Arizona Real Estate Study Guide 2026 — Free Cheat Sheet

Section 32-2101 defines the core license categories. A 'broker' (unmodified) is a person licensed or required to be licensed as a broker. A 'real estate salesperson' is a natural person acting on behalf of a licensed broker to perform acts within the broker definition. An 'associate broker' is a licensed broker employed by another broker and, unless otherwise specified, has the same license privileges as a salesperson. A 'designated broker' is a natural person licensed as a broker who is designated to act on behalf of an employing entity or is a sole proprietor.

• ✓An associate broker is licensed as a broker but is employed by another broker and generally has the same privileges as a salesperson
• ✓A designated broker must be a natural person licensed as a broker who acts for an employing entity or operates as a sole proprietor
• ✓A salesperson must act on behalf of a licensed broker; a broker acts for another for compensation

A 'real estate broker' means a person, other than a salesperson, who for another and for compensation performs acts such as: selling, exchanging, purchasing, renting or leasing real estate; offering or negotiating such transactions; listing property; auctioning; dealing in options; collecting rent; advertising as being in the business; procuring prospects; and acting as a business broker. Compensation includes any fee, commission, salary, or other valuable consideration, including the promise of consideration whether contingent or not.

• ✓Performing any listed brokerage act for another for compensation requires a real estate license
• ✓Collecting rent generally requires a license, except unlicensed clerical staff collecting in-person rent who provide a receipt
• ✓Compensation includes contingent promises of consideration, not just fees actually paid
• ✓Incident-to-sale loan negotiation is a brokerage act but excludes mortgage brokers under Title 6

A 'subdivider' is any person who offers for sale or lease six or more lots, parcels, or fractional interests in a subdivision, or who causes land to be subdivided, or undertakes to develop a subdivision (excludes public agencies). 'Subdivision/subdivided lands' means improved or unimproved land divided or proposed to be divided into six or more lots for sale/lease; it includes stock cooperatives, common promotional plan lands, and residential condominiums. It excludes leasehold offerings of one year or less, parcels 36 acres or more, leasing of agricultural land/apartments/commercial space, cemetery parcels, and certain sales occurring 10+ years apart.

• ✓The threshold for a subdivision is six or more lots, parcels, or fractional interests
• ✓Parcels of 36 acres or more are excluded from the subdivision definition
• ✓Leasehold offerings of one year or less are not a subdivision
• ✓Residential condominiums and common promotional plan lands are included as subdivisions

Section 32-2108 authorizes the commissioner, on their own motion or on a verified written complaint (mandatory), to investigate the actions of any person acting as a broker, salesperson, or developer and to examine books and records pertaining to transfer, sale, rental, lease, use, or management of real property. The commissioner may take testimony, examine and copy documents, issue subpoenas, and apply to superior court to compel compliance. A certification and enforcement unit is established for investigative duties.

• ✓The commissioner must investigate upon a verified written complaint and may investigate on their own motion
• ✓The commissioner may issue subpoenas and seek superior court orders to compel compliance
• ✓Investigation reaches books and records relating to real property transactions and management

Section 32-2108.01 requires each license applicant to obtain and provide the department a valid fingerprint clearance card under 41-1758.03 before receiving and holding a license. The department shall not issue a license to an original applicant before receiving the card. The department may suspend a license if the fingerprint clearance card is suspended and either the underlying conviction could support denial, or the licensee fails to prove they applied for a good-cause exception within five business days after notice. This applies to original salesperson/broker applicants (real estate, cemetery, membership camping), school operators, and certain renewal/public-report applicants with unreviewed criminal records.

• ✓A valid fingerprint clearance card is required before a license is issued or held
• ✓The department may suspend a license upon fingerprint clearance card suspension in specified circumstances
• ✓A licensee has five business days after notice to prove application for a good-cause exception

A 'business broker' is a real estate broker who acts as an intermediary or agent between sellers or buyers (or both) in the sale or purchase of businesses or business opportunities where a lease or sale of real property is either a direct or incidental part of the transaction. Acting as a business broker falls within the real estate broker definition.

• ✓A business broker must be a licensed real estate broker
• ✓Real property sale/lease need only be a direct OR incidental part of the transaction

'Advertising' means attempting by publication, dissemination, exhibition, solicitation, or circulation (oral, written, or broadcast) to induce any person to enter an obligation or acquire an interest in lands subject to the chapter. Advertising does NOT include press releases delivered to news media for general information/public relations if no charge is made, and certain stockholder communications (annual reports, proxy materials, registration statements, securities prospectuses, property reports, offering statements).

• ✓Advertising covers any medium intended to induce a person to acquire an interest in subject lands
• ✓Uncharged press releases for general information/PR are excluded from the advertising definition
• ✓Specified stockholder communications (e.g., proxy materials, prospectuses, property reports) are excluded

'Unsubdivided lands' means land divided or proposed to be divided into six or more lots/parcels that are 36 acres or more each but less than 160 acres each, or that are offered under a common promotional plan (agricultural leases excluded). It also includes land that would be the sixth lot if sold 10+ years after the earliest of the previous five sales within the same 36-to-160-acre parent parcel.

• ✓Unsubdivided lands are parcels of 36 acres or more but less than 160 acres each, six or more in number
• ✓Agricultural leases are excluded from the unsubdivided lands definition
• ✓A common promotional plan can bring parcels within the unsubdivided lands definition

A 'common promotional plan' is a plan undertaken by a person or group acting in concert to offer lots for sale or lease. If land is offered by persons acting in concert and is contiguous or advertised as a common unit/name, it is presumed offered as part of a common promotional plan regardless of the number of lots per offering. Separate subdividers in separately platted subdivisions within a master planned community are NOT deemed to be offering combined lots under a common promotional plan. 'Acting in concert' means evidence of collaborating to pursue a concerted plan.

• ✓Contiguous land advertised under a common name and offered by persons acting in concert is presumed a common promotional plan
• ✓Separate subdividers within a master planned community are not automatically under a common promotional plan

A 'license' includes the whole or part of any agency permit, certificate, approval, registration, public report, charter, or similar permission required by the chapter. A 'licensee' is a person granted a license for the current period (and for 32-2153(A), includes original applicants). A 'license period' is the two-year period beginning at original issue or renewal and ending on the expiration date. An 'inactive license' is issued to a licensee on inactive status not engaged by a broker.

• ✓A license period runs two years from original issue or renewal
• ✓A public report is included within the statutory definition of a license
• ✓An inactive licensee is not engaged by or on behalf of a broker

A 'corporation licensee,' 'limited liability company licensee,' and 'partnership licensee' each must have a designated broker: an officer (corporation), a member/manager who is a natural person (LLC), or a managing general partner (partnership), each licensed as the designated broker under 32-2125. An 'employing broker' is a person licensed as a broker entity under 32-2125(A) or as a sole proprietorship where the sole proprietor is a licensed broker.

