Broker Responsibilities on the Real Estate License Exam
Some states expect aspiring brokers to know something about administrative duties and responsibilities of running a real estate brokerage for the Real Estate License Exam, including supervising people who work for you, training those people, and setting office policies.
State laws may vary, but in general, a broker is required to supervise the people who work for her. This extremely specific requirement makes the broker responsible for the actions of salespeople who work for her. This responsibility extends to violations of the state licensing laws, fair housing laws, and illegal or fraudulent activities.
The extent of liability and punishment is, of course, determined by state licensing officials, and in the case of criminal or civil actions, by the courts.
The type of questions you’re likely to get on this subject fall into these two categories:
What your state law has to say about brokers’ responsibilities with respect to supervising their salespeople.
The expectation that you’ll know most of the important points of the state licensing law with which you and your salespeople are expected to comply.
Although this material may be information you found out about when pursuing your salesperson’s license, you still need to review the specific information that applies to your state’s broker’s exam.
Real Estate training
Brokers are expected to provide training to their salespeople. Most states require prospective salespeople to receive formal training through prelicensing courses before they can get a salesperson’s license. Even though this training gives you the basic background and the minimum amount of knowledge that the state requires you to have to work as a real estate agent, it often does not cover the day-to-day real world activities of an agent.
Brokers are expected to provide that day-to-day type of training. After you get your salesperson’s license, you can stay a salesperson forever. In most states, however, if you want to become a broker, you’re required to gain some hands-on experience.
Formulating and periodically updating an office policies and procedures manual is a suggested means of at least partially fulfilling your training and supervision obligations as a broker. This manual is distributed to all employees along with training in the policies and procedures of the brokerage.
Because most salespeople work as independent contractors, the policy and procedures manual needs to rely on words like suggested and recommended rather than must. The subjects contained in an office policy manual can range from dealings with attorneys and other professionals to record keeping, using supplies, and attending sales meetings.