D&D School of Real Estate

P.O. Box 4207Johnson City, TN 37602(423) 232-1811 or- (800) 282-9375admin@ddschoolofrealestate.comFax (423) 232-2804 or- (423) 232-2976

Dear Licensed Agent:

As a licensee, you owe it to yourself to keep abreast of the changes in the industry. Some practices that were common in the past are now illegal. Others have become outdated and obsolete as changes continue to come to our industry.

This 2015 & 2016 Tennessee Core Law Course is information updated from our previous courses plus new information concerning changes in laws and practices of the real estate business in Tennessee. The 2015 & 2016 Tennessee Core Law Course will also give you new insight into this ever-changing Real Estate industry.

As part of your continuing education requirements, this course has been approved by the Tennessee Real Estate Commission. Simply follow the instructions enclosed to fulfill the necessary requirements for the state.

We at D&D School of Real Estate have spent numerous hours collecting the information and data assembled on these pages. It is our hope that you find this course informative and helpful in your career. Any questions or comments will be most appreciated.

Thank you for using D&D School of Real Estate as your provider of continuing education.

Sincerely,

Richard J. Clemmer

President

RENEW YOUR REAL ESTATE LICENSE IN 3 EASY STEPS

STEP ONE

Study the manual at your own pace and complete the progress quizzes and the end of each section.

STEP TWO

Transfer all your answers to the answer sheet at the front of the manual, complete the additional information on the answer sheet then snail mail, scan and email or fax the answer sheet in for grading before your license deadline.

STEP THREE

Send your renewal fee to the state before your license deadline and be sure your E&O Insurance is up to date. You can renew your license online at www.apps.tn.gov/cirens

A licensed instructor will be available during normal business hours if you have any questions regarding the course material. No assistance on the final exam questions and answers can be given. For assistance call: 423-232-1811 or email your questions to admin@ddschoolofrealestate.com.

Work at your own pace! Complete the course and send in your answers for grading. We do the rest. We will notify the state of your successful completion of the course. Thank you for using D&D School of Real Estate.

