Chapter 5: Real Estate Brokerage Activities and Procedures

Question 1

Principal Office Requirements

Each active broker is required to open and maintain an office, which must be registered with the DBPR. What must the office consist of?

Answer 1

At least one enclosed room in a building of stationary construction where negotiations and closing can be conducted w/privacy

Question 2

Principal Office Requirements

True of False

A principal office registration is not transferable to a new location for the remainder of the current registration period.

Answer 2

False

A principal office registration IS transferable to a new location for the remainder of the current registration period.

Question 3

Branch Office Requirements

If a broker closes a branch office, can the registration of the branch office be transferred?

Answer 3

No

Question 4

Branch Office Requirements

If a branch office is closed and then later reopened in the same location during the same 2-year license period, a __________ of the license may be requested without having to pay an additional fee.

Answer 4

Reissue

Question 5

Office Signs

Where is a broker required to have a sign?

Answer 5

On or about the entrance of the office and all branch offices where it can be easily seen and read

Question 6

Office Signs

What must the sign of a broker operating as a sole proprietorship contain?

Answer 6

The broker’s trade name, if any, the name of the broker, and the words “Licensed (or Lic.) Real Estate Broker”

Question 7

Advertising

How must all legal advertising be?

Answer 7

In the name and under the supervision of the broker. It must be done in a manner that a reasonable person knows they’re dealing w/a real estate licensee. Ads must include registered name or trade name of the brokerage firm

Question 8

Internet Advertising

Where should the brokerage firm’s name or trade name be placed on internet ads?

Answer 8

Adjacent to, immediately above, or below the point of contact information.

Point of contact includes broker’s mailing address, phone number, fax number, or e-mail address

Question 9

Personal Transactions

Licensees should make known their status as a licensee to members of the public. When should this disclosure take place?

Answer 9

Prior to entering into serious negotiations

The disclosure should also be in writ my in Purchase and Sale Contract

Question 10

Earnest Money Deposits

Default by a buyer requires the deposit to be forfeited in favor of the seller to compensate for removing property from the market. What is the forfeiture called?

Answer 10

Liquidated damages

Question 11

Earnest Money Deposits

What are postdated checks offerred by the buyer considered and what must the sales associate/broker associate get before accepting one?

Answer 11

Postdated checks are considered promissory notes.

The agent must get sellers approval before accepting a postdated check

Question 12

Earnest Money Deposits

When a deposit is placed with a title company or attorney what must the licensee who prepared the contract indicate on that contract?

Answer 12

Name, address, and telephone number of title company or attorney with whom it was placed

Question 13

Earnest Money Deposits

Within ___ days after each deposit is due under a sales contract, the licensee’s __________ must make a written request to the title company or attorney to provide written verification of receipt of deposit.

Answer 13

10, broker

Question 14

Escrow Account

Where may an escrow account or trust account be held?

Answer 14

Commercial bank, Title company that has trust powers, Credit union, Savings and loan association in Florida

Question 15

Escrow Account

Where can’t an escrow account be held?

Answer 15

A stock and brokerage house

Question 16

Escrow Account

True or False

A broker may commingle or deposit personal money of any person with any money held in escrow, trust, or on condition.

Answer 16

False

A broker IS NOT ALLOWED to commingle or deposit personal money of any person with any money held in escrow, trust, or on condition

Question 17

Escrow Account

Under what circumstances may escrow funds entrusted to a broker be placed in an interest bearing account.

Answer 17

Escrow funds entrusted to a broker may be placed in an interest bearing account with the written approval of all interested parties, and with agreement as to who shall receive the interest earned.

Question 18

Escrow Account

How much personal or business money is a broker authorized to keep in a sales escrow account for the purpose of opening the account, keeping it opened, and paying ordinary service charges?

Answer 18

$1,000

Question 19

Escrow Account

How much personal or business money is a broker authorized to keep in a property management escrow account for the purpose of opening the account, keeping it opened, and paying ordinary service charges?

Answer 19

$5,000

Question 20

Escrow Funds

The misuse, commingling or intermingling of, or failure to account for money or property entrusted to a licensee is known as which form of fraud?

Answer 20

Conversion

Question 21

Depositing Escrow Funds

When must a sales associate or broker associate who recieves an earnest money deposit on behalf of his employer deliver the deposit to the employer?

Answer 21

No later than the end of the next business day following receipt

Saturdays, Sunday, and legal holidays are not considered business days

Question 22

Depositing Escrow Funds

When must a broker place earnest money deposits in an escrow or trust account?

Answer 22

Immediately; defined as “no later than the end of the third business day following receipt.”

Question 23

Escrow Disputes

What should a broker do if he has conflicting demands for escrowed property, or if he has good faith doubt as to which person is entitled to the property held in escrow?

Answer 23

The broker must give written notice to FREC (the Commission) within 15 days from the date of the last person’s demand for the property

Question 24

Escrow Disputes

How many days does the broker have to institute an authorized settlement procedure to resolve an escrow dispute?

Answer 24

30 business days from the last person’s request for the property

Question 25

Escrow Disputes

What are the authorized settlement procedures

Answer 25

Mediation

Arbitration

Litigation

Escrow Disbursement Order

Question 26

Escrow Disputes

Of the authorized settlement disputes for money held in escrow which would cause the broker to file a bill of interpleader and why?

Answer 26

Litigation

The broker may file a bill of interpleader if he/she does not claim any right to the deposit

Question 27

Escrow Disputes

Of the authorized settlement disputes for money held in escrow which would require the parties to agree to allow a third party to help in reaching an agreement but whose desicion is not final and binding?

Answer 27

Mediation

Question 28

Escrow Disputes

Of the authorized settlement disputes for money held in escrow which would require the parties to agree in advance by contract to abide by a third party’s decision?

Answer 28

Arbitration

Question 29

Escrow Disputes

Of the authorized settlement disputes for money held in escrow which would require the broker to request the Commission to determine the party entitled to the money in escrow?

Answer 29

Escrow Disbursement Order

Question 30

Rental Information

If a licensee provides a prospective tenant with rental information pertaining to potential rental properties for a fee, under what circumstances could the prospective tenant receive money back?

Answer 30

(1) If the tenant applicant did not like any of the rental properties available or (2) the tenant applicant was misled or deceived regarding terms or availability of property offered

Question 31

Rental Information

How much of their fee is a tenant applicant entitled to if they did not like or did not accept what was offered?

Answer 31

75%

Question 32

Rental Information

How much of their fee is a tenant applicant entitled to if the broker materially misrepresented what was offered?

Answer 32

100%

Question 33

Rental Information

How long does a tenant applicant have to request a return on any fees paid to a licensee?

Answer 33

Within 30 days of the contract date

Question 34

Rental Information

What level of crime is rental information violations considered and what punishment can be levied?

1/1/1,000

Answer 34

1st degree misdemeanor

Punishable by up to 1 year imprisonment and/or a fine up to $1,000

In addition a licensee is subject to disciplinary action by FREC

Question 35

Compensation

Upon who may a sales associate who is not compensated as agreed upon by his/her employer file suit?

Answer 35

ONLY that employer

Question 36

Change of Employer or Address

A sales associate or broker associate must report any change of employer to the __________ within ___ days.

Answer 36

Commission, 10

Question 37

Change of Employer or Address

A sales associate or broker associate must report a change of mailing address to the _________ with ___ days.

Answer 37

DBPR, 10

Question 38

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

Answer 38

60