Illinois Real Estate Broker Exam — All Questions

Under the Illinois Real Estate License Act, what is a 'designated managing broker'?

• a.A managing broker the sponsoring broker appoints to supervise offices✓
• b.Any broker who has finished 45 hours of post-license education
• c.The managing broker holding the largest share of the brokerage
• d.A monitor the Department places in a disciplined brokerage

The designated managing broker is appointed by the sponsoring broker and carries supervisory responsibility for licensees in one or multiple offices. The classification was created by Public Act 101-0357. Cite: 225 ILCS 454/1-10.

What must an Illinois sponsoring broker do about designated managing brokers?

• a.Appoint one for the whole company and no more than one
• b.Appoint one only once the brokerage exceeds ten sponsored licensees
• c.Rotate the appointment annually among all qualified brokers
• d.Name one per office and notify the Department of each appointment✓

The sponsoring broker supervises all designated managing brokers, must name one for each office, and must notify the Department of all of them and which offices they manage. Cite: 225 ILCS 454/5-45(b).

Which duties must a designated managing broker handle directly for a broker who has not completed the 45-hour post-license education?

• a.Only the monthly reconciliation of the escrow account
• b.Only advertising copy and the placement of yard signage
• c.Earnest money, escrow, contract negotiation, and advertising✓
• d.Only the retention of continuing education completion records

Until the new broker completes post-license education, the designated managing broker must directly handle all earnest money, escrows, contract negotiations, and advertisements for that broker. Cite: 225 ILCS 454/10-55(b).

Which of the following are listed responsibilities of an Illinois designated managing broker?

• a.Setting the brokerage's commission rates and cooperative splits
• b.Personally holding the brokerage's errors and omissions policy
• c.Supervision and training, company policy, and the special accounts✓
• d.Approving the sponsoring broker's tax filings and payroll records

The statute lists supervision and training of all licensees and employees at each assigned office, implementing company policies, and supervision of all the sponsoring broker's special accounts. Cite: 225 ILCS 454/10-55(a).

On which advertising may an Illinois designated managing broker omit identifying themselves as the designated managing broker?

• a.Yard signs placed on the listed property✓
• b.Listings displayed on internet real estate portals
• c.Business cards handed to prospective clients
• d.Printed brochures distributed at an open house

A designated managing broker must identify themselves to the public as such on all advertising, with yard signs the stated exception. Cite: 225 ILCS 454/10-30(g).

How long must an Illinois sponsoring broker retain records relating to a special account transaction?

• a.One year from the transaction
• b.Two years from the transaction✓
• c.Three years from the transaction
• d.Five years from the transaction

Records relating to a special account transaction must be kept at least 5 years, and electronic records must be backed up monthly. Cite: 225 ILCS 454/5-45(d).

How often must an Illinois sponsoring broker back up electronic records of special account transactions?

• a.Monthly✓
• b.Weekly
• c.Quarterly
• d.Annually

Electronic records must be securely stored in their original format, made accessible to the Department, and backed up monthly. Cite: 225 ILCS 454/5-45(d).

Where must an Illinois sponsoring broker keep physical records that the Act requires to be maintained?

• a.At the designated managing broker's own home address✓
• b.At whichever branch office the sponsored licensee picks
• c.At the sponsoring broker's principal office, open to review
• d.With the recorder of deeds for the county of the property

A physical record required to be maintained must be securely stored and made accessible to the Department at the sponsoring broker's principal office. Cite: 225 ILCS 454/5-45(d).

An Illinois licensee pays a fee to an unlicensed acquaintance who referred a buyer and who was not a party to the transaction. What is the consequence?

• a.It is permitted if the fee is under $500
• b.It is permitted if disclosed to both parties in writing
• c.It is a ground for discipline against the licensee✓
• d.It is permitted only in commercial transactions

Paying compensation to an unlicensed person who is not a party to the transaction in exchange for a referral is a ground for discipline. There is no dollar threshold and disclosure does not cure it. Cite: 225 ILCS 454/10-15(e).

What does the Illinois Act require on any property data form accessible to the consumer?

