Gold Coast RE 1001 Cram, Practice Math and Final Exam
60. In which federally designated floodplain is elevated construction mandatory for residential properties? a. "V" zone b. "B" zone c. "X" zone d. "A" zone
A. "V" zone
996. Brown owns an apartment complex with 24 units that produce a net monthly rent of $8,500. This $8,500 per month represents a 9.5% annual return to the owner. What did Brown pay for the building? a. $1,073,684 b. $1,048,325 c. $89,474 d. $9,690
A. $1,073,684
462. What would the value of a homestead exemption be for a property assessed at $285,000, if the city tax rate is 9 mills, the county rate is 8 mills and the school board rate is 10 mills? a. $1,100 b. $560 c. $480 d. This question cannot be answered as the school board rate exceeds the cap.
A. $1,100
445. A building cost $55 per square foot to build today, but cost $45 per square foot to build when it was new 10 years ago. It was kept in good condition and appears to be only 7 years old. It contains 3,000 square feet. The lot measures 100 feet by 120 feet and comparable sites are selling for $3.10 per square foot. Site improvements are valued at $4,000. Using a 35-year useful life, estimate the value of the property. a. $173,200 b. $159,057 c. $149,200 d. $137,629
A. $173,200.
991. A commercial building is 15% vacant but still has 85,000 square feet rented out. The municipality has taxed the owner of the property at a rate $.20 per square foot under the roof. What are the annual taxes on the property? a. $20,000 b. $17,000 c. $3,000 d. $2,550
A. $20,000
425. What is the maximum interest rate on a tax certificate? a. 18% b. 10% c. 9% d. 5%
A. 18%
790. The tax is excluded on the capital gain from the sale of a personal residence if it was the principal residence for at least how long? a. 24 months b. 12 months c. 18 months d. 36 months
A. 24 months
399. Residential investment property is depreciated over a useful life of how many years? a. 27.5 years b. 31.5 years c. 39 years d. 17.5 years
A. 27.5 years
506. What is the expected result when the banks stock up their reserves? a. A tight money market b. An easy money market c. Prepayment of loans d. Easier financing
A. A tight money market
976. Which mortgage clause would allow the mortgagee to call the note due in the event of a default by the mortgagor? a. Acceleration clause b. Prepayment clause c. Defeasance clause d. Subordination clause
A. Acceleration clause
824. A licensee is suspended for 3 years. After the 3 years have passed, their license will be active: a. After all penalties and conditions have been fulfilled b. After they pass the state exam c. After they attend a continuing education course and pass the state exam d. And it will automatically be renewed
A. After all penalties and conditions have been fulfilled
910. Five individuals form a limited partnership with three of them acting as limited partners. The partnership purchases a 100-acre tract and subdivides it into 1-, 2-, and 5-acre tracts. Mr. Ray brings the partnership a prospective purchaser, who offers to buy a 2-acre lot for $10,000. The sale is completed, and Mr. Ray receives a 5% commission. Which is correct? a. As long as Mr. Ray is a real estate licensee with a current and active license, there is no violation of the law. b. All of the partners must be active brokers. c. All of the general partners must be either brokers or sales associates. d. All of the partners must be brokers, and one of the general partners must be active.
A. As long as Mr. Ray is a real estate licensee with a current and active license, there is no violation of the law
321. An owner wants to build a 15-foot deck on the side of a house. There is a 10-foot setback requirement. If he builds the deck, there would be only 5 feet left over. What can the owner do? a. Ask for a variance b. Request a special exception or special use c. Build the deck under a nonconforming use d. Send the plans to the building department for approval
A. Ask for a variance
889. Broker Jones was convicted of embezzlement of funds from an employer and was sentenced to 5 years in the state penitentiary. Since broker Jones returned all of the embezzled funds, the sentence was withdrawn. Which is most correct? a. Broker Jones's license may be suspended since the DBPR is really not concerned with whether or not his sentence was withdrawn. b. Broker Jones can continue to work as a broker and hasn't done anything that would affect a license. c. Broker Jones's license will be automatically revoked. d. Since broker Jones's sentence was withdrawn, the DBPR will not feel that anything was done wrong and will feel no need to suspend his license.