UNIT ONE: TREC UPDATES- LAW; RULES;POLICIES

1. Law

2. Rules

A. 1260.01-.15 & 16 E&O Insurance; suspension and penalty fees 7

B. 1260.01-.18 Duplicate firm names 9

C. 1260.01-.19 Obtaining license/appearance before Commission 9

D. 1260.01-.21 Reinstatement of expired license 9

E. 1260.02-.01 Supervision of Affiliate Brokers10

F. 1260.02-.02 Termination of affiliation11

G. 1260.02-.08 Offers to purchase11

H. 1260.02-.09 Managing escrow accounts12

I. 1260.02-.39 Commissions earned by Affiliated licensees13

J. 1260.02-.40 Electronic records13

K. 1260.02-.41 Teams, groups, or similar entity within a firm13

3. Policies

A. 2015.cps.-00114

B. License recognition from another state14

Unit One Quiz15

UNIT TWO: AGENCY

1. Terms to become familiar with18

2. What is an Agency relationship?18

3. Why Agency law is important20

4. Agency Relationship relationships20

A. 62-13-401 Creation21

5. Single Agency22

A. 62-13-405 Written Disclosure23

B. 1260-02-.36 Buyer representation agreements23

6. Sub Agency24

7. Dual Agency24

8. No Agency27

9. Designated Agency27

A. 62-13-406 Designated Agency, Managing Broker27

10. Duties to your Client and Customer28

A. 62-13-403 Duties owed to all parties28

B. 62-13-404 Duties owed to licensees Client29

Unit Two Quiz31

UNIT THREE: ADVERTISING

1. Advertising Rules of T.R.E.C.34

A. 62-13-310 Affiliate Broker relationship to Broker34

B. 1260-02-.12 Advertising34

2. General Principals36

3. Advertising Franchises and Cooperative Groups36

A. 1260-02-.33 Advertising Gifts and Prizes37

4. Team participation in the Real Estate Field37

UNIT THREE QUIZ39

UNIT FOUR: REVIEW OF A LISTING CONTRACT

1. Contract law Basics41

A. 29-2-101 Writing Required for Action41

2. Offer and Acceptance42

3. Rejection42

4. Consideration42

5. Legally competent parties43

6. Discharge of contracts43

7. Listing Contracts43

A. Exclusive Right to Sell Contract44

B. Exclusive Agency Contract44

C. Open Listing44

D. Contract Terms44

8. Working with the listing Contract45

UNIT FOUR QUIZ57

UNIT FIVE: PROPERTY MANAGEMENT

1. License Requirements60

A. 62-13-102 Definitions60

B. 62-13-104 Exemptions60

2. Handling Escrow Accounts61

A. 62-13-309 Business Locations Signs61

B. 1260-02-.09 Deposits and Earnest money61

C. 62-13-321 Escrow Accounts63

D. 62-13-323 Escrow Account Waiver63

E. 1260-03-.01 Rental Location Agency license64

F. 1260-03-.02 Agent Licenses64

G. 1260-03-.03 Investigations and Office inspections65

H. 1260-03-.04 Requirements of contract or receipts65

I. 1260-03-.05 terms of contract or receipt65

J. 1260-03-.06 Standards for oral or written representations 66

of availability

3. Commercial leasing terms68

UNIT FIVE QUIZ70

UNIT SIX: PRINCIPAL BROKER SUPERVISION AND DISCLOSURES

1. Excerpts from TN law72

A. 62-13-102(4) Definition72

B. 62-13-209 Business location and signs73

C. 62-13-321 Escrow or Trust Account of deposited funds74

D. 1260-02-.09 Deposits and Earnest Money74

E. 62-13-323 Escrow Account Waiver76

F. 1260-01-.04 Licenses77

G. 1260-01-.12 Fees78

H. 1260-02-.01 Supervision of Affiliate Brokers78

I. 1260-02-.02 Termination of affiliation79

J. 1260-02-.12 Advertising79

K. 66-32-07 Time Share Estate Management80

2. Use of Managing Broker in the law80

A. 62-13-102 Definitions80

B. 62-13-406 Designated Broker-Managing Broker81

C. 62-13-407 Liability82

3. Chapter 671 Public Records Acts 200683

A. 62-13-102(2) Definitions84

B. 1260-02-.37 Septic Systems inspection letter84

4. Agency Disclosures84

A. 62-13-405 Written Disclosures85

5. Property Disclosures85

A. 66-5-201 General Provisions85

B. 66-5-202 Requirements for Disclosures and Disclaimers86

C. 66-5-212 Percolation test etc.86

D. 66-5-213 Disclosure for properties located in a planned 87

unit development

Attorney General opinion from March 6, 201487

UNIT SIX QUIZ91

Unit One

T.R.E.C. Updates

Law; Rules; Policies

1. LAW UPDATES

There have been no law changes in the past two years to Title 62 of the Tennessee code. The below link will take you to the T.R.E.C. website where you can review the law

www.regboards.tn.gov

2. RULE CHANGES

There have been a number of recent rule changes that are listed below.

A. 1260-01-.15 ERRORS AND OMISSIONS INSURANCE COVERAGE.

It shall be a requirement for an active licensee to carry errors and omissions insurance to cover all activities contemplated under the Tennessee Real Estate Broker License Act unless the Commission is unable to obtain coverage pursuant to T.C.A. 62-13-112(g) which would void the requirement of coverage under the applicable contract period.

(1) A licensee who places his license in an inactive or retired status is not required to carry errors and omissions insurance until such time as his license is activated.

(2) New licensees, licensees who activate their license from an inactive or retired status, and licensees who reinstate their license from an expired status at a time other than the beginning of the licensing period shall pay a prorated premium in accordance with a schedule provided by the insurance provider. (3) The Commission shall perform random audits to assure that licensees have met the requirements of this rule.

(4) Any independently obtained errors and omissions insurance policy shall, at a minimum, be issued upon the same terms and conditions as the policy obtained by the Tennessee Real Estate Commission pursuant to T.C.A. 62-13-112, including, but not limited to, the limits of coverage, the permissible deductible, the permissible exemptions and the term of the policy.

Authority: T.C.A. 62-13-203 and 62-13-212. Administrative History: Original rule filed October 15, 1990; effective November 29, 1990. Amendment filed October 1, 1998; effective December 15, 1998. Amendment filed December 3, 2007; effective February 16, 2008.

1260-01-.16 LAPSED ERRORS AND OMISSIONS INSURANCE.

(1) Licensees Who Fail to Maintain Errors & Omissions (E&O) Insurance

(a) Penalty fees for Reinstatement of a Suspended License: Any licensee whose license is suspended for more than thirty (30) days pursuant to T.C.A. 62-13-112 for failure to maintain E&O insurance must provide proof of insurance that complies with the required terms and conditions of coverage to the Commission and must pay the following applicable penalty fee in order to reinstate the license:

1. For a license suspended due to a lapse in E&O coverage for more than th