Illinois Real Estate Exam (Practice for Broker's License) 260 Qs & Ans 2024-2025., Exams of Real Estate Management

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Illinois Real Estate Exam (Practice for

Broker's License) 250+ Qs & Ans 2024-

What is the name given to the Illinois license laws under which brokers and salespeople practice? - Answer: Real Estate License Act of 2000 After May 1, 2011, the new license categories are: - Answer: Managing Broker and Broker

After April 30, 2012, as an alternative to passing the proficiency exam given by AMP, what are the requirements for converting a salesperson's license to a broker license? - Answer: 30 hours of post-licensure education, as defined by administrative rule. In Illinois, the real estate license law is administered by the...? - Answer: IDFPR (Bureau of Real Estate Professions) How are the nine members of the Real Estate Administration and Disciplinary Board Selected? - Answer: By the governor In Illinois, sponsor cards are good for: - Answer: 45 days What are the requirements for a newly licensed broker effective May 1, 2011? - Answer: 90 hours of pre-license coursework including 15 hours of situational offerings After May 1, 2011, what must a broker do to convert a managing broker license? - Answer: Complete 45 hours of post-license education When do real estate brokers' licenses expire in Illinois? - Answer: April 30 of every odd-numbered year To renew a license in Illinois, brokers must..? - Answer: Have completed 12 hours of continuing education in the last two years and pay the current fee.

Licensees who allow their licenses to expire have how long to reinstate their licenses? - Answer: Up to two years; then licensees must start over What procedures must be followed to obtain a license that has been expired for more than two years? - Answer: Meet the requirements for a new license, including all pre-license education and passing the exam Three weeks before N begins his real estate pre-license class, he offers to help his neighbor sell her house. The neighbor agrees to pay N a 5% commission. An offer is accepted while N is taking the class and closes the day after N passes the exam and receives his salesperson license. The neighbor refuses to pay N the agreed commission. Can N sue to recover payment? - Answer: No. State law prohibits lawsuits filed to collect commissions unless filed by a licensed broker - one with a license in effect before the agreement was reached. Which of the following conditions is NOT required to grant a nonresident broker's license in Illinois? - Answer: The broker has been active in the real estate business in her own state for one year prior to application. The resident property manager for Acme Apartments is responsible for negotiating leases for the apartment. In this position, the resident manager: - Answer: Is exempt from the licensing requirements.

After failing the Illinois licensing exam three times, what does a candidate have to do to get three more tries? - Answer: Complete the entire education requirement again. When terminating a sponsorship, the sponsoring broker must return the signed license to the DPR within - Answer: Two business days by signature restricted mail delivery. A leasing agent license requires how many hours of classroom time? - Answer: 15 hours In order to practice real estate, Illinois requires new licensees to have which of the following in their possession? - Answer: A 45-day sponsor card, then a pocket card later An agent is terminated by his broker for failure to pay the office bill. While the agent is looking for a new office, he is considered to have what kind of license? - Answer: Inoperative Performing which of the following activities requires a real estate license? - Answer: Negotiating Lease Terms J was really good at locating temporary housing for friends. They have encouraged her to start a small home business assisting people who are looking to rent. What is the first thing she should do? - Answer: Get a real estate license

Proof of continuing education is required every - Answer: Two years Of the following, who is required to hold an Illinois real estate license? - Answer: A person who represents clients in the negotiation of a real estate contract for a flat fee. All compensation earned by a licensee must be paid: - Answer: Through the licensee's sponsoring broker Who would be eligible after completing education for an appraiser's license? - Answer: A mom who will work part-time (no corporation, only people) What is usually considered proof in Illinois courts that the broker has earned a commission? - Answer: The closing of a sale A seller needs to sell quickly because he is getting transferred. Hoping to create excitement, he agrees to a 7% commission. The listing broker's offer to the cooperating broker must be: - Answer: Disclosed to the seller in writing what the compensation will be. The office assistant for a local real estate firm is responsible for the following activities: tracking the flow of paperwork through the office, preparing forms and advertising copy, and hiring and supervising clerical personnel. The office assistant is: - Answer: Exempt from real estate licensing requirements.

