Ohio Real Estate Broker Exam — All Questions

A new environmental ordinance leaves a landowner with no economically viable use of a parcel, although the government takes no title to it. The owner's strongest constitutional claim is:

• a.The ordinance is void because zoning cannot restrict use
• b.A regulatory taking entitling the owner to payment✓
• c.Escheat has occurred and the state now owns the parcel
• d.Spot zoning, since only this parcel lost its value

Regulation that goes so far it denies an owner all economically viable use is treated as a regulatory taking, and just compensation is owed even though the government never took title. Arguing that zoning simply cannot restrict use fails, because regulating land is a valid exercise of the police power and owners have no right to the most profitable use. Escheat moves property to the state only when an owner dies with no will and no heirs, which has nothing to do with an ordinance. Spot zoning describes singling out one parcel for a different classification, not a general environmental rule applied to a class of land.

Reviewing a title report, a broker finds an old recorded covenant, written decades ago, that bars resale of the lot to members of a specified race. Its legal effect today is:

• a.It binds the buyer because it was recorded before purchase
• b.It is void, so a court will never enforce it or enjoin it✓
• c.It stays valid until the homeowners association removes it
• d.It is enforceable by the association but not by an owner

A private restriction that discriminates on a protected basis is void and unenforceable under the federal Fair Housing Act and the Civil Rights Act of 1866, so no court will order compliance or enjoin a violation, and the association has no power the courts would back. Recording rescues nothing, because an illegal restriction gains no force from sitting in the public record. No association vote is required to strip it of effect, although many states let an owner have the language formally struck. Valid CC&Rs, by contrast, are enforced privately by injunction brought by an owner or the association. A broker must never repeat or give effect to such language.

A grantor signs and notarizes a deed naming a nephew as grantee, locks it in a safe deposit box, and tells no one. The grantor later dies. What is the deed's effect?

• a.Title passed when the grantor signed the deed
• b.Title passed because the deed was acknowledged
• c.No title passed, because delivery never occurred✓
• d.Title passes when the estate later records it

A deed operates only when the grantor delivers it with the present intent to pass title and the grantee accepts, and both must happen while the grantor is alive. Signing accomplishes nothing while the instrument stays under the grantor's control in a box no one knows about. Acknowledgment before a notary serves recording, not validity, so notarizing it changes nothing here. An estate representative cannot supply the delivery the grantor failed to make, and recording an undelivered deed does not revive it. The nephew takes only through the will or the intestacy statute, which is why closings hand over the executed deed rather than merely signing it.

A deed is signed by a competent grantor and handed to a grantee who accepts it, but the grantor's signature was never notarized. As between those two parties, the deed is:

• a.Void, since notarizing is a validity requirement
• b.Valid, though it cannot be recorded as it stands✓
• c.Valid only if the grantee later pays a recording fee
• d.Voidable at the option of the grantor's creditors

Acknowledgment is a recording requirement, not an element of a valid deed. Delivered and accepted, the deed transfers title between grantor and grantee even with no notary, but the recorder will reject it, leaving the grantee exposed to later purchasers and lienholders who record first. Calling it void confuses the two ideas: validity turns on a competent grantor, an identifiable grantee, words of conveyance, an adequate legal description, the grantor's signature, and delivery and acceptance. Paying a fee cannot cure a missing acknowledgment, because the recorder cannot accept the instrument at all. Creditors of the grantor gain no power to undo a completed conveyance.

In a deed, which clause opens with the words 'to have and to hold' and defines the extent of the estate the grantee is receiving?

• a.The granting clause containing the words of conveyance
• b.The habendum clause, following the granting clause✓
• c.The acknowledgment taken before a notary public officer
• d.The legal description identifying the land conveyed

The habendum clause follows the granting clause, begins with the traditional phrase 'to have and to hold,' and spells out the estate conveyed, for example a fee simple absolute or a life estate. The granting clause holds the words of conveyance that actually transfer the interest and names the grantee. The acknowledgment is the notary's certificate that the signature is genuine, which the recorder requires but the transfer does not. The legal description identifies the land by metes and bounds, lot and block, or government survey, and it fixes what is conveyed rather than how much of an estate. Reading both clauses tells a broker exactly what the buyer is getting.

A relocation company that has owned a home for three months conveys it, warranting title only against defects that arose during its own ownership. The deed it delivers is a:

• a.Bargain and sale deed implying ownership without covenants
• b.General warranty deed covering the entire chain of title
• c.Quitclaim deed conveying only the interest actually held
• d.Special (limited) warranty deed covering the grantor's period✓

Warranting only against defects created or suffered while the grantor held title describes the special or limited warranty deed, the customary instrument for corporate, relocation, and fiduciary sellers who cannot vouch for what earlier owners did. A general warranty deed reaches back through the whole history of the property and offers the broadest protection, which is more than this seller is giving. A quitclaim carries no warranties at all and passes only whatever interest the signer happens to hold. A bargain and sale deed implies that the grantor owns the property but adds few or no covenants. A buyer taking narrower covenants should lean on an owner's title policy.

A title search shows that a seller's former spouse may still hold a possible interest in the property. What is the usual instrument used to release that interest and clear the record?

• a.A quitclaim deed from the former spouse✓
• b.A general warranty deed from the former spouse
• c.A trustee's deed issued after a foreclosure
• d.A correction deed fixing the legal description

A quitclaim releases whatever interest the signer may hold, with no warranties attached, which makes it the standard tool for removing a cloud such as a possible marital interest, a stale easement claim, or a name discrepancy. Demanding a general warranty deed asks the former spouse to guarantee title he or she may never have owned, and it is normally refused. A trustee's deed is what the trustee under a deed of trust issues to the purchaser at a foreclosure sale. A correction deed reforms a mistake in an earlier deed between the same parties and cannot release an outsider's claim.

A court-appointed personal representative sells a decedent's home during probate, and the buyer's broker asks what instrument will convey title. The answer is:

• a.A trustee's deed given after a nonjudicial foreclosure
• b.A sheriff's deed issued following a judicial sale
• c.A general warranty deed with full title covenants
• d.An executor's or personal representative's deed✓

Estate property is conveyed by an executor's deed when a will names the executor, or by a personal representative's or administrator's deed when the court makes the appointment; these deeds recite the court authority and give only limited covenants. A trustee's deed comes from the trustee under a deed of trust after a nonjudicial foreclosure sale. A sheriff's deed, called a referee's deed in some states, follows a judicial sale ordered by a court. A general warranty deed is not used, because a fiduciary will not personally guarantee title against the acts of the decedent or of owners further back in the chain.

