Real Estate Licensing RePA_Sales_S Exam Questions

Under 63 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 professional to 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.

63 P.S. 455.304 -- Exemptions from Licensing Requirements

Under 63 P.S. 455.803 (Real Estate Recovery Fund), if the Pennsylvania Real Estate Commission pays 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.

63 P.S. 455.803 -- Real Estate Recovery Fund Suspension Rules

Under 49 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 manner to 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): Licensees are NOT required to list their own property with their firm.

Option C (Offer Commission to Brokers): There is no requirement to offer compensation to 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.

49 Pa. Code 35.285 -- Disclosure of Real Estate Affiliations

Under 63 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.

63 P.S. 455.305 -- Civil Penalty Provisions

Under 49 Pa. Code 35.311 (Duties of Buyer's Agent), a buyer's agent must disclose their relationship to the listing broker or seller before providing substantive services.

This ensures that all parties understand who represents whom in the transaction.

Failure to disclose agency relationships could result in ethical violations and penalties from the Pennsylvania Real Estate Commission.

Why the other answers are incorrect:

Option A (Initiate a Title Search): This is typically done by the buyer's attorney or title company, not the real estate broker.

Option B (Recommend an Inspection): While good practice, it is not legally required under agency law.

Option C (Disclose Dual Representation): This is incorrect because the broker is not acting as a dual agent in this case.

49 Pa. Code 35.311 -- Duties of Buyer's Agent