A. Broker Jones's license may be suspended since the DBPR is really not concerned with whether or not his sentence was withdrawn
27. What municipal ordinances specify the standards for altering, remodeling, and new construction? a. Building codes b. Zoning codes c. Subdivision requirements d. Health codes
A. Building codes
915. How would a new mortgage appear on the closing statement? a. Credit to the buyer b. Debit to the buyer c. Credit to the seller d. Debit to the seller
A. Credit to the buyer
466. How is an existing mortgage that is being retired at closing shown on a closing statement? a. Debit to seller b. Debit to buyer c. Credit to seller d. Prorated between the buyer and seller
A. Debit to seller
717. Which homeowner's right can keep someone off of their property? a. Exclusion b. Use c. Reduction d. Trespass
A. Exclusion
415. The following are exempt or immune from property taxes, EXCEPT: a. Farmland b. Nonprofit hospitals c. Libraries d. Churches
A. Farmland
820. Which of the following is a characteristic of the real estate market? a. Heterogeneous b. Reacts very quickly to changes c. Mobile d. Homogeneous
A. Heterogeneous
235. Which is the best definition for "escrow?" a. Holding something for someone else in trust b. Uncollected funds held as earnest money c. The broker's claim on earnest money d. Something of value held by an "interested" third party
A. Holding something for someone else in trust
354. Which mortgage provides an interest only loan? a. Term mortgage b. Amortized mortgage c. Reverse mortgage d. Home equity loan
A. Term mortgage
345. Which loan does NOT require a down payment? a. VA guaranteed b. Conventional c. FHA insured d. Adjustable rate mortgage
A. VA guaranteed
89. Which item is an essential element of a sales contract? a. An offer and acceptance b. Witnesses c. A notary seal d. An earnest money deposit
A. an offer and acceptance
916. How is 20 mills written? a. .002 b. .020 c. .0020 d. .200
B .020
697. A buyer purchases a home for $60,000. He obtains an 80% conventional loan at 8.5% interest, with a 2.5% loan origination fee. How much is the origination fee? a. $480 b. $1,200 c. $1,500 d. $4,080
B. $1,200
891. Four apartment houses recently sold with the following statistics: Sales Price Annual Gross Income $1,200,000 $171,400 $1,520,400 $202,720 $1,244,000 $191,380 $1,748,800 $218,600 The subject property has a gross income of $169,000. What is the subject property worth? a. $1,218,000 b. $1,225,250 c. $1,428,300 d. $2,344,900
B. $1,225,250
892. A four-unit apartment building is valued at $150,000, with $30,000 in expenses and no vacancies. The owner requires a 20% return. What is the monthly rent per unit? a. $1,000 b. $1,250 c. $1,500 d. $1,750
B. $1,250
792. A broker offers a tenant 1,450 square feet of office space at $10.50 per square feet. Calculate the monthly rent. a. $1,050.25 b. $1,268.75 c. $1,450.00 d. $1,470.50
B. $1,268.75
92. County taxes are 6 mills, city taxes are 8 mills, and school board taxes are 7 mills. If homestead property is assessed at $110,000, what are the annual taxes? a. $1,316 b. $1,435 c. $1,880 d. $2,310
B. $1,435
459. A house is purchased for $175,000. The buyer will assume the existing first mortgage with a balance of $110,512, and the seller will take back a purchase money second mortgage for $21,500. Calculate the total state documentary stamp taxes that will be charged in this transaction. a. $1,730.04 b. $1,730.35 c. $1,951.06 d. $1,951.37
B. $1,730.35
886. What is the annual amount charged to a sales associate, in addition to a renewal fee, if the amount in the recovery fund drops below $500,000? a. $2.00 b. $1.50 c. $3.00 d. $3.50
B. $1.50
435. A developer sells two lots that are each 60 feet by 100 feet for $20 per square foot each. On the first lot, she makes a 20% profit. On the second lot, she suffers a 20% loss. Calculate her net profit or loss a. $5,000 b. $10,000 c. $15,000 d. $0, she broke even.
B. $10,000
797. A property owner told a broker that he would list his home if a net of $120,000 could be received from the sale. If the broker's commission is 6% and closing costs are estimated to be $2,200, what should the listing price be? a. $122,200 b. $130,000 c. $127,200 d. $129,532
B. $130,000
168. An investment property has a potential gross income of $300,000, a vacancy rate of 5% and operating expenses including $13,000 of reserves for replacement totaling $140,000. What is the net operating income? a. $132,000 b. $145,000 c. $155,000 d. $160,000
B. $145,000
446. A 5-year-old building has a reproduction cost of $100,000. The building requires a new roof, which will cost $4,000. Estimate the accrued depreciation based on a 25-year useful life. a. $29,000 b. $23,200 c. $19,200 d. $4,000
B. $23,200
593. How many acres does a parcel of land measuring 330 feet by 660 feet contain? a. 3 b. 5 c.7 d. 9
B. 5
5. A judgment is awarded against a licensee for $100,000. What is the maximum the complainant may be compensated from the Real Estate Recovery Fund? a. 25% b. 50% c. 75% d. 100%
B. 50%
8. An investor purchased a property for $350,000. The investor made a cash down payment of $150,000 and obtained a mortgage of $200,000. The effective gross income for the property is $67,000 and the operating expenses are $25,000. What is the loan to value ratio? a. 42.86% b. 57.14% c. 19.14% d. 7.14%
B. 57.14%
226. When moving from one branch office to another, what must a broker do? a. Send in the old branch office registration with a request for transfer b. Apply for and obtain a new registration for the new branch and pay the proper fee c. Change the address on his branch office registration certificate d. Be at least 5 miles from the main office
B. Apply for and obtain a new registration for the new branch and pay the proper fee
617. What are real estate taxes are based upon? a. Market value b. Assessed value c. Appraised value d. Salvage value
B. Assessed value
834. To be eligible to receive VA mortgage benefits, how long must a veteran who was in the military in 1977 have served? a. Not more than 180 days b. At least 181 days c. Not more than 160 days d. At least 160 days
B. At least 181 days
150. Which financial statement shows the status of a business as of a specific date? a. Income statement b. Balance sheet c. Profit and loss statement d. IRS Form 1040
B. Balance sheet
353. What type of loan covers several parcels of land? a. Package mortgage b. Blanket mortgage c. Balloon mortgage d. Purchase money mortgage