• ✓Every entity licensee must have a natural-person designated broker licensed under 32-2125
• ✓LLC designated broker must be a member or manager who is a natural person
• ✓Partnership designated broker must be the managing general partner

Section 32-2102 provides the chapter is administered by the state real estate department under the direction of the real estate commissioner. The department's purpose in administering the chapter is to protect the public interest through licensure and regulation of the real estate profession in Arizona.

• ✓The Department of Real Estate administers the chapter under the commissioner's direction
• ✓The stated purpose is protecting the public interest through licensure and regulation

Section 32-2107 gives the commissioner charge of the department with power to administer and carry out the chapter, adopt an official seal, maintain a principal office at the state capitol, and open branch offices. The commissioner shall adopt rules necessary to carry out the chapter and may approve standardized legal forms for use in the sale or lease of real estate to recognize their compliance with the chapter and rules. The commissioner may also produce educational materials and hold seminars.

• ✓The commissioner shall adopt rules as necessary to carry out the chapter
• ✓The commissioner may approve standardized legal forms for sale or lease of real estate
• ✓The commissioner administers the department and may establish branch offices

Section 32-2108(C) allows the commissioner to require additional information about an applicant or holder (including entity officers, directors, members, managers, partners, 10%+ owners/stockholders, and controlling persons). This may include prior criminal records, a valid fingerprint clearance card, and an affidavit disclosing felony/misdemeanor convictions, denied/suspended/revoked licenses, denied public reports, injunctions, adverse judgments involving fraud or moral turpitude, bankruptcy filings, and participation in entities subject to such actions.

• ✓The commissioner may require criminal records, fingerprint clearance cards, and disclosure affidavits
• ✓Disclosure reaches entity officers, controlling persons, and 10%-or-more owners/stockholders
• ✓Applicants must disclose prior discipline, injunctions, fraud judgments, and bankruptcy

A.R.S. 32-2121 lists persons and activities that do not require a real estate license. Owners dealing in their own property, attorneys performing legal duties, court-appointed receivers/trustees, deed of trust trustees, government employees, and others are exempt when they do not receive special compensation or act as brokers. Understanding these exemptions is critical for determining when a license is required.

• ✓An owner selling/leasing/managing their OWN property is exempt if they do not receive special compensation and the majority of their activities are not those of a broker
• ✓An attorney is exempt only when performing attorney duties; the exemption does NOT allow otherwise engaging in acts requiring a license
• ✓A trustee selling under a deed of trust, receivers, and trustees in bankruptcy acting under court order are exempt
• ✓A person holding a power of attorney for a specific isolated transaction (not as a method of conducting real estate business) is exempt
• ✓A person who manages a hotel, motel, or RV park is exempt, as is a person handling reservations for occupancies of 31 or fewer days

A.R.S. 32-2122 makes it unlawful to act as a real estate broker, salesperson, cemetery broker/salesperson, or membership camping broker/salesperson without first obtaining a license. Any act done for compensation (or expectation of it) that falls within the definition of a broker constitutes acting as a licensee, even if incidental to a transaction.

• ✓Any act in consideration or expectation of compensation included in the broker definition requires a license, whether incidental or the entire transaction
• ✓An unlicensed person may collect in-person rent and related fees only if they work for a licensee, collect on behalf of the licensee, and provide a receipt when rent is paid
• ✓It is unlawful for any person, corporation, partnership, or LLC to engage in licensed activity without first obtaining a license

A.R.S. 32-2124 requires proof of competency and specific experience for broker licenses. An original real estate broker applicant must have been an active licensed salesperson or broker for at least three years during the five years immediately preceding application.

• ✓Original real estate broker license requires at least 3 years active licensed experience during the 5 years immediately preceding application
• ✓A license denied within the prior 1 year (per 32-2153) disqualifies an applicant; a license revoked within the prior 2 years also disqualifies
• ✓Equivalent active experience within the preceding 5 years may substitute for the licensed experience requirement at the commissioner's satisfaction
• ✓Reapplying more than one year after expiration requires meeting all current education/experience requirements and retaking the exam

A.R.S. 32-2124(B)-(C) require salesperson and broker applicants to complete an approved course of at least 90 classroom hours (or equivalent) at a certified real estate school and pass an examination. Courses may be live classroom or distance learning, but the exam must be proctored in person.

• ✓Both salesperson and broker prelicensure courses require at least 90 classroom hours or the equivalent at a certified school
• ✓The examination on the prelicensure course must be a proctored exam completed in person
• ✓Course completion may not be more than 10 years before application unless the commissioner finds equivalent work experience and education
• ✓Salesperson applicants must additionally complete 6 hours of instruction in real estate contract law and contract writing, including drafting practice

A.R.S. 32-2130 allows timely renewal by filing, paying the fee, and presenting evidence of continuing education: 24 hours for salespersons and associate brokers, and 30 hours for designated brokers (and associate brokers under 32-2151.01(G)) per 24-month period.

• ✓Salespersons and associate brokers must complete 24 continuing education credit hours per 24-month license period
• ✓Designated brokers (and associate brokers under 32-2151.01(G)) must complete 30 continuing education credit hours per 24-month period
• ✓Cemetery and membership camping brokers/salespersons are exempt from these education requirements
• ✓If renewing within one year after expiration, CE hours completed after expiration may be applied toward the renewal requirement

Under 32-2151(A), unless all parties agree otherwise in writing, a broker who does not immediately place entrusted monies in a neutral escrow depository in Arizona must, on receipt, place all such monies in a trust fund account in a federally insured or guaranteed account at a depository located in Arizona. This is the core trust-fund handling rule for Arizona brokers.

• ✓Monies must go into either a neutral in-state escrow depository or an in-state trust fund account immediately/on receipt
• ✓The trust fund account must be federally insured or guaranteed and located in Arizona
• ✓Parties may agree in writing to different handling arrangements

32-2151(B) sets minimum requirements: deposits by deposit slips with documentation identifying each transaction, date, amount, and parties; monies used only for the purpose deposited; complete records kept electronically, in the main/branch office, or at an approved in-state off-site storage location (with prior written notice of address to the department). Records must follow generally accepted accounting principles and include descriptive receipts, a disbursement journal, and a client ledger. Computerized records must allow reconstruction if electronic data is destroyed.