After closing under a general warranty deed, a buyer discovers a recorded utility easement that the deed never disclosed. Which covenant did the grantor breach?

• a.Quiet enjoyment, a promise against eviction by better title
• b.Seisin, a promise that the grantor owns the estate conveyed
• c.Against encumbrances, a promise of no undisclosed burdens✓
• d.Further assurance, a promise to sign curative papers

The covenant against encumbrances promises that no liens, easements, or similar burdens exist beyond those the deed discloses, so a recorded easement left unmentioned breaches it at the moment of delivery. Seisin promises the grantor actually owns the estate being conveyed, which is not the trouble when ownership is sound but burdened. Quiet enjoyment shields the grantee from later eviction by someone holding superior title, and an easement holder's use is not an eviction. Further assurance obliges the grantor to sign additional documents needed to perfect title. A general warranty deed carries all of these along with the right to convey and warranty forever.

A neighbor has openly farmed and fenced a strip of an absentee owner's land, excluding others and never asking permission. To take title by adverse possession the neighbor must prove:

• a.Payment of the owner's property taxes for every year
• b.Open, notorious, continuous, hostile, and exclusive possession✓
• c.A written agreement signed by the record title owner
• d.A recorded deed describing the disputed strip of land

Adverse possession requires possession that is open and notorious, continuous, hostile in the sense of being without permission, and exclusive, held for the statutory period set by state law. Some states add payment of taxes or color of title, but those elements are not universal, so a broker should never assume them from another state's rule. A written agreement from the record owner would destroy the claim outright, since permission defeats hostility. Recording a deed creates no possession and cannot manufacture the required years of use. Adverse possession is one form of involuntary alienation, alongside descent, escheat, foreclosure, eminent domain, and accretion.

An owner dies leaving no will, and after a diligent search no heirs can be located. A broker asked to list the property should understand that title:

• a.Passes by devise to the beneficiaries named in a will
• b.Descends to the decedent's nearest surviving creditors
• c.Vests permanently in the administrator the court appoints
• d.Escheats to the state, an involuntary transfer of title✓

Escheat is the state's claim to property when an owner dies intestate and no heirs can be found, and it is a classic involuntary transfer rather than a voluntary one by deed or will. Devise is a gift of real property by will, so it cannot operate where there is no will and no named beneficiary. Descent carries property to heirs under the intestacy statute, but creditors are paid as claimants out of the estate and never inherit the land itself. An administrator has authority to manage and convey estate property during probate, not to own it permanently. Each state sets its own escheat procedure and waiting period.

A search reveals an old mortgage of record that was paid off but never released, and the lender no longer exists. Which step clears that cloud so title is marketable?

• a.Ordering an abstract of title with an attorney's opinion
• b.Buying an owner's title policy that insures over it
• c.Filing a quiet title action asking a court to clear it✓
• d.Recording a correction deed signed by the current seller

A quiet title action asks a court to determine ownership and extinguish a stale or unreleasable claim, which is the practical cure when the mortgagee has vanished and no release can be obtained. An abstract of title with an attorney's opinion summarizes and evaluates the recorded chain; it reports the cloud rather than removing it, and it offers no indemnity. An owner's policy may insure over a known risk, but insurance pays for loss and leaves the defect on the record for the next buyer to confront. A correction deed fixes a drafting error between the original parties and cannot release a third party's lien.

A seller deeds a parcel to one buyer and later deeds the same parcel to a second buyer, who records first. Which framework decides who owns the land?

• a.A federal recording statute applied in all fifty states
• b.The state's recording act, race, notice, or race-notice✓
• c.The order in which the two deeds were signed and dated
• d.The county recorder's discretion over competing claims

Priority between competing grantees is governed by the recording act of the state where the land lies, and the schemes differ: a pure race state protects whoever records first, a notice state protects a later purchaser who took without notice of the earlier deed, and a race-notice state protects one who took without notice and recorded first. No federal statute governs land recording. Signing dates do not decide the contest, which is precisely why a public recording system exists. Recorders act ministerially and have no power to resolve claims. Because the gap between closing and recording is the danger zone, a broker should press for prompt recording.

A buyer pays for a lender's title policy at closing and asks the broker whether it also protects the buyer's equity in the home. The correct answer is that the policy:

• a.Protects both parties equally up to the full purchase price
• b.Protects the buyer once the mortgage has been fully repaid
• c.Protects the buyer against defects arising after closing
• d.Protects only the lender, declining with the balance✓

A lender's, or mortgagee's, policy insures only the lender's security interest, and its coverage shrinks as the principal is paid down, ending altogether when the loan is satisfied. It never covers the buyer's equity, which is why a separate owner's policy is offered at closing for a one-time premium and lasts as long as the insured holds an interest. Repaying the mortgage does not convert the lender's coverage into the buyer's; it extinguishes it. And no title policy insures defects that first arise after its date. Brokers should explain this plainly before a buyer waives owner's coverage to save money.

Six months after closing, a contractor the buyer hired records a mechanic's lien against the home. The buyer files a claim under the owner's title policy. The insurer will most likely:

• a.Deny, because the defect arose after the policy was issued✓
• b.Pay, because owner's policies cover all future liens
• c.Pay, because the standard exceptions were removed
• d.Deny, because only a lender may file a title claim

Title insurance looks backward: it covers defects that already existed when the policy was issued but were not discovered or excepted, not events that happen later. A lien for work the buyer ordered after closing is a new problem the buyer must resolve directly. Buying extended coverage removes standard exceptions and broadens what is insured as of the policy date, but it does not push coverage forward in time. Owners plainly may claim under their own policies; the lender's policy is the one limited to the lender. Extended coverage typically depends on a current survey, which reveals encroachments and boundary issues a records search alone cannot.

A buyer tours a house and finds an occupant who is not the seller living there under an unrecorded lease. What kind of notice does that occupancy give the buyer?

