Texas Real Estate State Exam ACTUAL
QUESTIONS AND ANSWERS
Texas Real Estate (Dealers) License Act - CORRECT ANSWER Passed in 1939 and
made it illegal to sell real estate in Texas without first obtaining a license
Texas Real Estate License Act - CORRECT ANSWER TRELA was passed in 1949 and
created TREC. It consist of 9 members, 6 Brokers & 3 General public members; appointed by
the governor and approved by 2/3 of the senate present. TRELA was codified as Title 7 of the
Occupational code Chapters 1101 (broker and sales person activities) and 1102 (real estate
inspectors)
What is TREC's authority? - CORRECT ANSWER to make rules and regulations,
which have the full force and effect of law; to protect the public
TREC on education - CORRECT ANSWER TREC is authorized to inspect and
accredit educational programs or courses of study in real estate and real estate inspection to
establish standards.
TREC on Law - CORRECT ANSWER TREC can advise with reference to the laws it
administers
TREC on Mediation - CORRECT ANSWER TREC does not mediate disputes between
or among licensees concerning entitlement to sales commissions
TREC on Licensees - CORRECT ANSWER TREC does not recommend individual
licensees to the public
TREC on Discipline - CORRECT ANSWER An employee of the commission
specifically authorized by it pursuant to the Act, to conduct hearings and render final
decisions in contested cases may suspend or revoke a license or reprimand or place on
probation a licensee for a violation of the Act or a rule of the commission.
,Real Estate Broker-Lawyer Committee - CORRECT ANSWER Drafts and revises
TREC promulgated contracts. Thirteen members-6 lawyers, 6 Brokers, 1 public member.
TREC Investigations - CORRECT ANSWER TREC may, after receiving a written
comlaint with proper evidence investigate the actions and records of a broker or sales agent.
The complaint must be submitted within 4 years. If the complaint is to be paid from the
recovery fund it must be filed within 2 years or be DTPA actionable
TREC investigation of licensee - CORRECT ANSWER TREC may authorize a
commission employee to file a signed written complaint against a licensee and to conduct an
investigation if:
1. A judgement against the licensee has been paid from a recovery fund established under the
Act.
2. The licensee is convicted of a criminal offense that may constitute grounds for the
suspension r revocation of the licensee's license
3. The licensee fails to make good on a check issued to the commission.
4. Licensee fails to complete required continuing education within the prescribed time.
5. Failing to provide information requested by TREC in connection with an application to
renew a license.
Subpoena Power Investigations - CORRECT ANSWER TREC has the power of
subpoena. TREC may compel by subpoena the attendance of witnesses for examination under
oath and the production for inspection and copying of books, accounts, records, papers,
correspondence, documents and other evidence relevant to an investigation. If a licensee fails
to comply with a subpoena, TREC can file suit through the attorney general to enforce the
subpoena.
Subpoena Power Hearings - CORRECT ANSWER If the commission proposes to
suspend or revoke a license, the person is entitled to a hearing before the commissioner. If
that ruling is adverse to the license, they can appeal to a district court within 30 days.
TREC Complaints - CORRECT ANSWER A person may file a written complaint with
TREC against a real estate licensee if the person believes the licensee violated TRELA. If
TREC has jurisdiction, it will investigate the allegations by interviewing the persons,
, witnesses and relevant info. TREC's Standards and Enforcement Services will notifiy the
licensee if it intends to initiate disciplinary proceedings
Complaint Priorities - CORRECT ANSWER TREC is required to maintain a system to
act promplty and efficiently on complaints and must maintain a file on each complaint.
TRELA requires that TREC assign priorities and investigate complaints using a risk based
approach on the:
-Degree of potential harm to the consumer
-Potential for immediate harm to the consumer
-Overall severity of the allegations and complaint
-Number of license holders potentially involved in the complaint
-Number of potential violations in the complaint
Refund to Consumer - CORRECT ANSWER TREC may order a licensee to pay a
refund to a consumer as provided by an agreement resulting rom an informal settlement
conference or enforcement order
TREC Advisory Letters - CORRECT ANSWER TREC may close a complaint file by
issuing an advisory letter to the licensee. This is normally in more technical matters. An
advisory letter is not a formal disciplinary action. The advisory letter is a notification that
there were item reveled in the investigation that do NOT warrant disciplinary action but, if
not corrected, could lead to further complaints and, ultimately, disciplinary action.
Informal Proceedings - CORRECT ANSWER In some cases the Deputy Director of
Standards and Enforcement services (SES) may offer a complainant and respondent an
opportunity to participate in an alternative dispute resolution process (ADR). The Deputy
Director does not have the authority to compel a complainant to participate in the process. If
an agreement can be reached, it may be some satisfaction to the complinant and save time for
the respondent. If the parties cannot reach an agreement of if SES does not pursue the ADR
process at the outset, the complaint is investigated to determine if there is sufficient evidence
to proceed with a hearing against the licensee.