• ✓Deposits must be made by deposit slips identifying transaction, date, amount, and parties
• ✓Trust monies may only be used for the purpose for which they were deposited
• ✓Records must be kept per GAAP and include descriptive receipts, disbursement journal, and client ledger
• ✓Off-site storage requires prior written notice of the street address to the department

32-2151(B)(3) requires the broker, on a monthly basis, to complete a three-way reconciliation between the trust fund account bank statements, client ledgers, and trust fund account ledgers, and to provide an explanation for any variation. Failure to regularly complete this reconciliation is itself a violation (per subsection C).

• ✓Three-way reconciliation must be done monthly among bank statements, client ledgers, and trust account ledgers
• ✓Any variation must be explained
• ✓Failure to regularly reconcile is a violation of the chapter

32-2151(C) lists acts/omissions causing a variation that constitute violations: failing to remove interest earned at least once every 12 months; allowing advance payment of others' monies into the broker's personal account or commingling with personal monies; failing to identify nonowner tenant monies in receipts; failing to maintain separate ledgers for each property; failing to complete required three-way reconciliations; transferring monies between differently-owned accounts without each person's written consent; failing to create checks and balances; and failing to follow state or federal requirements.

• ✓Interest earned on a trust account must be removed at least once every 12 months
• ✓A broker may deposit up to $5,000 of personal monies to keep the account open or avoid insufficient-balance charges without it being commingling
• ✓Separate ledgers must be maintained for each property
• ✓Transferring monies between accounts owned by different persons requires each person's written consent

32-2151.01(A) requires each employing broker to keep records of all real estate (and cemetery/timeshare/membership camping) transactions and employment records for current and former employees. Records must include earnest money receipts, closing statements showing all receipts/disbursements/adjustments, sales contracts, and employment agreements if applicable. Records must be open to the commissioner at all reasonable times and kept at least five years after termination of the transaction or employment, in the principal or licensed branch office or an approved in-state off-site storage location.

• ✓Transaction and employment records must be kept at least five years after termination
• ✓Records must be open at all reasonable times for inspection by the commissioner or representatives
• ✓Records must be kept in the principal/branch office or an approved in-state off-site storage location with prior written notice

32-2151.01(B) prohibits a broker from granting any person authority to withdraw from the trust fund account unless that person is a licensee under the broker's license (except as provided by 32-2174(C)). Subsection C requires the broker to specifically state the type of earnest money received (cash, check, promissory note, or other item of value) in the purchase contract, lease, or receipt. Subsection D requires all licensees to promptly place all cash, checks, or items of value received into the care of the designated broker.

• ✓Only a licensee under the broker's license may be granted trust-account withdrawal authority (except per 32-2174(C))
• ✓The type of earnest money must be specifically stated in the contract, lease, or receipt
• ✓Licensees must promptly deliver all payments received to the designated broker

32-2151.01(G) requires the designated broker to review each listing agreement, purchase or nonresidential lease agreement, or similar instrument within ten business days after execution by placing initials and date of review on the same page as the parties' signatures. The designated broker may authorize in writing an employed associate broker to review and initial on the broker's behalf. 'Business day' excludes Saturdays, Sundays, and legal holidays.

• ✓Designated broker must review and initial covered instruments within ten business days of execution
• ✓Initials and date must appear on the same page as the parties' signatures
• ✓Review authority may be delegated in writing to an employed associate broker

32-2151.02 requires all real estate employment agreements to be written in clear, unambiguous language, fully set forth all material terms including broker compensation, have a definite duration/expiration date showing inception and expiration, and be signed by all parties. Employing brokers cannot assign an agreement to another broker without written consent of all parties at the time of assignment. A licensee may not procure an agreement from a party already under an exclusive agreement without written acknowledgment of potential liability for additional commissions. An employment agreement is not required for a licensee to represent a party.

• ✓Employment agreements must be written, clear, list all material terms/compensation, have definite inception and expiration dates, and be signed by all parties
• ✓Assignment to another broker requires written consent of all parties at the time of assignment
• ✓A licensee needs written acknowledgment before procuring an agreement from a party already under an exclusive agreement
• ✓A written employment agreement is not required to represent a party in a transaction

32-2153(A) lists conduct within the preceding five years that can lead to denial, suspension, revocation, letters of concern, or provisional licensing, including misrepresentation/false promises; acting for more than one party without knowledge or written consent of all parties; violating the chapter or commissioner rules; false advertising; employing unlicensed persons; failing to account for/remit monies; commingling or converting client monies; failing to keep required records; failing to exercise reasonable supervision; negligence; signing another's name without written consent; and violating fair housing laws.

• ✓Acting for more than one party requires the knowledge AND written consent of all parties
• ✓Commingling or converting a client's/principal's monies is grounds for discipline
• ✓A broker's failure to exercise reasonable supervision over licensees/employees is grounds for discipline
• ✓Violating federal or Arizona fair housing law is a disciplinary ground

32-2155 requires a broker to employ and pay only active licensees, and a licensee may accept employment/compensation only from the broker to whom licensed or a qualifying employer (that holds a license, treats the licensee as a W-2 employee, has the same employing broker, and gets written permission from the employing broker). Compensation through a professional corporation/LLC must flow through the entity of which the licensee is officer/shareholder or member/manager. It is unlawful to pay anyone unlicensed at the time of service for broker acts.

• ✓A broker may employ and pay only active licensees
• ✓A licensee may be paid only by the employing broker or a qualifying same-broker W-2 employer with written permission
• ✓It is unlawful to pay an unlicensed person compensation for performing broker acts

32-2156 provides that no criminal, civil, or administrative action may be brought against a transferor/lessor or licensee for failing to disclose that a property is or was the site of a natural death, suicide, homicide, or felony; was owned/occupied by a person with HIV/AIDS or another disease not transmitted through common occupancy; or is located near a sex offender. Failing to disclose these facts is not grounds for termination or rescission of a transaction.

• ✓No liability for failing to disclose deaths, suicides, homicides, or felonies occurring on the property
• ✓No liability for failing to disclose HIV/AIDS status of prior occupants or proximity to a sex offender
• ✓These nondisclosures are not grounds to terminate or rescind a transaction

Property management agreements must be written in clear, unambiguous language and must state all material terms and conditions of the firm's services, obligations, and duties to the owner. They must be signed by the owner (or agent) and the firm's designated broker (or authorized licensee), specify beginning and ending dates, contain cancellation provisions agreeable to both parties, provide for disposition of all collected monies including tenant deposits, specify type and frequency of status reports, state operating reserve amounts and purposes, provide for disposition of interest earned on trust monies, state compensation terms, and prohibit assignment to another licensee without express written owner consent.