In Illinois, a personal assistant must be licensed to - Answer: Explain simple contract documents to prospective buyers. In Illinois, a personal real estate assistant - Answer: May insert factual information into forms under the agent's supervision and approval. The broker's unlicensed assistant worked late nights and weekends to help ensure the successful closing of a difficult transaction. The assistant's extra work included making several phone calls to the prospective buyers, encouraging them to accept the seller's counteroffer. Largely because of the assistant's efforts, the sale went through with no problem. Now the broker wants to pay the assistant a percentage of the commission "because the assistant has really earned it". Under Illinois law, the broker may: - Answer: Not pay a commission to the assistant under the facts presented here. A licensed personal assistant wishes to hold a public open house. Is this allowed in Illinois? - Answer: Yes, this is allowed if the assistant's license is held by the sponsoring broker. A sponsored licensee has decided to hire a licensed personal assistant. How is compensation paid to this licensed personal assistant? - Answer: Through the sponsoring broker.

A licensee decides to hire a personal assistant who does not hold a real estate license. In this situation, which of the following is correct? - Answer: The licensee being assisted is responsible for the activities of the unlicensed personal assistant. After successfully passing the state exam, an individual is very excited about starting her real estate career as quickly as possible. Under what circumstances, if any, can she practice real estate before receiving her real estate license? - Answer: The sponsoring broker can provide a temporary sponsor card that allows her to engage in the practice of real estate for a maximum of 45 days. What is NOT required of a nonresident to obtain a broker's license? - Answer: Room in the quota system for an additional out-of-state broker (i.e., quid pro quo) An unlicensed personal assistant may: - Answer: Provide security at an open house A broker has hired an unlicensed person as a leasing agent. What, if anything, allows an unlicensed person to function as a leasing agent? - Answer: 120-day leasing agent permit. What is the minimum number of continuing education hours that leasing agents must complete to renew their licenses? - Answer: Six hours every two years.

Which of the following actions might be considered an unauthorized practice of law? - Answer: A broker informs the buyers of his personal opinion of the condition of the seller's title to the property. In Illinois, the court case Chicago Bar Association, et al v. Quinlan and Tyson, Inc. established the principle that brokers and salespeople who are not lawyers may: - Answer: Only fill in blanks and make appropriate deletions on preprinted form contracts customarily used in their community. State law requires sales contracts in Illinois to be titled: - Answer: Real Estate Sales Contract (in bold) In Illinois, the age an individual may enter legally enforceable contracts (with no exceptions) and is of legal competence is: - Answer: 18 The Articles of Agreement for Warranty Deed - Answer: Must be drawn up by an attorney What types of agency are permitted in Illinois? - Answer: Seller, buyer, disclosed dual A listing agent holds an open house that a prospect/buyer attends. The agent then shows properties listed by other offices. Lacking a buyer agency agreement, what is the agent's status if the prospect buys the listing agent's original listing? - Answer: Dual agent

Services performed for a buyer that do NOT create an agency relationship are referred to as: - Answer: Ministerial Acts A buyer prospect working with one agent is interested in a house listed with an agent from the same company. In Illinois, can the buyer agent represent the buyer when showing an in-house listing? - Answer: Yes, this is allowable because Illinois recognizes designated agency. In a dual agency situation, a broker may collect a commission from both the seller and the buyer if: - Answer: Both parties give their informed, written consent to the dual compensation. A broker took a listing for a small office building. Because the property is in excellent condition and produces a good, steady income, the broker's sponsored licensee has decided to purchase it as an investment. If the broker's sponsored licensee wishes to buy this property, the licensee must: - Answer: Inform the owner in writing that the salesperson is a licensee before making an offer. A real estate licensee has signed a brokerage agreement with a tenant who is looking for an apartment to rent. The licensee does not charge a fee to prospective tenants; rather, the licensee receives a commission from landlords. The licensee tells a landlord that the prospective tenant could probably pay a somewhat higher rent than the landlord is asking. Which of the following

