Iowa Real Estate Practice Exam

What is required of an employing broker when a salesperson leaves to work for another broker?

1. Notify the seller about the change

2. Submit the license to the real estate commission

3. Transfer all current listings to the new broker

4. License is automatically renewed

The correct answer is: Submit the license to the real estate commission

When a salesperson leaves an employing broker to work for another broker, the primary responsibility that falls on the employing broker is to submit the license to the real estate commission. This is a critical step in the process because it officially updates the records and ensures that the salesperson's license is transferred to the new broker. Notifying the real estate commission of the departure is necessary for maintaining accurate licensing records and protecting the integrity of the state's real estate practice. The reason this is the correct answer lies in the regulatory framework governing real estate licenses. Each state has specific rules about how licenses are managed and transferred when agents change employers, and submitting the license helps ensure compliance with those regulations. The other options, while relevant in various contexts, do not accurately capture the essential requirement in this situation. For instance, notifying the seller about the change is generally good practice but not a formal requirement. Similarly, while transferring current listings to the new broker is often standard for some transactions, it is not the main responsibility of the departing salesperson's previous broker. Lastly, the notion that the license is automatically renewed does not apply; licenses require renewal on a set schedule, independent of employment changes.