• ✓The agreement must be signed by the property owner or agent and the designated broker or authorized real estate licensee
• ✓Must specify a beginning and an ending date
• ✓Must contain cancellation provisions agreeable to both parties
• ✓Must provide for disposition of all monies collected, including tenant deposits, and interest earned on trust accounts
• ✓May not be assigned to another licensee or licensed entity without express written consent of the owner

On termination the firm must provide a final accounting of the property's financial status: within 5 days a list of all tenant security obligations; within 35 days reimbursement of all monies remaining in property accounts (except monies needed for unpaid obligations incurred during the term); within 75 days a final accounts receivable and payable list; and within 75 days a final bank account reconciliation.

• ✓Within 5 days: provide a list of all tenant security obligations
• ✓Within 35 days: reimburse all remaining monies except those needed for unpaid obligations
• ✓Within 75 days: provide a final accounts receivable/payable list and a final bank account reconciliation

All property management accounts must be designated as trust accounts on the broker's records. A broker's trust account is required for all owner monies unless the owner directs deposit directly into the owner's account (the broker may not have access to the owner's account). Trust accounts may be interest bearing. The firm must deposit non-disputed, non-contingent monies within three banking days into either the owner's direct account or the firm's trust account. Each rental agreement executed by a property manager must include a provision clearly stating the disposition of any tenant deposits.

• ✓All property management accounts must be designated as trust accounts on the broker's records
• ✓A broker's trust account is required for all owner monies unless the owner directs direct deposit into the owner's own account, to which the broker has no access
• ✓Non-disputed monies must be deposited within three banking days
• ✓Each rental agreement must clearly state the disposition of any tenant deposits

Firms must keep a residential rental agreement plus amendments, addenda, and related documents for one year after expiration or until given to the owner at termination. Finder fee records paid to tenants must be kept for three years after payment or until given to the owner. All client financial records (bank statements, canceled checks/images, deposit slips, receipts, journals, owner statements, client ledgers, bills, invoices) must be kept at least three years from execution. Signed management agreements must be consecutively numbered or filed in an orderly, accessible system.

• ✓Residential rental agreements and related documents must be kept one year after expiration or until given to the owner
• ✓Finder fee records must be kept three years after payment
• ✓All client financial records must be kept at least three years from the date of execution
• ✓Signed management agreements must be consecutively numbered or filed in an orderly, accessible manner

Before offering subdivided lands for sale or lease, the subdivider must notify the commissioner in writing of the intention to subdivide. This notice of intention must contain extensive disclosures about the ownership, land, title condition, terms of sale, improvements, utilities, water, schools, taxes/assessments, and any restrictive covenants. It forms the basis for the commissioner's public report.

• ✓Subdivider must file a written notice of intention with the commissioner BEFORE offering subdivided lands for sale or lease
• ✓'Principal' means any person/entity holding 10% or more financial interest, or for a trust each beneficiary holding 10% or more beneficial interest
• ✓Notice must include name/address of owner and subdivider, legal description, condition of title including encumbrances, terms/conditions of sale, recorded subdivision map, and use restrictions/covenants
• ✓Subdivider need not disclose items more than one mile from the subdivision boundaries, except foreign nations or tribal lands within the one-mile radius must be disclosed

A creation of six or more lots, parcels or fractional interests of any size is a subdivision subject to the article, with specific exceptions such as 36-acre-plus partitions, foreclosure results, court decrees, securities-regulated interests, and commissioner special orders.

• ✓Creating six or more lots/parcels/fractional interests of any size is subject to the article unless an exemption applies
• ✓Exempt: each interest represents 36 acres or more; results of foreclosure/deed in lieu; created by court order/operation of law; oil/gas/mineral or registered securities interests; commissioner special-order exemptions
• ✓A sale/lease occurring 10 or more years after another lot's sale is treated as independent unless there is evidence of intent to subdivide

Upon examination, unless grounds for denial exist, the commissioner issues a public report authorizing sale/lease. The subdivider must furnish each prospective buyer/lessee a copy before they sign any offer to purchase or lease and take a receipt.

• ✓The commissioner shall issue a public report authorizing sale/lease unless grounds for denial exist
• ✓The subdivider must furnish each initial buyer or lessee a copy of the public report BEFORE they sign any offer to purchase or lease, and must take a receipt
• ✓Reports for property near military airports, training routes, restricted airspace or electronics ranges must include specified disclosure statements in bold 12-point block letters on the first page

The commissioner may suspend, revoke or deny a public report for numerous grounds including noncompliance, misrepresentation/fraud, inability to deliver title, failure to assure improvement completion, and disqualifying background of owners or 10%-or-more interest holders.

• ✓Grounds include failure to comply with the article/rules, sale that would constitute misrepresentation/deceit/fraud, inability to deliver title, and failure to assure completion of improvements
• ✓Disqualifying background of any owner/subdivider/officer/director/partner or 10%-or-more interest holder (felony/misdemeanor involving fraud or real estate, injunctions, adverse administrative orders/judgments) is a ground for denial
• ✓Procuring a public report by fraud, failure to demonstrate permanent access, or lots posing an unreasonable health risk are grounds for denial

A subdivider may not sell/lease or offer subdivided lands without first obtaining a public report and certificate of administrative completeness (unless exempt). Selling before the report issues, or failing to deliver it, makes the transaction rescindable by the buyer/lessee.

• ✓A subdivider must obtain a public report (and certificate of administrative completeness) before selling/leasing subdivided lands, except under section 32-2181.01 or 32-2181.02 exemptions
• ✓Sale/lease before the report issues or failure to deliver it renders the transaction rescindable by the purchaser or lessee
• ✓A rescission action must be brought within three years of the date the purchaser/lessee executed the purchase or lease agreement; prevailing party gets reasonable attorney fees

Purchasers of unimproved lots have statutory rescission rights: a seven-day cooling-off period without cause and a six-month inspection right if they had not inspected before contracting.

• ✓A purchaser of an unimproved lot may rescind without cause by written notice by midnight of the seventh calendar day after executing the contract; the subdivider must clearly disclose this right
• ✓A buyer who did not inspect the lot before signing has six months to inspect and unilaterally rescind, signing an affidavit of inspection
• ✓The subdivider must clearly and conspicuously disclose the rescission right per commissioner regulations

All contracts for purchase/lease of subdivided land must clearly disclose the document's nature, the right to receive the public report, and applicable rescission rights. Missing disclosures make the contract unenforceable against the purchaser.

• ✓Contracts must clearly and conspicuously disclose the nature of the document, the right to receive a copy of the public report, and the rescission right for unimproved lots
• ✓A contract failing to make these disclosures is not enforceable against the purchaser
• ✓For lots for present/future residential use, provisions waiving or disclaiming liability for prior material representations relied upon by the purchaser are void

Before offering unsubdivided land for sale or lease, the owner or agent must notify the ADRE Commissioner in writing of their intention. This written notice must contain extensive disclosure information about ownership, the land, and its condition. Principals holding a 10% or more financial interest (or trust beneficiaries holding 10% or more beneficial interest) must be identified.

