Louisiana Portion Part 2 - Prep Exam latest updated version with expert solitions + rationales

Of the 11 appointed Louisiana Real Estate Commission members, how many are members at-large?

Two

Two of the 11 members who sit on the Louisiana Real Estate Commission are members at-large.

Jace is in his third year of serving as a member of the Louisiana Real Estate Commission. How much longer is he allowed to fulfill this role?

Three more years until his six-year term is up

Louisiana Real Estate Commission members may serve one term of six years.

When conducting an investigation into a licensee’s possible violation of license law, the Louisiana Real Estate Commission may reserve the right to ______ to the complaint if it has documented probable cause.

Add additional licensees to the complaint if it has documented probable cause

To what court may licensees submit an appeal to reverse the Louisiana Real Estate Commission’s decision for a license law violation?

19th Judicial District Court

Robert, who’s 18, and will graduate high school in four months, wants to be a real estate salesperson in Louisiana. He’s completed the 90 hours of required education. Can anything prevent him from taking the licensing exam right now?

Yes. He must have his high school diploma before he’ll be allowed to take the licensing exam.

Travis, who’s licensed in another state, has a client who’s decided on a home in Louisiana. Can he still work with that client?

No. Travis must apply for a reciprocal license to practice real estate in Louisiana.

Clinton has always had an interest in real estate. He’s helped a few friends determine the asking price for their properties, and now he’s considering going into business doing this kind of work. Will Clinton need a Louisiana real estate license?

Yes, he will.

He certainly will! Clinton is technically performing market analyses, which requires a real estate license if he intends to charge for them.

Ted has a license but chooses to be supervised by Ann at Tip Top Realty. What’s true about Ted and Ann?

Ted is an associate broker who works for Tip Top Realty, where Ann is a licensed broker.

Yes! Because Ted has a license but chooses to be supervised by Ann, he’s known as an associate broker. Since Ann supervises Ted, she must be a licensed broker at Tip Top Realty.

How frequently must all Louisiana real estate licensees take post-licensing education courses?

Once within 180 days of initial licensure

All Louisiana real estate licensees must take PLE courses once within 180 days of initial licensure.

Bob holds a real estate license in Alabama and is looking to obtain a reciprocal license in Louisiana. Which of the following is one of the requirements he must meet?

Pay all required licensing fees.

One of the requirements to obtain an Louisiana reciprocal real estate license is to pay all required licensing fees.

Bob wants to reactivate his inactive license after having it in inactive status for three-and-a-half years. Which of the following is one of the requirements necessary to reactivate his inactive Louisiana real estate license?

Find a broker to sponsor him.

In addition to submitting an application, paying the required fees, and completing 40 hours of CE courses, Bob will need to find a broker to sponsor him.

How long does a licensee have after the renewal deadline to renew a Louisiana real estate license before the licensee will be required to meet the initial license application requirements?

Three months

Licensees who miss the three-month delinquency period will forfeit their renewal rights and will need to meet initial licensure application requirements to be re-licensed.

What states have reciprocal licensure agreements with Louisiana and allow you to practice real estate there?

AACGMOPIN = Alabama, Arkansas, Colorado, Georgia, Mississippi, Oklahoma, Pennsylvania, Iowa, and New Mexico

Currently Louisiana has reciprocal licensing with nine states: Alabama, Arkansas, Colorado, Georgia, Mississippi, Oklahoma, Pennsylvania, Iowa, and New Mexico.

Which of the following Louisiana civil law terms means things without a body, but that can be understood?

Incorporeals

Incorporeals are things without a body, but that can be understood, like ideas and concepts, such as freedom, rights, and ownership.

Which of the following is NOT required for the Louisiana 10-year option for acquisitive prescription?

Two witnesses

Two witnesses are not a requirement for the Louisiana 10-year option for acquisitive prescription. Without good faith or a just title, possession must be for 30 years.

What is a "designation of deposit" in Louisiana real estate?

When a deposit is not stated as earnest money, either party has the right to sue for damages.

If a deposit accompanies an offer, it is considered a deposit on account of the price and either party may demand specific performance, unless there is a clause in the contract that specifically states that the is earnest money.

Which of the following is an exception to dual agency relationships in Louisiana?