• a.Actual notice, given by the seller's written disclosure
• b.Constructive notice, given by the public record
• c.No notice at all, since the lease was not recorded
• d.Inquiry notice, requiring the buyer to ask about it✓

Someone in possession who is not the seller puts a buyer on inquiry notice: the buyer is charged with whatever a reasonable investigation of that occupancy would have turned up, including an unrecorded lease or an option to purchase. Actual notice is what a party genuinely knows, typically from a disclosure or a conversation, and no one has told this buyer anything. Constructive notice comes from the public record, which by definition cannot reveal an unrecorded lease. Treating an unrecorded interest as invisible is the classic error, because possession is itself notice. A broker should always ask who occupies a property and on what terms.

Which agency issues and regulates Ohio real estate broker licenses?

• a.The Division of Real Estate & Professional Licensing✓
• b.The Ohio Attorney General's Consumer Protection Section
• c.The county auditor where the brokerage is located
• d.The Ohio Association of Realtors

Ohio real estate licenses are issued and regulated by the Division of Real Estate & Professional Licensing within the Department of Commerce. ORC 4735.05(B) directs the superintendent of real estate to "administer this chapter," "issue all orders necessary to implement this chapter," and "investigate complaints concerning the violation of this chapter or the conduct of any licensee," while the five-member Ohio Real Estate Commission adopts canons of ethics, reviews the superintendent's orders on appeal, and decides discipline. The Attorney General's Consumer Protection Section enforces consumer law generally and can act against deceptive practices, but it neither issues nor renews a real estate license. A county auditor is a county fiscal and property-records office with no role in licensing a brokerage. And the Ohio Association of Realtors is a private membership organization that licensees join voluntarily; a trade group has no authority to license anyone or to take a license away.

When may the Division's investigators and auditors review and audit an Ohio licensee's business records?

• a.During normal business hours, as part of the section's inquiries✓
• b.Only after the Ohio Real Estate Commission has voted to open a case
• c.Only when a consumer has filed a signed written complaint against that broker
• d.Only under a subpoena issued by a court of common pleas

ORC 4735.05(B)(4) requires the superintendent to "establish and maintain an investigation and audit section to investigate complaints and conduct inspections, audits, and other inquiries as in the judgment of the superintendent are appropriate to enforce this chapter," and provides that "the investigators or auditors have the right to review and audit the business records of licensees and continuing education course providers during normal business hours." The right therefore runs with the license and needs no prior vote of the Commission, whose statutory role under ORC 4735.03 is to adopt rules, review the superintendent's orders, and decide discipline rather than to authorize inspections. A consumer complaint is one trigger for an inquiry, not a precondition, since the same division lets the superintendent audit on his or her own judgment. And a court subpoena is unnecessary for records the statute already opens to inspection; ORC 4735.05(C)(1) reserves subpoena power for compelling witnesses.

After a hearing examiner reports on a complaint against an Ohio licensee, which sanction may the Ohio Real Estate Commission impose?

• a.A criminal sentence of up to six months in jail for a first offense
• b.A fine of up to twenty-five thousand dollars per violation
• c.A fine capped at two thousand five hundred dollars per violation✓
• d.An order that the licensee repay the buyer's closing costs

ORC 4735.051(I) lists the sanctions available to the Commission: revoke a license, suspend a license for a term the Commission sets, "impose a fine, not exceeding two thousand five hundred dollars per violation," issue a public reprimand, and require additional continuing education that does not count toward the licensee's ordinary requirement. Those fines are credited to the real estate recovery fund. The Commission is an administrative body and cannot impose a jail term; criminal penalties come from a court, and the Commission's own unlicensed-activity remedy under ORC 4735.052(C)(4) is a civil penalty capped at one thousand dollars per violation. Twenty-five thousand dollars appears nowhere in the section; the closest figure is the two-thousand-five-hundred-dollar ceiling on a single advertising citation under ORC 4735.16(C)(1). And the Commission does not order restitution: a consumer's money claim runs through a court judgment and, if it cannot be collected, through the recovery fund under ORC 4735.12.

The Ohio Real Estate Recovery Fund is used to:

• a.Provide down-payment and closing-cost assistance to qualified Ohio first-time buyers
• b.Pay the salaries of Division of Real Estate investigators
• c.Reimburse a consumer with an uncollectible judgment for license-law violations✓
• d.Cover a brokerage's ordinary operating losses and legal fees

ORC 4735.12(B)(1) lets "any person who obtains a final judgment in any court of competent jurisdiction against any broker or salesperson licensed under this chapter, on the grounds of conduct that is in violation of this chapter," apply in the Franklin County court of common pleas for payment out of the fund of the unpaid portion representing the applicant's actual and direct loss. The applicant must have exhausted appeals and diligently pursued the judgment debtors, liability is capped at forty thousand dollars for any one licensee, and under division (E) the licensee's own license is automatically suspended until the fund is repaid with interest. That makes it a last-resort compensation fund, not a housing program: it pays nothing toward a buyer's down payment or closing costs. Nor does it pay the Division's staff; the chapter routes that money into a separate real estate operating fund created by ORC 4735.211. And it never covers a brokerage's own losses or legal fees; punitive damages, attorney's fees, and interest are expressly excluded by division (B)(2).

A legal difference between an Ohio real estate salesperson and a licensed broker is that only a broker may:

• a.Complete thirty hours of continuing education every three years
• b.Hold a license that is active rather than inactive or resigned
• c.Maintain the brokerage trust account and employ salespersons✓
• d.Show residential property to a prospective purchaser

The trust account and the brokerage itself belong to the broker. ORC 4735.18(A)(26) makes it a disciplinary matter for a broker to fail "to maintain at all times a special or trust bank account," ORC 4735.13(B) puts each salesperson's license in the possession of "the licensed broker with whom the salesperson is or is to be associated," and ORC 4735.21 bars a salesperson from collecting money "except in the name of and with the consent of the licensed real estate broker." Continuing education separates nobody: ORC 4735.141(A) imposes thirty hours every three years on "each person licensed under section 4735.07 or 4735.09," which is both tiers. Holding an active rather than inactive or resigned license is simply a status any licensee can be in, defined for both in ORC 4735.01(M) and (Y). And showing residential property to a purchaser is ordinary licensed activity at either tier, which is why the definition of a broker's acts in ORC 4735.01(A) is extended to salespersons by division (C).

Which person must hold an Ohio real estate license?