• a.The sponsoring broker's license number and expiration date
• b.Disclosure of the licensee's status as a licensee✓
• c.The most recent appraised value recorded for the property
• d.A statement of the cooperating commission being offered

Failure to indicate disclosure of licensee status on a property data form accessible to the consumer is a ground for discipline. Cite: 225 ILCS 454/10-30(c)(1).

Must a claim against the Illinois Real Estate Recovery Fund arise from intentional misconduct?

• a.Yes, only fraud and conversion of funds can support a claim
• b.Yes, unless the licensee has died before the claim is filed
• c.No, the loss need not result from intentional misconduct✓
• d.Only losses involving special account funds can be claimed

The Act provides that a claim against the Fund does not need to arise from a loss resulting from intentional misconduct. The Department sets by rule the maximum an aggrieved person may recover and the maximum liability arising out of one licensee's activities. Cite: 225 ILCS 454/20-85.

Which statement about attorney's fees in an Illinois Real Estate Recovery Fund claim is correct?

• a.There is no longer a cap on attorney's fees✓
• b.Attorney's fees may never be recovered
• c.Attorney's fees are capped at 10% of the award
• d.Attorney's fees are capped at $2,500

Public Act 101-0357 removed the cap on attorney's fees in Recovery Fund claims. The Department still sets maximum recovery amounts by rule, but that is a separate limit from attorney's fees. Cite: 225 ILCS 454/20-85.

An applicant business entity has an officer who was denied an Illinois real estate license three years ago. What is the result?

• a.The entity may be licensed once that officer resigns the post✓
• b.No license issues, the denial falling inside the 5-year window
• c.The entity is licensed but placed on probationary status
• d.The prior denial has no bearing on an entity's application

No person, partnership, or business entity may be granted a license if any owner, officer, director, partner, member, or manager was denied a real estate license in the previous 5 years or is currently barred from practice. Three years is inside that window. Cite: 225 ILCS 454/5-15(f).

Cheating on a continuing education course or a licensing examination in Illinois is:

• a.Handled solely by the education provider
• b.A civil matter between the provider and the student
• c.Grounds for a fine but not license discipline
• d.An enumerated ground for discipline under the Act✓

Cheating on continuing education courses or examinations is specifically enumerated as a ground for discipline. Cite: 225 ILCS 454/20-20(a)(7).

A person performs real estate brokerage in Illinois while their license is inactive. How does the Act treat this?

• a.As a minor administrative lapse with no consequence
• b.As unlicensed practice, an enumerated ground for discipline✓
• c.As permitted if a managing broker supervises the work
• d.As permitted if the license is later reactivated

Engaging in brokerage without a license, with an expired license, or while the license is inactive, revoked, or suspended is unlicensed practice and an enumerated ground for discipline. Inactive counts, which is why the automatic inactive status on sponsorship termination matters so much. Cite: 225 ILCS 454/20-20(a)(6).

Submitting a payment to IDFPR with a credit or debit card that is invalid, expired, or declined:

• a.Is an enumerated ground for discipline✓
• b.Has no consequence beyond the failed payment
• c.Voids the license automatically
• d.Is treated as fraud and referred for prosecution

The Act specifically makes submitting a credit or debit card payment using a card that is invalid, expired, or declined a ground for discipline. Cite: 225 ILCS 454/20-25.

Through what date has the Illinois Real Estate License Act of 2000 been extended?

• a.January 1, 2027
• b.January 1, 2025
• c.The Act has no sunset date
• d.January 1, 2030✓

Public Act 101-0357, signed August 9, 2019, updated the Act and extended it to January 1, 2030. Cite: Public Act 101-0357.

Under the 2025 amendments, what changed about the Illinois managing broker license examination?

• a.It need no longer include a national brokerage law portion✓
• b.It was waived for applicants holding five years of experience
• c.It gained a mandatory section devoted to fair housing law
• d.It became an oral examination conducted before the Board

Public Act 103-1039 removed the requirement that the managing broker examination include a portion focused on national brokerage laws and practices, leaving the exam focused on Illinois supervisory content. Cite: Public Act 103-1039, effective 1/1/2025.

Which body hears disciplinary matters and reports on them under the Illinois Real Estate License Act?

