What is the effect on an associate's business activities if a principal broker loses their license?

When a principal broker loses their license, the implications are significant for the associate brokers affiliated with them. Associate brokers cannot continue their business activities as usual because their license to operate as a real estate agent is directly tied to the principal broker's license. Without an active and licensed principal broker, associates cannot engage in any real estate transactions, as the principal broker is responsible for the supervision and oversight of all licensed activities within the brokerage.

This situation mandates that associates must halt all business activities immediately until a new principal broker is obtained or the previous one’s licensing issues are resolved. In practical terms, it protects consumers and ensures that all real estate transactions are conducted under the auspices of a licensed principal broker, maintaining the integrity and legality of the real estate practice. Consequently, this creates a clear and necessary line of action for associates who find themselves without a supervising broker.