Maryland Real Estate Broker Exam — All Questions

A Maryland listing is already under a ratified contract of sale when a second written offer arrives. Section 17-532 requires the licensee to:

• a.Return the offer to the buyer's agent as untimely
• b.Present the offer to the seller in a timely manner✓
• c.Hold the offer until the first contract falls through
• d.Present the offer only if the seller asks about it

Section 17-532(b)(1)(ii)3 requires the licensee, unless the brokerage agreement says otherwise, to present in a timely manner all written offers and counteroffers to and from the client 'even if the real estate is subject to an existing contract of sale or lease.' The client, not the licensee, decides what to do with a backup offer, and a seller cannot weigh what never reaches them. That is why holding the offer or waiting to be asked both fail — the duty is affirmative. COMAR 09.11.02.02H adds how: all written offers and counteroffers go to the client in full, and in hard copy or electronic format. What § 17-532(b)(4) does not require is that the licensee go looking for further offers while the property is under contract. The duties in this section may not be waived or modified under subsection (g).

Under the Maryland Code of Ethics, written offers and counteroffers must be presented to the client:

• a.In summary, at the next scheduled client meeting
• b.In full, in hard copy or in electronic format✓
• c.In person, with the buyer's own agent also present
• d.In writing, only after the broker has reviewed them

COMAR 09.11.02.02H(2) provides that, unless the brokerage agreement specifies otherwise, all written offers or counteroffers shall be presented to the client 'in full' and 'in hard copy or electronic format.' In full is the operative phrase: the client sees the offer as written, not the licensee's precis of it, because the terms a licensee thinks unimportant may not be the ones the client cares about. Electronic delivery is expressly allowed, so nothing turns on a meeting or on the other side's agent being in the room. The regulation implements § 17-532's duty to present all written offers in a timely manner, and there is no rule making broker review a precondition to the client seeing an offer — though COMAR 09.11.05.03B(2)(b) does expect a supervising broker or branch manager to review executed contracts and brokerage agreements as part of adequate supervision.

A Maryland broker wants to pay a finder's fee to an unlicensed friend who referred a buyer to him. Section 17-604 provides that he:

• a.May pay it if the amount is under five hundred dollars
• b.May not pay compensation for brokerage services✓
• c.May pay it if the friend signs a referral agreement
• d.May pay it out of personal rather than escrow funds

Section 17-604(a) forbids a broker, associate broker, or salesperson to 'pay compensation, in any form, for the provision of real estate brokerage services to any person who is not licensed under this title.' In any form and to any person leave no room for a small payment, a signed paper, or a different pocket to make it lawful — the source of the money is irrelevant. The exceptions in (b) are narrow and specific: an individual licensed in another state who satisfies the reciprocal fee-splitting condition of § 17-513; a professional service corporation, limited liability company, or other entity formed under § 17-512 by the firm's own licensees; and a licensed title insurance producer paying on the broker's behalf under a written disbursement authorization at settlement. Section 17-322(b)(7) reaches the related dodge of retaining an unlicensed individual to evade the rule, and (b)(23) covers rebates and commissions paid in violation of the title.

A Maryland property manager receives a supplier rebate on repairs billed to the owner. The Code of Ethics permits her to keep it only:

• a.With the knowledge and consent of the owner✓
• b.If the rebate amounts to under one hundred dollars
• c.If the management agreement says nothing about it
• d.After the Commission approves the arrangement

COMAR 09.11.02.02E is short and absolute: when acting as agent in the management of property, 'the licensee may not accept any commission, rebate, or profit on expenditures made for an owner without the owner's knowledge and consent.' The money was spent on the owner's account, so any benefit flowing back belongs to the owner unless the owner knowingly agrees otherwise — silence in the management agreement is the opposite of consent, not a substitute for it, and the size of the rebate does not change whose money produced it. The Commission enforces this rule but does not pre-approve individual arrangements. The same principle runs through COMAR 09.11.02.02C, which bars accepting compensation from more than one party to a transaction without the full knowledge of all parties, and § 17-322(b)(23) makes a rebate paid or received in violation of Title 17 a ground for discipline.

Section 17-606 governs an outdoor sign on a Maryland property subject to ground rent. The cost and capitalization of the ground rent must be shown in print that is:

• a.Placed directly above the listing broker's own name
• b.No smaller than the lettering used to show the price✓
• c.At least twice the size of the lettering used for price
• d.Printed in a color that contrasts with the background

Section 17-606 forbids a licensee to post, on real property offered for sale or exchange, 'an outdoor sign or other advertisement on which the cost and capitalization of ground rent on the real property is shown in print or lettering that is smaller than the size of the print or lettering that is used to show the price of the real property.' It is a parity rule, not a magnification rule — the ground rent must be as legible as the price, so a buyer sees the recurring obligation at the same moment as the number that drew them in. Nothing in the section dictates the position of the text on the sign or its color. Ground rent is the Maryland arrangement, concentrated in Baltimore, under which the occupant owns the improvements while another party owns the land and is owed periodic rent for it. Violating § 17-606 is a misdemeanor under § 17-613(a)(12).