statements is TRUE? - Answer: The licensee's disclosure violated the statutory duties owed to the tenant. A broker has entered into a listing agreement with the seller. Another broker, who has been working with the buyer, learns of the property through the MLS. Typically the second cooperating broker would represent: - Answer: The buyer as an agent. A broker decides to sweeten an MLS listing for a property by making a blanket offer of subagency. Is the broker's action acceptable? - Answer: No, subagency relationships in Illinois may be created only by a specific agreement between parties. All of the following can create buyer agency in Illinois EXCEPT: - Answer: Accepting subagency. All of the following are statutory duties an agent owes a client in Illinois EXCEPT: - Answer: Following all instructions of the client. A buyer calls a licensee to see a new listing. Upon seeing it, the buyer wishes to buy it on the spot. The licensee insists that to do this, she can only be a dual agent. Is this correct? - Answer: No, the buyer must be given all the agency options offered by the licensee's office first.

A licensee has no intention of being a dual agent. The licensee is holding an open house and her sellers want her to exclusively represent them. What is her obligation to the potential buyers looking at the house? - Answer: She must give the buyers written disclosure that she is not their agent before they tell her anything confidential. Can buyers refuse to have an agent represent them? - Answer: Yes. An agent has had a listing for a year. An agent from another office has shown it several times to a prospective buyer, but the prospect cannot make an offer until her house sells. The first agent's listing expires, and the second agent gets the listing. If the prospective buyer purchases it during the first agent's protection period, is the first agent entitled to any commission? - Answer: No, the first agent will get nothing (No protection period on 1-4 unit facilities). A broker wants to list a property but is getting a lot of competition from other brokers who would also like to list it. The broker offers the seller the following inducement to sign his listing agreement: "I'll buy your property if it doesn't sell in 90 days." With this inducement, the broker must do all of the following EXCEPT: - Answer: Buy the property at the agreed figure at any time during the 90 days. A broker works for weeks to put a transaction together as a dual agent. After depositing the earnest money in her escrow account, the broker learns that the buyer has been in a car wreck and cannot close. The broker hopes to be reimbursed for her time, so she asks the buyer for half the earnest money before

releasing the rest to her. Is this legal in Illinois? - Answer: No, holding earnest money hostage is illegal. Which of the following, if any, brokerage agreements must be in writing? - Answer: Any exclusive brokerage agreement What is required in an exclusive listing agreement? - Answer: Defined date of termination with no condition for automatic extension. What is required in an exclusive buyer brokerage agreement? - Answer: Anti- discrimination clause. Listings based on a net price are: - Answer: Legal in Illinois but not recommended. The sponsoring broker is worried that some of her newer sponsored licensees may make mistakes. She added an exculpatory clause to her brokerage agreements to limit her liability. Is this a good solution? - Answer: No, exculpatory clauses are forbidden. A broker did a superior job for his seller. The contract he is going to present is for $25,000 over list price. The broker is going to demand an additional 1% commission before he presents the contract to the seller. Is this appropriate? - Answer: No, it is violating the law.

In Illinois, a consumer working with a real estate licensee can: - Answer: Generally assume that the consumer is being represented by the real estate licensee. Upon obtaining a listing, a listing broker is obligated by Illinois law to: - Answer: Give the person or persons signing the listing a copy within 24 hours. Which of the following actions is legal and NOT a violation of Illinois license law? - Answer: Placing a For Sale sign in front of a house after asking the seller's permission and receiving written permission to do so. A real estate broker made an agreement with the seller to keep any amount received over the listed price as compensation. In Illinois, this is viewed as: - Answer: A net listing, which is legal in Illinois but not recommended. In Illinois, all of the following must appear in a written listing agreement EXCEPT: - Answer: The complete legal description of the property being sold. A broker signs a listing agreement with a seller. The agreement contains this clause: "If the property has not been sold after three months from date of this signing, this agreement will automatically continue for additional three-month periods until the property sells." Such an agreement: - Answer: Is illegal in Illinois. All of the following agreements must be in writing EXCEPT: - Answer: An open listing.