B. Blanket mortgage.
826. Recording a mortgage is which form of notice? a. Actual b. Constructive c. Legal d. Lien
B. Constructive
252. A licensee becomes a convicted felon serving a prison term. The Commission: a. Would probably suspend the license for the length of the term b. Could revoke the license c. Will revoke the license d. Will suspend the license
B. Could revoke the license
46. When a seller takes back a second mortgage, how is it entered on a closing statement? a. Credit to the seller b. Debit to the seller c. Debit to the buyer d. Credit to the broker
B. Debit to the seller
51. When the mortgagor fulfills all obligations under the note, what clause protects his rights to the property? a. Cognovit b. Defeasance c. Subordination d. Condemnation
B. Defeasance
786. When the mortgagor fulfills all his obligations under the note, what clause protects his rights to the property? a. Cognovit clause b. Defeasance clause c. Subordination clause d. Condemnation clause
B. Defeasance clause
124. The present value of a future cash flow is the basis for which appraisal technique? a. Cost depreciation b. Direct capitalization c. Market data d. Comparable sales
B. Direct capitalization
803. What is the likely result if the federal government starts selling T-bills? a. Intermediation b. Disintermediation c. Loanable funds to increase d. Interest rates to decline
B. Disintermediation
363. Savings associations look to what agency to sell their mortgages? a. FDIC b. Freddie Mac c. RTC d. FHA
B. Freddie Mac
430. Which statement applies to the real estate market? a. It is organized centrally. b. It cannot be allowed to operate free of controls. c. It must be allowed to operate free of controls. d. It responds rapidly to changes in supply and demand.
B. It cannot be allowed to operate free of controls
623. What must be included in real estate ads and on signs? a. Name of the sales associate b. Name of the brokerage firm c. Name of the seller d. Office phone number
B. Name of the brokerage firm
683. Which business structure makes all principals responsible for any debts incurred in the name of the entity? a. Corporation b. Partnership c. Limited partnership d. Joint venture
B. Partnership
403. What section is immediately due west of Section 18? a. Section 17 b. Section 13 c. Section 19 d. Section 20
B. Section 13
338. All of the following are required for a valid mortgage, EXCEPT: a. The legal description of the property b. Signature of the mortgagee c. Signature of the mortgagor d. It be in writing
B. Signature of the mortgagee
970. With which type of mortgage could negative amortization occur due to payment caps? a. purchase money mortgages b. adjustable rate mortgages c. blanket mortgages d. reverse mortgages
B. adjustable rate mortgages
117. How would an escrow deposit typically appear on a closing statement? a. Credit to seller b. Debit to seller c. Credit to buyer d. Debit to buyer
C Credit to buyer
340. Under what circumstance is personal property included in the purchase of a home as additional security for the loan? a. As an optional extra feature b. As an additional down payment c. As part of a package mortgage d. Never
C. As part of a package mortgage
38. Depreciation or obsolescence that results from ordinary wear and tear is called which of the following? a. Straight-line depreciation b. External obsolescence c. Physical depreciation d. Functional obsolescence
C. Physical depreciation
924. Which entity enforces deed restrictions? a. The planning commission b. The DBPR c. Private owners d. The FREC
C. Private owners
654. A Florida real estate licensee is permitted to draw up which of the following items? a. Deeds b. Purchase money mortgages c. Sales contracts and the approved fill-in the-blank residential lease d. Promissory notes
C. Sales contracts and the approved fill-inthe-blank residential lease
479. Builder Paul obtained a mortgage to develop lots in a new subdivision, with a release clause allowing the sale of each lot for $10,000. Broker Sally locates a buyer for one of the lots for $9,000, which Paul agrees to accept. Without disclosing the terms of the mortgage to the buyer, Sally sells the lot. Based on this information, which statement is correct? a. Paul must pay $1,000 to the bank at closing. b. Sally must make up the difference. c. Sally has committed fraud. d. Paul and Sally have formed a conspiracy.
