change. Finally, the terms “he,” “him,” and “his” are used throughout this book. They are meant to apply equally to the female professional. It is merely an editorial device.
Chapter 1
LICENSING
LAW
INTRODUCTION
California has been the leader in real estate licensing since the first laws for it were enacted. Often California’s laws serve as models for other states. Before real estate licenses are granted, qualifications are thoroughly checked and knowledge is tested.
This chapter explains the types of real estate licenses available, requirements for getting them initially and for renewing them, and some laws related to licenses.
Incidentally, none of the fees required for licensing is refundable.
PURPOSE OF LICENSING LAWS
Licensing laws were developed in order to protect the public by regulating real estate agents. Almost every activity related to a real estate transaction requires a license to perform.
If the agent has no license for his activities, he cannot receive commissions or fees for performing them.
Anyone found guilty of operating without a license faces a possible $1,000 fine or six months in jail or both. Corporations can be fined up to $5,000.
Anyone who pays an unlicensed person for real estate transactions requiring licenses is guilty of a misdemeanor and can be fined up to $50.
BROKER’S LICENSE
Anyone who wants a real estate broker’s license in California must be at least 18 years old and honest and truthful. He must also file necessary applications, prove required experience and education, pass a qualifying exam, and pay all required fees.
One must meet all qualifications prior to being scheduled for examination. The Department of Real Estate will conduct no evaluation of claimed experience or education with applicants in person or on the telephone. Satisfaction of requirements is a matter of records and filings. In order to be evaluated by the DRE for previous college courses, degrees, or experience, you must submit the following materials:
a. Examination application (form RE 400)
b. Appropriate fee
c. Transcripts of your college courses and/or degree
d. Catalog description of any courses that you wish to substitute for the statutorily required courses
e. Employment Verification Form (form RE 226).
f. Equivalent Experience Form (form RE 227)
When you apply for qualification, as described above, you may find that you do not meet all of the qualifications. If that is the case, you will be given two years from the date of the receipt of your application in which to complete the qualifications and take the examination for your license.
If you do not pass the examination during the two year period, the application expires, and you will be required to resubmit all qualifying material with the appropriate application and fee.
There are no upper limit age restrictions for a California real estate license. Nevertheless, to apply for a license you have to be 18 years of age or older — minors are not eligible.
There are certain residency requirements. One need not necessarily be a resident of California, but the state in which one resides must allow California residents to qualify for and obtain a real estate license in that state. Otherwise, one may not apply for either an original or a renewal license.
EDUCATION
If you wish to apply for a real estate broker’s license in California, you must successfully complete certain college level courses, required by state law, plus a certain number of elective courses from an approved list. We will break down the required courses into an easily understandable listing presently. First, it should be mentioned that “college level” does not necessarily mean that you have to take the courses at a college, or be enrolled at a college.
Broker qualification courses must be completed in any one of the following ways:
1. At an institution of higher learning (college) accredited by the Western Association of Schools and Colleges, or by any other regional accrediting agency recognized by the United States Department of Education (be sure to check); or