Transfer of Property
Approximately 8 percent of the examination, covering title insurance, deeds, escrow, tax aspects, special processes, transfer through court supervision, and types of vesting.
Deeds and recording
A California deed must be in writing, name a grantor with capacity and an identifiable grantee, contain a granting clause and an adequate property description, and be signed by the grantor and delivered and accepted; consideration need not be recited and the grantee does not sign. A grant deed carries two implied warranties — that the grantor has not already conveyed to another and that the estate is free from undisclosed encumbrances made by the grantor. A quitclaim conveys whatever interest the grantor has, with no warranty. California's recording statute is race-notice, so a subsequent purchaser for value who records first and takes without notice prevails.
Escrow and title insurance
A California escrow is a neutral depository holding funds and documents under the joint written instructions of the parties; the escrow holder is a dual agent of both parties until the conditions are met and becomes the separate agent of each on closing. Independent escrow companies are licensed by the Department of Financial Protection and Innovation under the Escrow Law, while a real estate broker may perform escrow incidental to a transaction in which the broker is a party or is acting as an agent and holds the license for it. A CLTA standard policy insures matters of record and off-record risks such as forgery and lack of capacity; an ALTA extended policy adds an inspection and survey and covers unrecorded rights of parties in possession and encroachments.
Tax aspects and court-supervised transfers
The documentary transfer tax authorized by Revenue and Taxation Code section 11911 is 55 cents for each $500 of consideration, exclusive of liens remaining, and a city within a county may impose half that rate with a credit against the county tax. Revenue and Taxation Code section 218 gives a $7,000 homeowners' exemption from full value on an owner-occupied principal residence. Under Proposition 19, codified at section 69.6, an owner over 55, a severely and permanently disabled owner, or a wildfire or natural disaster victim may transfer the taxable value of a principal residence to a replacement dwelling bought or built within two years, up to three times for the 55-and-over and disabled categories. Court-supervised transfers include probate sales, which in a confirmed sale may be exposed to overbidding in court.
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State-specific details
State exam facts
- State regulator
- California Department of Real Estate (DRE)
- Prelicensing education
- 8 statutory college-level real estate courses
- Passing score
- 75%
- Scored questions
- 200
- Time limit
- 240 minutes
Who regulates real estate brokers in California?
The California Department of Real Estate (DRE) licenses and regulates real estate brokers and salespersons. Unlike most states, the DRE develops and administers the broker exam itself at its own electronic exam sites rather than contracting with PSI or Pearson VUE.
What experience do I need before the California broker exam?
Broker applicants must show at least two years of full-time licensed salesperson experience within the prior five years, or an equivalent qualifying background — for example, a four-year college degree with a major or minor in real estate. Experience is documented on the DRE's Broker Experience form.
How is the California broker exam structured?
The California broker examination is a single 200-question multiple-choice test given over 4 hours (one 4-hour session). A score of 75% or higher is required to pass. Applicants must also complete eight statutory college-level real estate courses before qualifying.
Sources: https://www.dre.ca.gov/examinees/brokerexperience.html, https://www.dre.ca.gov/examinees/TakingExam.html
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