Chapter 2 (License Law and Qualifications for Licensure)

Question 1

Caveat Emptor

Answer 1

A policy of let the buyer beware (buyer is responsible for own knowledge in real estate transactions).

Question 2

Historical Perspective of Florida Real Estate License Law

Answer 2

Prior to the latter part of the 19th century, the real estate business was unorganized and extremely competitive. The policy of caveat emptor, a Latin term meaning “let the buyer beware,” prevailed. In 1923, the Florida legislature passed the real estate license law, Chapter 475 of the Florida statutes.

In 1925, the Florida Legislature created the Florida Real Estate Commission to administer and enforce the license law. The Legislature granted the Commission authority to keep records, conduct investigations, and the power to grant, deny, suspend, and revoke licenses. The Florida Real Estate Commission is also called the Commission or the FREC.

Today, the Division of Real Estate (DRE) provides support services to the Commission. The DRE is under the Department of Business and Professional Regulation (DBPR).

The intent of real estate regulation is to protect the health, safety, and welfare of the public (consumer protection). The Legislature believes the profession should be regulated when:

1. The unregulated practice can harm the public, the potential harm is recognizable, and the danger outweighs any anticompetitive impact that might result from regulation;
2. The public is not adequately protected by other state statutes, local ordinances, or federal laws; or
3. Less restrictive means of regulation are not available.

Question 3

Statutes and Rules Important to Real Estate

Answer 3

Applicants must meet certain application and academic requirements and demonstrate minimal competence with regard to the real estate business.

Prospective licensees must demonstrate knowledge of real estate business practices and knowledge of Florida real estate license law and certain federal laws pertaining to real estate.

To be prepared for the licensure examination and to competently perform real estate practices, the licensee must be familiar with the laws regulating the real estate business.

Question 4

Florida Laws

Answer 4

1. Florida Statute 20.

Chapter 20, Organizational Structure, establishes the structure of the executive branch of Florida’s government.

The Florida Constitution provides for the legislative, executive, and judicial branches of government. The executive branch executes the programs and policies adopted by the Legislature. The policies are implemented by the departments of the executive branch, including the Department of Business and Professional Regulation (DBPR).

2. Florida Statute Chapter 475.

This law is often called the Real Estate Professional Practice Act.

Chapter 475 was created by the Florida Legislature to establish the legal rights and responsibilities of real estate licensees and real estate appraisers.

*Chapter 475 is divided into four parts.

A. Part I pertains to real estate brokerage.

Real estate licensees are responsible for knowing the provisions of this chapter. The Florida Real Estate Commission (FREC) implements, interprets, and enforces the regulatory provisions of Chapter 475.

B. Part II of Chapter 475 pertains to real estate appraisers and sets forth the requirements for licensed and certified appraisers according to federal statute.

The Florida Real Estate Appraisal Board (FREAB) regulates state-certified, licensed, and registered trainee appraisers. The FREAB functions very similarly to the Florida Real Estate Commission (FREC). Both quasi-judicial bodies follow the same procedures for disciplining licensees.

C. Part III of Chapter 475, the Commercial Real Estate Sales Commission Lien Act, gives a broker lien rights for earned commission.

This act applies only to commercial property (not residential property). The lien is only against the owner’s net proceeds (personal property) from the sale and does not attach to the commercial real property.

D. Part IV, the Commercial Real Estate Leasing Commission Lien Act, gives a broker lien rights for earned commission associated with a brokerage agreement to lease commercial real estate.

3.Florida Statute 455.

The Regulation of Professions and Occupations defines the general legal practice and procedure for the DBPR and the licensees of all professions regulated by the DBPR, including real estate.

Section 455.10 of the statute provides that an individual cannot be disqualified from practicing an occupation or profession regulated by the state of Florida solely because the person is not a U.S. citizen.

Another section of this statute sets forth laws regarding Commission and board organization, meetings, compensation, and so forth.

This statute also concerns the unlicensed practice of a profession, including real estate.

Requirements concerning license examinations and the use of professional testing services are set forth in Chapter 455.

This law also mandates what actions the DBPR may take in regulating licensees.

Licensees who fail to comply with the provisions of this chapter can be disciplined by the FREC.

For example, Section 455.227, F.S., authorizes the Commission to discipline a real estate licensee who has failed to notify the DBPR within 30 days of a conviction, finding of guilt, plea, or adjudication of a crime, regardless of where the event occurred.

4. Florida Statute 120.

The Administrative Procedure Act defines the procedural process by which regulatory agencies decide and implement agency action. The licensing and disciplinary process for real estate licensees is outlined in this unit.

5. Chapter 61J2.

Chapter 61J2 is the rules of the Florida Real Estate Commission.

It is a set of administrative rules developed by the Florida Real Estate Commission, pursuant to the rulemaking process outlined in Chapter 120, Florida Statutes.

