Key Terms

Question 1

Absentee owner

Answer 1

A property holder who does not reside on the property and who usually relies on a property manager to supervise the investment.

Question 2

Appraisal

Answer 2

The process of developing and communicating an opinion of a property’s value based on supportable evidence and approved methods as of a certain date.

Question 2

Appraiser

Answer 2

One who is registered, licensed, or certified by the DBPR and provides an estimate of value.

Question 3

Broker’s price opinion (BPO)

Answer 3

A written opinion of the value of real property. Florida real estate licensees are allowed to prepare and charge for BPOs provide the BPO is not called an appraisal. Price opinions are often requested by relocation companies and lenders involved in short sales of distressed properties.

Question 4

Business broker

Answer 4

Real estate licensees who engage in the sale, purchase, or lease of businesses.

Question 5

Business opportunity

Answer 5

The real estate activity dealing in the sale, purchase, or lease of businesses.

Question 6

Community association manager (CAM)

Answer 6

A person who holds a CAM license to manage community associations of more than 10 units and associations with annual budgets in excess of $100,000.

Question 7

Comparative market analysis (CMA)

Answer 7

An informal estimate of market value performed by a real estate licensee for the seller to assist in arriving at an appropriate listing price, or if working with the buyer, an informal estimate of market value to assist the buyer in arriving at an appropriate offering price.

Question 9

Abandonment

Answer 9

A surrender of rights; point when a broker makes no effort to service or sell listed property; failure to perform.

Question 10

Abstract of title

Answer 10

Condensed history of title to real property consisting of a summary of the links of “chain of title” extracted from documents bearing on the title status

Question 11

Acceleration clause

Answer 11

Stipulation in a mortgage that the entire unpaid balance of the debt may become due and payable if a default of expressed conditions should occur.

Question 12

Acceptance

Answer 12

Voluntary receipt of an item offered by another.

Question 13

Accretion

Answer 13

Gradual addition of land caused by natural forces, such as wind, tide, flood, or watercourse deposits.

Question 14

Acknowledgment

Answer 14

Formal declaration before an authorized official, by the person who executed the instrument, that it is a free act.

Question 15

Acre

Answer 15

43,560 square feet

Question 16

Active license

Answer 16

A current, valid license registered with the DBPR. The status required to actively engage in the real estate business.

Question 17

Actual notice

Answer 17

Information a person has actually learned by reading, seeing, or hearing.

Question 18

Ad valorem

Answer 18

According to the value; in proportion to worth.

Question 19

Adjustable-rate mortgage (ARM)

Answer 19

A financing technique in which the lender can raise or lower the interest rate according to a set index.

Question 20

Adjusted basis

Answer 20

The owner’s original cost plus buying expenses plus capital improvements.

Question 21

Administrative law

Answer 21

The body of law created by administrative agencies in the form of rules, regulations, orders, and decisions.

Question 22

Administrative law judge

Answer 22

An attorney employed by the Devision of Administrative Hearings, Department of Administration, to hear complaint and issue recommended orders.

Question 30

Point of contact information

Answer 30

Any means by which to contact the brokerage firm or individual licensee, including mailing address(es), physical street address(es), email address(es), telephone number(s), or facsimile telephone number(a).

Question 31

Advance fee

Answer 31

A commission or partial compensation received by a broker before completing the real estate service.

Question 32

Adverse interest

Answer 32

A purpose in opposition to the interest of another party (as, for example, with a buyer and a seller)

Question 33

Adverse possession

Answer 33

A method of obtaining title to real property by occupying it in an open hostile manner contrary to the interests of the owner.

Question 34

Affidavit

Answer 34

A sworn statement written down before a notary or public official.

Question 35

Affiliated business relationship

Answer 35

An arrangement in which (a) a person who is in a position to refer business incident to or a part of a real estate settlement service involving a federally related mortgage loan, or an associate of such person, has either an affiliate relationship with or a direct or beneficial ownership interest of more than 1% in a provider of settlement services; and (b) either of such persons directly or indirectly refers such business to that provider or affirmatively influences the selection of that provider.

Question 36

Agency

Answer 36

Express or implied authorization for one person to act for another.

Question 37

Agent

Answer 37

A representative; one who is authorized to act on behalf of another.

Question 38

Air rights

Answer 38

The freedom to use the open space above a property.

Question 39

Alienation

Answer 39

The act of transferring ownership, title, or an interest or estate in real property.

Question 40

Alluvion (Alluvium)

Answer 40

The increase of land by the gradual and imperceptible action of natural forces (e.g., deposits of sand and mud on a riverbank).

Question 41

Amortized mortgage

Answer 41

A loan characterized by payment of a debt by regular installment payments.