Question 52

The real estate license will automatically be revoked.

When a sum has been paid from the real estate recovery fund toward satisfaction of a judgment against a real estate licensee, the license will be automatically revoked as a consequence of the payment made from the fund.

A) The real estate license is automatically suspended.

This option is incorrect because the action taken is not a suspension but a revocation of the license. A suspension implies that the license could be reinstated after a certain period or conditions are met, which does not apply in this scenario.

B) The licensee has 90 days to reimburse the fund or lose the license.

This choice is also incorrect since the immediate action taken against the licensee is a revocation of the license, not a grace period for reimbursement. There is no allowance for a 90-day period in this situation according to the regulations regarding the recovery fund.

C) The real estate license will automatically be revoked.

This option is correct because the regulations stipulate that if a payment is made from the real estate recovery fund to satisfy a judgment against a licensee, the license is automatically revoked. This ensures accountability for licensees who have caused financial harm.

D) The licensee must reimburse the fund before the license expires.

This statement is incorrect as it suggests a conditional requirement tied to license expiration. Upon a payment from the recovery fund, the license is revoked, and there is no stipulation for the licensee to reimburse the fund while the license remains valid.

Conclusion

The correct action taken against a licensee after a payment from the real estate recovery fund is the automatic revocation of their license. Other options incorrectly suggest conditions, such as suspensions or grace periods for reimbursement, which do not align with the established legal framework governing real estate licenses. Thus, option C is definitively the correct answer.