C. Sally has committed fraud
349. All of the following loans can be first liens, EXCEPT: a. First mortgage b. Home equity loan c. Second mortgage d. Purchase money mortgage
C. Second mortgage
932. What could cause a fixture to be converted into personal property? a. Attachment b. Severalty c. Severance d. Accretion
C. Severance
114. Which characteristic applies to the note documentary stamp tax? a. Paid by the seller b. $.70 per $100 c. .002 of the loan amount d. $.35 per $100
D. $.35 per $100
418. Mr. Brown sold his home for $160,000; $10,000 was allocated for closing costs, leaving him with a net of $150,000. Seven years prior to the sale of his home, Mr. Brown purchased the home for $100,000, thereby realizing a profit of $50,000. Mr. Brown had lived in the home for 7 years. How much of the capital gain is taxable in the year of the sale? a. $15,000 b. $5,000 c. $1,000 d. $0
D. $0
595. Calculate the cost per square foot on a lot 40 feet by 60 yards selling for $21,780 per acre. a. $2.00 b. $1.00 c. $.58 d. $00.50
D. $00.50
166. Calculate the total state taxes due in the following transaction: The sales price is $249,480. The buyer will assume the seller's first mortgage of $190,000. The seller has agreed to take back a new purchase money second mortgage for $25,000 a. $1,796.50 b. $2,176.50 c. $2,461.50 d. $2,549.00
D. $2,549.00
130. Which term refers to the tangible and intangible resources of a business? a. Liabilities b. Net worth c. Owner's equity d. Assets
D. Assets
57. Real estate physically is what? a. Homogeneous b. Indestructible c. Intangible d. Immobile
D. Immobile
308. Which of the following is a characteristic of a parol contract? a. In writing b. Signed by two witnesses c. Covered by statue of frauds d. Oral
D. Oral
818. Able, Baker, and Charlie are officers in ABC Realty, Inc. Able and Baker are actively involved in brokerage, while Charlie attends only the quarterly meetings. What are the minimum requirements for Charlie? a. Sales associate b. Broker c. Active broker d. Registered
D. Registered
61. A property that borders a river or stream includes which rights? a. Allodial b. Alluvial c. Littoral d. Riparian
D. Riparian
34. The subject property has three bedrooms; the comparable property has four bedrooms. A bedroom is worth $5,000. What is the correct adjustment? a. Add $5,000 to the subject property b. Add $5,000 to the comparable property c. Subtract $5,000 from the subject property d. Subtract $5,000 from the comparable property
D. Subtract $5,000 from the comparable property
31. A broker may hold escrow deposits in any of the following, EXCEPT: a. A savings association b. A commercial bank c. A credit union d. A mutual fund
D. mutual fund
71. How is the right to occupy a cooperative evidenced? a. Tenancy in common b. Joint tenancy c. Deed d. Proprietary lease
D. proprietary lease
7. Which power authorizes the FREC to pass or revise rules? a. Ministerial powers b. Quasi-executive c. Quasi-judicial d. Quasi-legislative
D. quasi-legislative
273. A broker can legally show homes based upon which requests? a. Caucasian neighborhood b. African American neighborhood c. Hispanic community d. retirement community
D. retirement community
463. It costs the city $20 per foot to pave the road in front of a 100-foot lot. The city has agreed to pay for 30% of the cost. What would be the amount of the special assessment tax? a. $700 b. $1,000 c. $1,400 d. $2,000
A. $700
609. Which encumbrance might cloud a title? a. A judgment b. Zoning c. A right-of-way d. An easement
A. A judgment
531. An earnest money deposit can be placed in all of the following institutions, EXCEPT: a. A stock association b. A commercial bank c. A savings association d. A credit union
A. A stock association
928. What is the classification for economic activity that brings money into an area? a. Basic b. Secondary c. Service d. Dynamic
A. Basic
781. Which time period applies to an estate for years? a. It is for a fixed time period. b. It must be for at least 1 year. c. It must be for at least 2 years. d. It cannot be for more than 1 year
A. It is for a fixed time period
588. What instrument gives the broker authority to represent the seller in a real estate transaction? a. Listing agreement b. Buyer broker agreement c. Sales contract d. Agency disclosure
A. Listing agreement
587. All of the following are application requirements for obtaining a Florida real estate license, EXCEPT: a. Must be a Florida resident b. Must be a high school graduate or its equivalent c. Must be at least 18 years of age d. Must submit a completed application and fee payment
A. Must be a Florida resident
104. Where are the interest rate, payment, and other terms of a loan found? a. Note b. Lease c. Satisfaction d. Mortgage
A. Note
855. Which term refers to the substitution of a debtor or a creditor for another? a. Novation b. Subordination c. Defeasance d. Equity of redemption
A. Novation
704. Which of the following statements pertaining to VA and FHA loans is correct? a. The FHA insures loans. VA loans are guaranteed. b. Both the FHA and the VA make loans. c. FHA loans are guaranteed. d. Conventional loans are insured by the government.
A. The FHA insures loans. VA loans are guaranteed
77. Complete the sentence. The ownership of a property actually transfers from the grantor to the grantee when the deed is: a. Notarized and recorded b. Delivered and accepted c. Signed by the grantee and witnessed d. Signed by the grantee and recorded
B) delivered and accepted
163. Closing date is June 8 with the day of closing belonging to the buyer. Annual real estate taxes are $2,730. Using the 365-day method, what prorated amount of taxes will be debited to the seller? a. $957.37 b. $1,181.75 c. $1,548.25 d. $1,772.63
B. $1,181.75
12. A homestead property is assessed at $65,000. The tax rate is 22 mills, the city rate is 7 mills, the county rate is 6 mills, and school rate is 9 mills? How much are the annual taxes on the property? a. $1,430 b. $685 c. $869 d. $440
