15 free questions from the Cinna RE Tennessee real estate exam bank (91 in the app). Tap an answer to check it. The rationale opens right away.
Every active Tennessee real estate licensee is required to maintain a specific type of insurance as a condition of active licensure. What is it, and who can the licensee turn to if private coverage is needed?
Answer: B. Errors and omissions (E&O) insurance, available through a TREC group policy or an independent equivalent policy
Tennessee mandates that all active licensees carry errors and omissions (E&O) insurance. TREC contracts for a group policy that licensees may purchase, or a licensee may obtain an independent policy meeting the state's minimum coverage and terms.
Tennessee's brokerage law allows a single firm to represent both the buyer and the seller in the same transaction, with each party assigned a different agent in the firm so each receives full client-level representation. What is this Tennessee model called?
Answer: A. Designated agency
Tennessee uses designated agency, in which the principal broker appoints different affiliated licensees to represent the buyer and the seller. Each client gets full fiduciary-type representation from his or her designated agent, avoiding the conflicts of traditional dual agency.
A Tennessee licensee is managing rental property and screening applicants. Beyond the seven federal protected classes, what is the most accurate statement about Tennessee's fair-housing framework?
Answer: B. Tennessee's fair-housing law generally mirrors the federal protected classes and prohibits discriminatory housing practices accordingly
Tennessee's fair-housing statute generally parallels the federal Fair Housing Act protected classes (race, color, religion, national origin, sex, familial status, and disability) and prohibits the same categories of discriminatory housing conduct. It does not, at the statewide level, add sexual orientation or gender identity as protected classes.
In a Tennessee designated agency arrangement, what is the role of the managing broker who designates two affiliates to represent different parties in the same transaction?
Answer: B. The managing broker may act as a facilitator/transaction broker rather than as an agent for either party
When a broker designates different affiliates to represent each party, the broker typically serves as a neutral facilitator rather than as an agent for either side, preserving confidentiality between the designated agents.
A Tennessee affiliate broker accepts a commission directly from a seller without his principal broker's knowledge and never tells his firm. Which statement is correct?
Answer: A. This is a license-law violation; an affiliate broker may be paid only through his or her principal broker
In Tennessee, an affiliate broker works under and is compensated only through his or her principal broker. Accepting compensation directly from a party, bypassing the firm, is a prohibited act subject to disciplinary action regardless of the seller's consent or the amount.
After investigating a complaint, TREC determines that a formal disciplinary hearing is warranted. Which of the following is a sanction the Commission may impose against a licensee found to have violated the license law?
Answer: C. Suspension or revocation of the license and/or a civil penalty
TREC's disciplinary authority is administrative: after a hearing it may suspend or revoke a license, impose civil penalties, or require additional education. It cannot impose criminal jail time, which is the province of the courts.
A Tennessee affiliate broker wishes to become a licensed managing broker. Which statement is generally true about that license type?
Answer: A. A broker license requires additional experience and education beyond the affiliate broker level, and a managing broker may supervise affiliate brokers in a firm
Advancing from affiliate broker to broker requires additional experience as a licensee plus further broker-level education and passing the broker exam. A managing (principal) broker is the broker responsible for supervising the affiliate brokers in a firm. All these licenses are issued by TREC.
In a Tennessee transaction, a broker assigns one affiliate to represent the seller and a different affiliate in the same firm to represent the buyer. This arrangement is best described as:
Answer: B. Designated agency
Designated agency allows a managing broker to appoint different licensees within the same firm to represent the buyer and the seller, each as a designated agent for their respective client.
An affiliate broker in Tennessee personally believes she can represent a buyer directly without her brokerage. Which statement is correct?
Answer: B. An affiliate broker must always work under the supervision of a licensed managing broker
An affiliate broker is the entry-level license and must always practice under the supervision of a licensed managing broker; she cannot operate independently.
A newly licensed Tennessee affiliate broker completed the 60-hour Principles course and 30-hour New Affiliates course before licensure. What additional education obligation applies specifically to a first-time affiliate broker after receiving the license?
Answer: B. A 30-hour Course for New Affiliates completed within the first license period after activation
Tennessee's 90 pre-license hours consist of 60 hours of Real Estate Principles plus the 30-hour Course for New Affiliates. The Course for New Affiliates is the foundational education tied to entry at the affiliate broker level; afterward licensees move into the standard 16-hour-per-cycle CE structure. Tennessee does not require a separate 120-hour post-licensing course.
Under the Tennessee Uniform Residential Landlord and Tenant Act (URLTA), how must a landlord generally handle a tenant's security deposit?
Answer: B. Keep it in a separate account at a regulated financial institution and account for it as required by law
Under Tennessee's URLTA, a landlord must place the security deposit in a separate account held at a bank or other regulated lending institution and follow statutory procedures for accounting and return, including providing the tenant an opportunity to inspect for itemized deductions.
A Tennessee broker has one affiliate representing the seller and another affiliate in the same firm representing the buyer in the same transaction. Which Tennessee agency concept allows the firm to handle this while assigning each client an individual representative?
Answer: B. Designated agency, where the broker appoints different affiliates to represent each client individually
Tennessee recognizes designated agency. The managing broker may designate one affiliate to represent the seller and another to represent the buyer, so each client receives individual representation within the same firm rather than forced dual agency.
After an offer is accepted in Tennessee, a buyer's earnest-money check is delivered to the brokerage. TREC rules require the broker to handle the deposit by:
Answer: B. Depositing the funds promptly into the firm's escrow/trust account
Funds belonging to others must be deposited promptly into the broker's escrow or trust account. Holding deposits indefinitely, releasing them directly to a party without authorization, or routing them through personal accounts are all improper.
Several affiliate brokers in a Tennessee firm want to operate as a 'team' and market under a team name. Under TREC requirements, the team name must:
Answer: B. Be used together with, and clearly subordinate to, the licensed firm's name, and may not imply the team is a separate brokerage
A team operates within a single firm. Team advertising must include the firm name and may not be presented in a way that implies the team is an independent brokerage or that misleads the public about who holds the license.
Under Tennessee's Residential Property Condition Disclosure Act, when must a seller of residential real property generally deliver the disclosure to a buyer?
Answer: B. At or before the buyer makes a written offer (binding purchase agreement)
Tennessee's Residential Property Condition Disclosure Act requires the seller to furnish the property condition disclosure (or disclaimer where permitted) to the buyer before the buyer signs a binding purchase contract. Delivering it after acceptance can give the buyer certain rescission rights.
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