TN Real Estate State Test Questions and Answers Already Passed

TN Real Estate State Test Questions and Answers Already Passed What Tennessee law covers landlord-tenant relations? Tennessee has the Uniform Landlord and Tenant Act for residential rentals. This law is designed to simplify, clarify, modernize, and revise the laws governing the rental of dwelling units and the rights and obligations of both landlords and tenants and to encourage them to maintain and improve the quality of housing. In addition, the law ensures that the right to the receipt of rent is inseparable from the duty to maintain the premises. Anyone who manages even one unit should have a copy of this law and consult it frequently. The days have gone by when a landlord or manager could simply change the locks and toss a tenant's belongings into the street. Today, the tenant has enforceable rights, and if the landlord violates these rights, the landlord may be faced with financial penalties. Is there a special license required for brokers to be property managers? There is no license just for property managers in Tennessee, unless they are engaged in rental/leasing management of property of others. If so, they come under the Tennessee Real Estate Broker License Act of 1973. A resident manager hired by the owner, the broker, or an employee of the broker is exempt only if the duties they perform do not include negotiation of leases or security deposits. Do all leases have to be in writing? To receive legal recognition in the judicial system, the Tennessee Code requires that all lease agreements over one year be in writing. Thus, an oral lease for less than a year is enforceable. However, this is important to remember: If it's in writing, you have a prayer; if it's oral, it's just air. It is best to get any lease in writing. What specific procedures must a landlord follow to evict a tenant? The landlord must send a written notice to the tenant specifying the breach of the agreement and stating that the rental agreement will terminate 30 days from the date of receipt of the notice. If the breach is not remedied in 14 days, the rental agreement terminates in accordance with the notice. What are the requirements for holding a security deposit (i.e., type of account, interest, limits on use, repayment, etc.)? All such deposits must be placed in an account used only for that purpose in any bank or other lending institution subject to regulation by the state of Tennessee or an agency of the U.S. government. The tenant must be informed of the location of the separate account. What courts handle landlord-tenant disputes? General session courts and circuit courts hear landlord-tenant disputes. What is the name of the Tennessee real estate regulatory body? Instead of having a Commissioner to regulate real estate activity, Tennessee has a nine-member body that makes up the Tennessee Real Estate Commission (TREC). It is created within the Division of Regulatory Boards of the Tennessee Department of Commerce and Insurance. How many members are on the Tennessee Real Estate Commission? TREC consists of nine members, three of whom are appointed from each grand division or the state: east, middle, and west. They serve a five-year term and may be reappointed only once Seven of the members must he licensed brokers or affiliate brokers who have been principally engaged in the real estate business in the state for at least five years. The other two must be persons who are not engaged in the real estate business, nor can they be in the business of real estate finance or development. These two are commonly called public members, though that term is not defined in the law, How long may they serve? Commission members serve a five-year term and may be reappointed only once The governor appoints the members. The governor may remove members for willful neglect of duty. misconduct or in competency. What is the purpose and mission of TREC? The purpose of the Commission is to "license and regulate real estate brokers and affiliate brokers, real estate firms, rental location agents, time-share salespersons and developments, vacation clubs and vacation lodging services." According to the TREC, the mission of the TREC is to "protect the public through establishment and administration of minimum requirements for candidates and licensees effective professional education of licensees, ant enforcement of professional conduct." TREC is charged with what statutory duties? TREC is charged to do all things necessary and proper to carry out the provisions of the Tennessee Broker License Act of 1973 and the Rules and Regulations of the Commission. Specifically, the Commission is authorized to promulgate rules and regulations. to adopt a code of ethics and to establish minimum standards of practice. The Commission may refer a complaint before any court of competent jurisdiction for any violation of this chapter and may petition any circuit or chancery court lo prohibit persons from violating any provisions of the law. The Tennessee Broker License Act of 1973 is a law that can be changed only by a vote of the legislature, signed by the governor. On the other hand, the Commission may change the Rules and Regulations from time to time. In Tennessee, who is required to hold a real estate license? Although there are some exemptions, a real estate license is generally required before