Question 90

A licensee must have a property management agreement with the owner before receiving a security deposit from a tenant.

Before a licensee can accept a security deposit from a tenant, it is essential that she has a property management agreement in place with the owner of the property to ensure that she is authorized to act on behalf of the owner.

A) have a property management agreement with the owner.

This option is correct because having a property management agreement establishes the legal authority for the licensee to manage the property and collect deposits on behalf of the owner. It outlines the responsibilities and obligations of both parties, ensuring compliance with legal and contractual requirements.

B) be certain the deposit does not exceed 1% month's rent.

This option is incorrect. While there may be regulations regarding the maximum amount for security deposits, the primary requirement before collecting any deposit is the existence of a property management agreement. The focus here is on the necessity of having an agreement rather than the specific percentage of the deposit.

C) obtain the tenant's credit report.

This option is incorrect. Although obtaining a tenant's credit report is a common practice in the tenant screening process, it is not a prerequisite for receiving a security deposit. The critical step is to ensure that the licensee has the authority to collect deposits as outlined in a property management agreement.

D) provide the tenant with a blank inventory checklist.

This option is incorrect. While providing an inventory checklist may be part of the move-in process, it is not a requirement that must be fulfilled before collecting a security deposit. The licensee's priority should be to have a property management agreement in place.

Conclusion

The necessity of having a property management agreement with the owner is fundamental for a licensee to legally accept a security deposit. All other options fail to address this critical requirement, focusing instead on processes or practices that come after the agreement is established. Thus, option A is definitively the correct choice in this context.