Chapter 2 Opening a Real Estate Office Flashcards
Sole Proprietorship at a glance
The broker: is the only (sole) owner, is personally liable for business debts and torts, must register sole proprietorship with the DBPR, must register trade name (if applicable) with the DBPR. Page 29
General Partnership
A general partnership is an association of two or more persons for the purpose of jointly conducting business. One must be a broker. Page 29
General Partnership at a Glance
Two or more persons are involved, A general partnership is created by contract (written, oral, or implied), All partners are personally liable, Each partner is responsible for all partnership debts, Each partner can bind the other partners in contracts, Each partner shares in profits and losses as agreed upon.
General Partnership
Sales associates and broker associates may NOT be general partners in a real estate brokerage partnership. Page 30
Ostensible Partnership
An Ostensible Partnership or (quasi-partnership) exists where there is no real partnership, but the parties act or do business in such a manner that the pubic, having no knowledge of the parties private relations, reasonably would assume that a partnership exist. OSTENSIBLE PARTNERSHIPS ARE CONSIDERED FRAUDULENT AND DECEITFUL. PAGE 31
Limited Part ships at a Glance
At Least one general partner and one limited partner are required. General partners are personally liable for business debts. Limited partners invest cash and may not participate in management. Limited partners have limited liability. A certification of limited partnership must be filed with the Florida Department of State. The partnership name must identify entity as a limited partnership for example, “Limited or LTD Page 32
Real Estate Brokerage limited partnerships
The limited partnership must register wit the DBPR under the limited partnership name. The limited partnership registration must be renewed every two years. Limited partners are not required to register wit the DBPR. Page 32.
Limited Liability Partnership at a Glance
Limited Liability for all. File limited liability partnership with the Florida Department of State. Name must identify entity as a limited liability partnership for example. Limited Liability. The broker must register: brokerage lip wit the debar, all general partners wit the DBPR, trade name wit the DBPR and the Florida Department of State. page 33.
What is a Corporation?
A corporation is an artificial person or legal entity created by law and consists of one or more persons. It is considered to have an existence of its own, separate from the individual. Page 33
Corporation at a Glance
Limited Liability for All. Files articles of incorporation with the Florida Department of State. The corporation name must identify the entity as a corporation. Such as Parrot head realty Corp.. A corporation exists perpetually. Shares of stock represent ownership. An annual report must be filed wit the Division of Corporations, Florida Department of State. Page 34
Real Estate Brokerage Corporations
At Least one of the officers or directors must be licensed as an active broker (the principal broker or qualifying broker). Sales associates and broker associates may be shareholders of a real estate brokerage corporation. Page 35
What do you need to qualify for S Corp?
To Qualify for S corporation status, a business must be a domestic corporation organized in the United States or originated under federal or state law. An S-Corp can issue only 1 type of stock. Page 36
Other Business Forms that May not Register
- Corporation Sole: A corporation sole is an ecclesiastical or a church organization. 2. Joint Venture: A joint venture is a temporary form of business arraignment often encountered in the real estate business. 3. Business Trust: is a form of business entity that may be crated to engage in transactions involving its own real property. 4. Associations: Unincorporated associations are generally recognized as groups of people associated for some noncommercial common purpose. Page 38.
Trade Name
The Fictitious Name Act defines fictitious name as any name under which a person transacts business in the state of Florida, other that the person’s legal name. Page 39
Fictitious names
A fictitious name registered under the Fictitious Name Act may not contain the work Corporation, Incorporated, or Company, or the abbreviations Corp. Inc., or CO. unless the person or business for which the name is registered is incorporated or has obtained a certificate of authority to transact business in Florida pursuant to Chapter 607 or 617 Page 39.
The Real Estate Office
All Active Florida real estate brokers are required to have an office and to register the office wit the DBR. A brokers office must consist of at least one enclosed room in a building of stationary construction that will provide privacy to conduct negotiations and closing of real estate transactions. Page 40
Branch Offices
If a broker desires to conduct business from additional locations, the broker must register each additional location as a branch office and pay the appropriate registration fees. Thereafter, the broker must renew branch office registrations every tow years. Page 41.
Branch Offices
Registrations issued to branch offices are not transferable.
Entrance Signs
Active real estate brokers must display an official sign on either the exterior or interior of the entrance to their principal office and all branch offices. The sign must be easily observed and read by anyone entering the office. The sign must contain the following information: Trade name (if one is used), Broker’s Name, the Words, “Licensed Real Estate Broker, or Lic. (abreved). Page 42
Entrance Signs: Partnerships, Corporations, LLC, or LLP
Sign must contain the following information: Name of the firm or Corporation (or trade name), Name of at least one active broker, the words “Licensed Real Estate Broker” or Lic. Real Estate Broker”. Page 42.
American with Disabilities Act (ADA)
Whether leasing or purchasing space, brokers must comply with federal and state laws regarding accessibility. Under Title III of the American with Disabilities Act (ADA) laces of public accommodations and commercial facilities must be accessible to persons with physical or mental disabilities. Page 43.
Advertising
Advertising is considered under Florida law to be a broker activity. Page 44.
Blind advertisement
Advertisements that fail to disclose the license name of the brokerage firm. Page 44
Internet Sites
When advertising on an Internet site, the name of the brokerage firm must appear adjacent to or immediately above or below the point of contact information. Point of Contact info refers to any means by which to contact the brokerage firm or individual licensee, including mailing address, street address, email, telephone, fax. page 45
Fair Housing Act*
Under the Fair Housing Act, the protected classes are race, color, religion, sex, handicap, familial status, and national origin. Page 46, be familiar with each.
Housing for older persons
Certain housing for older persons is exempt from the familial status protection under the Fair Housing Act, provided that: All units are occupied by persons 62 years of age or older; or, At least 80 percent of the units are occupied by one or more persons 55 years of age or older and housing policies are published and followed that demonstrate an intent to be housing for persons 55 and older. page 47.
Fair Housing Poster
The fair Housing Act requires the use of an equal opportunity poster. The poster features the equal housing logo and a statement pledging adherence to Fair Housing Act. The poster must be displayed at real estate brokerage offices and other businesses involved in housing. Page 47.
Advertising
All advertisements of real property must be accurate representations of the property. Truth advertising is serious business. Page 47.
*Rental Information Lists
Advertising rental property information or lists that are not current or are materially inaccurate is illegal. Any person who violates the requirements outlined above is guilty of a misdemeanor of the first degree, is subject to a fine of up to $1,000 and or imprisonment of up to one year, and is subject to license suspension or revocation. Page 49.
Telephone Solicitation
The federal law covers both interstate and intrastate telemarketing calls. Violators of the Federal law may be fined up to $11,000 for each illegal call. Violators of Florida’s Telemarketing Act my be fined $10,000 per call.
Telephone Solicitation
The FCC recently ruled that under the federal law, real estate licensee may not call for sale by owners and homeowners with expired listings to solicit for listings if the owners name are listed on the National Do Not Call Registry, even if the homeowners # appears on a yard sign or newspaper. page 50.
Fax Solicitations
FCC rules mandate that it is unlawful to send unsolicited advertisements to residential or business fax machine without the recipients prior express invitations or permission. Read 4 requirements on Page 51.