• a.An attorney at law selling a client's property in the performance of the attorney's duties
• b.A property manager who rents apartments to the public for an owner and is paid a fee✓
• c.An owner selling a building acquired on the owner's own account as an investment
• d.A court-appointed executor selling a decedent's home under the probate court's authority

ORC 4735.01(A)(5) puts within the definition of a real estate broker anyone who, for another and for a fee, "operates, manages, or rents, or offers or attempts to operate, manage, or rent, other than as custodian, caretaker, or janitor, any building or portions of buildings to the public as tenants" — so the paid property manager needs a license. The other three are named exemptions in ORC 4735.01(I)(1). Subdivision (I)(1)(d) exempts a person acting "as an attorney at law in the performance of the attorney's duties." Subdivision (I)(1)(b) exempts a person acting as "executor, administrator, trustee, assignee, commissioner" or similar "under authority or appointment of, or incident to a proceeding in, any court." And subdivision (I)(1)(a) exempts acts done with reference to real estate "owned by such person... or acquired on its own account in the regular course of, or as an incident to the management of the property and the investment in it," which is the owner selling an investment building.

An Ohio licensee misses the renewal filing deadline. What happens to the license?

• a.Revoked immediately, and the licensee must qualify for and sit the licensing examination again
• b.Suspended automatically, with a fifty per cent penalty to reactivate within twelve months✓
• c.Moved to resigned status, from which the licensee may reactivate at any time by paying the renewal fee
• d.Covered by a sixty-day grace period, after which the renewal fee doubles

ORC 4735.14(C) provides that the license of any broker, brokerage, or salesperson that fails to file a notice of renewal by the deadline "shall be suspended automatically without the taking of any action by the superintendent," and that "a suspended license may be reactivated within twelve months of the date of suspension, provided that the renewal fee plus a penalty fee of fifty per cent of the renewal fee is paid." Revocation is real but it is the second step, not the first: the same division makes revocation automatic only if the licensee does not reactivate inside that twelve-month window, and it is that revoked status, defined in ORC 4735.01(Q) as "void and not eligible for reactivation," that sends a person back to the examination. Resigned status is something a licensee chooses under ORC 4735.142, and it is permanent rather than a parking place. And nothing in the section creates a grace period or a doubled fee; the suspension bites on the deadline itself.

An Ohio salesperson enters the armed forces. What does the license law permit?

• a.Keeping the license active with no further renewal or education ever required
• b.Practicing independently, without a broker, while on active duty
• c.Depositing the license with the Ohio Real Estate Commission until discharge✓
• d.Transferring the license to an unlicensed spouse for the duration of the service

ORC 4735.13(G)(1) says that "if a real estate broker or salesperson enters the armed forces, the broker or salesperson may place the broker's or salesperson's license on deposit with the Ohio real estate commission," and that the licensee "shall not be required to renew the license until the renewal date that follows the date of discharge." The same division extends the continuing-education deadline by the length of active duty, and division (G)(2) gives a comparable extension to a licensee whose spouse's service took the licensee out of the state. Service does not loosen the affiliation rule: a salesperson practices only through a broker, which is why ORC 4735.13(B) keeps the license in the broker's possession. Nor does it end the obligations permanently, since the deposit only postpones renewal and education to the cycle after discharge. And a license is personal to the individual who qualified for it; ORC 4735.02(A) bars anyone not licensed from acting, so it cannot be handed to a spouse.

A newly licensed Ohio broker owes post-licensure instruction. How much, and by when?

• a.Ten hours, within twelve months of the date the license was issued✓
• b.Twenty hours, within twelve months of the date the license was issued
• c.Thirty hours, before the first renewal three years after licensure
• d.Ten hours, within thirty days of the first transaction the broker closes

ORC 4735.07(G)(1) requires a broker, "not earlier than the date of issue" but "not later than twelve months after the date of issue," to submit proof of "the completion of ten hours of instruction" in commission-approved schools or seminars; miss it and the broker's license is suspended automatically, and a further twelve months without proof revokes it. Twenty hours is the parallel figure for a salesperson under ORC 4735.09(J), not for a broker. Thirty hours is the continuing-education requirement under ORC 4735.141(A), which runs on the three-year renewal cycle and is a separate obligation from post-licensure instruction. And the deadline is fixed to the date of issue rather than to any transaction, which is what makes the automatic suspension in division (G)(1) self-executing.

What continuing education must an Ohio broker or management level licensee report each cycle?

• a.Thirty hours every year, including a three-hour principal broker course
• b.Nine hours every three years, whatever the licensee's age
• c.Thirty hours every three years, from which brokers and management level licensees are exempt
• d.Thirty hours every three years, including a three-hour principal broker course✓

ORC 4735.141(A) requires proof of "thirty hours of continuing education... on or before the licensee's birthday occurring three years after the licensee's date of initial licensure, and on or before the licensee's birthday every three years thereafter," and adds that "if the person is licensed as a broker or broker on deposit, or acts as a management level licensee, the continuing education shall include a three-hour course on the duties of a principal broker and other issues involved in operating a real estate brokerage." The cycle is three years, not one, which OAC 1301:5-1-22(A) confirms in providing that "all licenses issued shall be renewed on a three year renewal cycle." The nine-hour figure is real but narrow: the same section reduces the requirement to nine hours only for a licensee who is seventy years of age or older within the reporting period. And brokers are the opposite of exempt, since the three-hour principal broker course is required of them on top of the thirty hours everyone owes.

Ohio's advertising rules require that a salesperson's advertisement:

• a.Show the brokerage name in at least equal prominence with the salesperson's name✓
• b.Carry the salesperson's license number and the brokerage's license number
• c.Be submitted to the Division of Real Estate for written approval before publication
• d.List the names of all licensees affiliated with the brokerage

ORC 4735.16(B)(3) states that "the name of the brokerage shall be displayed in equal prominence with the name of the salesperson in the advertisement," and OAC 1301:5-1-02(B) extends that to "all advertising, including internet websites, that are within the ownership or direct control of the licensee or the brokerage." What the statute requires is identification by name, not by number: ORC 4735.16(B)(1) says the licensee "shall be identified in the advertisement by name and indicate the name of the brokerage," and no license number is called for. There is no pre-approval process either; the Division polices advertising after the fact, and ORC 4735.16(B)(5) makes a non-conforming advertisement prima-facie evidence of a violation of ORC 4735.18(A)(21). And naming every affiliated licensee is not required, as OAC 1301:5-1-21(B)(1) confirms even for team advertising, where "the licensee is not required to include in the advertisement the names of every member of the team."