• ✓Written notice of intention must be filed with the Commissioner BEFORE offering unsubdivided land for sale or lease
• ✓'Principal' means any person or entity with a 10% or more financial interest, or a trust beneficiary holding a 10% or more beneficial interest
• ✓Notice must include owner/agent name and address, legal description and area, title condition and encumbrances, terms of offering, intended uses, and access provisions
• ✓Copies of original promotional and advertising material must be attached to the notice

It is unlawful for any owner or agent to make offerings of unsubdivided land without the written authorization of the Commissioner. The Commissioner issues a public report, and a copy must be furnished to each offeree at the time of the offering.

• ✓It is unlawful to make offerings without written authorization of the Commissioner
• ✓The Commissioner issues a public report that must be furnished to each offeree at the time of offering
• ✓The Commissioner may terminate any authorization on grounds set out in section 32-2183

Upon examination, unless grounds for denial exist, the Commissioner issues a public report authorizing sale or lease. Alternatively, an owner may prepare a final public report and obtain a certificate of administrative completeness. The Commissioner has 15 business days to determine administrative completeness. Sales may commence after obtaining the certificate.

• ✓Public report must be reproduced by the owner/agent and furnished to each prospective buyer before signing an offer to purchase, taking a receipt
• ✓Owner-prepared public reports require a $500 initial (or $250 amended) filing fee and assigned registration number
• ✓Department must determine administrative completeness within 15 business days
• ✓Owner may commence sales/leasing only after obtaining a certificate of administrative completeness
• ✓Military airport vicinity land requires bold 12-point block letter statements on the first page of the report

No owner or agent may sell, lease, or offer unsubdivided lands without first obtaining both a public report and a certificate of administrative completeness. Sales made before issuance are voidable by the purchaser.

• ✓Both a public report AND a certificate of administrative completeness are required before selling, leasing, or offering
• ✓Any sale or lease before public report issuance is voidable by the purchaser
• ✓An action to void must be brought within three years of the purchaser executing the purchase agreement
• ✓The prevailing party in a voidance action is entitled to reasonable attorney fees

An owner/agent may only sell unsubdivided lots using one of three prescribed methods: (1) deed conveying marketable title (recorded within 60 days), (2) escrow of a real estate sales contract with title report, executed deed, and blanket encumbrance releases (deposited within 60 days), or (3) deed to a qualified trustee with a trust agreement. Recording must occur in the county where the land is located.

• ✓Only three prescribed methods (direct deed, escrow of sales contract, or deed to trustee) may be used to sell unsubdivided lots
• ✓Deeds, mortgages/deeds of trust, and sales contracts generally must be recorded within 60 days of purchaser execution
• ✓All documents must be recorded in the county and state where the unsubdivided land is located
• ✓Only a bank, savings and loan, or title insurance company (or authorized escrow agent) may act as trustee under method 3

Purchasers of unsubdivided land have two distinct rescission rights: a 7-day cooling-off period after signing, and a 6-month inspection rescission right if they did not inspect the parcel before signing. The owner/agent must clearly disclose the 7-day right and provide opportunity to exercise it.

• ✓A purchaser may rescind without cause by midnight of the 7th calendar day following execution of the contract
• ✓A buyer who has not inspected the lot before signing has a 6-month period to inspect and unilaterally rescind
• ✓At inspection the buyer must sign an affidavit stating he inspected the property, which may be required to be filed with the department
• ✓Owner/agent must clearly and conspicuously disclose the right to rescind

An owner or a condominium/planned community association may petition the ADRE for a hearing concerning violations of the community documents or of the statutes regulating condominiums (Title 33, ch. 9) or planned communities (Title 33, ch. 16). The petitioner files a written petition on a department-approved form and pays a filing fee set by the Commissioner, which is deposited in the condominium and planned community hearing office fund.

• ✓Either an owner or the association may petition the department for a hearing over document or statutory violations
• ✓Petition must be in writing on a department-approved form, list the complaints, be signed with addresses, and state a hearing is desired
• ✓A filing fee set by the Commissioner must accompany the petition and is deposited into the hearing office fund
• ✓If the petitioner voluntarily dismisses or the parties stipulate to dismissal before a hearing is scheduled, the filing fee is refunded

R4-28-101 defines license statuses that are heavily tested. An 'active license' is a current license naming the employing broker and the work location. A 'current license/status' is one that is active or eligible to be active, within the two-year license period OR the one-year grace period while expired. An 'eligible license/status' is issued under article 2 to a licensee who holds a license during the current period but is not engaged by a broker and is prohibited from doing anything requiring an active license. 'Inactive license/status' means a period in which a licensee is prohibited from performing acts requiring an active license.

• ✓Active license must state the employing broker's name and the location of employment
• ✓An employing broker's active license requires a currently licensed designated broker of record
• ✓Current status spans the two-year license period plus a one-year grace period while expired
• ✓Eligible and inactive licensees may NOT perform activities requiring an active license

Every applicant for a Department-issued license or renewal (and, for entities, any officer, director, member, manager, partner, owner, 10%+ trust beneficiary, 10%+ stockholder, or controlling person) must submit a signed licensure/renewal questionnaire disclosing criminal convictions/deferrals, adverse civil judgments involving fraud/dishonesty or real estate business, professional license discipline, and injunctions related to real estate/securities/consumer fraud/racketeering.

• ✓Entity applicants must disclose for any 10%+ owner, stockholder, trust beneficiary, or controlling person
• ✓Must disclose misdemeanor/felony convictions or deferred judgments/sentencing
• ✓Must disclose fraud/dishonesty judgments and professional license restriction, suspension, or revocation in any state
• ✓Must disclose injunctions involving real estate, securities, consumer fraud, or racketeering

A timely, administratively complete renewal keeps the existing license active until the Department finally determines the application. Renewal applications require any licensing corrections, late status, applicant signature attesting truthfulness, and a completed disciplinary actions disclosure form. Designated brokers renewing must file a signed Broker Supervision & Control Audit Declaration.

• ✓A timely, complete renewal application keeps the license from expiring pending determination
• ✓A completed disciplinary actions disclosure form is required at renewal
• ✓A DB must file a Broker Supervision & Control Audit Declaration no earlier than 90 days before expiration, listing all property management and trust accounts

Unlawful license activity includes performing licensed acts without an active license, acting for a broker other than the employing broker, or a broker employing an unlicensed/improperly licensed person. The person must report it as soon as aware, with written explanations, signed statements from the person and the designated broker, and requested compensation/contract documentation.

