Michigan License Law Practice Test

What is required for a broker to receive a commission?

1. Having a website

2. Securing financing for buyers

3. Being the procuring cause of a sale

4. Conducting open houses

The correct answer is: Being the procuring cause of a sale

For a broker to receive a commission, it is essential that they are the procuring cause of a sale. This means that the broker's actions must directly lead to the successful transaction between the buyer and seller. The concept of procuring cause refers to the broker's role in initiating or facilitating the negotiations that ultimately result in the sale of the property. If a broker can demonstrate that their efforts were a significant factor in bringing the parties together and completing the sale, they are entitled to their commission. In contrast, having a website, securing financing for buyers, and conducting open houses are all activities that may contribute to a broker's overall effectiveness but are not requirements for earning a commission. A broker may have a strong online presence or perform these additional services, yet without being the procuring cause of the transaction, they would not qualify for a commission. Thus, the focus on being the procuring cause highlights the importance of the broker's direct involvement in the sale process.