What is the correct answer to: What is the max from Delaware Real Estate Guaranty Fund per transaction?

The correct answer is $25,000. Delaware law sets the maximum recovery from the Real Estate Guaranty Fund at $25,000 per transaction, regardless of the actual damages suffered by the claimant, ensuring that the fund can serve multiple injured consumers over time without insolvency. This cap is established under Delaware's Real Estate Licensure Law and reflects the Commission's regulatory framework for consumer protection. A claimant must first obtain a court judgment against the licensee and demonstrate that the judgment is uncollectible before accessing the fund.

What background knowledge is needed for this Practice Of Real Estate question?

State real estate recovery funds emerged across the United States during the consumer protection movement of the 1960s and 1970s, as legislatures recognized that civil judgments against dishonest real estate agents were often uncollectible because the agents had no assets. Delaware established its Real Estate Guaranty Fund as part of its broader licensure law to give consumers a meaningful remedy beyond a worthless paper judgment. Over the decades, states have periodically adjusted their fund caps to reflect inflation and changing transaction values, though Delaware's $25,000 per-transaction limit has remained a stable feature of its consumer protection framework. The fund is sustained by mandatory contributions from licensees at the time of licensure and renewal, creating a self-funding mechanism that does not rely on general tax revenue.

What is a good way to remember the answer to this Practice Of Real Estate question?

Associate Delaware's $25,000 cap with the number of letters in 'Delaware Real Estate Fund' — count them and you get a number close to 25, or simply remember '$25K for the First State' since Delaware is the First State and 25 is the first round number after 20 that feels significant. Alternatively, picture a quarter (25 cents) stamped with Delaware's colonial courthouse — '$25,000, quarter-century state.' This visual links Delaware's identity to its fund limit. Recite this rhyme when questions about Delaware's Guaranty Fund arise. The number 'twenty-five' directly references the $25,000 limit.

What exam tip applies to this Practice Of Real Estate question?

For state-specific recovery fund questions, always memorize the exact dollar figures — per transaction, per licensee, and lifetime caps — because exam writers deliberately use plausible-sounding wrong numbers that are close to the correct answer. On the Delaware exam, the three numbers to know are $25,000 per transaction, and any associated per-licensee or aggregate caps; if only one number is tested, it is almost always the per-transaction maximum of $25,000. Never guess based on what 'sounds right' — these figures must be memorized precisely.

How does this Practice Of Real Estate concept apply in real world practice?

A Delaware homebuyer hired a licensed agent who fraudulently diverted $40,000 of the buyer's earnest money deposit into a personal account. The buyer sued the agent, obtained a $40,000 judgment, but discovered the agent had declared bankruptcy and had no assets. The buyer then filed a claim with the Delaware Real Estate Guaranty Fund and received the maximum payout of $25,000, partially offsetting the loss. The remaining $15,000 remained an uncollected judgment against the bankrupt agent, illustrating both the fund's value and the importance of its per-transaction cap.

Practice Of Real EstateLicense LawMEDIUM

What is the max from Delaware Real Estate Guaranty Fund per transaction?

Correct Answer

D) $25,000

$25,000 maximum per transaction.

Answer Options

$10,000

$100,000

$50,000

$25,000

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Commingling is the illegal act of mixing client trust funds with a broker's personal or business operating funds; conversion is the misappropriation of those funds.

Continuing Education

Continuing education (CE) refers to the ongoing coursework that licensed real estate professionals must complete during each renewal cycle to maintain an active license. CE ensures agents stay current with changes in laws, regulations, and industry practices.

Do Not Call Registry

The National Do Not Call Registry is a federal program administered by the FTC that allows consumers to opt out of receiving unsolicited telemarketing calls, including calls from real estate agents soliciting business.

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What is the max from Delaware Real Estate Guaranty Fund per transaction?

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