Administrative rules are published in the Florida Administrative Code (FAC).

The FREC promulgates these rules to expand upon the statutory provisions of Chapter 475, Florida Statutes, by addressing in greater detail, the principles of practice for the real estate profession (appraisal rules are in Chapter 61J1 of the FAC).

Question 5

Important Federal and State Laws

Answer 5

The Bureau of Education and Testing’s Candidate Information Booklet for Sales Associates lists 36 Florida statutes and one rule of the Florida Administrative Code that are tested on the state license exam.

Students are also responsible for knowing the main points associated with nine Federal regulations codified in the U.S. Code.

The Candidate Information Booklet lists the applicable federal and state laws.

Question 6

Online Resources

Answer 6

The best way to access the Florida statutes is using the official Online Sunshine website.

http://www.leg.state.fl.us/statutes/

For the most up-to-date version of the administrative rules of the Florida Real Estate Commission, click here:

http://www.myfloridalicense.com/dbpr/re/statutes.html

Select “Florida Administrative Code Chapter 61J2.”

Click here:

http://www.myfloridalicense.com/dbpr/servop/testing/documents/RE_sales_cib.pdf

to download a copy of the Candidate Information Booklet. The booklet includes important information regarding taking the state license exam.

Question 7

General Licensing Provisions

Answer 7

An individual typically begins a real estate career in Florida as a licensed sales associate.

Applicants who have completed the required education and passed the license exam are initially licensed as voluntary inactive sales associates.

Inactive sales associates can become active by finding an employer and filing the information with the DBPR.

Sales associates and broker associates are employed by and work under the direction and control of a broker or an owner-developer.

Sales associates and broker associates are agents of their employer.

An owner-developer is an unlicensed entity that sells, exchanges, or leases its own property. An example of an owner-developer is a real estate development company that owns land that it develops into subdivisions and then builds and sells homes.

An owner-developer’s sales staff must hold active real estate licenses in order to be paid a commission or other compensation based on actual sales (that is, on a transnational basis).

The sales staff is exempt from real estate licensure if paid strictly on a salaried basis.

To become a broker requires additional education, experience, and passing the broker license exam. While many sales associates want the prestige of a broker’s license, they are not interested in opening their own real estate brokerage business.

A broker associate is an individual who holds a broker’s license but who chooses to register and work in real estate under the direction of another broker.

Question 8

Application Requirements

Answer 8

A person desiring to be licensed must submit an application.

The application is furnished by the DBPR and may be downloaded from the internet at the DBPR’s Form Center (see the web link below).

Applicants may download, print, and mail the application, or they may apply online.

Prior to accessing the online application, applicants must register one time with the DBPR using the applicant’s email address.

You can apply for a Florida real estate license online by clicking here.

Applicants are cautioned to complete the application carefully, particularly with respect to past history concerning felonies, misdemeanors, and traffic offenses (other than parking, speeding, inspection, or traffic signal violations). When responding regarding past history (background questions on application), applicants who have been convicted of a crime, found guilty, or entered a plea of guilty or *nolo contendere (no contest), even if court action (adjudication) was withheld, should attach full details of all cases with dates and outcomes, including any sentence and conditions imposed.

Attach to the application important documentation such as copies of police records.

Failure to truthfully disclose this information may result in denial of a real estate license.

In cases where a license has already been issued, revocation of the license may result.

An application number is assigned when an application is filed online.

Applicants who responded “yes” to any of the background questions should mail applicable documentation with a cover letter indicating the application number.

Applicants who have a criminal history or just want to make sure that no criminal matters are attached to their identity are best served by researching their criminal history.

For incidences that took place in Florida, an applicant can go online to the Florida Department of Law Enforcement (FDLE) website (see the web link below) and request a copy of the applicant’s Florida criminal history.

If a criminal matter that the applicant is aware of is not listed, the applicant will need to double-check with the local court regarding the status of the matter and confirm whether it was expunged.

If a matter appears on the list of criminal history, the applicant will know that the matter was not expunged and that it must be disclosed on the license application.

*Note that expungement is a process by which the record of a criminal conviction is destroyed or sealed after expiration of time.

Expungement is not automatic.

Attorneys charge extra for this, and applicants should not assume a record has been expunged without first confirming that the matter no longer appears on one’s criminal history. Applicants are not required to disclose a personal bankruptcy.

To perform a criminal history record search, click here:

http://www.fdle.state.fl.us/Content/home.aspx

Under “Search Our Systems,” select “Criminal History Records.” An applicant can order an FDLE criminal history report for $24.

Question 9

Background Check of Criminal History

Answer 9

On the license application, applicants are asked whether they have ever been convicted of a crime, found guilty, or entered a plea of guilty or nolo contendere (no contest) to a criminal charge, even if the applicant received a withhold of adjudication.

