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Vinod Unit5 Class > Unit 5- Real Estate Brokerage Activities And Procedures > Flashcards

Unit 5- Real Estate Brokerage Activities And Procedures Flashcards

1
Q

May a broker work out of their residence?

A

Yes. Provided the REQUIRED sign is displayed properly

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2
Q

Are SALES ASSOCIATES permitted to open their own office?

A

No. They must be registered under and work out of their employing brokers office.

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3
Q

Are Branch Office Registrations transferable?

A

No.

A broker may RE-OPEN a branch office in the same location during the SAME LICENSE PERIOD by requesting a RE-ISSUE of the branch office license w/out paying additional fee.

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4
Q

What are Temporary Shelters and must they be registered with the DBPR?

A

It is a temporary office or shelter in a subdivision being sold by a BROKER intended only for the protection of the customers and sales associates.

It must be registered with the DBPR ONLY if sales associates are permanently assigned there and transactions are CLOSED there.

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5
Q

What must an OFFICE SIGN include?

A

The Trade name
The Brokers Name
The words “licensed real estate broker” OR “Lic. Real Estate Broker”

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6
Q

Must a sign include the name of sales/broker associates?

A

NO

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7
Q

May associates advertise in their own name?

A

No… It is brokers responsibility.

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8
Q

What may be categorized as advertising?

A

LetterHead, stationary, flyers, business cards, yard signs, billboards, magazine ads, Internet ads, radio and TV, etc…

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9
Q

May licensees use a nickname if included on any advertising?

A

Yes, BUT they must also provide their legal name as registered with the DBPR

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10
Q

Are address and phone number required on Advertising?

A

No. The exception is Internet advertising.

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11
Q

What is it called when through advertising, a licensee misleads the public into believing the offer is being made by a private individual and not a RE Licensee?

A

BLIND ADVERTISING

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12
Q

The publication of false or misleading advertising by means of radio, TV or written matter for the purpose of inducing someone to buy, lease, rent or acquire an interest in title to real property is an illegal act known as?

A

FALSE ADVERTISING

It is a 2nd Degree Misdemeanor

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13
Q

Describe the requirements for advertising as it pertains to INTERNET SITES.

A

Name of the brokerage firm MUST APPEAR adjacent to or immediately above or below the point of contact info. (email, fax, mail, phone)

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14
Q

What is the penalty for the unauthorized use, by a licensee, of an association name?

A

$300

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15
Q

Who may call themselves Realtors?

A

Only current, ACTIVE, licensed members of the NAR(National Assoc of Realtors)

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16
Q

May a licensee place their own ad to sell their property?

A

Yes, but they should disclose that they are a RE Licensee and this disclosure should be documented in the sale contract as mandated in the NAR STANDARDS OF PRACTICE.

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17
Q

What is the penalty for violation of

FLORIDA’S No solicitation calls registry?
FEDERAL DO NOT CALL REGISTRY?

A

Up to 10k PER CALL

Up to 11K per call?

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18
Q

What are the designated hours for telephone solicitation?

A

8a-9p

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19
Q

If a sales associate had an established business relationship with a customer on the DNC registry, may they contact those customers.

A

Yes.. For up to 18 months if a prior business relationship existed

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20
Q

Escrow Account

A

An account for the deposit of money , including cash, checks, money orders,)
that a disinterested third party (BROKER) holds in trust for others.

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21
Q

ESCROW DEPOSIT

AKA: good faith/binder deposit

A

The deposit included with an offer on REAL PROPERTY to show good faith that they are serious

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22
Q

What is the time frame for depositing Escrow funds?

A

Licensees or associates receiving a binder deposit must deliver that to their employer no later than the next business day.

Broker must DEPOSIT those funds by the end of the 3rd business day after receipt

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23
Q

May a sales associate deposit an escrow check made out to them?

A

No. It is suggested they request a new check made out to the BROKER. If not..

They must endorse over to their broker “for deposit only” and deliver those funds by the end of he next business day.

