Chapter 5

Question 1

All brokers must have a

Answer 1

primary office

Question 2

A sales associate or broker associate

Answer 2

may not have an independent office of his own.

Question 3

The broker’s office

Answer 3

must have an entrance sign located on the door of, or adjacent to the front entry.

Question 4

Whenever a broker wishes to conduct business in more than one location

Answer 4

Each office must be registered with DBPR (Department of Business and Professional Regulations) and the appropriate fee/s paid

Question 5

The branch office

Answer 5

must have an entrance sign located on the door of, or adjacent to the front entry.

Question 6

If the home office is used in connection with a trade or business

Answer 6

and there is no other business location, deductions may be allowed.

Question 7

Every office entry must have a sign located on the front entry door

Answer 7

The sign must contain the NAME of the BROKER who is registered as the broker of record for that office

Question 8

Blind ads are illegal and they are

Answer 8

real estate advertisement by a licensee that show only a post office box number or telephone number or other vague information so that the public does not know that it is a licensee.

Question 9

Conversion

Answer 9

means taking money that should be held in escrow for the parties and using the money for the broker’s own needs (such as operating money). This is an illegal act.

Question 10

Commingling is

Answer 10

To mix personal and public money is illegal under Florida law

Question 11

When a broker receives money

Answer 11

to be deposited in an escrow account, he must deposit it immediately within three business days. (Holidays and weekends are excluded)

Question 12

A broker may maintain more than one escrow account and maintain

Answer 12

maintain up to $1000 of his own money in each sales escrow account or up to $5,000 in a property management account.

Question 13

The broker must reconcile the accounts

Answer 13

no more than 30 days from the date of the last reconciliation was performed or should have been performed. This requirement cannot be delegated to any other person.

Question 14

Broker must

Answer 14

1. Have permission from all parties to have escrow in an interest bearing account
2. Keep careful, exact records of the money in trust accounts.
3. Keep records available to the DBPR or its authorized representatives during regular business hours.
4. Provide once a month, a written statement comparing the broker’s total liability with the reconciled bank balances of all trust accounts

Question 15

If there is an escrow dispute

Answer 15

It is the responsibility of the broker to then notify the FREC within 15 business days from the last party’s demand

Question 16

There are three exceptions to having to communicate an escrow dispute to the FREC

Answer 16

1. f it is a property utilizing HUD
2. if the buyer of a condominium unit delivers written notice to cancel as provided under the Condominium Act
3. if the buyer is unable to satisfy a financing contingency within the time frame as provided by the contract

Question 17

After reporting to the FREC, the broker has 30 days from the last party’s demand to implement one of the procedures set up for escrow disputes

Answer 17

1. Escrow Disbursement Order,
2. Mediation,
3. Arbitration,
4. Litigation.

Question 18

After the broker notifies the FREC of the escrow dispute problem

Answer 18

1. An Escrow Disbursement Order - Once the EDO is requested, the broker must follow the instructions of the FREC
2. Mediation - If the issue is not solved within 90 days, the licensee must use the other types of dispute procedures.
3. If the buyer and seller cannot agree, the issue is submitted to arbitration and a third party (arbitrator) makes a decision for one party or the other.
4. is simply a law suit, asking the courts through a process called Interpleader to determine the rightful owner of the disputed escrow

Question 19

Once the escrow dispute is settled

Answer 19

The broker must notify the FREC within 10 days that the dispute is over.

Question 20

When a broker provides a rental list

Answer 20

the FREC requires that the broker give the tenant a contract

Question 21

The FREC requires that the broker gives the tenant a contract that

Answer 21

1. Request a refund of 75% of the fee (if requested within 30 days) if the tenant does not find a rental; and
2. Request a refund of 100% of the full fee (if requested within 30 days) if the information is inaccurate.

Question 22

The penalty for advertising obsolete or otherwise inaccurate rental lists

Answer 22

is a fine up to $1,000 and/or up to one year in prison

Question 23

Puffing is

Answer 23

If the write up on the property provides information that is a subjective opinion or inflates a listing

Question 24

The Sales Associate never

Answer 24

accept direct payment from a Principal or customer; the sales associate receives payment only from the employing broker

Question 25

The Sherman AntiTrust Act

Answer 25

affects Brokers

Forbids price fixing

Question 26

Brokers can receive kickbacks under special circumstances which are

Answer 26

all parties know about the kickback
the kickback is not prohibited by another law
the kickback can be shared with a non-licensed seller or buyer with lender approval

Question 27

When a current broker changes employer,

Answer 27

he must notify the FREC within 10 days on the current form prescribed by the DBPR

Question 28

When the Sales Associate changes address

Answer 28

he or she must notify the FREC within 10 business days

Question 29

A general partnership is

Answer 29

one formed by more than one broker
one where all brokers can be liable for partnership debt
at least one partner must be the active broker
the active broker is the one dealing with the public

Question 30

If the primary or active broker dies,

Answer 30

that broker must be replaced within `14 days, otherwise, all licenses associated with the partnership become inactive

Question 31

A general partnership is dissolved by

Answer 31

agreement of the partners
death of one of the partners
court action
bankruptcy of one of the partners
bankruptcy of the partnership

Question 32

Type of businesses that may register

Answer 32

Limited Liability Partnership

Limited Liability Company

Question 33

Trade Name

Answer 33

No individual, partnership or corporation may be registered under more than one trade name.

Question 34

A Sales Associate

Answer 34

1. May not use a trade name or fictitious name at any time.
2. They must register and operate under their true name only.

Question 35

The following cannot be registered as real estate brokerage

Answer 35

A Corporation Sole- church organization, but not a non-profit

A joint venture-temporary relationship

A Business Trust-investment group for its own purposes

A Cooperative/Condominium/Homeowners’ Association

An Unincorporated Association- local property owners, not partners

An Ostensible (Quasi) Partnership - hidden relationship

An ostensible partnership may be formed without the knowledge of a real estate broker.