When the court determines that a defendant is not likely to again engage in a criminal act and that the ends of justice and the welfare of society do not require that the defendant suffer the penalty imposed by law, the court may withhold adjudication of guilt, stay (stop) the imposition of the sentence, and place the defendant on probation. A withhold of adjudication must be disclosed on the application.

Nolo contendere is a plea of no contest entered in a criminal court of law. The defendant does not admit or deny the charges; although, a fine or sentence may be imposed by the court.

For out-of-state criminal history, an applicant should first contact the attorney who handled the matter. The applicant should also contact the court where the matter took place. If an applicant is not sure or cannot confirm the expungement of a criminal matter, the applicant should disclose it. It is better to disclose only to find out that the matter did not have to be disclosed than to not disclose and be charged with obtaining a license by fraud. When in doubt, disclose.

Applicants must submit their fingerprints as part of the license application process. An applicant’s fingerprints are scanned and electronically submitted to the FDLE and to the Federal Bureau of Investigation (FBI). The purpose of the fingerprinting process is to determine whether an applicant has a criminal history.

The DBPR has contracted with its test vendor, Pearson VUE, to provide fingerprinting services for real estate applicants.

Fingerprints are scanned at Pearson VUE’s test sites and other locations subcontracted by Pearson VUE.

Once students have enrolled in the prelicense course for sales associates and have made application for a license, they are encouraged to go ahead and complete the fingerprinting process.

Students do not have to wait until the application is submitted and the course is completed before getting their fingerprints scanned.

In fact, getting fingerprints scanned early will allow the application to be approved sooner because the DBPR will not have to hold up the application approval pending the results from the criminal history check.

To schedule a fingerprinting appointment, click here:

https://pearson.ibtfingerprint.com/

Applicants choose a date and time and are asked to provide demographic information (gender, eye color, and so forth). Payment is due at the time of making the appointment.

The application fee must accompany the application.

Checks and money orders are accepted for applications received by mail.

Online applicants may charge the fee to a credit card.

A 30-day period is allowed after receipt of the application to check for errors and omissions and to send the applicant a notice of insufficiency concerning any additional information required.

An applicant’s failure to supply additional information may not be grounds for denial of a license unless the applicant was notified within the 30-day period.

Any application for licensure that is not processed within the legislated time periods must be considered approved.

An applicant must be informed of approval or denial of the application within 90 days after receipt of the last correctly submitted application.

When the Commission denies an application, it sends a copy of the denial to the applicant, lists the reasons for the denial, and advises that the applicant has 21 days from the date of receipt of the order to request a hearing in accordance with Chapter 120, F.S.

To check the status of your application, click here:

https://www.myfloridalicense.com/intentions2.asp

Select “View Application Status.”

Question 10

Nonresident Applicant Requirements

Answer 10

Proof of U.S. citizenship is not required of applicants.

However, applicants must possess a Social Security number.

Furthermore, applicants do not have to be residents of Florida.

Question 11

Nonresident Licensee Requirements

Answer 11

A Florida real estate licensee who moves out of state and becomes a nonresident of Florida is required by law to notify the Commission within 60 days of the change in residency.

The licensee agrees to keep the licensee’s mailing address current.

Nonresident licensees must satisfactorily complete the post-licensing and continuing education required of all Florida real estate licensees.

Nonresident applicants and licensees must comply with all other F.S. 475 requirements and FREC rules.

Question 12

Rules Pertaining to Nonresident Licensees

Answer 12

Any resident licensee who becomes a nonresident must notify the Commission within 60 days of the change in residency and comply with all nonresident requirements.

A Florida resident licensee who fails to notify the Commission of becoming a nonresident as prescribed in Section 475.180 may be issued a citation and fined $300.

Reference: Section 475.180, F.S., and 61J2-24.002, F.A.C.

Question 13

Mutual Recognition Agreements

Answer 13

The FREC currently has mutual recognition agreements with licensing authorities in eight states:

Alabama, Arkansas, Connecticut, Georgia, Illinois, Mississippi, Nebraska, and Oklahoma.

The intent of mutual recognition agreements is to recognize the education and experience of individuals licensed in another state or nation when the other jurisdiction has education and experience requirements comparable to Florida’s requirements.

The agreements apply exclusively to nonresidents who are licensed in other jurisdictions.

A resident of Florida who is licensed in a mutual recognition state cannot apply for a Florida real estate license under mutual recognition.

If a holder of a real estate license from a state with which Florida has a mutual recognition agreement desires a Florida real estate license, the individual submits a Florida real estate license application.

The applicant requests mutual recognition on the license application and indicates from which state mutual recognition is being requested.

An applicant applying for mutual recognition must obtain a certification of license history from the Real Estate Commission in the state where the applicant is licensed.

A certification of license history must contain the applicant’s initial license exam information, current license status, the number of active months of licensure within the preceding five years, and whether any disciplinary action has been taken against the licensee. The certification is submitted with the application.