Section 17-547 requires every advertisement placed by a Maryland real estate team to carry the brokerage name, the name of at least one team member, and:

• a.The license number issued to each member of that team
• b.The telephone number of the broker or branch manager✓
• c.The date on which the team was registered with the MREC
• d.The address of the local zoning authority for the property

Section 17-547(b) lists exactly three things every team advertisement must contain: the name of the brokerage displayed in a meaningful and conspicuous way, the name of at least one licensee member of the team, and 'the telephone number of the real estate broker or branch office manager of the real estate broker.' A live number for the supervising licensee is what keeps a team from reading as an independent firm. Subsection (c) requires the team name to be directly connected to the brokerage name in the advertisement, and COMAR 09.11.02.01G(5) interprets that strictly: only the words 'of', 'from', 'with', or 'at' may sit between them, with no other word, symbol, or image. Subsection (a) bars a team name containing 'real estate' or 'real estate brokerage' or anything else suggesting the team offers brokerage services independently. Teams are defined in § 17-543 and are not separately registered or licensed by the Commission.

Section 17-608 forbids inducing an owner to sell by making representations about who is moving into a neighborhood. That prohibition applies:

• a.Whether or not the person acted for monetary gain✓
• b.Only when the person earned a commission on the sale
• c.Only in Baltimore City and in Montgomery County
• d.Only when the representations later prove to be false

Section 17-608(a)(2) opens with the words 'whether or not acting for monetary gain,' and reaches any person — not only licensees — who knowingly induces or attempts to induce another to sell, rent, or transfer real estate, or discourages another from buying, by making representations about the entry or proximity of individuals of a particular race, color, sex, religion, handicap, familial status, or national origin. The offense is complete on the attempt, so no sale and no commission is needed. Truth is no defense either: the statute also catches representations that such proximity will lower property values, change the character of an area, increase crime, or hurt the schools. Section 17-608(b) extends liability to anyone knowingly financing a transaction resulting from that conduct, § 17-609 separately bans door-to-door, telephone, and mass-circular solicitation aimed at changing a neighborhood's racial composition, and § 17-322(b)(16) makes the same conduct a ground for discipline. Sections 17-525 and 17-526 are the ones limited to Baltimore City and Montgomery County.

Section 17-525 applies only to residential property in Baltimore City. It requires each broker to keep a registry of listings and, on request, to show a prospective buyer:

• a.The registry, once the buyer signs a brokerage agreement
• b.The whole registry, including every listing in the city
• c.The part of the registry for the price category of interest✓
• d.The registry, but only for the broker's own exclusives

Section 17-525(c)(1) requires each broker to maintain a current and complete registry of the residential properties the broker lists for sale in Baltimore City, broken into price categories established by the Commission, and then: 'if a prospective buyer requests to see the registry, the real estate broker shall allow the prospective buyer to see the part of the registry for the price category in which the prospective buyer indicates interest.' Access is by price band, not the whole book, and it is not conditioned on the person becoming a client. The purpose stated in (a) is to prohibit steering, and (d) backs the registry with a duty not to refuse to show available property because of the buyer's race, color, sex, religion, or national origin or the racial composition of the neighborhood, and not to claim the shown listings are all there are when others exist in the stated price range. Subsection (c)(2) exempts properties obtained through a multiple listing service.

Section 17-328 lets the Commission suspend a license summarily — that is, before any hearing — when a licensee:

• a.Fails to complete the required continuing education
• b.Fails to renew a branch office certificate on time
• c.Fails to account promptly for money held in trust✓
• d.Fails to answer a consumer complaint within 30 days

Section 17-328(a) lists four grounds for summary suspension, and the first two are about client money: failing to account promptly for any money held in trust, and failing on demand to display to the Commission all records, books, and accounts of trust money. The others are a felony conviction under the laws of the United States or any state, and failing to disclose such a conviction to the Commission within 10 days after the conviction or after release from incarceration, whichever is later. Trust money is on this fast track because the harm compounds while a hearing is scheduled. The licensee is not left without process — (b)(2) requires an opportunity to be heard promptly after the suspension takes effect — and (c)(2) keeps the suspension running until the licensee complies with the order or the Commission decides otherwise after that hearing. Missed continuing education, a lapsed branch certificate, and a slow response to the Commission all have consequences, but they run through the ordinary § 17-324 hearing route. Section 17-327 covers summary revocation after a final conviction for violating Title 17.