Ohio Real Estate Broker Exam - State Portion

Key Concepts

Commission structure (ORC 4735.03). The Ohio Real Estate Commission consists of five members appointed by the governor with the advice and consent of the senate. Four members must have been engaged in the real estate business as licensed real estate brokers in Ohio for the ten years immediately preceding appointment; one member represents the public.

Commission duty — ethics (ORC 4735.03(A)). Among the commission's enumerated statutory duties is to adopt canons of ethics for the real estate industry.

Monthly report (OAC 1301:5-3-01(A)(1)). The superintendent's monthly report to the commission must include the number of all applicants who passed the real estate broker examination and the real estate salesperson examination.

Audit rights (ORC 4735.05(B)(4)). The division's investigators and auditors have the right to review and audit, during normal business hours, the business records of licensees and continuing education course providers.

Confidentiality after release (ORC 4735.05(E)). Information released by the Division to authorized agencies — such as the Division of Financial Institutions, the attorney general, or law enforcement — remains confidential after release; release does not make it a public record.

Statute of limitations on investigations (ORC 4735.32(A)(1)). An investigation may be commenced at any time within three years from the date the alleged violation occurred; after that the investigation is barred and no discipline may be imposed for that alleged violation.

Complaint process (ORC 4735.051). - (A) Within five business days after a person files a signed written complaint, the superintendent must acknowledge receipt and send notice to the licensee describing the acts complained of. Both parties then have ten business days to request an informal mediation meeting. - (B) If both complainant and licensee request it, the superintendent schedules the informal mediation meeting within twenty business days; any party may request an extension of up to fifteen business days for good cause shown. If the parties reach an accommodation, the complaint file is closed. - (E) Within twenty-five business days after the conclusion of formal hearings, the hearing examiner files a report of findings of fact and conclusions of law with the superintendent, the commission, and the…

Ohio Real Estate Exam, State Portion

Key Concepts

Activities Requiring a License

• "Real estate broker" includes any person, partnership, association, LLC, LLP, or corporation who, for another, for a fee, commission, or other valuable consideration (or expectation/promise of one), does any of the acts in R.C. 4735.01(A) — including selling, exchanging, purchasing, renting, leasing, or negotiating any of those (A)(1); listing or auctioning real estate (A)(3); dealing in options on real estate (A)(4); operating, managing, or renting buildings or portions of buildings to the public as tenants, other than as custodian, caretaker, or janitor (A)(5); and collecting rental information for referring prospective tenants to rental units and charging the prospective tenants a fee (A)(9). (Ohio Chapter 4735, Section 4735.01(A))
• Single act rule: Any person who, for another, in consideration of compensation by fee, commission, salary, or otherwise, does or offers to engage in any single act or transaction contained in the broker definition — whether an incidental part of a transaction or the entire transaction — is constituted a real estate broker or salesperson. (Section 4735.01(H))
• Exclusions from the definitions (R.C. 4735.01(I)(1)) include: a person acting with reference to real estate owned by that person or entity (I)(1)(a); receivers, trustees, guardians, executors, and similar court-appointed or bona fide fiduciaries (I)(1)(b); public officers performing official duties (I)(1)(c); attorneys at law performing their duties (I)(1)(d); brokering of the sale of business assets, not including the sale, lease, exchange, or assignment of any interest in real estate (I)(1)(e); sale of manufactured or mobile homes where the sale does not include any interest in real estate (I)(1)(f); and an oil and gas land professional performing those duties, provided the professional is not engaged in the purchase or sale of a fee simple absolute interest in oil and gas or other real estate and complies with R.C. 4735.023(A) (I)(1)(h).
• Real estate includes leaseholds and every interest or estate in land in this state, and improvements, but does not include cemetery interment rights. (Section 4735.01(B))
• A licensed partnership, association, LLC, LLP, or corporation **may not employ as an officer,…

Key Concepts

Definitions (ORC 4735.01) - "Real estate" includes leaseholds and every interest or estate in land situated in Ohio and improvements on the land, but does not include cemetery interment rights — ORC 4735.01(B). - Any person who, for another and for compensation, does or offers to engage in any single act or transaction in the broker definition — whether an incidental part of a transaction or the entire transaction — is constituted a real estate broker or salesperson — ORC 4735.01(H). - An exclusive purchaser agency agreement may authorize the broker to receive compensation from the seller or the seller's agent, and may provide the purchaser/tenant owes nothing if the property is obtained solely through the purchaser's or tenant's own efforts — ORC 4735.01(W). - A nonexclusive agency agreement grants the broker a nonexclusive right to represent the purchaser, tenant, or seller, and the client may obtain services from other brokers or brokerage firms, subject to the agreement's terms — ORC 4735.01(JJ)(1)-(2).

Advertising (OAC 1301:5-1-02 and 1301:5-1-21) - A licensee may advertise in a first name other than the name on the license, or with a maiden name, provided it is not misleading and is registered with the division — 1301:5-1-02(A). - Words/abbreviations on the broker's license showing legal framework ("Inc.," "Co.") are not required in advertising — 1301:5-1-02(C)(3). - Website information that becomes outdated or expired must be updated within 14 days — 1301:5-1-02(E). - "Advertising" includes business cards, signs, internet websites, social networking sites, blogs, email, voicemail, facsimile, unsolicited mail, and property listing database services — 1301:5-1-02(H). It does not include private communications (private mail, voicemail, email, password-protected websites, facsimile) initiated at the request of a client, customer, or prospective client — 1301:5-1-02(I). - A team name shall not use the terms "realty" or "associates" — 1301:5-1-21(B)(5). - A broker under an exclusive right to sell or lease listing shall not advertise the property as "for sale by owner" or mislead the public into believing the seller is unrepresented — ORC 4735.16(B)(4).

Key Concepts

Agreement types. An exclusive right to sell or lease agreement compensates the broker if the broker, the seller, or any other person or entity produces a purchaser, or if the property sells during the term to anyone other than specifically exempted persons — ORC 4735.01(U). An exclusive agency agreement compensates the broker unless the property is sold or leased solely through the seller's efforts or to exempted persons — ORC 4735.01(V)(2). An exclusive purchaser agency agreement compensates the broker if a property is purchased during the term unless the property is specifically exempted in the agreement — ORC 4735.01(W)(2). Any single act in the broker definition, incidental or entire, done for another for compensation makes a person a real estate broker or salesperson — ORC 4735.01(H).

Creating agency. Only four relationship types exist: licensee–seller, licensee–purchaser, dual agency, and subagency with another licensee's client — ORC 4735.53(A). Also agents of the client: the brokerage, supervising management level licensees, any licensee who receives confidential information from the client's agent, any licensee who assisted in establishing the relationship, and any licensee appointed with the client's consent — ORC 4735.53(B); a commission share alone does not — 4735.53(D). An open-house host is the seller's agent only if appointed in writing, assisted in establishing the relationship, received confidential information, or is a management level licensee — OAC 1301:5-6-02(A). Delegated appointment authority must be written, signed, and must notify the client of the right to veto an appointment — OAC 1301:5-6-08(A).