Real estate applicants approved for licensure under mutual recognition are exempt from the prelicense education course.

However, the mutual recognition applicant must demonstrate mastery of Florida’s real estate license law by passing a written Florida-specific real estate law license exam.

The exam consists of 40 questions worth one point each.

A grade of 30 points (75%) or higher is required to pass the exam.

After demonstrating knowledge of Florida license law, the applicant is issued a Florida real estate license.

Individuals who receive a Florida real estate license under mutual recognition must fulfill the same post-license and continuing education requirements as all other Florida real estate licensees (post-license education and continuing education requirements are explained later in this unit).

Mutual recognition agreements also ensure that Florida licensees have an opportunity for licensure in mutual recognition states.

The agreements are state-specific and what is required of Florida licensees varies among mutual recognition states depending on how another state’s license law compares to Florida’s license law.

A Florida real estate licensee interested in obtaining a license from a mutual recognition state should contact the state’s Real Estate Commission for information regarding application

Question 14

Mutual Recognition is Not Reciprocity

Answer 14

Reciprocity is an agreement between two states that allows a real estate licensee with a valid license in one of the states to practice real estate in both states. There is no reciprocity between Florida and any other state.

Florida instead has entered into contractual agreements, called mutual recognition agreements, with some other states.

Florida and another state enter into a contract to recognize each other’s real estate license education. Mutual recognition applicants must demonstrate knowledge of Florida’s real estate laws by passing a license exam that consists of 40 questions concerning Florida-specific real estate law.

After demonstrating knowledge of Florida license law, the applicant is issued a Florida real estate license.

Only nonresidents of Florida may use education obtained in a mutually recognized state to obtain a Florida real estate license.

Question 15

Florida Resident Defined

Answer 15

For application and licensing purposes, the FREC rules define a resident of Florida as a person who has resided in Florida continuously for a period of four calendar months or more within the preceding year, regardless of whether the person resided in a recreational vehicle, hotel, rental unit, or other temporary or permanent location.

Any person who presently resides in Florida in any of the above-described accommodations with the intention of residing continuously in Florida for four months or longer, beginning on the date the person established the current period of residence, is also considered a legal Florida resident.

This is the test used to determine whether an applicant for licensure qualifies as a nonresident under mutual recognition.

Question 16

Sales Associate Qualifications for Licensure

Answer 16

The sales associate applicant must:

be 18 years of age or older;
have a high school diploma or its equivalent;
possess a Social Security number;
be honest, truthful, trustworthy, of good character, and have a reputation for fair dealing; and
be competent and qualified to make real estate transactions and conduct negotiations with safety to investors and others.

Question 17

License Application

Answer 17

A Social Security number is required to apply for a real estate license.

In the Full Legal Name section of the license application, applicants must enter their name as it appears on their Social Security card.

Florida law requires that an applicant’s Social Security number be disclosed on all professional license applications.

The Social Security number is used to determine whether applicants are in compliance with child support obligations.

A real estate license application is valid for two years from the date the complete application is received by the DBPR.

The application expires two years after it is received by the DBPR.

Reference: Section 475.181(2) and 455.213, F.S.

When completing an application for licensure, the applicant must disclose:

regardless of adjudication, whether the applicant has ever been convicted or found guilty of a crime, has ever entered a plea of guilty or nolo contendere (no contest) to a crime, or is currently under criminal investigation;
whether the applicant has ever done business under any name or alias other than the name signed on the application (this includes maiden names);
whether in Florida or in any other state or jurisdiction, the applicant has had disciplinary action against a license (registration or permit) to practice a regulated profession (disciplinary action includes revocation, annulment, suspension, relinquishment, surrender, or a pending investigation against a professional license); and
whether in Florida or in any other state or jurisdiction, the applicant has had an application for a real estate license denied or there is a pending proceeding to deny an application.

An applicant who has been disbarred or is guilty of the offenses listed above is not considered qualified for a real estate license unless passage of time, good conduct and reputation, or other sufficient reasons cause the Commission to believe granting the license will not endanger the interests and welfare of the general public.

Applicants who acted as, attempted to act as, or held themselves out as a real estate broker or sales associate during the year prior to filing an application, or until a valid license was issued, may have their license application denied.

The denial may occur regardless of whether compensation was an issue.

Question 18

Education Requirements

Answer 18

Sales associate candidates must successfully complete Course I or an equivalent FREC-approved prelicense course.

The course is based on understanding and applying the fundamentals of real estate principles and practices, real estate law, real estate license law, and real estate mathematics.

Course I consists of 60 hours of instruction plus 3 hours for an end-of-course examination.

The end-of-course examination consists of 100 questions worth one point each and is normally organized with 45 questions on principles and practices, 45 questions on real estate law, and 10 math questions.

A passing score of at least 70 is required on the end-of-course exam.