A group of Ohio licensees in one brokerage advertises under a group name. What must their advertising do?

• a.Obtain a separate brokerage license for the team from the superintendent of real estate
• b.Name every member of the team in each advertisement
• c.Use the word "Realty" or "Associates" in the team name to show that it is licensed
• d.Include "team" or "group" in the name and show the brokerage at least as prominently✓

OAC 1301:5-1-21(B) requires a licensee advertising as part of a team to "include the term 'group' or 'team' in the team name" and to include the brokerage name "displayed in equal or greater prominence with the team name and with the name of the salesperson." A team is by definition unlicensed — paragraph (A) describes a group name "that name is not licensed pursuant to Chapter 4735" — so no separate brokerage license is sought or issued for it, and any unlicensed team member named in the advertising must be identified as unlicensed under (B)(3). Listing everyone is expressly unnecessary, since (B)(1) requires the name of "at least one of the licensees." And the two words offered as required are the two the rule forbids: (B)(5) says the team shall "not use the terms 'realty' or 'associates' in the team name."

An Ohio salesperson closes a sale. How may the salesperson collect the commission?

• a.Directly from the seller at the closing table
• b.Only in the broker's name and with the broker's consent✓
• c.From the cooperating brokerage if the salesperson's own broker refuses to pay
• d.From any party named in the purchase agreement

ORC 4735.21 provides that no salesperson "shall collect any money in connection with any real estate... transaction, whether as a commission, deposit, payment, rental, or otherwise, except in the name of and with the consent of the licensed real estate broker... under whom the salesperson is licensed at the time the salesperson earned the commission," and bars the salesperson from suing anyone other than that broker for it. Collecting from the seller at the table would be exactly that prohibited direct collection, whatever the seller agreed to. A cooperating brokerage is no substitute either, because the same section limits the salesperson's cause of action to the broker under whom the salesperson is licensed. And being named in the purchase agreement gives no one a claim against a salesperson's principal broker's obligation; ORC 4735.18(A)(31) instead makes it a disciplinary matter for the broker to fail to account and pay the salesperson's earned share after receiving the commission.

How long must an Ohio broker keep complete and accurate records of a transaction?

• a.One year from the date of the transaction
• b.Three years from the date of the transaction✓
• c.Five years from the closing, or seven if litigation is threatened
• d.Until the parties' rights under the purchase agreement have expired

ORC 4735.18(A)(24) makes it a disciplinary violation to have "failed to keep complete and accurate records of all transactions for a period of three years from the date of the transaction," and it spells out what those records include: "copies of listing forms, earnest money receipts, offers to purchase and acceptances of them, records of receipts and disbursements of all funds received by the licensee as broker." One year is shorter than any retention period in the chapter. Five or seven years is a longer duty than Ohio imposes, and no provision lengthens the period because a suit is threatened. And a period that ends when the parties' contract rights expire would defeat the purpose of the rule, which is to leave an auditable trail the Division's investigators can inspect under ORC 4735.05(B)(4) after the deal is over; the same three-year clock is used for the broker's records of payments under ORC 4735.20(C)(4) and (5).

A seller signs an exclusive agency agreement rather than an exclusive right to sell listing. The difference is that the seller:

• a.May cancel the agreement at any time without notice or further obligation
• b.May list the same property with several brokerages at the same time
• c.Owes no commission if the property sells solely through the seller's efforts✓
• d.Owes a commission only if the broker personally produces the purchaser or tenant

The two are defined side by side in ORC 4735.01. Under (V), an exclusive agency agreement provides that the broker is compensated if the broker "or any other person or entity produces a purchaser or tenant... unless the property is sold or leased solely through the efforts of the seller." Under (U), an exclusive right to sell or lease listing agreement drops that carve-out and pays the broker "if the broker, the seller, or any other person or entity produces a purchaser or tenant." Both forms still "grant the broker the exclusive right to represent the seller," so neither allows simultaneous listings with several brokerages; that describes the nonexclusive agency agreement defined in division (JJ). Neither is cancellable at will either, which is why ORC 4735.55(C)(1) requires an expiration date and ORC 4735.18(A)(28) disciplines a broker for omitting one. And limiting compensation to a purchaser the broker personally produces is narrower than either definition, since both pay the broker when any other person produces the buyer.

Ohio license law makes it a disciplinary violation for a licensee to fail to:

• a.Recommend that the client accept the highest offer the licensee has received
• b.Submit every offer to the client's attorney for review before presenting it
• c.Inform the client of an offer or counteroffer and present it in a timely manner✓
• d.Withdraw an earlier offer from the seller before presenting a later one

ORC 4735.18(A)(36) reaches a licensee "having failed to inform the licensee's client of the existence of an offer or counteroffer or having failed to present an offer or counteroffer in a timely manner, unless otherwise instructed by the client." ORC 4735.63(A)(2) says the same thing as an affirmative duty to a seller: accept delivery of and present any purchase offer "in a timely manner, even if the property is subject to a contract of sale, lease, or letter of intent to lease." Recommending the highest offer is not a duty and could be poor advice, since price is only one term; the licensee's job under ORC 4735.63(A)(3) and (4) is to answer questions and help the seller develop and communicate offers and counteroffers. Routing offers through the client's attorney first is nowhere required and would delay the presentation the statute wants prompt. And earlier offers are not withdrawn to make room for later ones; every offer goes to the client, which is precisely what the duty of presentation means.

Ohio's broker lien law gives a licensed broker a lien on:

• a.Any property the broker has listed, once the listing is recorded
• b.A residence, if the seller signed an exclusive right to sell listing
• c.Commercial real estate, under a written contract signed by the owner✓
• d.Any property on which the broker's client has defaulted on a mortgage

ORC 1311.86(A) provides that "any broker that enters into a written contract for services related to selling, leasing, or conveying any interest in commercial real estate has a lien on that commercial real estate," and that "the lien is effective only if the contract for services is in writing and is signed by the broker or the broker's agent and the owner of the lien property or the owner's agent." ORC 1311.85(B) then defines commercial real estate as "any parcel of real estate in this state other than real estate containing one to four residential units," expressly excluding condominiums, townhouses and subdivision homes conveyed unit by unit. So the lien does not reach residential listings, however exclusive the listing agreement is, and recording a listing does not create one where the statute gives none. Nor does it follow a client's mortgage default: ORC 1311.86(C)(1) limits the lien to "the broker named in the contract," for the amount due under that contract, and only against the interest that is the subject of it.