B. $685
808. How many acres are contained in 1/4 of a section? a. 640 b. 160 c. 40 d. 10
B. 160
984. A buyer makes a written offer to purchase. The seller changes the terms or conditions, initials the changes, signs the contract and sends it back to the offeror. In contract law, what is the seller's changed contract? a. An offer b. A counteroffer c. A binding offer d. Illegal
B. A counteroffer
710. Who should hold an escrow deposit? a. The broker b. A disinterested third party c. The attorney d. The seller
B. A disinterested third party
990. Complete the sentence. A convenience store located in an area that has now been zoned for residential use only would be: a. Made to move b. A nonconforming use c. A variance d. A special use exception
B. A nonconforming use
626. Mary deeds John a property for John's lifetime. Upon John's death, the property will transfer to Fred. What is Fred's interest in the property? a. An estate in reversion b. A remainder estate c. A tenancy in waiting d. A tenancy in entirety
B. A remainder estate
767. A sales associate agrees to give part of his commission to the seller, provided that the seller agrees to send the sales associate at least one hot buyer prospect. This is: a. A violation, because the sales associate did not check with the broker b. A violation, because F.S. 475, prohibits compensating unlicensed individuals for referrals c. Not a violation as the compensation does not exceed $1,000 d. Not a violation
B. A violation, because F.S. 475, prohibits compensating unlicensed individuals for referrals
375. Which of the following could be an example of external obsolescence? a. The architectural design of a building b. A zoning change in the area c. Peeling paint on the exterior of the building d. An outdated oil-burning range in the kitchen
B. A zoning change in the area
707. Sales associate Aaron sells a home that was listed by broker Bob. Who must pay Aaron's share of the commission? a. Any party as long as the amount is as agreed upon b. Aaron's broker c. Either Aaron's broker or broker Bob d. Any party, since Aaron is licensed, and therefore can be compensated by anyone
B. Aaron's broker
333. What is the primary reason for the increased need for property managers over recent years? a. Farming b. Absentee ownership c. Stricter license law d. Channeling
B. Absentee ownership
107. Which term refers to the process of sand deposits building up over time, causing an increase in land? a. Reliction b. Accretion c. Erosion d. Alluvion
B. Accretion
284. What is the name for the gradual buildup of sand on the riparian or littoral owner's shoreline by natural causes? a. Alluvial b. Accretion c. Reliction d. Aeolian
B. Accretion
724. How does a broker determine what the selling price should be on a net listing? a. Get the highest possible price b. Add the broker's commission and seller's closing costs to the amount the seller wants to net c. Add 10% to the net amount d. Do nothing, since net listings are illegal in Florida
B. Add the broker's commission and seller's closing costs to the amount the seller wants to net
299. Where do special assessment liens on property rank in priority of payment? a. After private liens b. Ahead of private liens c. Ahead of real property tax liens d. Ahead of all liens
B. Ahead of private liens
278. Which of the following shares of real property will a widow with no children receive at her husband's death in the absence of a will? a. One-third b. All c. One-half d. Life estate
B. All
660. Larry, Moe, and Curly form a partnership by oral agreement. Moe and Curly buy a property and sign a contract under the partnership name. Which applies? a. Only Moe and Curly are liable b. All three are liable c. The partnership is liable d. No one is liable
B. All three are liable
942. Which process refers to sand deposits that build up on the shoreline as a result of accretion? a. Erosion b. Alluvion c. Addition d. Littoral
B. Alluvion
2. Which of the following cannot be used by the Federal Reserve to change or control the money supply? a. Change the discount rate b. Alter income tax rates c. Increase or decrease the reserve requirement d. Buy or sell government notes
B. Alter income tax rates
339. What part of an amortized mortgage payment reduces the principal balance? a. Debt service b. Amortization c. Interest d. Principal and interest
B. Amortization
282. Which type of estate refers to the lessor's interest in leased property? a. An estate for years b. An estate in reversion c. An estate by the entireties d. A leasehold estate
B. An estate in reversion
43. Who has the right to file a complaint against a licensee with the DBPR? a. FREC b. Anyone c. DRE d. DBPR
B. Anyone
76. How is a quitclaim deed most often used? a.Asataxdeed b. As a way to clear clouds on title c. As a personal representative's deed d. As a guardian's deed
B. As a way to clear clouds on title
845. A sales associate tells a customer that he should sell his home because of inmigration of a certain ethnic group. What is the term used to describe this situation? a. Commingling b. Blockbusting c. Redlining d. Channeling
B. Blockbusting
616. Which is considered to be an interest in real property? a. Deed restriction b. Easement c. Encroachment d. Survey
B. Easement
59. Under the Truth in Lending Act, in credit advertising, which would not be considered a "triggering term"? a. $1,500 down b. Easy terms c. 6% interest d. 10% down
B. Easy terms
280. Which type of estate is the most comprehensive? a. Life estate b. Fee simple estate c. Estate for years d. Estate at will
B. Fee simple estate
22. Karl's license expired on September 30, 2015. On February 10, 2019 he wants to activate it again. Which is correct? a. He must complete 28 hours of continuing education. b. His license is null and void. c. He must complete 42 hours of continuing education. d. He must complete 45 hours of post- license education.
