Arkansas Real Estate License License Law and Disclosures 3 — Questions and Answers
Question 1: Under Arkansas law, a licensee's failure to disclose a known material defect to a buyer is considered:
- A minor procedural violation
- Misrepresentation or fraud (Correct answer)
- An acceptable business practice
- Only a civil matter outside AREC jurisdiction
Correct answer: Misrepresentation or fraud
Knowingly concealing a material defect constitutes misrepresentation or fraud and is a violation of Arkansas license law.
Question 2: What is the maximum fine the Arkansas Real Estate Commission can impose per violation?
- $500
- $1,000
- $2,500 (Correct answer)
- $5,000
Correct answer: $2,500
AREC can impose a civil penalty of up to $2,500 per violation of Arkansas real estate license law.
Question 3: A licensee in Arkansas who changes their home address must notify AREC within:
- 10 days
- 30 days (Correct answer)
- 60 days
- 90 days
Correct answer: 30 days
Arkansas licensees must notify AREC of a change of address within 30 days of the change.
Question 4: Which of the following is NOT a ground for license revocation or suspension under Arkansas law?
- Conviction of a felony
- Paying a referral fee to an unlicensed person
- Advertising a competitor's listing without permission
- Belonging to a national real estate trade association (Correct answer)
Correct answer: Belonging to a national real estate trade association
Membership in a trade association is not a violation; the other choices are recognized grounds for disciplinary action.
Question 5: In Arkansas, the term 'licensee' in the context of real estate law most specifically refers to:
- Only brokers
- Only salespersons
- Both brokers and salespersons holding a valid Arkansas license (Correct answer)
- Any person involved in a real estate transaction
Correct answer: Both brokers and salespersons holding a valid Arkansas license
Under Arkansas law, 'licensee' encompasses all individuals holding a valid real estate license, including both brokers and salespersons.
Question 6: A broker's license in Arkansas expires every:
- 1 year
- 2 years (Correct answer)
- 3 years
- 4 years
Correct answer: 2 years
Arkansas real estate licenses, including broker licenses, are renewed on a 2-year cycle.
Question 7: If an Arkansas salesperson's employing broker dies, the salesperson may continue to practice real estate for up to:
- 7 days
- 30 days
- 60 days (Correct answer)
- 90 days
Correct answer: 60 days
Arkansas law provides a 60-day grace period for a salesperson to affiliate with a new qualifying broker after their broker's death or license termination.
Arkansas Real Estate License License Law and Disclosures 3
Under Arkansas law, a licensee's failure to disclose a known material defect to a buyer is considered: