Exam (elaborations)
COLORADO REAL ESTATE EXAM PREP
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COLORADO REAL ESTATE EXAM PREP
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COLORADO REAL ESTATE EXAM PREPPurpose of the Law - Answers -To protect the public of the state of CO in real estate
matters
Conway-Bogue Decision - Answers -Landmark decision confirming a licensee's right to
a limited practice of law
Under Conway-Bogue, licensees - Answers -A. Must be connected to the transaction,
B. Must use standard and approved forms C. May not assess a separate fee for
preparing documents
According to the Denver and CO Bar Ass V. Title Guaranty Company & the Record
Abstract & Title Company, A Title Insurance Company - Answers -May not prepare legal
documents, may prepare settlement sheets and acts a s scrivener of the real estate
listing broker, who is responsible for all documents produced by the title company.
According to the Denver and CO Bar Ass V. Title Guaranty Company & the Record
Abstract & Title Company, a broker is responsible for - Answers -payment for the legal
documents the broker requests from the title company- deeds and bills of sale for
example
Regarding the relationship between brokers and title companies - Answers -Brokers
may not accept referral fees or inducements from title companies; and a broker who is a
partner or affiliated with a title company may, with written disclosure of the broker's
relationship to the title company, refer a member of the public to the broker's title
company.
What are the requirements for licensing in CO - Answers -Candidates must complete
168 hours of education, pass the licensing exam, have valid proof they are US citizens
and be at least 18 years old.
The Commission, upon its own motion, and upon a verified written complaint, must
investigate licensees who might be guilty of: - Answers -False advertising, violating the
colorado consumer protection act, failing to properly handle and manage trust monies,
failing to properly handle and manage trust monies, failing to provide a closing
statement, failing to provide a closing statement, failing to keep documents for 4 years,
paying a commision to an unlicensed person for work requiring a license, dual
contracting- loan fraud, nondisclosure
Define Dual contracting- loan fraud - Answers -Dual contracting is a form of loan fraud
in which a fraudulent loan application is supported by a false purchase contract, usually
for a sales price higher than the price actually agreed upon between the buyer and
seller. If the property appraises for the higher price, this application can result in a loan
for a higher amount than the lender's normal loan-to-value ratio ** Dual contracting is
, criminal and can result in legal action, license discipline, and disbarment from federally
related loan programs.
Non-resident brokers must - Answers -have an office in their home state; agree to keep
all trust funds in a Colorado depository; and accept legal action in Colorado
Exemptions from licensing - Answers -A regularly salaried employee of the owner of an
apartment building or complex acting as an on-site manager or a regularly salaried
employee of a new home builder
Business Opportunity Brokerage must - Answers -have a real estate broker's license if
the transfer involves any real property or rights under a lease, must have a definite
termination date, CO Use Tax on personal property - paid by the owner
Real Estate Options and Securities - Answers -A real estate broker's license is required
to sell real estate options for a fee. Te sell a real estate security, a securities license is
required.
Individual licensees and their employing broker do not need to notify the Commission if
the licensee changes firms - Answers -False. They must notify the Commission
If a brokerage firm changes its business location without notification - Answers -It will
inactivate all licensees, even if an individual licensee notified the Commission
Inactive licensees may perform any activities requiring a licnese - Answers -False they
may not perform any activities requiring a license
Inactive brokers do not need an office or errors and omissions insurance. - Answers -
True
What duties may an inactive broker perfrom - Answers -Any unlicensed duties such as
on-site property management or salaried new home sales.
What is Errors and Omissions Insurance - Answers -Professional liability insurance that
is obtained from a state-endorsed carrier or any other state approved carrier
When should errors and omissions insurance be renewed - Answers -December 31st
every year
Errors and Omissions insurance claims are not reported to the real estate Commission -
Answers -True
Blanket Policy - Answers -Brokerage firm required to have as well as all licensed
individuals must have a separate policy. Required when applying for active license.
Required for licensed corporations and limited liability copanies
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