• ✓Acting without an active license or for a non-employing broker is unlawful license activity
• ✓The person and the employing broker's DB must submit signed statements identifying all unlawful activity
• ✓Requested documentation includes all agreements and compensation received while improperly licensed

A person with no prior unlawful activity, who acted unlawfully for 30 days or less with no pending complaints, may renew or change to active status without processing delay and receives only an Advisory Letter of Concern. The Commissioner may take disciplinary action under A.R.S. § 32-2153 if the activity exceeded 30 days, was repeated, or a complaint is pending.

• ✓30 days or less with no prior history and no pending complaint results in an Advisory Letter of Concern
• ✓Activity over 30 days, repeat activity, or a pending complaint permits discipline under A.R.S. § 32-2153

An active licensee must sever from the employing brokerage before requesting inactive status, which may last up to 15 years. Inactive licensees need not complete continuing education until reactivating but must still renew and pay fees. Failure to renew causes expiration; an expired inactive license may be renewed within one year, after which it is terminated. Inactive licensees cannot perform activities requiring an active license.

• ✓A licensee must sever from the brokerage before requesting inactive status
• ✓Inactive status may not exceed 15 years and does not relieve renewal/fee obligations
• ✓An expired inactive license may be renewed within one year, then is terminated
• ✓Inactive licensees may not perform activities requiring an active license

A license may be reactivated on 30 days' written notice with CE completed within 24 months of applying. CE requirements increase with time inactive: same-as-required if under 3 years; plus 6 hours for 3-6 years; plus 15 hours for 6-10 years; plus 30 hours for 10-15 years (on top of 24 salesperson/30 broker base hours). No exam is required if reactivated within 15 years; after 15 years a new application, prelicensing education, and exam are required.

• ✓Reactivation requires 30 days' written notice and CE completed within 24 months
• ✓Additional CE hours scale with the length of inactivity (6/15/30 extra hours)
• ✓No exam if reactivated within 15 years; a new application and exam are required after 15 years
• ✓Continuous industry/government work may waive additional CE hours if approved by the Commissioner

Every applicant for a real estate license must complete a 90-hour prelicensure education course and pass a course examination with at least 75 percent, as required by A.R.S. § 32-2124. Alternatively, applicants may apply for a waiver of prelicensure courses, but the 27-hour Arizona-specific course can NEVER be waived.

• ✓Applicant must complete the 90-hour prelicensure course and pass its exam with a score of at least 75 percent
• ✓A waiver may be granted for prelicensure courses EXCEPT the 27-hour Arizona-specific course, which is always required
• ✓Exam requirement is prescribed under A.R.S. § 32-2124

To renew, a salesperson or associate broker must complete 24 credit hours of Department-approved continuing education, including a minimum of 3 hours in each mandatory category (A5a–A5h), plus any required Current Issues. Designated/delegated associate brokers must complete 24 hours with 3 hours each in categories A5a–A5f and a Broker Management Clinic (A.R.S. § 32-2136). CE completed within 90 days after fulfilling a renewal may count toward the next period but cannot be counted for two license periods.

• ✓Salespersons and associate brokers must complete 24 hours of approved CE with a minimum of 3 hours in each mandatory category (A5a–A5h)
• ✓Designated/delegated brokers must complete 24 hours including 3 hours in categories A5a–A5f plus a Broker Management Clinic under A.R.S. § 32-2136
• ✓CE completed within 90 days after fulfilling a renewal may count toward the next period but not for two license periods

A licensee may not advertise property in a way that implies no salesperson or broker is involved. When a licensee advertises their own or another licensee's property, they must disclose their licensed status and property ownership by using the words 'owner/agent' in the advertisement.

• ✓A licensee shall not advertise property implying no salesperson/broker is involved (R4-28-502.A)
• ✓A licensee advertising their own or another licensee's property must disclose licensure and ownership using the words 'owner/agent' (R4-28-502.B)

All advertising must contain accurate claims and representations and fully state factual material. A salesperson or broker must not misrepresent facts or create misleading or ambiguous impressions.

• ✓Advertising must contain accurate claims and fully state factual material (R4-28-502.C)
• ✓A licensee shall not misrepresent facts or create misleading or ambiguous impressions (R4-28-502.C)

A licensee must ensure all advertising clearly and prominently identifies the employing broker's legal name or the dba name(s) on the employing broker's license certificate. The designated broker is responsible for the advertising of all real estate activity.

• ✓All advertising must clearly and prominently identify the employing broker's legal name or dba name(s) (R4-28-502.E)
• ✓The designated broker is responsible for the advertising of all real estate activity (R4-28-502.G)

A real estate broker must disclose to all parties in a transaction, in writing at least three calendar days before closing, the name of each employing broker who represents a party and who will receive compensation from the transaction.

• ✓Disclosure of compensated employing brokers must be in writing at least three calendar days before closing (R4-28-701)
• ✓The disclosure must go to all parties in the transaction (R4-28-701)

Upon execution of any transaction document, a licensee must expeditiously deliver a legible copy of the signed document and final agreement to each party signing it.

• ✓A licensee must expeditiously deliver a legible copy of any executed transaction document (R4-28-802.A)
• ✓A copy must go to each party who signs the document (R4-28-802.A)

During a listing agreement, a licensee must promptly submit to the client all offers to purchase or lease. With the seller/lessor's permission, the licensee may disclose the existence and terms of additional offers. The duty to submit offers continues after acceptance until closing unless the client instructs otherwise in writing; offers may be voluntarily submitted and submitted after termination of the listing.

• ✓A licensee must promptly submit all offers to the client during the listing (R4-28-802.B)
• ✓Acceptance of an offer does not release the duty to submit further offers unless the client instructs in writing (R4-28-802.B)
• ✓With seller/lessor permission, the licensee may disclose the existence and terms of additional offers (R4-28-802.B)

A developer or its agent must ensure sale/lease agreements for a development requiring a public report contain, above the signature portion in bold or larger print, the statement that the developer shall give the purchaser a copy of the public report and an opportunity to read it before signing. The document must conspicuously disclose its nature at or near the top.

• ✓Development contracts requiring a public report must include the mandated public-report language in bold/larger print above the signatures (R4-28-803.A)
• ✓The document must conspicuously disclose its nature at or near the top (R4-28-803.B)

The contract must indicate where earnest money/down payment will be deposited, naming the title company, broker's trust account, or other depository. If advanced money is paid directly to the seller instead of a neutral escrow, this must be conspicuously disclosed with the mandated bold-print warning, and the purchaser must sign or initial the provision.

• ✓The contract must state where earnest money/down payment is deposited and name the depository (R4-28-803.C)
• ✓Non-escrow direct payment to the seller must be conspicuously disclosed with the mandated bold warning and purchaser sign/initial (R4-28-803.D)

Contracts for unimproved subdivided lots or unsubdivided land must include bold rescission language granting cancellation without cause by midnight of the seventh calendar day after execution (plus a six-month inspection right if not inspected). Time-share interval contracts grant rescission by midnight of the tenth calendar day. The seller's current name, address, phone, and email must be disclosed, and rescission notices must be in writing and delivered by hand, email, courier, or certified mail.