B. His license is null and void
948. Which type of risk is the risk that an investment property cannot be bought or sold quickly enough to prevent loss? a. Business risk b. Liquidity risk c. Financial risk d. Static risk
B. Liquidity risk
255. A licensee files a false affidavit to make a claim against a property. How is this criminal action classified? a. First-degree felony b. Second-degree felony c. First-degree misdemeanor d. Second-degree misdemeanor
B. Second-degree misdemeanor
410. Where is section 33 located within a township? a. North b. South c. East d. West
B. South
819. Adam, Bob, and Chris form a partnership to buy property. What would the ideal form of ownership be from Chris' family's point of view? a. Tenancy at will b. Tenancy in common c. Joint tenancy d. Life tenancy
B. Tenancy in common
761. Jack and Jane each purchased 50% interest in the same building, at different times. What are the two owners considered to be? a. Joint tenants b. Tenants in common c. Tenants at sufferance d. Tenants in severalty
B. Tenants in common
413. What is the term used for the amount of money that a homeowner pays in property taxes? a. The tax base b. The tax levy c. Exempt property d. Taxable property
B. The tax levy
850. When a deed of trust is involved, who signs the note? a. Trustee b. Trustor c. Beneficiary d. Mortgages
B. Trustor
69. The initial tax exemption for homestead is available only to owners that: a. Claimed the property as their principal residence as of January 1 and filed by April 15 b. Claimed the property as their principal residence as of January 1 and filed by March 1 c. Claimed their property as their principal residence as of March 1 and filed by April 15 d. Recorded their deed by January 1 and filed by April 1
B. claimed the property as their principal residence as of January 1 and files by March 1
65. Who owns the property in a tenancy by the entireties? a. Two cohabitating adults b. Husband and wife c. Entirely one person d. An entire family
B. husband/wife
167. Mr. Johnson owns an apartment building that produces an effective gross income of $85,000 per year. What would be the value, given operating expenses of $30,000, and an overall capitalization rate of 11%? a. $272,727 b. $300,000 c. $500,000 d. $772,727
C. $500,000
448. An investor buys an income property for $300,000 that shows a $30,000 income. If the investor could increase the yield to 12%, how much additional money could the investor earn per year? a. $2,500 b. $3,600 c. $6,000 d. $9,000
C. $6,000
45. What is the maximum number of years that FREC may suspend a real estate license? a. 3 b. 5 c. 10 d. 15
C. 10
279. What does personal property that is permanently attached to the land become? a. An encumbrance b. An attachment c. A fixture d. An encroachment
C. A fixture
621. What is an abstract of title? a. A history of all documents concerning a property b. A summary of the important documents concerning a property c. A history of all recorded documents concerning a property d. An estimate of fair market value of a property
C. A history of all recorded documents concerning a property
586. All of the following statements related to the role of the sales associate are correct, EXCEPT: a. A sales associate may only be employed by one broker at a time. b. A sales associate may only be compensated by their employing broker or owner-developer. c. A sales associate can be employed by the general public to perform real estate activities. d. A sales associate may only perform real estate activities authorized by their employer.
C. A sales associate can be employed by the general public to perform real estate activities
309. Which item creates a formal contract? a. An acknowledgment b. Signatures c. A written form d. A notary's statement
C. A written form
368. Who could be the seller? a. Mortgagor b. Vendee c. Grantor d. Grantee
C. Grantor
541. A broker receives conflicting claims on an escrow deposit and requests an escrow disbursement order from the Commission. The Commission orders the money be given to the buyer. The seller obtains a judgment against the broker. What must the broker do? a. Borrow the money to pay the seller b. Ask the buyer to give the money back to the seller c. Have the claim paid by the recovery fund d. Require the sales associate to pay it
C. Have the claim paid by the recovery fund
768. Bob, a resident of Kentucky, has been an active broker in Kentucky for 10 years. Bob wishes to obtain a Florida real estate license. All of the following statements are correct, EXCEPT: a. He can take a Florida law exam and obtain a broker's license through mutual recognition if Kentucky has a mutual recognition agreement. b. He can apply for a broker's license, take the broker's course, and take the broker's state examination. c. He must begin again in Florida as a sales associate. d. He can apply for a sales associate license, take the sales associate course, pass the sales associate state examination and be issued a sales associate license.
C. He must begin again in Florida as a sales associate
426. All of the following are characteristics of real estate, EXCEPT: a. Heterogeneous b. Market is elastic in the short run c. Homogeneous d. Immobility
C. Homogeneous
828. A Florida broker has an Alabama license suspended. How will this affect his Florida license? a. It will be automatically suspended. b. It will be automatically revoked. c. It may be suspended or revoked. d. It will not be affected.
C. It may be suspended or revoked
867. What is produced by applying the loan constant to the loan amount? a. Interest b. Interest rate c. Mortgage payment d. Mortgage payoff
C. Mortgage payment
400. When determining the net operating income (NOI) for direct capitalization, all of the following items are subtracted from the potential gross income (PGI), EXCEPT: a. Vacancies and collection losses b. Reserves for replacements c. Mortgage payments d. Property taxes
C. Mortgage payments
532. What would be considered an arm's length transaction? a. Mr. Ajax to the Ajax Corporation b. Mr. Smith to Mrs. Smith (husband and wife) c. Mr. Black to Mrs. Jones (not related) d. Gateway Corporation to ABC investment (Gateway owns 15 shares of ABC)
C. Mr. Black to Mrs. Jones (not related)
812. All of the following are qualifications for a sales associate license, EXCEPT: a. Must be at least 18 years of age b. Must be a high school graduate or equivalent c. Must be a Florida resident for at least the preceding 6 months d. Must be honest, trustworthy and have a reputation for fair dealing
C. Must be a Florida resident for at least the preceding 6 months
562. A sales associate is selling his or her own property. What information would be required in the broker's advertisement? a. Agent and licensed real estate broker b. Owner-agent c. Name of the brokerage firm d. Name of the brokerage firm, owner-agent and sales associate's name
C. Name of the brokerage firm
371. Which type of lending institution is formed by private investment groups to purchase real estate for investment and to make short-term construction and long-term mortgage loans? a. Credit union b. Savings association c. REIT d. Commercial bank
C. REIT
941. What is the term used for the 6-mile wide strip of land that is contained between two meridians? a. Township b. Tier c. Range d. Check
C. Range
89. What is required to create a joint tenancy? a. Three parties b. A husband and wife c. The four unities d. A will
C. The four unities
137. The Johnsons have lived in their home for the last 4 years. Now they are selling and expect a profit of nearly $200,000. Which statement applies? a. $125,000 of the gain can be excluded from being taxable. b. The gain can be moved to another house of equal or greater value to delay the tax. c. The gain is exempt from tax. d. They must pay tax on 40% of the gain.