If the licensee is the seller and represents the buyer

Louisiana agency law doesn’t consider it dual agency if the licensee is the seller in the transaction.

You're representing Travis and Paul in a dual agency situation. Travis tells you something that would give Paul a distinct advantage if he knew. Do you tell Paul?

No, because you can't share one client's confidential information with another client.

Dual agents must still keep their clients' information confidential, even from the other client.

Keisha is a licensed real estate salesperson, and her friend Andrew is looking for a home. Andrew is interested in having Keisha represent him in his search. What will Andrew and Keisha sign?

Brokerage agreement

The brokerage agreement, also called an agency agreement, outlines the agency relationship between Andrew and Keisha, and they’ll both sign it.

There’s one piece of buyer information that might be considered confidential in circumstances other than a real estate transaction. What is that information?

Financing information

Information about whether or not a buyer is going to be able to obtain financing should be disclosed to all parties in the transaction.

Which of the following tasks would be considered a ministerial act in Louisiana?

Providing a referral to a real estate professional in another state

Ministerial acts are informative or clerical in nature, and don’t require an agency relationship for the licensee to perform them.

Kalia’s the transaction broker for seller Josh. Josh is buying a house from Norman, who’s represented by his agent, Marc. To whom does Kalia owe fiduciary duties in this transaction?

No one

While agents work on behalf of and advocate for their clients, transaction brokers are neutral, not advocating for the buyer or the seller.

If a seller was liable for the mistakes of the seller’s agent, this would be called ______.

Vicarious liability

Vicarious liability is holding one party liable for the actions or mistakes of another person. If a client was responsible for the actions of his agent, this would be vicarious liability.

Ronald can’t disclose anything confidential that his buyer client Amy shared with him, unless which of the following things occur?

Amy gives him permission to share a specific piece of information.

Louisiana law provides three exceptions to the duty of confidentiality, including an exception if the client consents to the disclosure of previously confidential information.

Nelly has a meeting scheduled with a potential new buyer. Per Louisiana law, what document must she try to get the prospect to sign at the meeting?

An agency disclosure

An agency relationship other than designated agency may be formed in Louisiana as long as what is in place?

A written agreement between the client and the licensee

Marta’s listing agent downplayed the seriousness of the foundation issues at Marta’s house to prospective buyers. Now that the buyers are new owners of the house, they’ve discovered how much settling has occurred and want to sue Marta. Marta isn’t legally responsible, because Louisiana says there is no ______.

Vicarious liability

Leland is a licensee who works for Miller Realty. Joy Miller is his broker. Which of the following statements about client confidentiality is true for Leland?

Leland may share confidential information with Joy, since she’s his supervising broker, if he needs some guidance.

The Louisiana Real Estate Commission has mandated the use of a specific agency disclosure by licensees. How many versions are there from which a licensee can choose?

Two

Louisiana brokerage agreements almost always ______.

Have a definite ending date

Frieda is practicing dual agency, and neither party seems to mind, even though she didn't obtain informed consent. Is this legal?

No. Without written informed consent dual agency is illegal.

Mitchell, a seller’s agent in Louisiana, is carefully tracking and accounting for the funds associated with his client’s transaction. Which statutory duty is he fulfilling?

Adhere to the brokerage agreement.

Employ reasonable skill and care in performing services for the client.

Promote the client’s best interests.

Treat customers with honesty.

Promote the client’s best interests.

The requirement to properly account for funds and property is part of the statutory duty of promoting the client’s best interest.

Louisiana law requires licensees to disclose their personal interest to all parties in a real estate transaction. Which of the following must licensee Ben disclose to a buyer client when writing up an offer?

He is the seller.

He knows the other party to the transaction because it’s his neighbor.

He’s helping an acquaintance write an offer on the same house.

He’s told his former college roommate about the house, and he may make an offer.

He is the seller.

Louisiana licensees must disclose personal interest before acting on their own behalf. If a buyer later discovers a personal relationship was involved, the buyer could question the licensee’s loyalty.

There are risks to being a Louisiana property manager. Which one of these is a property management requirement designed to keep you out of trouble?

Hold an accounting certificate.

Hold a real estate broker’s license.

Join a property management association.

Join the Louisiana Real Estate Commission.

Hold a real estate broker’s license.

