TREC TREC Ethics and Professional Conduct

Question 1

Under the Texas Real Estate License Act, what is the primary duty of a licensee acting as an intermediary?

Accepted Answer

To facilitate the transaction while treating both parties fairly and honestly

Answer

To represent the buyer exclusively

Answer

To represent the seller exclusively

Answer

To act solely in the broker's financial interest

Question 2

A Texas licensee must disclose their license status when:

Accepted Answer

Whenever they are buying or selling property on their own behalf

Answer

Only when asked by the client

Answer

Only during the first meeting with a client

Answer

Only if the transaction exceeds $500,000

Question 3

What does the Texas Real Estate License Act prohibit regarding 'net listings'?

Accepted Answer

They are prohibited because they create a conflict of interest

Answer

They are allowed if both parties consent

Answer

They are only allowed for commercial properties

Answer

They must be approved by TREC in advance

Question 4

A licensee who discovers a property has an undisclosed material defect is required to:

Accepted Answer

Disclose it to the buyer regardless of the seller's wishes

Answer

Keep it confidential to protect the seller

Answer

Only disclose it if the buyer specifically asks

Answer

Report it only to the broker, not the buyer

Question 5

Under TREC rules, commingling refers to:

Accepted Answer

Mixing client funds with the broker's personal or business funds

Answer

Combining multiple client files into one folder

Answer

Sharing a commission with an unlicensed person

Answer

Advertising multiple listings in a single ad

Question 6

What is 'conversion' in the context of TREC ethics?

Accepted Answer

The unauthorized use of client funds by a licensee for personal purposes

Answer

Changing a property from residential to commercial use

Answer

Converting a client's lease to a purchase contract

Answer

Switching a client from one broker to another