Iowa Real Estate Broker Exam — All Questions

Which of the following is a common ground for the Iowa Real Estate Commission to discipline a broker?

• a.Charging a negotiated commission the client agreed to in writing
• b.Completing more continuing education hours than a renewal requires
• c.Commingling trust funds or failing to supervise affiliated licensees✓
• d.Belonging to a local board of Realtors or a state trade association

The Iowa Real Estate Commission may discipline a broker for violations such as commingling or converting trust funds, failing to supervise affiliated licensees, misrepresentation, and other conduct prohibited by Chapter 543B and the Commission rules at IAC 481 Chapters 2001 through 2022. Belonging to a trade association, negotiating a commission, and exceeding CE minimums are lawful and not grounds for discipline.

Under Iowa Code section 543B.29(4), an Iowa licensee's real estate license must be revoked after:

• a.Any single violation for which a civil penalty of $2,500 is imposed
• b.Two violations of section 543B.29 or 543B.34 within a five-year period
• c.Four written consumer complaints filed against the licensee in a year
• d.Three violations of section 543B.29 or 543B.34 within a three-year period✓

Section 543B.29(4) is mandatory and specific: "A real estate broker's or salesperson's license shall be revoked following three violations of this section or section 543B.34 within a three-year period." Two violations in five years inverts both numbers and states no Iowa rule. A civil penalty is a separate sanction rather than an automatic revocation trigger, and section 543B.48 caps it at $2,500 per violation, which rule 481-2018.14(1)"l" repeats among the sanctions the commission may impose alone or in combination with revocation, suspension, probation, added continuing education, reexamination, a downgrade from broker to salesperson license, or a reprimand. Complaints are not violations: rule 481-2018.6(5) has staff screen every written complaint first, and rule 481-2018.11 lets the commission close a file, sometimes with a confidential letter of caution that is expressly not disciplinary action.

The Iowa Real Estate Commission may accept a licensee's voluntary surrender of a license. Such a surrender:

• a.Is a private resolution that is not published and is not disciplinary action
• b.Ends the matter permanently and bars any later application to reinstate
• c.Is available only after a contested case hearing has been fully decided
• d.Is disciplinary action and is published like any other disciplinary order✓

Rule 481-2018.14(3) says the commission may accept a voluntary surrender to resolve a pending disciplinary contested case or a pending investigation, but "cannot accept a voluntary surrender of a license to resolve a pending disciplinary investigation unless a statement of charges is filed along with the order accepting the voluntary surrender," and that "such a voluntary surrender is considered disciplinary action and is published in the same manner as is applicable to any other form of disciplinary order." That is the point of the rule, so treating surrender as a quiet private exit describes exactly what Iowa refuses to allow. It is available while a case or investigation is still pending rather than only after a decided hearing. And it is not permanent: rule 481-2018.15 treats reinstatement as covering a new license after a revocation, voluntary revocation or voluntary surrender, though rule 481-2018.14(4) makes strict compliance with the wind-down steps in rule 481-2007.3 a condition of applying.

An Iowa broker's license is revoked. Under rule 481-2007.3, the broker must:

• a.Keep the trust account open and disburse funds for thirty additional days
• b.Finish any closings already pending before the effective date of the order
• c.Remove or cover all advertising within ten calendar days of the effective date✓
• d.Assign the firm's listings to another broker without notifying the clients

Rule 481-2007.3(6) bars a broker whose license is suspended or revoked from advertising real estate in any manner as a broker and requires that all advertising, including signs, be "removed or covered within ten calendar days after the effective date," with the brokerage telephone no longer answered in a way suggesting the broker is still active. The broker may not finish pending closings: rule 481-2007.3(5) transfers that responsibility to another broker, an attorney, a financial institution or an escrow company, with the written approval of all parties and notice of where the trust and escrow money will be held. Listings cannot be quietly handed off either, because rule 481-2007.3(4) cancels the brokerage and management agreements, requires clients to be told they may engage a broker of their choice, and forbids selling or assigning those agreements without the client's written consent. Affiliated licensees are automatically placed on inactive status unless they transfer to another broker (rule 481-2007.3(2)).