- Real Estate Broker
- A licensee authorized to independently operate a real estate business, employ salespersons, and handle transactions on behalf of others for compensation.
- Passing Score
- The minimum performance required to pass the broker exam, which is answering 75% of the questions correctly.
- Examination Fee
- The cost charged to sit for the licensing exam; for the broker exam this fee is $150.
- Multiple Choice Format
- The question style used on the exam, in which candidates select the best answer from several options; the broker exam contains 200 multiple-choice questions.
- Fiduciary Duty
- The legal obligation a broker owes to a client to act with loyalty, honesty, and the client's best interests above the broker's own.
- Agency
- The legal relationship in which one party (the agent) is authorized to act on behalf of another (the principal) in dealings with third parties.
- Escrow
- A neutral third-party arrangement that holds funds and documents until all conditions of a real estate transaction are satisfied and the sale can close.
- Trust Account
- A separate bank account a broker uses to hold client or third-party money apart from the broker's own funds, preventing commingling.
- Commingling
- The prohibited practice of mixing a client's or third party's funds with the broker's personal or business funds.
- Deed of Trust
- A security instrument used in California in which a borrower conveys title to a trustee to secure repayment of a loan, allowing non-judicial foreclosure if the borrower defaults.
- Disclosure
- The legal requirement that a broker reveal material facts about a property or transaction to the parties involved so they can make informed decisions.
- California Department of Real Estate (DRE)
- The state agency that licenses and regulates real estate salespersons and brokers in California, including administering the licensing exam.