The listing agreement with a seller has expired and the seller lists with a different firm. The original listing agent now has a buyer interested in the seller's property. The original listing agent: - Answer: Cannot disclose to the buyer offers received on the seller's property when it was listed with him. Buyer brokerage contracts in Illinois: - Answer: Must be in writing to be enforceable. If a minor enters into a contract in Illinois, what is the statutory period within which she may legally void the contract after reaching the age of majority? - Answer: There is no statutory period. Who is responsible for drafting a company's listing agreement? - Answer: An attorney working with a broker. What needs to be in letters larger than those used in the rest of the listing agreement? - Answer: Earnest Money and Purchaser's Default. Which of the following duties must a licensee observe even when the transaction is completed? - Answer: Confidentiality A licensee represents the seller. The seller has confided certain information to the listing agent. Which of the following should NOT be disclosed to potential buyers?

• Answer: The previous occupant of the property was afflicted with Human Immunodeficiency Virus (HIV).

A licensee represents buyers who are looking for a home in a desirable neighborhood that does not have very many properties listed for sale. The licensee shows a reasonably priced property to two sets of buyer clients. Both are interested in making an offer. How should the licensee proceed? - Answer: The licensee must notify the competing buyers that the licensee is preparing several offers to purchase. A licensee represents the seller but is working with a nonrepresented buyer. What duty does this licensee owe the nonrepresented buyer? - Answer: Honest notice of all latent material adverse facts pertaining to the physical condition of the property. After terminating a brokerage agreement, unless otherwise agreed upon in a written agreement, a licensee owes the former client: - Answer: Accounting for all monies and property and to keep confidential all confidential information received during the course of the brokerage agreement. A seller is required to give a buyer a real property disclosure report in all of the following transactions EXCEPT: - Answer: For a sale of a commercial property. A real property disclosure report must be delivered to the buyer no later than: - Answer: At the time the buyer and seller sign a contract to purchase.

A broker lists a home and asks the seller to fill out a property condition disclosure. Which statement is TRUE in Illinois? - Answer: Seller disclosure of known property conditions is required by statute. Five years ago, Unit 5B in a condominium was the site of a brutal and highly publicized murder. The unit was sold to an elderly woman who contracted the AIDS virus in a blood transfusion and died in the unit last year. As the agent for the woman's estate, what are your disclosure responsibilities to prospective purchasers of Unit 5B? - Answer: You are specifically relieved of liability for nondisclosure of either event by Illinois license law. Six months after the buyer bought a house, its roof leaked during a rainstorm. When the house was listed, the seller told the broker that the roof leaked, but they agreed not to tell any prospective buyers. The broker claims that the buyer did not ask about the roof. Under these facts, the buyer: - Answer: Can sue the broker for nondisclosure. Of the following transactions, in which is a seller disclosure required? - Answer: Sale by a real estate licensee of a two-unit residential property. A real estate broker representing the buyer knows that the property has a cracked foundation and that its former owner committed suicide in the kitchen. The broker should disclose: - Answer: Both facts

In Illinois, agents are required to disclose what kind of defects to a prospective buyer, regardless of who they represent? - Answer: All defects The seller refuses to provide a property disclosure to the buyer. In this situation, the buyer: - Answer: May terminate the contract The sale of which of the following properties requires a property disclosure? - Answer: Not less than one and not more than four residential dwelling units. To comply with the Residential Real Property Disclosure Act, sellers must provide the disclosure statement to the buyers: - Answer: Before the buyers make an offer. To comply with the Residential Real Property Disclosure Act, what information must the sellers disclose? - Answer: Material defects of the property of which they have actual knowledge. Buyers signed a lead-based paint disclosure form on a house they purchased through a buyer's agent. How long must the buyer's agent keep that signed form?