Question 19

Time Limit for Prelicense Education

Answer 19

If an applicant does not pass the state license exam within two years after the course completion date, the course completion expires, and the applicant must again complete the prelicense education course.

The completion date is the date the student passed the prelicense end-of-course exam.

Question 20

Exemptions to the Prelicense Course Requirement

Answer 20

Attorneys who are active members of The Florida Bar are exempt from Course I.

Additionally, individuals who have received a four-year degree in real estate from an accredited institution of higher education are exempt from the prelicense course.

Question 21

Regulations Pertaining to Prelicense Courses

Answer 21

A student may not miss more than eight hours of instruction.

An instructional hour is considered to be 50 minutes (Section 475.17, F.S.).

A student may attend makeup classes to take the end-of-course exam or a makeup exam if absences were due to student or family illness, if done within 30 days of the regularly scheduled exam time, or later with Commission approval.

Makeup classes must consist of the original course material that the student missed (61J2-3.008, F.A.C.).

The school or institution provides each student passing the end-of-course exam with a FREC-prescribed grade report of successful completion of the course.

The school must submit a roster notifying the Commission of the name of each student who has satisfactorily completed the education requirements (Section 475.175, F.S.).

The student must pass the school-administered end-of-course exam with a grade of 70 or higher (61J2-3.008, F.A.C.).

A student failing the end-of-course exam must wait at least 30 days from the date of the original examination to retest. Within one year of the original examination, a student may retest a maximum of one time.

Otherwise, a student failing the end-of-course exam must repeat the course prior to being eligible to retake the end-of-course examination.

Schools must administer a different form of the end-of-course exam to a student who is retaking the exam or repeating the course (61J2-3.008, F.A.C.).

Students may choose to complete a distance-learning course and satisfactorily complete a timed, distance learning course examination (Section 475.17, F.S.).

The prelicense course may be taken by correspondence or other suitable means by anyone who, because of individual physical hardship, cannot attend the course where it is regularly conducted or who does not have access to distance learning courses (Section 475.17, F.S.).

Question 22

License Examinations

Answer 22

When the application processing is complete and the applicant is considered qualified, the DBPR notifies the national testing vendor.

The vendor then sends a notice informing the candidate of eligibility to take the state license examination.

Applicants schedule examination appointments directly through the testing vendor.

License examinations for sales associates and broker applicants are given at test sites located throughout Florida.

The license exam may also be taken in any state where the test vendor has a test center.

Examinees must be prepared to show sufficient identification to obtain admission to the test site.

Sufficient identification is defined as two forms of signature identification, one of which contains a photograph and the signature of the applicant.

Student and employment identification cards are not accepted.

Examinees must also provide the notice of satisfactory completion (grade report) at the scheduled examination as proof that they have satisfactorily completed the Commission-prescribed course.

The grade report is issued by the school as proof that the student successfully completed the required prelicense course.

The examination consists of multiple-choice questions and is administered as a computerized test.

The license exam is offered in English and Spanish.

Students who want the Spanish version must request the Spanish language examination when making the test reservation.

Students who elect to take the license exam in Spanish may toggle between the Spanish and English translation of each question while taking the exam. The passing score on the license exam is a grade of 75 or higher.

Examinees’ answers are graded at the test site.

Examinees who pass the exam are given a “pass” notification at the test site.

A real estate license is mailed to examinees who passed the exam.

New sales associates must change their license to active status before legally operating as a sales associate.

A change from inactive to active status is accomplished by submitting the appropriate DBPR form.

The form includes the sales associate’s name, license number, contact information, and the employer’s name, license number, and business address.

The form is signed by the broker or owner-developer and the sales associate.

Florida brokers may also register new licensees online at the DBPR’s website.

New licensees must not begin working until the DBPR website indicates that the license has been changed to active status under the proper broker or brokerage entity.

Licensees can monitor the progress of their change of status request on the DBPR website.

To download and print the Change of Status for Sales Associates and Broker Sales Associates form, click here. Click here to monitor the progress of a request for change of status. Select “Renew Your License” and follow the prompts.

Examinees who fail the license exam are given a failure notice at the test site.

The failure notice includes a breakdown of the points scored in each major content area.

The notice also includes information about reviewing the exam, retaking the exam, and requesting a formal administrative hearing to challenge the exam.

Requests to review the exam must be received within 21 days after the date of the examination (release date on the original grade notification).

Review appointments are scheduled with the test vendor. Examinees may only review the questions they answered incorrectly.

Applicants who fail the license exam have the right, at their own expense, to have an attorney review the exam with them.

During the exam review, an applicant who has objections to any of the exam questions and answers should write down the objections to the specific questions and turn in the comments to the test center employee (review monitor).

If the examination review results in a corrected score, the new score will apply only to the applicant who challenged the examination questions.

An applicant also has the right to petition for a formal hearing before the Division of Administrative Hearings.