• ✓Unimproved lot/unsubdivided land contracts allow rescission by midnight of the 7th calendar day after execution (R4-28-804.A)
• ✓If the lot is not inspected before execution, the purchaser has six months to inspect and unilaterally rescind (R4-28-804.A)
• ✓Time-share interval contracts allow rescission by midnight of the 10th calendar day after execution (R4-28-804.B)
• ✓Notices of rescission must be in writing and delivered by hand, email, courier, or certified mail, with the seller's contact info disclosed on the contract face (R4-28-804.C)

A licensee owes a fiduciary duty to the client and must protect and promote the client's interests, while also dealing fairly with all other parties to a transaction. This dual obligation is foundational to professional conduct under R4-28-1101(A).

• ✓A licensee owes a fiduciary duty to the client and shall protect and promote the client's interests
• ✓A licensee shall deal fairly with all other parties to a transaction

A licensee participating in a transaction must disclose in writing to all other parties any information that materially or adversely affects the consideration to be paid. This includes the seller's or buyer's inability to perform, known adverse material facts or defects in the property, and any lien or encumbrance on the property being transferred.

• ✓Must disclose in writing information that materially or adversely affects consideration to be paid by any party
• ✓Must disclose information that seller/lessor or buyer/lessee is or may be unable to perform
• ✓Must disclose any known adverse material fact or material defect in the property
• ✓Must disclose existence of a lien or encumbrance on the property being transferred

A licensee must not act directly or indirectly in a transaction without informing other parties in writing, before any binding agreement, of a present or prospective interest or conflict. This includes acting as a principal, when a party is an immediate family member of the licensee or designated broker, when a party owns or is an employee of the employing broker, or when the licensee or immediate family has a financial interest beyond normal compensation.

• ✓Conflicts of interest must be disclosed in writing before parties enter any binding agreement
• ✓Must disclose if the licensee is acting as a principal
• ✓Must disclose if a party is a member of the licensee's or designated broker's immediate family
• ✓Must disclose a financial interest of the licensee or immediate family beyond receipt of compensation

A licensee shall not accept compensation from, or represent, more than one party to a transaction without the prior written consent of all parties. This is the core rule governing dual agency and dual compensation situations.

• ✓A licensee shall not accept compensation from more than one party without prior written consent of all parties
• ✓A licensee shall not represent more than one party without prior written consent of all parties

An employing broker and designated broker must exercise reasonable supervision and control over licensed activities of licensees and others in their employ. This includes establishing and enforcing written policies and systems to review and manage transactions, disclosure forms and contracts, document filing/storage, trust fund handling, use of unlicensed assistants, and advertising; overseeing delegation of authority; familiarizing licensees with applicable laws; and reviewing documents with material effect and licensee advertising/marketing.

• ✓Employing and designated brokers must exercise reasonable supervision and control over licensees and employees
• ✓Must establish and enforce written policies to review and manage transactions, disclosure forms, document handling, trust funds, unlicensed assistants, and advertising
• ✓Must review and inspect documents with a material effect on party rights/obligations and licensee advertising and marketing
• ✓Must familiarize licensees with federal, state, and local real estate laws

A designated broker must establish a system to monitor compliance with statutes, rules, and the employing broker's policies. This system must include a progressive disciplinary policy for managing violations. The designated broker must exercise reasonable supervision and control over licensed activities, and the employing broker is responsible for the acts of all licensees and employees within the scope of employment. A designated broker who immediately reports a licensee's violation to the Department upon learning of it is shielded from failure-to-supervise discipline.

• ✓A designated broker must establish a monitoring system including a progressive disciplinary policy; failure to enforce it is a violation
• ✓An employing broker is responsible for the acts of all licensees and employees acting within the scope of their employment
• ✓A designated broker may delegate to employees but may not relinquish overall responsibility for supervision and control
• ✓A designated broker who immediately reports a licensee's violation to the Department is not subject to failure-to-supervise discipline
• ✓A one-office broker employing a designated broker plus no more than one other licensee and one unlicensed person need not maintain written policies

The applicant must disclose water provider type and contact info, compliance status, line locations, extension costs to lot lines, and maintenance responsibility. Key requirements: a water adequacy report from ADWR for subdivisions outside an active management area, and a water availability report for unsubdivided land (a copy/summary must appear in all promotional material and contracts). Outside an AMA with no water source, an ADRE addendum advising investigation must be provided.

• ✓A water adequacy report from ADWR is required for a subdivision located outside a groundwater active management area
• ✓A water availability report from ADWR is required for unsubdivided land, and a copy/summary must appear in all promotional material and contracts
• ✓Outside an AMA with no current water source, an ADRE addendum advising the consumer to investigate water availability must be provided

An applicant must provide one or more approved assurances that improvements will be completed and maintained: a surety/completion bond, an irrevocable letter of credit, a loan commitment, a trust or escrow account, a city/county trust agreement, a written escrow agreement, subdivision assurances, or any other assurance satisfactory to the Department. Financial assurances generally must be payable to a non-developer third party, not expire before the last improvement's completion date, and be in an amount 10% greater than the estimated completion cost.

• ✓Applicant must provide an approved assurance (bond, letter of credit, loan commitment, trust/escrow, or governmental agreement) for completion of improvements
• ✓Financial assurances must be payable to a third party who is not the developer and be in an amount 10% greater than the estimated cost to complete
• ✓Assurances cannot expire before the estimated completion date of the last improvement
• ✓Under a written escrow agreement, if the completion date is not met the developer must notify purchasers, who may cancel for a full refund within 30 days, and the public report becomes invalid with sales suspended

A developer may obtain a special order of exemption to offer lots before a public report issues by submitting a Petition for Conditional Sales Exemption, the completed public report application, a purchase contract with all disclosures and a Conditional Sales Addendum, a current title report, the development map, water documentation, and any other requested items. The conditional sales exemption expires upon issuance or denial of the public report, or upon a suspension/cease-and-desist order or voluntary suspension of sales.

• ✓A conditional sales exemption lets a developer offer lots before a public report issues, using a Conditional Sales Addendum in the purchase contract
• ✓The conditional sales exemption expires upon issuance or denial of the public report or upon a suspension/cease-and-desist order
• ✓Earnest money and down payments for conditional sales must be deposited in a neutral depository

A developer must notify the Department of all material changes and must amend the public report when a material change adversely impacts a purchaser or lessee. Amendments require a fee and specified information plus a purchase contract addendum acknowledging the sale is conditioned on the amended report. The Department may suspend sales pending amendment or accept a written agreement to suspend; if not necessary, sales may continue if purchasers receive the current report and disclosure of all changes.

