Handling of Documents and Record Keeping
Six state items cover who keeps the file, how long, what has to be in it, when copies must be handed over, and the Commission's right to walk in and read it.
Three Years, and Who Is Responsible
Tenn. Code Ann. 62-13-312(b)(6) makes it a ground for discipline to fail to preserve, for three years following its consummation, records relating to any real estate transaction. Section 62-13-321 sets the same three-year period for escrow account records. Rule 1260-02-.40 permits electronic recordkeeping on two conditions: every retained document must be readily accessible in an organized format allowing easy identification within twenty-four hours of a Commission request for inspection, and the principal broker must develop and use a retention schedule safeguarding the security, authenticity, and accuracy of the records for the whole period.
What the Escrow Ledger Must Show
Section 62-13-321 requires the broker to keep an escrow or trustee account of funds deposited relating to a real estate transaction and to maintain accurate records showing the depositor of the funds, the date of deposit, the date of withdrawal, the payee of the funds, and other pertinent information the Commission may require. Rule 1260-02-.09(14)(c) adds, for interest-bearing accounts, a detailed and accurate accounting of the precise sum of interest earned for each separate deposit.
Offers, Copies, and Closings
Rule 1260-02-.08 requires a licensee promptly to tender every written offer to purchase or sell obtained on a property until a contract is signed by all parties, and on a proper acceptance to deliver true executed copies signed by the seller to both purchaser and seller. It requires licensees to make certain that all terms and conditions are in the contract, and where an offer is rejected, to request the seller to note the rejection on the offer and return it to the offeror or the offeror's agent. Tenn. Code Ann. 62-13-312(b)(8) requires a copy of any listing, sale, lease, or other contract relevant to a transaction to be furnished to all signatories at the time of execution. Rule 1260-02-.10 requires a broker acting as closing agent to provide copies of the closing documents to each customer or client.
Commission Access
Tenn. Code Ann. 62-13-312(d) lets the director of the division of regulatory boards or the director's authorized representatives, at all reasonable hours, examine and copy books, accounts, documents, or records relevant to whether a licensee has properly maintained and disbursed escrow or trustee funds. On refusal the director may pursue the remedies in section 4-5-311(b), and refusal is itself grounds for the Commission to suspend or revoke a license. Rule 1260-06-.03(4) gives the Commission the same inspection power over time-share escrow records.
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State-specific details
State exam facts
- State regulator
- Tennessee Real Estate Commission (TREC)
- Exam vendor
- PSI
- Prelicensing education
- 120 classroom hours, including 30 hours covering office or brokerage management
- Passing score
- 75% on each portion
- Scored questions
- 125
- Time limit
- 240 minutes
Who regulates real estate brokers in Tennessee?
The Tennessee Real Estate Commission (TREC), within the Department of Commerce and Insurance, licenses brokers and affiliate brokers under the Tennessee Real Estate Broker License Act of 1973 (Tenn. Code Ann. tit. 62, ch. 13). TREC contracts with PSI to deliver the licensing exams.
What experience do I need before the Tennessee broker exam?
Tenn. Code Ann. § 62-13-303(c) requires a broker applicant to certify 120 classroom hours in real estate, including 30 hours covering office or brokerage management, and — for anyone licensed as an affiliate broker after May 12, 1988 — to have held an active real estate license for at least 36 months, or 24 months with a baccalaureate degree with a major in real estate. Within three years of the original broker license, § 62-13-303(h) requires a further 120 classroom hours.
How is the Tennessee broker exam structured?
PSI bulletin 511 sets the broker exam at 125 scored items in two independently passed portions: a 75-item national portion scored to 80 points in 150 minutes, and a 50-item Tennessee state portion (50 points) in 90 minutes. You need 75% on each — 60 of 80 national points and 38 of 50 state items. Do not use the Affiliate Broker column printed beside it in the same bulletin; that tier is 80 national items and 40 state items at 70%.
What is on the Tennessee broker state portion?
PSI bulletin 511 sets nine areas for the Broker tier: Duties and Powers of the Real Estate Commission (6 items), Licensing Requirements (5), Advertising and Marketing (7), Broker/Affiliate Relationships (6), Handling of Documents and Record Keeping (6), Handling of Trust/Escrow Funds (7), Other Improper Activities and Consumer Protection (3), Agency and Disclosure Issues (7), and Special Areas of Practice (3). Advertising, trust and escrow funds, and agency are the joint-largest at 14% each, so most of your study time belongs in Tenn. Code Ann. tit. 62, ch. 13 and TREC rules 1260-01 and 1260-02.
Sources: https://test-takers.psiexams.com/api/content/bulletin/511, https://www.tn.gov/commerce/regboards/trec.html, https://publications.tnsosfiles.com/rules/1260/1260.htm
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