A request for a hearing before an administrative law judge must be filed within 21 days from the date of the on-site grade notice, or 21 days from the date of the letter notifying the student of the DBPR evaluation decision regarding the student’s challenges.

The request for a hearing is filed with the Chief, Bureau of Education and Testing, DBPR.

Question 23

Post-Licensing Education

Answer 23

Sales associates are required to successfully complete a prescribed post-licensing education requirement before the first renewal of their licenses.

This requirement has the effect of placing all initial licenses in a conditional (probationary) status because failure to complete the post-licensing education requirement will cause the initial license to become null and void by operation of law.

Sales associates who do not complete the 45-hour post-licensing requirement and want to continue in the real estate business are required to requalify for licensure by repeating the prelicense course and end-of-course exam and by again passing the state licensing exam.

Post-licensure courses are offered by accredited colleges, universities, and community colleges; area technical centers; real estate proprietary schools; and FREC-approved sponsors.

Post-licensure courses are offered in live classroom format and online.

Students must pass the 45-hour end-of-course exam with a score of 75% or higher.

Licensees who fail the end-of-course exam must wait at least 30 days from the date of the original examination to retake a different form of the end-of-course examination (alternatively, licensees who do not want to wait 30 days may choose to retake the course and, in such cases, take a different form of the end-of-course exam).

Florida-licensed attorneys who are also licensed real estate sales associates must complete the post-licensing education requirement.

A licensed sales associate who has received a four-year degree in real estate from an accredited institution of higher education is exempt from the sales post-license education requirement.

Question 24

Tips Regarding Post-License Education

Answer 24

Students should not enroll in a post-license course until first becoming licensed.

If you take your post-license course before becoming licensed, the course will not count.

Students are encouraged to take their post-license education soon after becoming licensed. Do not wait until the last minute.

Plan to complete the course at least 30 days before the expiration date on your license. Licensees who fail the post-license end-of-course exam must wait at least 30 days from the date of the original examination to retake a different form of the end-of-course examination.

Therefore, it is wise to allow yourself ample time so that if you need to retake the exam, you can do so before the expiration date on your license.

If you are taking the course by distance education, your school will need time to grade your exam and electronically submit the results to the state before your expiration date.

Furthermore, you need to allow for unexpected events, such as computer problems, sickness, and emergencies.

Question 25

Continuing Education

Answer 25

After completing the post-licensing education requirement during the initial license period, active and inactive licensees must complete at least 14 hours of continuing education during every two-year license period after that.

Three of the 14 hours must consist of core law, which includes updates to applicable rules and statutes. While only 3 hours of core law are required in the two-year, 14-hour renewal cycle, the legislature encourages licensees to take 3 hours of core law in each year of the renewal cycle to stay current on changes in the Florida real estate laws.

A licensee who takes the 3-hour core-law course in each year of the renewal period receives 6 hours of credit toward the 14-hour continuing education requirement.

The continuing education requirement may be satisfied by attending a classroom course, by completing an approved distance education course, or by attending a Commission-approved education seminar or conference.

A licensee may substitute attendance at one legal agenda session of the FREC for three classroom hours of continuing education (CE) credit.

A licensee may substitute three CE credits only one time per renewal cycle. To obtain the credit, the licensee must notify the DRE at least seven days in advance of the licensee’s intent to attend the FREC’s legal agenda session.

A licensee may not earn CE credit for attending a legal agenda session if the licensee is a party to a disciplinary action slated for that FREC legal agenda.

Active members in good standing with The Florida Bar are exempt from the continuing education requirements for real estate licensees.

Question 26

Broker Requirements

Answer 26

Applicants who possess a Florida sales associate’s license must fulfill their sales associate’s post-licensing education before the expiration of the initial sales associate’s license or before applying for a broker’s license (whichever occurs first).

Broker applicants must successfully complete Course II or an equivalent FREC-approved course (unless qualifying as a broker under the mutual recognition provision).

Course II consists of 69 hours of instruction plus 3 hours for the end-of-course examination.

Question 27

Broker Experience Requirements

Answer 27

Broker applicants must fulfill an experience requirement in addition to the education requirement.

To fulfill the experience requirement, a broker applicant must have held an active real estate license for at least 24 months during the five-year period preceding application to become a Florida real estate broker.

A broker applicant can fulfill the experience requirement in one of the following three ways:

1. The applicant has held an active sales associate license under one or more real estate brokers for at least 24 months during the five-year period preceding application to become a Florida real estate broker. The employment can be under a Florida real estate broker or a broker licensed in another state or in any foreign jurisdiction.
2. The applicant held an active sales associate license while working as a salaried employee of a governmental agency and performing the duties authorized in Chapter 475, F.S., for at least 24 months during the five-year period preceding application to become a Florida real estate broker.
3. The applicant held an active broker license in another state or in any foreign jurisdiction for at least 24 months during the five-year period preceding application to become a Florida real estate broker.