In Louisiana, a property manager is required to have a real estate license.

Dezerea is a Louisiana licensee who is representing the buyer in a foreclosure transaction. Does she have to provide a personal interest disclosure to the other parties to the transaction?

No, because Dezerea has no personal interest in the transaction.

No, because the personal interest disclosure requirement doesn’t apply to distressed properties.

Yes, because Louisiana law requires that she do so.

Yes, but only if her client’s offer is accepted.

No, because Dezerea has no personal interest in the transaction

If Dezerea had any direct or indirect interest in the property, she’d have to disclose in writing to all parties that she’s a licensed real estate professional. However, that is not the case in this scenario, since she’s simply acting as the buyer’s agent.

______ must include the broker name, location, and jurisdictions on either the first or last page of the communication.

Anything online

Emails, chat boards, and online bulletins

Online ads and website marketing

Only chat boards

Emails, chat boards, and online bulletins

Emails, chat boards, and online bulletins must include this information one either the first or last page of the communication.

In Louisiana, under which circumstance may trust funds NOT be withdrawn?

After a “reasonable interpretation” of the contract terms and 10 days’ notice to the parties

By court order

The broker receives a letter requesting disbursal

To return to the buyer at closing

The broker receives a letter requesting disbursal

Under Louisiana law, trust funds may be disbursed for a number of reasons including after a reasonable interpretation of the contract, by court order, or to return them to the buyer at closing. However, a letter requesting disbursal would not be enough to warrant disbursal unless it was a written request signed by both parties.

Maria is a supervising broker in Louisiana. One of her required duties is to ______.

Act as a liaison between the brokerage and third parties such as lenders and title companies.

Establish work hours for licensees

Maintain the brokerage’s accounts

Mandate in-office training for new licensees

Maintain the brokerage’s accounts

Louisiana brokers are responsible for maintaining the sales escrow account, the rental trust account, and the security deposit trust account.

Licensee compensation in Louisiana must be authorized by the licensee’s sponsoring broker and must include which of the following?

The broker’s name and license number

The city and state of the sale and the sale amount

The licensee’s name and the amount of compensation

The seller’s name

The licensee’s name and the amount of compensation

Broker authorization of compensation must include the licensee’s name and the amount of compensation.

Which of the following work locations would NOT be considered a branch office in Louisiana?

A licensee’s home office, even though the licensee’s advertising directs consumers to the main office

A licensee’s home office, where the licensee routinely hosts workshops and holds meetings with clients

An office that advertises its convenient proximity to the downtown shopping area

An office that is registered with the real estate commission and has a different address than the main office

A licensee’s home office, even though the licensee’s advertising directs consumers to the main office

Additional locations that advertise the brokerage or agency at their own address rather than the main office address are considered branch offices and require a license.

In Louisiana, brokerages are responsible for depositing security deposits into a(n) ______.

Earnest money account

Security deposit trust account

Special funds account

Transaction funds account

Security deposit trust account

Brokerages providing property management services in Louisiana are responsible for handling security deposits properly and must deposit them into a “Security Deposit Trust Account.”

Interest paid on the accrued interest as well as the principal is called _____.

A. compensating interest

B. simple interest

C. exponential interest

D. compound interest

D. compound interest

The sales comparison approach to valuation is directly related to _____

A. market investment return rates

B. all pending, canceled and short-sale listings

C. the quality and amount of sales data available

D. the principle of anticipation

C. the quality and amount of sales data available

Which document outlines the environmental effects that are caused by new development?

A. Environmental Development Report

B. Environmental Impact Report

C. Environmental Project Report

D. Environmental Risk Report

B. Environmental Impact Report

What is meant by riparian rights?

A. The former property owner still lives at the property, but it has officially been sold.

B. There is no legal owner to the land so the property becomes possession of the government.

C. The property owner has property that borders a moving body of water.

D. The property was given to the current owner by a deceased family member.

C. The property owner has property that borders a moving body of water.

Mr. Smith has died. By what rights does his wife lay claim to his property?

A. tenancy in common

B. dower

C. courtesy

D. eminent domain

B. dower

How many days may a licensee submits an appeal to the 19th Judicial District Court for review of a commission decision on a license law violation after the decision?

within 30 days