Which of these is prohibited to an Ohio licensee as an unlawful inducement?

• a.Advertising a reduced commission rate to attract new listings
• b.Paying a referral fee to a broker licensed in another state
• c.Giving a prospective seller a written market analysis without charge
• d.Offering value not recited in the sales contract to induce a purchase✓

ORC 4735.18(A)(14) disciplines a licensee for "having offered anything of value other than the consideration recited in the sales contract as an inducement to a person to enter into a contract for the purchase or sale of real estate," and in the same breath for "having offered real estate or the improvements on real estate as a prize in a lottery or scheme of chance." Advertising a lower commission is not an inducement of that kind; ORC 4735.55(C)(7) in fact requires every written agency agreement to state conspicuously that "broker fees and commissions are not set by law, are fully negotiable." Paying an out-of-state broker is permitted by ORC 4735.20(B), which lets an Ohio broker pay or receive a commission from "a licensed real estate broker... of another state or country" under commission rules. And a free market analysis is ordinary licensed service to a prospective client rather than value offered outside the sales contract to close a purchase.

A sole Ohio principal broker dies and no other broker is affiliated with the brokerage. The superintendent may:

• a.Recommend an ancillary trustee to conclude the existing business✓
• b.Transfer the brokerage's listings to the nearest licensed brokerage
• c.Allow the most senior salesperson to run the brokerage for one year
• d.Order the Commission to appoint a receiver from among its five members

ORC 4735.05(C)(3)(a) lets the superintendent recommend the appointment of a qualified ancillary trustee "upon the death of a licensed broker, if there is no other licensed broker within the brokerage, upon application by any interested party, subject to the approval by the appropriate probate court, to conclude the business transactions of the deceased broker." OAC 1301:5-3-02(B)(1) limits that trustee to "the supervision and completion of existing contracts and obligations" and forbids initiating new ventures. Listings are not reassigned by the Division to a neighboring firm, because a listing is a contract between the client and that brokerage. A salesperson cannot step up, since ORC 4735.13(A) requires the brokerage to be maintained by a broker and ORC 4735.02(A) bars unlicensed brokerage activity. And the Commission does not supply receivers from its own membership; its five members serve the functions listed in ORC 4735.03, and the ancillary trustee route is the mechanism the chapter provides.

Ohio license law requires a brokerage to maintain:

• a.A minimum of five affiliated salespersons
• b.A definite place of business in Ohio✓
• c.A membership in the local board of Realtors
• d.A physical office in every county where it lists property

ORC 4735.13(A) provides that "every real estate broker licensed under this chapter shall have and maintain a definite place of business in this state," that "a post office box address is not a definite place of business," and that "the license of a real estate broker shall be prominently displayed in the office or place of business of the broker." ORC 4735.16(A) adds a sign at the premises stating that the licensee is a real estate broker. No minimum headcount attaches to that; a brokerage is defined in ORC 4735.01(BB) by its broker's license, not by how many salespersons are affiliated with it. Membership in a local Realtor board is voluntary participation in a private trade organization and is not a condition of licensure. And the requirement is one definite place of business, not an office in every county: ORC 4735.13(A) asks only that a broker who does keep additional locations "apply for and procure a duplicate license for each branch office," each in the charge of a licensed broker or salesperson.

Earnest money and other client funds received by an Ohio brokerage must be:

• a.Held in cash in the office safe
• b.Deposited into the brokerage's trust or special account✓
• c.Sent immediately to the county recorder
• d.Deposited into the broker's personal account until closing

ORC 4735.18(A)(26) requires the broker to maintain at all times "a special or trust bank account in a depository of a state or federally chartered institution located in this state," which "shall be noninterest-bearing, separate and distinct from any personal or other account of the broker," and which is used "for the deposit and maintenance of all escrow funds, security deposits, and other moneys received by the broker in a fiduciary capacity." OAC 1301:5-5-08(B) adds that the deposit tickets and checks must bear the words "trust account" or "special account." Holding the deposit as cash in an office safe leaves no bank record and no trail showing the funds were kept apart. The broker's personal account is the commingling the statute names, whatever the intention, and the same rule lets the broker's own money sit in the trust account only to meet a minimum balance or a service charge. And the county recorder records documents affecting title; it is not a depository for a buyer's earnest money.

Buyer and seller dispute who is entitled to the earnest money. What must the Ohio broker do?

• a.Apply the disputed funds to the commission the brokerage has earned
• b.Hold the disputed funds in the trust account✓
• c.Release the funds to whichever party asks for them first
• d.Let the salesperson who wrote the contract decide who receives them

ORC 4735.24(A) requires the broker to "maintain that money in the account in accordance with the terms of the purchase agreement" until one of the listed events occurs: the transaction closes and the money is disbursed under the agreement, both parties give the broker separate signed written instructions, the broker receives a copy of a final court order, the sale is canceled by a record owner under ORC 5301.95(C)(1), or the money becomes unclaimed funds and is remitted to the director of commerce. Applying contested money to a claimed commission converts funds whose ownership is still unsettled, which ORC 4735.18(A)(5) reaches as a failure to account for money belonging to others. Releasing to whichever party asks first substitutes speed for entitlement and matches none of the statutory triggers. And the decision is not the salesperson's: the account, and the duty that runs with it, belong to the broker under ORC 4735.18(A)(26).

A brokerage that manages rental property for owners must:

• a.Deposit rents in the same trust account it uses for earnest money
• b.Hold tenants' security deposits in the brokerage's operating account
• c.Keep rents in a noninterest-bearing account, as it does earnest money
• d.Keep a separate property management trust account✓

ORC 4735.18(A)(27) requires a separate trust account "to be used exclusively for the deposit and maintenance of all rents, security deposits, escrow funds, and other moneys received by the broker in a fiduciary capacity in the course of managing real property," and adds that "this account may earn interest, which shall be paid to the property owners on a pro rata basis." OAC 1301:5-5-11(A) says the same and requires a separate ledger sheet for each owner, with paragraph (E) requiring an accounting to each owner at least quarterly. So rents do not share the earnest-money account: paragraph (G) of that rule confirms the two are separate by exempting brokers engaged only in property management from ORC 4735.18(A)(26). Security deposits in an operating account would be the commingling both divisions forbid; OAC 1301:5-5-11(D) requires them in the property management trust account, clearly identified and credited to the tenant. And the noninterest-bearing rule belongs to the earnest-money account alone.