The experience cannot be earned by working for an owner-developer unless the owner-developer is a licensed broker who holds a current, valid, active real estate license.

A broker applicant who holds a Florida real estate sales associate license must fulfill the 45-hour post-licensing education requirement before the initial sales associate license expires in order to be eligible to obtain a Florida broker license, even if the applicant is applying real estate experience from another state.

If the broker applicant does not hold a Florida real estate sales associate license, the 45-hour post-licensing education requirement does not apply.

Question 28

Broker Post-Licensing Education

Answer 28

Broker licensees are required to successfully complete post-licensing education before the first renewal of their licenses.

If a broker does not complete the 60-hour post-licensing requirement, the broker’s license becomes null and void by operation of law.

However, the broker may request and receive a sales associate’s license after completing 14 hours of continuing education within the six months following expiration of the broker’s license—and provided the broker has complied with all requirements for renewal.

A licensee who has received a four-year degree in real estate from an accredited institution of higher education is exempt from the broker prelicense and post-license education requirements to become initially licensed.

Question 29

Broker Continuing Education

Answer 29

Broker licensees must complete the same continuing education requirements required for sales associates.

Question 30

Registration and Licensure

Answer 30

Registration is the process of submitting information to the DBPR that is entered into the Department’s records.

Information that is placed on record with the DBPR includes the name and address of each licensed broker and sales associate; the name and business address of each sales associate’s employer; the sales associate’s and broker’s license status (active or inactive); and the person’s involvement as an officer, director, or partner of a real estate business.

Sales associates and broker associates licensed in Florida must be registered under their employing broker (or owner-developer, if applicable).

Sales associates and broker associates may have only one registered employer at any given time.

Florida licensees may also hold active licenses in other states.

Individuals who do not intend to engage actively in the real estate business, such as a director of a real estate corporation, simply register this information with the DBPR so that the information can be entered into the database.

However, an individual who wishes to actively engage in the real estate industry must be licensed and registered as active with the DBPR.

Licensure is obtained when an applicant passes the state license exam.

Passing the license examination gives the applicant the right to request and be issued a real estate license.

The license indicates the effective date, expiration date, the name of the governor, and the DBPR secretary. The licensee’s full name and license status are also indicated.

The two-letter prefix before the license number indicates the license type. BK signifies broker; SL signifies sales associate; BL signifies broker associate; BO signifies branch office; CQ signifies corporations and LLCs; and PR signifies partnerships and LLPs.

A real estate license is considered prima facie evidence that the holder possesses a current and valid license.

Question 31

Prima Facie Evidence

Answer 31

Prima facie evidence is a legal term used to refer to evidence that is good and sufficient on its face (at first view) to establish a given fact or prove a case.

Unless it is refuted by evidence to the contrary, prima facie evidence will prove a case (presumptive evidence).

A real estate license indicates the licensee’s name, issue date, and expiration date, and it serves as prima facie evidence that the licensee holds a current and valid license.

Furthermore, official Commission documents become prima facie evidence once they are signed by the FREC chairperson or the chairperson’s designee and affixed with the Commission’s seal.

Question 32

Real Estate Services

Answer 32

The Florida Real Estate License law identifies real estate-related activities called real estate services that require a Florida real estate license. Real estate services include any real estate activity involving compensation for performing the service for another.

To remember the most common services of real estate, use the mnemonic (memory trick) acronym A BAR SALE, where the first letter of each service forms the memory aid.

A     	Advertise real estate services
B     	Buy
A     	Appraise (non-federally related transactions)
R     	Rent or provide rental information or lists
S     	Sell
A     	Auction
L     	Lease
E     	Exchange

Real estate services are further defined in license law to include the following activities in the sale, exchange, or lease of real property, including mineral rights, business enterprises, or business opportunities:

1. Offer to, agree to, or attempt to perform real estate activities
2. Advertise or otherwise indicate to the public that one is in the business of performing real estate services
3. Direct or assist in the procurement of sellers, buyers, lessors, or lessees
4. Negotiate or close a real estate transaction (note that case law has determined that the intention to close a real estate transaction is sufficient)

Anyone who performs real estate services for another person for compensation of any type must be licensed, unless specifically exempted by law.

*Compensation is defined as anything of value or a valuable consideration, directly or indirectly paid, promised, or expected to be paid or received.

Compensation includes money in the form of a salary, bonuses, commissions, and gratuities.

Compensation is also things of value such as dinner, flowers, wine, gift certificates, event tickets, and so forth.

It is a violation of license law to share a commission with or to pay a fee or other compensation to an unlicensed person for the referral of real estate business clients, prospects, or customers.

However, a Florida broker may pay a referral fee to a broker licensed in another state so long as the foreign broker does not violate Florida law.