• ✓A developer must amend the public report when a material change adversely impacts a purchaser or lessee
• ✓Completion date extensions require an affidavit that purchasers, owners, and officials were given written notice; the Department may deny extensions beyond the first if opposed
• ✓If sales continue pending amendment, prospective purchasers must receive the current report and disclosure of all changes before signing

A response must specifically admit, deny, or state inability to obtain sufficient information for each allegation; a statement of lack of information operates as a denial. Any allegation not denied is deemed a violation of A.R.S. § 32-2153(B)(10). If a party fails to respond or appear, the Department may file an Affidavit of Default and act on the charges, even before the hearing date. The party may move to vacate the default within 15 days of receiving the default/order, and the Commissioner may vacate for good cause. Responses must be signed by the party or an attorney and verified.

• ✓A statement of lack of information has the effect of a denial; unanswered allegations are deemed violations of A.R.S. § 32-2153(B)(10)
• ✓Department may file an Affidavit of Default if a party fails to respond or appear, and may act before the scheduled hearing date
• ✓A motion to vacate default must be filed within 15 days of receiving the default/order; Commissioner may vacate for good cause
• ✓Every response must be signed by the party or at least one attorney and be verified

A.R.S. 44-101 requires certain agreements to be in writing and signed by the party to be charged to be enforceable. For real estate practice, this includes any agreement to lease real property for longer than one year or to sell real property or an interest therein, and any agreement employing an agent or broker to buy or sell real property for compensation or commission. An agent acting for a party must have written, subscribed authority.

• ✓Agreements to lease real property for more than one year or to sell real property must be in writing and signed by the party to be charged
• ✓Agreements employing an agent/broker to purchase or sell real property for compensation or commission must be in writing to be enforceable
• ✓An agent's authority to bind a party to a real property agreement must itself be in writing, subscribed by the party sought to be charged
• ✓Contracts not to be performed within one year must be in writing

A.R.S. 44-502 makes it unlawful for an exclusive property engagement agreement to last longer than 12 months from execution, to be a covenant running with the land, to bind a future owner (with narrow exceptions), to be recorded with a county recorder, to place a lien or security interest on the property, or to allow assignment without the owner's notice and agreement. These provisions target abusive long-term or lien-based listing schemes.

• ✓An exclusive property engagement agreement may not last longer than 12 months after execution
• ✓It may not be a covenant that runs with the land
• ✓It may not be recorded in the county recorder's office
• ✓It may not authorize any lien, encumbrance, or security interest against the residential real estate
• ✓It may not permit assignment without notice to and agreement by the owner
• ✓It must meet the requirements of A.R.S. 32-2151.02

A.R.S. 44-5101 requires wholesale buyers and sellers of residential real property (fewer than five dwelling units) to make written disclosures before entering any binding agreement. A wholesale buyer must disclose in writing that they are a wholesale buyer. A wholesale seller must disclose in writing that they hold only an equitable interest and may not be able to convey title. A wholesale buyer is one who contracts to buy then assigns the contract; a wholesale seller contracts to sell without holding legal title and assigns the contract.

• ✓A wholesale buyer must disclose in writing to the seller that the buyer is a wholesale buyer before any binding agreement
• ✓A wholesale seller must disclose in writing that it holds only an equitable interest and may not be able to convey title
• ✓If a wholesale buyer violates this section, the seller may cancel before close of escrow without penalty and retain the earnest money
• ✓If a wholesale seller violates this section, the buyer may cancel before close of escrow without penalty and receive a refund of all earnest money
• ✓Residential real property here means property with fewer than five dwelling units

• A. Comply with the instruction because language preference is not explicitly listed as a protected class in A.R.S. § 41-1491.
• B. Comply only if the association can document specific prior incidents where language differences caused safety problems.
• C. Refuse to implement the policy, because a language-based screening criterion is closely correlated with national origin — a protected class under Arizona's Civil Rights Act — and enforcing it would expose both the broker and the association to fair housing liability. ✓ Answer
• D. Ask ADRE for a written ruling before implementing the policy, then proceed if ADRE does not respond within 30 days.

• A. The housing provider may require the tenant to pay an additional pet deposit equal to one month's rent before approving the accommodation.
• B. The housing provider must engage in an interactive process and, if the need is verified and the accommodation is reasonable, must waive the no-pets policy without charging an additional pet deposit for the service animal. ✓ Answer
• C. The housing provider is only obligated to accommodate service animals trained by a licensed professional organization and registered with the state of Arizona.
• D. The housing provider may deny the request if the lease was signed before Arizona's Civil Rights Act was enacted.

• A. HOAs have absolute authority over sign rules within their communities, and assisting with enforcement is a routine professional service.
• B. Arizona law (A.R.S. § 33-1261) gives sellers the right to display a for-sale sign on their property, and HOA rules that ban all for-sale signs may conflict with this right as well as fair housing principles regarding freedom of choice in housing. ✓ Answer
• C. The salesperson may assist the HOA only if the sign prohibition applies equally to political and commercial signs.
• D. ADRE rules require salespersons to defer entirely to HOA governing documents and take no position on the legality of HOA rules.

• A. Denying an applicant who was convicted of manufacturing methamphetamine at his previous rental unit ✓ Answer
• B. Denying an applicant who disclosed that she is in recovery from opioid addiction and attends an outpatient treatment program
• C. Denying an applicant who was once involuntarily hospitalized for a psychiatric condition but has no criminal record
• D. Denying an applicant with an old drug-related arrest solely because he asked for a reasonable accommodation for his disability

• A. Military status is not a protected class under Arizona's Civil Rights Act, so the refusal does not constitute an Arizona fair housing violation. ✓ Answer
• B. Military status is a protected class under Arizona's Civil Rights Act, and the refusal constitutes unlawful housing discrimination.
• C. Military status is protected only if the tenant is actively deployed and seeks housing near a military installation.
• D. Military status is protected under Arizona law only for properties receiving federal funding.

• A. The licensee may face disciplinary action by the Arizona Department of Real Estate, as tendering a knowingly false or inaccurate wood infestation report in a residential transfer is a specific ground for discipline. ✓ Answer
• B. The licensee faces no professional discipline unless the buyer suffers a financial loss exceeding $5,000 as a direct result of the inaccurate report.
• C. Only the pest control company that performed the inspection can be held responsible; the licensee who submits the report has no disciplinary exposure.
• D. The licensee's conduct is subject only to civil liability in court and cannot form the basis for any administrative disciplinary action by the real estate commissioner.