A licensee who charges prospective tenants a fee for referrals to rental units must:

• a.Refund the entire fee if the tenant does not sign a lease within thirty days
• b.Collect no more than ten dollars in total from any prospective tenant
• c.Register the rental list with the county recorder before charging any fee
• d.Use a written contract that discloses how the listings were obtained✓

ORC 4735.021(A) requires a licensee in that business to "enter into a written contract with any prospective tenant," to give the tenant a copy, and to "disclose in the contract the manner in which the listings of units have been obtained." The refund term is narrower than a flat thirty-day rule: the contract must stipulate that any fee above ten dollars is repaid on demand, "no sooner than thirty days after the contract has been entered into and no later than sixty days after," if the tenant does not obtain a rental conforming to the stated specifications, and the whole fee is refunded if the information supplied was not current or accurate. Ten dollars is that refund threshold, not a ceiling on what may be charged. And no recorder filing is involved; the companion duty in division (B) is substantive instead — no licensee shall refer a tenant "to any property without the consent of the owner or to any nonexistent address."

Every Ohio brokerage must designate a principal broker. That principal broker's statutory duties include the duty to:

• a.Generally oversee the licensed activity of affiliated licensees✓
• b.Review only those transactions that have already produced a written complaint
• c.Guarantee that each listing the brokerage takes will sell within its term
• d.Personally attend every showing and open house an affiliated licensee conducts

ORC 4735.081(A) requires each brokerage to "designate at least one affiliated broker to act as the principal broker," and division (C)(14) makes that broker responsible to "generally oversee the licensed activity of affiliated licensees and to assure that affiliated licensees are providing real estate services within their area of competency." The rest of division (C) is the specific list: office and sign requirements, the fair housing display, license maintenance and renewal, the trust account and its records, the written company policy on agency, and paying affiliated licensees. Nothing in that list asks the principal broker to attend showings and open houses, and division (D) allows any of these duties to be assigned to a management level licensee. Waiting for a complaint inverts the duty, which is ongoing oversight of licensed activity. And no broker can guarantee that a listing sells; market outcomes are absent from the statutory list precisely because they are not within a broker's control.

What must every Ohio broker's office display in the same immediate area as the licenses?

• a.A schedule of the brokerage's commission rates
• b.The Ohio Real Estate Commission's canons of ethics
• c.A copy of the brokerage's written policy on agency relationships
• d.A fair housing statement bearing the HUD equal housing logo✓

ORC 4735.16(D) requires that "every broker's office shall prominently display in the same immediate area as licenses are displayed a statement that it is illegal to discriminate against any person because of race, color, religion, sex, familial status..., national origin, military status..., disability... or ancestry" in housing, "and that blockbusting also is illegal." The same sentence requires that the statement "bear the United States department of housing and urban development equal housing logo" and give the Division's address, telephone number and role in consumer complaints. A commission schedule is the opposite of what the law contemplates, since ORC 4735.55(C)(7) requires each agency agreement to state that fees are fully negotiable. The canons of ethics are adopted and published by the Commission under ORC 4735.03(A) but are not the posted notice. And the written brokerage policy on agency is a document delivered to clients under ORC 4735.56, and supplied on request under ORC 4735.54, rather than posted on the wall.

Ohio requires a signed written agency agreement before a licensee does which of the following?

• a.Shows a house to a prospective purchaser who has not yet made an offer
• b.Prepares a comparative market analysis for an owner who is considering selling
• c.Answers a purchaser's questions about a listed property at an open house
• d.Advertises or shows residential real property on behalf of a seller✓

ORC 4735.55(B), as amended by House Bill 96 of the 136th General Assembly and effective September 30, 2025, provides that "a licensee shall enter into a written agency agreement before doing any of the following: (1) Advertising or showing residential real property on behalf of a seller; (2) Making an offer to purchase residential real property on behalf of a purchaser; (3) Making an offer to lease a residential premises on behalf of a tenant for a term exceeding eighteen months." The trigger is asymmetric, and that is the point: showing is a trigger only on the seller's side, so showing a house to a buyer does not by itself require a buyer agency agreement in Ohio — the buyer-side trigger is making the offer. Answering questions at an open house is not a listed act at all, and ORC 4735.56(D)(3) treats an open house as an exception even to the brokerage policy on agency. And a market analysis prepared before any listing precedes the advertising or showing that the statute names.

Which item must appear in every Ohio written agency agreement?

• a.The name of the multiple listing service the property will be entered in
• b.The lowest price the seller is willing to accept for the property
• c.A copy of the HUD equal housing opportunity logotype✓
• d.A statement that the commission rate is set by the local board of Realtors

ORC 4735.55(C) lists seven required contents, and division (C)(4) is "a copy of the United States department of housing and urban development equal housing opportunity logotype, as set forth in 24 C.F.R. 109.30." The other six are an expiration date; the fair housing statement citing ORC 4112.02(H) and 42 U.S.C.A. 3601; a statement defining blockbusting and saying it is illegal; a statement that the licensee is appointed as agent, indicating whether the relationship is exclusive or nonexclusive; the terms of the broker's compensation; and a conspicuous statement that "broker fees and commissions are not set by law, are fully negotiable, and may be paid by the seller, the buyer, the landlord, the tenant, or a third party." That last item is why a claim that a local board sets the rate is not merely absent but contrary to the required text. A reserve price is a negotiating position, confidential under ORC 4735.51(F) rather than required in the agreement. And no listing service is named, because the statute regulates the agreement, not where the property is marketed. Divisions (D) and (E) add a place for both parties to sign and date, and delivery of a copy to the client in a timely manner.

A licensee is engaged to lease a client's warehouse. Does Ohio's written agency agreement statute apply?