Question 33

Individuals Who Are Exempt from a Real Estate License

Answer 33

Individuals may buy, sell, exchange, or lease property for themselves. Therefore, the following individuals and business entities are exempt from a real estate license in the following circumstances:

1. Property owners do not need a real estate license to buy, sell, exchange, or lease their own real estate.
2. Corporations, partnerships, trusts, and joint ventures may buy, sell, exchange, or lease their own property.
3. Salaried employees of these business entities may buy, sell, exchange, or lease real property for their employer, provided the activity is incidental to their employment and they are not paid a commission or compensated on a transactional basis.

Also exempt from real estate licensure are salaried employees:

a. who work in an on-site rental office in a leasing capacity and who do not receive a commission (there is no restriction on the duration of the rental leases for this exemption);

b. who are managers of condominiums or cooperative apartment complexes who rent individual units for periods no longer than one year and who are not paid a commission [if the condominium or cooperative meets certain requirements, property managers must obtain community association manager licenses (CAM licenses) from the DBPR; salaried managers of community associations are required to obtain CAM licenses];
of an owner-developer (real estate developer) provided they do not receive a commission;

c. of a governmental agency who perform real estate services for the state or local government and who do not receive a commission (this exemption includes persons who appraise railroad property for tax purposes); and
d. of business entities who negotiate the sale or purchase of radio, television, or cable enterprises provided the sale does not involve real property. (If the transaction involves the sale or lease of land, buildings, or other improvements to land, a real estate licensee must be retained for that portion of the transaction.)

Chapter 475 of the Florida Statutes exempts the following individuals from holding a real estate license:

• Persons who sell cemetery lots (this exemption exists because Chapter 475, F.S., excludes cemetery lots from the definition of real property)
• Individuals who rent lots in a mobile home park or recreational travel park
• Attorneys-at-law when acting within the scope of their professional duties in an attorney-client relationship (in Florida, holding a Florida Bar license does not entitle an attorney to compensation for performing real estate services)
• Certified public accountants (CPAs) when performing accounting duties within the scope of their professional duties
• A person who has been given a power of attorney (called an attorney-in-fact) in order to sign contracts and conveyances on someone’s behalf (a person cannot appoint another individual as an attorney-in-fact for the purpose of conducting real estate services for others)
• Owners of time-share periods for their own use and occupancy who later offer the time-share periods for resale
• State-certified and licensed real estate appraisers who are licensed under Chapter 475, Part II for the purpose of conducting appraisal services
  Court-appointed individuals acting within the limitations of their duties
• Hotel and motel clerks who rent lodging accommodations on behalf of the establishment
• Federally regulated banks and dealers registered with the Securities and Exchange Commission (SEC) selling business enterprises to accredited investors
• Apartment property owners or property management firms for the purpose of paying a finder’s fee of no more than $50 to a tenant of the complex for a rental referral

Question 34

Summary of Important Points

Answer 34

A sales associate is a person who performs real estate services for compensation or other consideration but does so under the direction, control, and management of an active broker or owner-developer.

A broker is a person who, for another and for compensation or other consideration, performs real estate services.

A broker associate is an individual who meets the requirements of a broker but who chooses to work in real estate under the direction (employ) of another broker.

An owner-developer is an unlicensed entity that sells, exchanges, or leases its own property.

Sales staff must hold active real estate licenses to be paid commission.

The sales staff is exempt from licensure if paid strictly on a salaried basis.

To become a sales associate, applicants must complete

(1) a 63-hour prelicense course with a score of at least 70; and
(2) the application process, including the DBPR license application, fingerprints submission, background check information, affidavit of honesty (attest statement), initial license and application fee payment; and passage of the state license exam with a score of at least 75.

Applicants must be at least 18 years of age and have earned a high school diploma or its equivalent. U.S. citizenship is not required, and applicants do not have to be Florida residents.

Applicants must possess a Social Security number.

Resident licensees who move out of the state must notify the Commission within 60 days of the change in residency.

Sales associates must complete a 45-hour post-licensing course before the expiration of their initial license. Brokers must complete a 60-hour post-licensing course during the initial license period.

Failure to complete the post-license education before the expiration of the initial license will cause the license to become null and void.

Fourteen hours of continuing education each license period is required for all real estate licensees following the initial license period.

Individuals who have earned a four-year degree in real estate are exempt from the sales associate and broker prelicense courses, as well as the post-license requirement. They are not exempt from the continuing education requirement.

Florida-licensed attorneys who are active members of The Florida Bar are exempt from the sales associate prelicense course and from continuing education. They are not exempt from the broker prelicense education and the post-license requirement.

To become a broker, applicants must complete a 72-hour prelicense course with a score of at least 70; have at least 24 months of active real estate licensure during the previous five years; and successfully pass the state broker exam.

Applicants who hold a Florida sales associate license must also complete the sales associate post-licensing education before being eligible for a broker license.

Real estate services include any real estate activities involving compensation for performing the service for another.

Compensation is anything of value paid or promised to be paid to an individual for performing any service of real estate.