Division of markets by location or price . The Real Estate Settlement Procedures Act (RESPA) is regulated by the Consumer Financial Protection Bureau. It was enacted to protect consumers from abusive practices and high settlement charges. A broker seeking a kickback from a title company or mortgage provider for referring and closing a property with their particular company is a violation. Any time a sales associate changes employers (brokers) he must notify the FREC within 10 days on the current form prescribed by the DBPR. When a broker or real estate school changes business address, they must file a notice of change and the names of the licensees no longer associated with the firm. Licensees whose names are included in the list of non-associates if not already inactive will become involuntary inactive. The broker or school will have ten business days to notify the FREC. There are various forms of real estate business entities: Sole Proprietorship - a business owned by one person. It may have a trade name rather than the name of the owner. All actions of associates to this broker are his responsibility and his alone. General Partnership- a business owned by more than one broker. Each partner in a general partnership is liable for any debt; each partner helps to make the decisions and receives a share of the profits. At least one of the brokers must be specified as the active broker . All partners dealing with the public must be an active broker. The corporation and the trade name must be registered.
Limited Partnership- a business owned by at least one general partner and at least one limited partner . All the management is done by the general partner. Limited partners contribute investment cash but are limited in the amount of liability to the amount of money they have already given. The limited partnership is registered with the FREC, and at least one of the general partners must be an active broker. Corporation- a company that is an entity , rather than a single person . It may have a trade name associated with it. At least one officer must be an active broker licensed by the FREC. Only active brokers can conduct meetings, direct the sales staff, or can communicate in any way with the public. Limited Liability Partnership (LLP)- a form of ownership that provides liability protection similar to protection offered to limited partners in a limited partnership. Basically the partner is liable only for the acts the he, himself has done, rather than the partnership . Limited Liability Company (LLC) - also called a "professional company,” its purpose is to provide professional real estate services without the liability of an unprotected broker's or sales associate license. Good luck on the Chapter 5 Quiz! Click here if you would like to open this summary as a pdf, which you can then print or save to your device: Chapter 5 Summary End of Page
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