Louisiana Real Estate Broker Exam — All Questions

Which agency issues, renews, and disciplines real estate broker licenses in Louisiana?

• a.The Louisiana Department of Insurance
• b.The Louisiana Real Estate Commission (LREC)✓
• c.The Louisiana Association of Realtors
• d.The parish clerk of court where the broker practices

The Louisiana Real Estate Commission (LREC), created under the Louisiana Real Estate License Law (La. R.S. 37:1430 et seq.), licenses and regulates brokers and salespersons. A trade association such as the Louisiana Association of Realtors is a private membership group with no licensing authority, and parish clerks and the Department of Insurance have no jurisdiction over real estate licensing.

To qualify for a Louisiana broker license, an applicant must generally have been actively licensed for at least:

• a.1 year, with no additional coursework
• b.2 years, with a 20-hour course
• c.4 years (including the 2 years immediately preceding) plus 150 hours of broker education✓
• d.6 months as an unlicensed assistant

Louisiana requires broker applicants to have held an active license for four years, including the two years immediately preceding application, and to complete 150 hours of broker prelicense education. That education includes the 30-hour 'RE 203 Broker Responsibilities' course, which focuses on the supervisory and trust-fund duties that distinguish the broker tier from the salesperson tier.

In Louisiana, a licensed salesperson or associate broker may lawfully accept a real estate commission:

• a.Only from the sponsoring broker who holds their license✓
• b.Directly from any buyer or seller in the transaction
• c.From the LREC as a state disbursement
• d.From the escrow agent at closing without the broker's involvement

Under Louisiana license law, licensed activity is conducted for and in the name of the sponsoring broker, and compensation for that activity must flow through that broker. A licensee cannot be paid directly by a client or by the closing agent independently of the broker. This channels supervisory and financial responsibility to the broker.

A Louisiana broker who operates a firm and supervises affiliated licensees is responsible for all of the following EXCEPT:

• a.Maintaining the firm's trust/escrow account
• b.Supervising the licensed activity of affiliated salespersons
• c.Retaining transaction records for the period required by LREC
• d.Personally guaranteeing each client a profit on resale✓

A qualifying broker must supervise affiliated licensees, maintain the firm's trust account, and retain transaction records for LREC inspection. No broker can lawfully guarantee a client a profit on resale; doing so would be a misrepresentation. The broker's supervisory and recordkeeping accountability is what the 30-hour RE 203 course emphasizes.