Pennsylvania Real Estate Broker Exam — All Questions

The Pennsylvania Real Estate Recovery Fund exists to:

• a.Reimburse a consumer who obtains a final court judgment against a licensee for fraud or certain violations and cannot collect it✓
• b.Pay the Commission's administrative payroll
• c.Fund mortgage down payments for buyers
• d.Reimburse brokers for slow markets

The Real Estate Recovery Fund compensates a member of the public who obtains a final court judgment against a licensee based on fraud, misrepresentation, or certain RELRA violations in a transaction and cannot otherwise collect. When the fund pays, the licensee's license is suspended until the fund is repaid with interest. It is not an operating or lending fund.

When the Pennsylvania Real Estate Recovery Fund pays a claim on behalf of a licensee, the licensee's license is:

• a.Permanently revoked with no path to reinstatement
• b.Unaffected
• c.Automatically suspended until the fund is repaid, typically with interest✓
• d.Upgraded to a broker license

A payment from the Recovery Fund on a licensee's behalf results in automatic suspension of that licensee's license until the amount paid, plus interest, is repaid to the fund. This protects the fund and gives the licensee an incentive to satisfy judgments. The suspension is not automatically permanent.

Which type of loss is the Pennsylvania Real Estate Recovery Fund generally intended to cover?

• a.A brokerage's business expenses
• b.An actual monetary loss a consumer suffered because of a licensee's fraud or violation in a licensed transaction✓
• c.A buyer's disappointment with a home's resale value
• d.Ordinary market fluctuations in property prices

The fund addresses actual monetary loss a consumer suffered from a licensee's fraud, misrepresentation, or other covered violation in a licensed transaction, after the consumer has obtained a judgment and exhausted collection efforts. It does not cover business losses, market changes, or general dissatisfaction unrelated to licensee misconduct.