• Answer: For three years. A couple with a five-year-old son lives in their own home in Illinois. Knowing their house contains some surfaces with lead paint, the couple had their son tested for elevated blood levels. The tests showed he had no lead in his system. Does Illinois law require that the parents take any action with regard to the lead paint in their

home? - Answer: No, abatement is required only if the child has an elevated blood lead level. The Illinois Lead Poisoning Prevention Act requires that physicians screen children under the age of six in high-risk areas. Which of the following area is NOT considered high risk? - Answer: A middle-class neighborhood. What procedures must a managing broker follow when terminating an agent? - Answer: Sign the bottom of the agent's license and give it to the agent, then send a copy to the IDFPR and keep one copy on file. An Illinois real estate sponsored licensee may lawfully collect compensation from:

• Answer: His sponsoring broker only. A sponsored licensee may hold a concurrent license with more than one Illinois broker under which of the following circumstances? - Answer: Under no circumstances. Several weeks after closing, a broker received a thank-you letter and a bonus check from the seller of the house. The broker cashed the check because she felt it was earned. In this situation, which statement is TRUE? - Answer: Accepting the money is a violation of IDFPR regulations. All the following would be considered compensation to an agent in Illinois EXCEPT
• Answer: A thank-you note

An agent works for one real estate company, but then moves to a second company. Several transactions are pending during the move. Can the broker of the first company pay the agent directly after those closings? - Answer: Yes, commissions need not flow through the second broker. A sponsored licensee wants to form a corporation for the sole purpose of receiving commissions from her broker. Is this allowed? - Answer: Yes, this is allowed as long as it's a solely owned corporation. Sponsored licensees are allowed to do all of the following EXCEPT - Answer: Manage an office A sponsoring broker intends to open a branch office in a neighboring town. The sponsoring broker applies for a branch office license, giving a name that clearly identifies its relationship with his main office. The broker names a sponsored licensee with minimum training as the branch office manager. Under these facts, will the broker receive approval for the branch office? - Answer: No, the manager of a branch office must be a licensed managing broker. When a managing broker dies, - Answer: A sponsoring broker or power of attorney may step in and manage the office temporarily for up to 60 days, providing IDFPR is notified within 15 days.

Best Builders and Real Estate, Inc. wish to offer a new car to anyone purchasing a home priced in excess of $1,000,000. Can they do this under Illinois law? - Answer: Yes, they can do this as long as the conditions are spelled out in any ad. Broker J asked the telephone company to list her name in the directory under the real estate heading as "J, Real Estate Broker; residential property is my specialty!" Based on this information, J is also required to include: - Answer: The name of her employing broker. A real estate licensee decides to sell his own property without using a broker. When advertising the property, the licensee: - Answer: Must disclose the fact that he is a real estate licensee. A licensee has developed a Web site that showcases all her listings. What, if anything, must the licensee include? - Answer: The city or geographic area for each property, company name, and state of licensure if the property is not within jurisdiction of her license. A licensee wishes to put up a huge billboard on the edge of town with his name and phone number on it. Must he also include his company's name? - Answer: Yes, he may put up the billboard as long as the company name is displayed. A sponsored licensee owns some rental homes that she advertises for rent when they become vacant. She must follow all of these guidelines EXCEPT - Answer: Use a real estate company sign.

Where should all licensure certificates be located? - Answer: Conspicuously displayed in the broker's place of business. What is the maximum percentage, if any, of stock that can be owned by an individual or groups of affiliated licensees? - Answer: 49 percent. Who must hold a license when the real estate company is licensed as an Illinois corporation? - Answer: All corporation officers and all employees acting as sponsored licensees. In an effort to increase awareness of and compliance with the Illinois Real Estate License Act of 2000, Illinois: - Answer: Launched the DFPR Compliance Program. All of the following are required when a sponsoring broker wants to operate a real estate branch office EXCEPT - Answer: The compliance form indicating that the office space meets minimum code requirements. At what time may a sponsoring broker allow licensees to work from a branch office? - Answer: Upon receipt of the branch office license. Who may practice real estate activities under an assumed business name? - Answer: Only the sponsoring broker.