C. The gain is exempt from tax
649. What happens with negative amortization? a. The monthly payment amount increases b. The term of the loan increases c. The loan balance increases d. The term of the loan decreases
C. The loan balance increases
202. Who is the principal, or employer? a. The buyer b. The seller c. The one who engages the broker in a single agency relationship d. The one who pays the broker
C. The one who engages the broker in a single agency relationship
229. Broker Davis, Broker Ben, and Broker Boone form a partnership. The partnership buys, develops, and sells land. Sales associate Jerry becomes an equal partner in the firm. A sale is made, resulting in a $40,000 profit. Which statement is correct? a. The partnership is illegal unless Jerry becomes broker. b. The partnership agreement must be filed with the Secretary of State. c. The profits may be divided equally. d. Jerry cannot receive any portion of the profit.
C. The profits may be divided equally
34. A sales associate wants to use a trade or fictitious name. Which statement applies? a. The name must be registered with the county clerk. b. The name must be registered with FREC. c. This would violate F.S. 475. d. The name must be registered with the Secretary of State
C. This would violate FS 475
73. What does an encumbrance affect? a. Mortgage b. Deed c. Title d. Structure
C. Title
953. What is the function of Fannie Mae? a. To insure FHA loans b. To regulate lending terms and policies of member banks c. To purchase existing loans d. To absorb any losses incurred by the Government National Mortgage Association (GNMA)
C. To purchase existing loans
13. What is the purpose of the closing statement? a. To verify the terms of the contract b. To provide a source of income for closing agents c. To summarize and simplify the transaction d. To inform each party the closing costs to be charged to the other
C. To summarize and simplify the transaction
14. Which of the following is a characteristic of group license? a. It allows a broker to have branch offices. b. It allows a sales associate to work for more than one broker. c. It may be held by a sales associate or broker associate. d. It allows a broker to qualify for more than one brokerage firm.
C. it may be held by a sales associate or broker associate
94. What is the amount of guarantee based upon for a VA guaranteed loan? a. Appraised value b. Assessed value c. Loan amount d. Sale price
C. loan amount
29. What must all advertising of listed property contain? a. Name of the sales associate b. Telephone number for the brokerage firm c. Name of the brokerage firm d. Telephone number of the sales associat
C. name of the brokerage firm
8. All of the following would be grounds for suspension or revocation of a real estate license, EXCEPT: a. Not giving the proper agency disclosure b. Falsifying information on a license application c. Not being a resident of Florida d. False advertising
C. not being a resident of Florida
63. An owner of a piece of real estate has purchased the materials to fence the backyard. What type of property is the fencing material? a. Trade fixture b. Real estate c. Personal property d. Fixture
C. personal property
93. If interest at 12% for 3 months equals $135, what is the principal amount? a. $2,600 b. $2,750 c. $3,800 d. $4,500
D. $4,500
95. Fill in the blanks. Conventional lenders usually want the buyer's housing ratio not to exceed ____ and the total obligations ratio not to exceed ______. a. 31%, 43% b. 29%, 41% c. 29%, 36% d. 28%, 36%
D. 28%, 36%
694. Mr. Jones purchased a home for $95,000, with closing costs of $3,500. The loan-tovalue ratio was 80%. If the bank charged $2,280.00 for lender fees, how many points did the lender charge? a. 2.3 points b. 2.4 points c. 2.5 points d. 3.0 points
D. 3.0 points
919. Once a final order is issued, within how many days may a petition for review with the District Court of Appeals be filed? a. 10 b. 15 c. 20 d. 30
D. 30
961. What is the maximum allowable total obligations ratio for an FHA insured loan? a. 28% b. 29% c. 36% d. 43%
D. 43%
97. A developer purchased a tract of land for $100,000, subdivided the parcel into three lots, and sold the lots for $50,000 each. What was the developer's profit on investment? a. 20% b. 30% c. 40% d. 50%
D. 50%
644. What is a title plant? a. Where deeds are printed b. A system of records, collected and filed by the names of real property owners c. A system of records, collected and filed according to the names of the title insurance holders d. A system of records, collected and filed by legal descriptions
D. A system of records, collected and filed by legal descriptions
30. Savings associations compete for new money to make mortgage and construction loans with which of the following? a. Common stocks only b. Government bonds only c. Business investments only d. All other lenders and users of money
D. All other lenders and users of money
341. A buyer purchases a property with an existing mortgage and assumes personal responsibility for the note. Which term describes this situation? a. An assignment of mortgage b. Novation c. Purchasing subject to a mortgage d. An assumption of mortgage
D. An assumption of mortgage
111. Which term refers to the interest that is charged when banks borrow from the Federal Reserve? a. Prime rate b. Discount points c. Usury rate d. Discount rate
D. Discount rate
270. Who is exempt from provisions of the Fair Housing Act of 1968? a. Sales associates b. Brokers c. Mortgagees d. Homeowners who are selling their only single-family home as a FSBO
D. Homeowners who are selling their only single-family home as a FSBO
335. In the process of mortgage underwriting (qualifying), which is of most concern to the lender? a. Assets b. Credit history c. Deductions d. Income
D. Income
290. Which statement accurately describes an owner's title insurance policy? a. It is transferable. b. It covers the amount of the mortgage. c. It guarantees against all defects and encumbrances. d. It guarantees against all defects and encumbrances to which no exception has been taken.
