Practice of Real Estate
This topic covers the professional and ethical duties of a licensee, including fair housing, advertising, and the handling of trust funds.
Fair Housing
The federal Fair Housing Act prohibits discrimination in housing based on race, color, religion, sex, national origin, familial status, and disability. Prohibited practices include steering (directing buyers toward or away from areas), blockbusting (inducing sales by suggesting a change in neighborhood composition), and redlining (denying loans in certain areas). Licensees must serve all clients equally and use inclusive advertising.
Trust Funds, Advertising, and Supervision
Client and customer funds such as earnest money must be held in a separate trust or escrow account; mixing them with personal funds (commingling) or using them personally (conversion) is a serious violation. Advertising must be truthful and not misleading, and generally must identify the brokerage. Brokers are responsible for supervising the salespersons associated with them.