Arkansas Real Estate License AREC Rules and Regulations Questions and Answers — Questions and Answers
Question 1: According to AREC regulations, which of the following is TRUE regarding advertising for a real estate agent in Arkansas?
- The agent's personal phone number can be the only contact information listed.
- The real estate firm's name must be included and be of equal or greater prominence than the agent's name. (Correct answer)
- Team names can be displayed in a way that might be construed as the firm's name.
- Advertising a property for sale does not require the written permission of the owner.
Correct answer: The real estate firm's name must be included and be of equal or greater prominence than the agent's name.
AREC Regulation 10.5 and advertising guidelines state that all advertising must include the name of the real estate firm. Furthermore, the firm's name must be displayed in equal or greater prominence than any licensee or team name to avoid public confusion.
Question 2: A principal broker in Arkansas receives an earnest money deposit from a buyer on a Friday afternoon. According to AREC rules, what is the LATEST the broker can deposit these funds into the trust account?
- Immediately upon receipt.
- By the end of the next business day.
- Within three business days following the execution of the contract. (Correct answer)
- Within three calendar days following the execution of the contract.
Correct answer: Within three business days following the execution of the contract.
AREC Regulation 10.8(g)(1) specifies that trust funds, such as earnest money, must be deposited into a trust account no later than three (3) days following the execution of a real estate contract by both the seller and buyer. The count typically refers to business days, not calendar days.
Question 3: What are the annual continuing education (CE) requirements for an active real estate salesperson to renew their license in Arkansas?
- 6 hours of electives and 2 hours of safety.
- 7 hours, including a mandatory 1-hour safety course. (Correct answer)
- 12 hours on any topic approved by the commission.
- No CE is required for the first renewal period.
Correct answer: 7 hours, including a mandatory 1-hour safety course.
All active licensees in Arkansas are required to complete seven hours of continuing education annually. This must include a specific one-hour course on safety. The remaining six hours can be comprised of other required or elective courses as determined by the Commission for that year.
Question 4: An agent represents a seller in a transaction. At what point must the agent disclose their agency relationship to a potential buyer who is not represented by another agent?
- During the property inspection.
- Only when a written offer is being prepared.
- At the first substantive contact with the potential buyer. (Correct answer)
- At the closing of the transaction.
Correct answer: At the first substantive contact with the potential buyer.
AREC Regulation 8.1 dictates that a seller's agent must disclose their agency relationship to a potential buyer at the first contact. While this can initially be oral, it must be confirmed in writing before the buyer signs any transaction-related documents like an offer.
Question 5: A buyer and seller are in dispute over the disbursement of earnest money held in a principal broker's trust account. The real estate contract does not specify how to handle such a dispute. According to AREC rules, the broker should:
- Immediately release the funds to the seller.
- Release the funds to the party the broker believes is in the right.
- Hold the funds until a written agreement between the parties is received or a court order is issued. (Correct answer)
- Return the funds to the buyer immediately.
Correct answer: Hold the funds until a written agreement between the parties is received or a court order is issued.
A principal broker cannot disburse trust funds in a manner inconsistent with the contract. When a dispute arises and the contract is silent on the matter, the broker is prohibited from acting as a judge. They must hold the funds in the trust account until the parties provide a mutual written release or until they receive an order from a court of competent jurisdiction.
Question 6: Regarding license renewal in Arkansas, which of the following is correct?
- Licenses are renewed every two years on the licensee's birthday.
- There is no penalty for renewing after September 30th, as long as it's before December 31st.
- Licenses expire on December 31st of each year, and renewing by September 30th avoids a late fee. (Correct answer)
- Continuing education must be completed after the license is renewed.
Correct answer: Licenses expire on December 31st of each year, and renewing by September 30th avoids a late fee.
Arkansas real estate licenses are valid for one year and expire on December 31st. The renewal period opens in mid-July, and while the ultimate deadline is December 31st, applications filed after September 30th are subject to a late penalty.
Arkansas Real Estate License AREC Rules and Regulations Questions and Answers
According to AREC regulations, which of the following is TRUE regarding advertising for a real estate agent in Arkansas?