TREC Informal Case - CORRECT ANSWER TREC is required to adopt procedures
governing informal disposition of contested cases. The informal contested case must provide
the complainant and licensee the opportunity to be heard, which is similar to the ADR
QUESTIONS AND ANSWERS
Texas Real Estate (Dealers) License Act - CORRECT ANSWER Passed in 1939 and
made it illegal to sell real estate in Texas without first obtaining a license
Texas Real Estate License Act - CORRECT ANSWER TRELA was passed in 1949 and
created TREC. It consist of 9 members, 6 Brokers & 3 General public members; appointed by
the governor and approved by 2/3 of the senate present. TRELA was codified as Title 7 of the
Occupational code Chapters 1101 (broker and sales person activities) and 1102 (real estate
inspectors)
What is TREC's authority? - CORRECT ANSWER to make rules and regulations,
which have the full force and effect of law; to protect the public
TREC on education - CORRECT ANSWER TREC is authorized to inspect and
accredit educational programs or courses of study in real estate and real estate inspection to
establish standards.
TREC on Law - CORRECT ANSWER TREC can advise with reference to the laws it
administers
TREC on Mediation - CORRECT ANSWER TREC does not mediate disputes between
or among licensees concerning entitlement to sales commissions
TREC on Licensees - CORRECT ANSWER TREC does not recommend individual
licensees to the public
TREC on Discipline - CORRECT ANSWER An employee of the commission
specifically authorized by it pursuant to the Act, to conduct hearings and render final
decisions in contested cases may suspend or revoke a license or reprimand or place on
probation a licensee for a violation of the Act or a rule of the commission.
,Real Estate Broker-Lawyer Committee - CORRECT ANSWER Drafts and revises
TREC promulgated contracts. Thirteen members-6 lawyers, 6 Brokers, 1 public member.
TREC Investigations - CORRECT ANSWER TREC may, after receiving a written
comlaint with proper evidence investigate the actions and records of a broker or sales agent.
The complaint must be submitted within 4 years. If the complaint is to be paid from the
recovery fund it must be filed within 2 years or be DTPA actionable
TREC investigation of licensee - CORRECT ANSWER TREC may authorize a
commission employee to file a signed written complaint against a licensee and to conduct an
investigation if:
1. A judgement against the licensee has been paid from a recovery fund established under the
Act.
2. The licensee is convicted of a criminal offense that may constitute grounds for the
suspension r revocation of the licensee's license
3. The licensee fails to make good on a check issued to the commission.
4. Licensee fails to complete required continuing education within the prescribed time.
5. Failing to provide information requested by TREC in connection with an application to
renew a license.
Subpoena Power Investigations - CORRECT ANSWER TREC has the power of
subpoena. TREC may compel by subpoena the attendance of witnesses for examination under
oath and the production for inspection and copying of books, accounts, records, papers,
correspondence, documents and other evidence relevant to an investigation. If a licensee fails
to comply with a subpoena, TREC can file suit through the attorney general to enforce the
subpoena.
Subpoena Power Hearings - CORRECT ANSWER If the commission proposes to
suspend or revoke a license, the person is entitled to a hearing before the commissioner. If
that ruling is adverse to the license, they can appeal to a district court within 30 days.
TREC Complaints - CORRECT ANSWER A person may file a written complaint with
TREC against a real estate licensee if the person believes the licensee violated TRELA. If
TREC has jurisdiction, it will investigate the allegations by interviewing the persons,
, witnesses and relevant info. TREC's Standards and Enforcement Services will notifiy the
licensee if it intends to initiate disciplinary proceedings
Complaint Priorities - CORRECT ANSWER TREC is required to maintain a system to
act promplty and efficiently on complaints and must maintain a file on each complaint.
TRELA requires that TREC assign priorities and investigate complaints using a risk based
approach on the:
-Degree of potential harm to the consumer
-Potential for immediate harm to the consumer
-Overall severity of the allegations and complaint
-Number of license holders potentially involved in the complaint
-Number of potential violations in the complaint
Refund to Consumer - CORRECT ANSWER TREC may order a licensee to pay a
refund to a consumer as provided by an agreement resulting rom an informal settlement
conference or enforcement order
TREC Advisory Letters - CORRECT ANSWER TREC may close a complaint file by
issuing an advisory letter to the licensee. This is normally in more technical matters. An
advisory letter is not a formal disciplinary action. The advisory letter is a notification that
there were item reveled in the investigation that do NOT warrant disciplinary action but, if
not corrected, could lead to further complaints and, ultimately, disciplinary action.
Informal Proceedings - CORRECT ANSWER In some cases the Deputy Director of
Standards and Enforcement services (SES) may offer a complainant and respondent an
opportunity to participate in an alternative dispute resolution process (ADR). The Deputy
Director does not have the authority to compel a complainant to participate in the process. If
an agreement can be reached, it may be some satisfaction to the complinant and save time for
the respondent. If the parties cannot reach an agreement of if SES does not pursue the ADR
process at the outset, the complaint is investigated to determine if there is sufficient evidence
to proceed with a hearing against the licensee.
TREC Informal Case - CORRECT ANSWER TREC is required to adopt procedures
governing informal disposition of contested cases. The informal contested case must provide
the complainant and licensee the opportunity to be heard, which is similar to the ADR