How soon must any changes in managing brokers, branch, or principal offices be reported to the Division? - Answer: 15 days. Within what time frame must a managing broker notify the Division of any change of business address of the offices they manage? - Answer: 24 hours One of the duties of a managing broker is to supervise the activities of licensees and unlicensed assistants. What is an example of such supervision? - Answer: Implement office policies and procedures established by the sponsoring broker. Every sponsoring broker must have a - Answer: Written employment agreement with each sponsored licensee. Under what conditions, if any, may unlicensed individuals or unlicensed entities own an unlimited amount of a real estate brokerage firm? - Answer: Unlicensed owners must file an Affidavit of Nonparticipation. In Illinois, what is a major requirement for opening a real estate office? - Answer: Must have a managing broker of record. After all parties agreed to the contract, the licensee noticed that the sellers had not initialed one change. The licensee is very aware that the sellers were in agreement, but the sellers are now on vacation. How should the licensee proceed? - Answer: Wait until the sellers return to initial the contract.

All funds received by a broker on behalf of his principal must be deposited in an escrow or trust account within: - Answer: One business day of contract acceptance. If a sponsoring broker establishes an account to hold money belonging to others, which of the following is correct? - Answer: All monies must be held in a federally insured depository. A broker received an earnest money deposit along with a contract signed by both buyer and seller. Under Illinois law, the broker should: - Answer: Deposit the money in an existing special non-interest-bearing escrow account in which all earnest money received from buyers may be held at the same time. Every Illinois real estate office that holds escrow is required to do all the following EXCEPT - Answer: Employ at least one additional salesperson in addition to the broker. A sponsoring broker and two partners bought a 12-unit building that the broker will manage. When the broker collects the security deposits, the broker: - Answer: Puts them in a non-interest-bearing escrow account Which of the following is NOT considered escrow monies? - Answer: Rent monies to be transmitted to the licensee's client.

How many escrow accounts, if any, is a sponsoring broker required to open? - Answer: None, if the broker will not be receiving escrow monies while acting as a real estate broker. Under what conditions, if any, may a sponsoring broker place personal funds in an escrow account? - Answer: Only an amount sufficient to avoid incurring service charges relating to the escrow account. How soon after the consummation or termination of the transaction must the sponsoring broker disburse escrow monies? - Answer: Not later than the next business day following the notice of the consummation or termination. When the sponsoring broker has delegated the responsibility of maintaining the escrow account over to another person, who is ultimately responsible for the proper administration of the escrow account? - Answer: Sponsoring Broker The IDFPR may suspend or deny a license for failure to: - Answer: Pay taxes, child support, or any Illinois-guaranteed student loan. In Illinois, all of the following would be grounds for discipline of a broker EXCEPT - Answer: Agreeing with a seller to accept a listing for more than the normal commission rate.

Upon renewal of her license, a licensee writes a bad check to the IDFPR. In this circumstance, the licensee faces: - Answer: Paying a $50 fine and the amount due within 30 days or face license termination. Taking a listing or participating in any transaction in which the property owner seeks to discriminate: - Answer: Is strictly prohibited under license law. In a civil proceeding, a licensee was found guilty of discrimination and fined $75,000. He appealed and lost again. What is the status of his license? - Answer: Suspended or revoked. An unlicensed individual who engages in activities for which a real estate license is required is subject to which of the following penalties? - Answer: Civil penalty up to $25,000 in addition to other penalties provided by law. When a sponsoring broker has her license suspended for two years, what effect does this have on the sponsored licensees associated with the sponsoring broker?

• Answer: The sponsored licenses are inoperative until securing a 45-day sponsor card from a new sponsor. A real estate licensee may be disciplined for: - Answer: Representing more than one sponsoring broker. A licensee advertised a guaranteed sales plan but was unable to purchase the property when no buyer was found. How does the IDFPR view this issue? -