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24
Q

Are post dated checks acceptable for ESCROW? How are they handled by broker?

A

Yes, provided the buyer has sellers approval.

Broker must secure the check (in a safe) until date in check becomes current.

Broker is NOT RESPONSIBLE for non payment of funds in an escrow check provided those funds were deposited in a timely manner.

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25
Q

What are acceptable types of accounts and depositories for escrow funds??

A

May be placed in an interest or non-interest bearing a punt in a FL commercial bank, credit union, or savings association

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26
Q

Who is the SIGNATORY on all escrow accounts?

A

FREC MANDATES that the broker is signatory on all Brokerage Escrow Accounts

Broker is required to review, sign and date monthly bank reconciliations

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27
Q

What is the procedure for depositing escrow monies in a title company or attorney escrow account?

A
  • the LICENSEE must indicate on the purchase and sale agreement, the title company(or attorney’s) name, address and telephone number.
  • the licensees broker must request from the title company, WRITTEN VERIFICATION of receipt of the deposit and then provide that to the sellers broker within 10 BUSINESS DAYS
  • verification is waived if deposit is held by a title company or by an attorney nominated in writing by the seller or the seller’s agent.
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28
Q

Does the FREC govern the title company or attorney used as escrow agents?

A

No because the FREC governs RE License Law and therefore ONLY broker escrow accounts.

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29
Q

What are the requirements to place funds in an interest bearing escrow account?

A
  • Broker must get written permission from all parties

- authorization must specify who is entitled to the interest.

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30
Q

How long must a broker retain records?

A

5 Years

** if brokers records were subject to litigation or served as evidence for litigation, records MUST BE PRESERVED for 2 years beyond conclusion of civil action or appellate proceeding.

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31
Q

How much money may a broker place in a

SALES ESCROW ACCOUNT?

PROPERTY MANAGEMENT ESCROW ACCT?

A

Up to $1,000 of personal or brokerage funds in a sales escrow acct.

Up to $5,000 of their own monies in a property management escrow account.

** if a broker maintains both escrow funds in a single escrow account, the account cannot exceed $5,000.

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32
Q

What is the ILLEGAL practice of mixing escrow money with a broker’s personal or brokerage funds?

A

Commingling of funds.

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33
Q

What occurs when both buyer and seller make demands regarding the disbursement of escrowed property that are inconsistent and cannot be resolved?

A

CONFLICTING DEMANDS.

34
Q

How long does the broker have to notify the FREC (IN WRITING) of conflicting demands?

A

Within 15 business days of receiving the demand.

35
Q

How long after receiving a conflicting demand does a broker have to institute one of the 4 settlement (escape) procedures?

A

30 days to initiate however… The 15 business days to notify the FREC of the conflicting demand is part of the 30 day period.

I.e. If the broker waits 10 biz days to report the conflicting demand, they will have 20 biz days left.

36
Q

What are the four SETTLEMENT PROCEDURES for conflicting demands?

A

M-A-L-E

M-mediation
A-arbitration
L-litigation
E-escrow disbursement order (EDO)

37
Q

What is Arbitration

A

After prior written consent of parties, the dispute is submitted to a disinterested third party who will make a binding judgment based on each sides presentation.

38
Q

Explain the two COURT PROCEDURES involved in Litigation.

A

1- INTERPLEADER
IF BROKER HAD NO CLAIM TO FUNDS THEY CAN BE DELOSITED WITH COURT REGISTRY AND THR BROKER IS EXCUSED FROM THE CASE.

2- DECLARATORY JUDGMENT
BROKERS WHO BELIEVE THEY ARE ENTITLED TO PORTION OF DISPUTED FUNDS FIKE A COURT ACTION-A JUDGE DECIDES

39
Q

What is an Escro Disbursement Order or EDO?

A

A determination of who is entitled to disputed funds only if those funds were held in a broker Escrow Account.