anyone can offer to list, sell, purchase, negotiate, lease, or manage real estate on behalf of someone else for a fee. One must hold a real estate license before initiating a suit or action for compensation for performing a real estate activity. What is the most important exemption from the licensing requirements? The most important exemption is the person who acts on his or her own behalf. Any person can list, buy, rent, or sell his or her own property. The state does not regulate such a transaction, if the owner makes a mistake, the owner must take responsibility, no one else. Certain other individuals are exempt as follows: • Person holding a valid power of attorney from the owner or lessor • Executors, administrators, trustees acting under a deed of trust or trust agreement, or any other persons acting under a court order or instrument • Attorney at law while performing duties as an attorney • Resident manager for an owner or broker or an employee of the broker with limited authority • Officer of a corporation authorized to handle real estate matters for the corporation, as long as he or she is salaried Does Tennessee recognize licensure in other states? Reciprocity agreements exist between Tennessee and states that have licensing requirements similar to those of Tennessee and where similar recognition and courtesies are extended to each other Tennessee will reciprocate with any state that will agree to reciprocate with Tennessee. Tennessee has reciprocity agreements with 21 states, including most of Tennessee's bordering states. Licensed nonresidents in these reciprocity states may be granted a Tennessee license without passing Tennessee's examination. (It is important to note that these agreements change from time to time. For complete current regulations contact the specific state regulatory body.) However, the licensee's brokerage has to have an active place of business within his or her home state and the requesting licensee's broker must have a valid Tennessee license. In addition, applicants must prove "active" licensure (by examination) in the reciprocal state and have no charges pending against them. The licensee must complete an application form, sign an affidavit indicating familiarity with Tennessee license Law, and sign an irrevocable consent that lawsuits and actions may be brought against him or her in the proper court of any Tennessee county in which a cause of action may arise. Simply stated, if a legal action is initiated, the licensee cannot request a change of venue. If the home-state license of a nonresident Tennessee licensee is revoked or suspended. the licensee must notify TREC. A hearing may be held to determine whether similar disciplinary action should he taken against the Tennessee licensee. What is the difference between an affiliate broker and a principal broker? a.) An affiliate broker is typically a sales person b.) A principal broker is responsible for all licensees in their firm c.) A principal can also be a sales person Can there be more than one broker in any given office? Real estate licensees start out with an affiliate broker's license working under the direct supervision of an employing, principal broker. Tennessee law requires that a person must have been actively licensed as an affiliate broker for at least 36 months if licensed after May 12. 1988. This time may be reduced to 24 months or 12 months, respectively. if the applicant has a baccalaureate degree with a major in real estate. There is only one principal broker in any office. When the license law refers to a broker it is referring to this individual. The other licensees in the office may hold either an affiliate brokers' licenses or a broker's license affiliated with the principal broker. The principal broker may be the owner or a manager. The broker is responsible for the trust account and for the real estate activities conducted by the associates in this office. The public has the right to know that there is a person in charge locally. Even if the office is owned by another entity in another city, the local broker is responsible for the trust moneys held by' that office and the activities of each person licensed in that office. All brokerage contracts are in the name of the broker Can a corporation or partnership receive a real estate license? A partnership association or corporation may be granted a firm license. At least one member, who will be the principal broker has to hold a broker's license. The basic requirements for a real estate license are: An applicant must be al least 18 years; of age. The applicant must hold a high school diploma or GED. A copy must be submitted when applying for the original license. In addition, pre-licensing education and testing are required to ensure the applicants competency (discussed below). The applicant must include with the application a sworn statement by tile principal broker certifying the-in the broker's opinion. the applicant is honest and trustworthy' and that the broker will actively supervise and train the applicant during the period that the license remains in effect. The applicant does not have to be a U.S. citizen. Tennessee requires a 45-day residency in the state. However, a person may be licensed under a Tennessee broker if he or she does not live farther than 50 miles from the broker's office, even if the applicant lives in another state