• a.No, the section reaches residential property of one to four dwelling units✓
• b.Yes, because a lease of any length triggers the requirement
• c.Yes, because every listing of any property in Ohio requires one
• d.No, because leases are excluded from Chapter 4735 altogether

ORC 4735.55(A)(1) borrows its scope from ORC 5302.30, where division (A)(4) defines "residential real property" as "real property that is improved by a building or other structure that has one to four dwelling units." A warehouse is outside that, so the written agency agreement requirement in division (B) does not reach it, and commercial work escapes the section entirely. Nor does the requirement extend to every lease: division (B)(3) is limited to "making an offer to lease a residential premises on behalf of a tenant for a term exceeding eighteen months," with "residential premises" and "tenant" taking their meanings from ORC 5321.01. Leases are certainly not outside Chapter 4735, since ORC 4735.01(A)(1) puts leasing and negotiating leases squarely within the definition of a broker's licensed acts. Falling outside ORC 4735.55 removes the written-agreement trigger, not the license law.

Ohio requires a licensee to give the consumer the Agency Disclosure Statement:

• a.No later than when an offer to purchase or lease is prepared✓
• b.Within 30 days after the date on which the transaction closes
• c.Only if the consumer requests a copy of it in writing before closing
• d.Only after the seller has accepted the buyer's written offer

ORC 4735.58(A)(1) requires a purchaser's agent or a seller's subagent working with a purchaser to present the agency disclosure statement and request a signature "no later than the preparation of an offer to purchase or lease, or a written request for a proposal to lease," and to present it to the seller before the seller receives a written offer. This is a different document with a different clock from the written agency agreement in ORC 4735.55; the disclosure statement records who represents whom, while the agency agreement creates the relationship and carries the seven contents. Delivering it a month after closing would arrive long after every decision it exists to inform. Waiting until an offer is accepted is the same problem in smaller form, because the offer has by then been written and negotiated. And the duty does not turn on a written request; ORC 4735.58(C) makes non-compliance prima-facie evidence of misconduct under ORC 4735.18(A)(6), and the consumer who does not know to ask is exactly who the requirement protects.

In Ohio, dual agency, in which the same brokerage represents both the buyer and the seller in one transaction, is:

• a.Automatically created whenever two agents in the same firm are involved, with no consent needed
• b.Permitted only with the informed, written consent of both parties✓
• c.Prohibited in all residential transactions
• d.Allowed only for commercial property

ORC 4735.71(A) says that "no licensee or brokerage shall participate in a dual agency relationship... unless both the seller and the purchaser in the transaction have full knowledge of the dual representation and consent in writing to the dual representation on the agency disclosure statement," and requires the licensee to disclose everything each party needs "to make an informed decision" before that consent is taken. Consent is therefore never automatic, and while ORC 4735.70(B) does make a brokerage representing both parties a dual agent, the involvement of two agents from one firm creates the status, not the permission. Dual agency is not prohibited in residential transactions, since Ohio allows it wherever the parties consent. And it is not confined to commercial property, because what makes the arrangement lawful is the consent, not the type of property. ORC 4735.57(B)(7) requires the statement to tell the client that consent may be refused and the client may seek representation elsewhere.

When two different agents in the same Ohio brokerage separately represent the buyer and the seller, the brokerage commonly manages the conflict through:

• a.Refusing to disclose that both agents work for the same brokerage
• b.Terminating one of the two agents involved
• c.A dual-agency arrangement in which each agent keeps their own client✓
• d.Referring the buyer to a competing brokerage after the offer is written

ORC 4735.70(C) makes the management level licensee the dual agent in an in-company transaction, and ORC 4735.71(B) permits the arrangement only where the brokerage has established a procedure under ORC 4735.54 ensuring that "licensees, including management level licensees, who represent one client will not have access to and will not obtain confidential information concerning another client," and where "each licensee fulfills the licensee's duties exclusively to the licensee's client." Concealing that both agents work for one firm is the reverse of what the law asks, since ORC 4735.57(A)(5) requires the agency disclosure statement to state whether affiliated licensees are acting as dual agents or representing the parties separately. Terminating an agent solves nothing, because ORC 4735.53(B)(1) makes the brokerage itself an agent of the client. And referring the buyer away after the offer is written abandons a client mid-transaction; ORC 4735.59 requires written consent from the party originally represented before a licensee changes sides at all.

Ohio's fiduciary duties statute requires a licensee representing a client to:

• a.Disclose material facts of the transaction that are not confidential information✓
• b.Guarantee the accuracy of the seller's residential property disclosure form
• c.Obtain the best price the open market could produce for the property
• d.Advance the client's earnest money if the client is short at closing

ORC 4735.62 makes the licensee "a fiduciary of the client" and lists the duties, including division (F): "disclosing to the client any material facts of the transaction of which the licensee is aware or should be aware in the exercise of reasonable skill and care and that are not confidential information pursuant to a current or prior agency or dual agency relationship." The list also includes reasonable skill and care, following lawful instructions, accounting in a timely manner for money and property, and keeping confidential information confidential. Guaranteeing the seller's disclosure form is not among them; ORC 4735.67(B) says a licensee need not "verify the accuracy or completeness of statements made by the seller" unless aware of something that should cause doubt. A best-price guarantee is likewise absent, because ORC 4735.63(A)(1) asks the licensee to seek an offer "at a price and with terms acceptable to the seller," which is the client's standard rather than the market's. And advancing a client's funds appears nowhere in the chapter; ORC 4735.62(H) points the other way, toward accounting for money rather than supplying it.

Which duties may an Ohio client waive?

• a.The fiduciary duties in the general duties section, if the waiver is notarized
• b.None, because every duty in the chapter is mandatory in every transaction
• c.Any duty at all, provided the brokerage's company policy allows it
• d.The seller or purchaser duties, on a signed waiver of duties statement✓

ORC 4735.621 draws the line in two sentences. Division (A): "the duties required of a licensee under section 4735.62 of the Revised Code may not be waived by a client." Division (B): "a licensee shall perform the duties required under section 4735.63 or 4735.65 of the Revised Code unless the client agrees to waive these duties, and signs a waiver of duties statement." So the core fiduciary duties stand whatever formality is added, and notarization cannot reach them. The transaction-specific seller and purchaser duties — seeking offers, presenting them, answering questions, assisting with counteroffers — are the ones a client may give up, on the form the superintendent prescribes by rule in OAC 1301:5-5-30, which must list the duties individually, state that no other licensee will perform a waived duty, and note that the client may hire counsel. A brokerage's own company policy under ORC 4735.54 governs which agency relationships its licensees may form; it cannot enlarge what a client is permitted to waive. And it is wrong that nothing may be waived, since division (B) expressly allows it.