The FREC REQUIRES NOTIFICATION WITHIN 10 BUSINESS DAYS if dispute is otherwise settled or if it goes to court before EDO is issued.

40
Q

What are the exemptions to the SETTLEMENT PROCEDURES?

A

1- brokers with earnest money deposits concerning HUD contracts

2-Buyer of real property in good faith fails to satisfy the terms of financing clause. Escrowed funds may be returned w/out notifying FREC.

41
Q

Does broker have obligation to report an escrow dispute if the title company or attorney are the escrow agents?

A

NO

42
Q

What reimbursement is the tenant entitled to if a rental is not obtained within 30 days?

A

75%

Payable within 30 Days

43
Q

What reimbursement is the tenant entitled to if information furnished to them is not current or accurate?

A

100%

Payable ON DEMAND

44
Q

What is a Rental Information List?

A

List of current and accurate properties furnished to prospective tenants

Sometimes furnished for a fee… If so… Reimbursement rules apply.

45
Q

How many days does a tenant have to demand repayment of money spent on information/lists?

A

30 Days from the day they contracted with the broker or the associate.

  • copy of this contract must be sent to the DBPR within 30 days of first use.
46
Q

What is the classification and penalty for disseminating inaccurate information?

A

1st degree misdemeanor

Fine up to 1K and 1yr imprisonment

47
Q

Price Fixing

A

When brokers CONSPIRE to set a commission rate.

48
Q

Who determines the commissions to be paid?

A

It is a rate negotiated and agreed to between Broker and buyer OR seller.

49
Q

May a LICENSEE share brokerage comissions with another party to the RE Transaction?

A

Yes. Provided full disclosure under CH 475 F.S.

50
Q

May a sales associate contract directly with a customer/client?

A

NO

51
Q

How are SALES ASSOCIATES commissioned?

A

Compensated by splitting commissions paid to the broker.

52
Q

May a sales associate operate independently?

A

No. Associates work as an agent for their employing broker

53
Q

How long does the BROKER have to compensate the associate

A

72 Hours regardless of whether funds are released.

54
Q

Antitrust Laws

A

Sherman Antitrust Act
Clayton Antitrust Act

Protect against price fixing.

55
Q

When brokers agree to split up competitive market areas among themselves and not compete in those areas, they are committing a PRIHIBITED ACT known as…

A

MARKET ALLOCATION

56
Q

May a broker place a lien on real property for non payment of commission?

A

Yes if they are expressly authorized to do so in a contractual agreement.

If not authorized to do so, the FREC is authorized to suspend or revoke a real estate license for unauthorized recording of a lis pendens that affects the title of OR encumbered, real property.

57
Q

What is the Commercial Real Estate SALES Comission Lien Act and who does it apply to?

A

Applies only to COMMERCIAL PROPERTY.

It is a lien against the owners net proceeds from the sale and DOES NOT apply to the commercial property.

Lien takes priority as if date of recording not to the date of the brokerage agreement.

58
Q

What is the Commercial Real Estate Leasing Comission Lien Act?

A

Gives broker lien rights for earned commissions associated with a brokerage agreement to LEASE commercial real estate.

59
Q

What is a kickback?

A

An unearned fr paid to a licensee associated with RE for NON-Real Estate services.

60
Q

What is RESPA and what does it do?

A

Real Estate Settlement Procedures Act.

Prohibits the payment of kickback associated with settlement(closing) service, title searches, title insurance, attorney services, surveys, credit reports, and appraisals.

61
Q

Is it unlawful for a licensee to lay an UNLICENSED person for performing real estate services?

A

Yes.

However, FL law provides that a PM firm or owner of an apartment complex may pay a “finders fee” of no more than $50 to an unlicensed person who is a tenant of the apartment complex for the referral of a prospect who becomes a tenant.

62
Q

How long does a sales associate have to notify the DBPR of a change of employer?

A

10 Days AFTER the change.

63
Q

Can an associate who changes emoloyers make copies of any records acquired while with old employed?

A

No. Everything belongs to the Broker.

