Iowa Real Estate Practice Exam

Whose custody must an active salesperson's license be kept in?

1. The salesperson

2. The agency

3. The broker

4. The state commission

The correct answer is: The broker

The active salesperson's license must be kept in the custody of the broker. This is crucial because the broker is legally responsible for overseeing the salespersons affiliated with their agency, ensuring that all activities comply with state laws and regulations. The broker's role includes managing the operations of the agency, providing guidance and oversight to salespersons, and maintaining records that reflect the conduct and transactions of salespeople operating under their license. While salespersons may hold their personal copies of licenses for identification, the official custody and the authority related to the license remains with the broker, reinforcing the hierarchical structure in real estate practice where the broker is the primary legal point of responsibility and accountability. The agency itself acts under the broker’s oversight, and the state commission regulates the entire process but does not retain custody of individual licenses.