• a.The grievance committee of the state REALTORS association
• b.The circuit court for the county where the office is located
• c.The Real Estate Administration and Disciplinary Board✓
• d.The Illinois Commerce Commission's professional panel

The Real Estate Administration and Disciplinary Board issues a report in disciplinary proceedings, and the Act permits that report to be served by electronic mail on the person subject to the proceeding. Cite: 225 ILCS 454/20-64.

May IDFPR serve a citation or notice of an investigation and hearing by electronic mail?

• a.No, personal service on the licensee is required in every case
• b.Only where the licensee has consented to e-mail service in writing
• c.Only in matters that involve special account or escrow violations
• d.Yes, on the accused and their managing and sponsoring brokers✓

The Act expressly allows electronic mail to serve a citation or provide notice of investigations and a hearing to the accused and to their designated managing broker and sponsoring broker. Cite: 225 ILCS 454/20-20.1 and 20-60.

A sponsoring broker offers sellers a plan under which the brokerage will purchase the home if it does not sell. What does the Illinois Act call this, and who may be disciplined for a non-compliant version?

• a.A net listing, and only the seller may bring a complaint
• b.A guaranteed sales plan, and licensed and unlicensed alike✓
• c.A buyer representation agreement, to which no discipline attaches
• d.An option contract, handled only by the Department's civil side

The Act addresses guaranteed sales plans and permits discipline of licensed and unlicensed individuals who offer one that does not comply with the Act. Cite: 225 ILCS 454/20-20(a)(29).

An Illinois applicant makes a false statement of material fact on a license application. Which provision does this implicate?

• a.The special account provisions found in Article 20 of the Act
• b.The good moral character provisions of Section 5-25✓
• c.The advertising and licensee-status rules of Section 10-30
• d.The sponsorship notice requirements found in Section 5-40

A false statement of material fact on an application goes to good moral character under Section 5-25, which also lists aggravating and extenuating circumstances the Department must consider where an applicant has had a license revoked or has certain criminal convictions. Cite: 225 ILCS 454/5-25.

A sponsoring broker fails to timely provide sponsorship or termination information to the Department. What is the result?

• a.It is excused if the licensee also failed to report
• b.It is an enumerated ground for discipline✓
• c.It is a fee-only violation with no discipline
• d.It voids the affected transactions

Failure by a sponsoring broker or licensee to timely provide proof of sponsorship or termination information is an enumerated ground for discipline, and it pairs with the 24-hour notice duty. Cite: 225 ILCS 454/20-20(a)(20).

A licensee forms a business entity to receive compensation from the sponsoring broker. Who may own it?

• a.Any family member of the licensee who is not otherwise licensed
• b.Any group of investors, whether or not they hold a license
• c.The licensee alone, or with a spouse licensed under the same broker✓
• d.The sponsoring broker and the licensee as equal joint owners

Such an entity must be owned solely by the licensee, or by the licensee together with the licensee's spouse, and then only if the spouse is also licensed and sponsored by the same sponsoring broker. Cite: 225 ILCS 454, sponsorship and compensation provisions as amended by PA 101-0357.

The Illinois Act permits the Department to adopt rules addressing which emerging business model?

• a.Virtual real estate practice✓
• b.Auction-only brokerages
• c.Cooperative housing brokerages
• d.Timeshare resale brokerages

The Act recognizes the growing trend toward the virtual real estate business model and authorizes the Department to adopt rules to regulate the operation of a virtual real estate practice. Cite: 225 ILCS 454/5-45(f).

Which Illinois license authorizes leasing residential real estate without holding a broker license?

• a.Property manager registration
• b.Residential leasing agent license✓
• c.Limited broker permit
• d.Rental agent certificate

Illinois issues a residential leasing agent license for those who lease residential real property, distinct from the broker and managing broker licenses. Cite: 225 ILCS 454, Article 5.

Which agency division administers the Illinois Real Estate License Act day to day?

• a.The Illinois Department of Revenue
• b.The Office of the Secretary of State
• c.The Illinois Housing Development Authority
• d.The IDFPR Division of Real Estate✓

The Division of Real Estate within the Illinois Department of Financial and Professional Regulation administers licensing, education, and enforcement under the Act. Cite: IDFPR Division of Real Estate; 225 ILCS 454.