64
Q

What businesses may register as a broker?

A 
Corporations
General Partnerships
Limited Oartnerships
LLC's
LLP's
Some Proprietorships
65
Q

What are the characteristics of a general partnership?

A

An association of two or more persons jointly conducting business

Each general partner is responsible for all debts incurred

Each general partner has the power to bind the other in transactions

Each entitled to share of profits

66
Q

What are the characteristics of a brokerage GENERAL PARTNERSHIP?

A

1- Must register with DBPR
2-1 partner must be a licensed and active broker
3-sales/broker associates may not be GP.
4-change in composition must be reported to DBPR
5-if only active broker resigns, dies, or is removed from office…have 14 calendar days to replace them.

** failure to appoint another active broker results in automatic cancellation of partnership registration and all licenses under are involuntarily in active

67
Q

What are the characteristics of a limited liability partnership (LLP)

A

1-protection from personal liability
2-Partners are not liable for obligations or liabilities of partnership arising from contract, errors, omissions, negligence, malpractice, or wrongful acts committed by another partner or employee, agent, or representative of that partnership.
3-Partners are liable for errors, omissions, negligence, malpractice, or wrongful acts committed by that partner or any person under that partners direct supervision and control

68
Q

What are the characteristics of corporations?

A

1-they are created by law
2-artificial person or legal entity
3-consists of one or more persons
4-must register with DBPR under a Corporation name
5-at least 1 officer/director must be licensed as active broker
6-Active/inactive FL brokers and unlicensed people may serve as officers of a real estate brokerage, but officers/directors who will deal with the public and perform services of real estate must be licensed/active
7-all officers/directors who aren’t licensed must be registered with the DBPR for identification
8-if only active broker dies or resigns-14 days to replace

69
Q

Who may not register as a broker?

A

Corporation Sole (i.e. church)

Joint Venture
temporary business
Two or more parties combine efforts to complete a single transaction or fixed number of transactions.

Business Trust
Created to engage in transactions regarding its own property.

Cooperative Association
Conduct COMMERCIAL business
Convey, sell or buy its own property.

70
Q

Must RE Brokers have an office and are there specific requirements for an office?

A

Yes! It must be an enclosed room in a building of stationary construction and it must be registered with the DBPR!

71
Q

What is a “trade name” and may they be used by sales/broker ASSOCIATES?

A

A business name other than the legal name of the person doing business.

Sales and broker associates MAY NOT use a trade name? They are permitted to form a professional corporation, LLC for tax purposes only!!!

72
Q

What is the role of a “Personal Assistant?”

A

Hired by the licensees to perform administrative tasks associated with real estate transactions.

Increase customer base and improve service.

73
Q

What are some of the duties an “unlicensed”personal assistant may perform?

A

Advertising, hand out flyers at open house, place a lawn sign.

They may not perform any services of Real Estate

74
Q

What is a “Breach of Trust?”

A

When a violation or omission of a legal or moral duty exists.

75
Q

The mixing of money or other personal property of the buyer or seller, with the broker’s own money or property

and/or…

The combining of escrow monies with personal or business funds are both examples of…

A

Commingling of funds (Comingle)

76
Q

What is conversion?

A

The ILLEGAL act of using earnest money funds for personal use

77
Q

The failure of a broker, while UNINTENTIONAL, to give ordinary, careful attention to their brokerage and not exercise reasonable control over their agents makes them guilty of…?

A

Culpable Negligence

78
Q

Fraud is defined as?

A

The INTENTIONAL deceit for the purpose of inducing another person to rely on that deceitful information to part with something of value or surrender a legal right.

79
Q

Misrepresentation

A

An untrue statement of fact.

I.e. Failure to indicate in a newspaper that a listed property is advertised by a real estate LICENSEE

80
Q

Moral Turpitude

A

Conduct contrary to honesty, good morals, justice OR accepted custom

I.e. Writing bad checks

Vinod Unit5 Class (1 decks)

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