D. It guarantees against all defects and encumbrances to which no exception has been taken
16. Which statement regarding a Planned Unit Development (PUD) is correct? a. Common areas are not an essential element. b. Commercial and industrial developments are not permitted. c. Zero lot line and patio homes are the only type of residential construction allowed. d. It is a type of zoning that permits flexibility from rigid zoning standards
D. It is a type of zoning that permits flexibility from rigid zoning standards
199. Jeff is the owner of a building that is leased to Craig. If Jeff sells the building, what is the status of the lease? a. It becomes a tenancy at will b. It must be renewed c. It is terminated d. It is binding on the new owner
D. It is binding on the new owner
722. Mr. and Mrs. Jones, and Mr. Jones's sister, take title to a duplex together. What type of tenancy have they formed? a. Tenancy by the entireties b. Tenancy at will c. Tenancy at sufferance d. Joint tenancy
D. Joint tenancy
411. Which legal descriptions would equal 5 acres? a. E 1/2, SE 1/4, NW 1/4, Section 24 b. SE 1/4, SE 1/4, NW 1/4, Section 24 c. N 1/2, SE 1/4, SE 1/4, Section 24 d. N 1/2, SE 1/4, SE 1/4, NW 1/4, Section 24
D. N 1/2, SE 1/4, SE 1/4, NW 1/4, Section 24
887. Broker Warmington assigns sales associate Smith to work exclusively on Bennett's development. Which statement applies? a. Broker Warmington can lend Smith to Bennett with no problem. b. Smith is no longer accountable to Warmington because she is now working for herself. c. Smith is allowed to work for as many employers as she feels she can handle. d. Provided Warmington is the listing broker at Bennett's development, and all commissions paid to Smith come from Warmington, there is no problem.
D. Provided Warmington is the listing broker at Bennett's development, and all commissions paid to Smith come from Warmington, there is no problem
856. Which of the following applies to the FHA Section 203(b) loan program? a. Guarantees loan approval b. Applies only to borrowers that meet certain income limits c. Does not require payment of mortgage insurance premiums d. Provides mortgage insurance coverage of owner-occupied one-to-four family homes
D. Provides mortgage insurance coverage of owner-occupied one-to-four family homes
103. Which type of mortgage is known as seller financing? a. Package mortgage b. Term mortgage c. Second mortgage d. Purchase money mortgage
D. Purchase money mortgage
406. What is the opposite of N10°E? a. N90°W b. S40°E c. N10°W d. S10°W
D. S10°W
716. All of the following items are typical prorations on a closing statement, EXCEPT: a. Real property taxes b. Interest on assumed loan c. Rent collected d. State documentary stamp taxes
D. State documentary stamp taxes
417. Which entity establishes the rates for the documentary stamps? a. DBPR b. FREC c. The county where the property is located d. State of Florida
D. State of Florida
12. The original mortgagor is NOT released from liability if title to real property is taken by what? a. As a result of a short sale b. Foreclosure of the mortgage c. Novation of the mortgage d. Subject to the mortgage
D. Subject to the mortgage
214. A broker's principal is away on vacation. The broker receives an offer of $75,000 for his principal's property. Before the principal returns, the broker receives a second offer of $72,000. What should the broker do? a. Refuse the second offer since it is not as good as the first offer b. Submit the offer they feel is best c. Hold the second offer pending acceptance of the first offer d. Submit both offers to the principal
D. Submit both offers to the principal
206. If an oral offer is made to a broker on a property the broker has listed, what should be the broker's response? a. Demand that the offer be in writing b. Inform the buyer that the offer violates the statute of frauds c. Ask for a substantial deposit d. Submit the offer to the seller
D. Submit the offer to the seller
534. What type of writ contains a command to stay a legal proceeding, as in halting or delaying the suspension or revocation of a real estate licensee's license? a. Certiorari b. Mandamus c. Possession d. Supersedeas
D. Supersedeas
721. A real estate sales associate obtains an offer to lease from a prospective tenant. The agent calls the owner to inform them of the offer. The owner asks the sales associate, "What race is the tenant?" The sales associate responds, "They are Caucasian." Which statement is correct? a. The sales associate responded in a manner consistent with the law. b. The sales associate acted as any licensee should. c. Had the tenant been a minority, the sales associate would be in violation, but because the tenant was Caucasian, there is no violation. d. The sales associate may be subject to severe administrative and civil penalties.
D. The sales associate may be subject to severe administrative and civil penalties
663. A real estate sales associate may accept commissions from which of the following? a. A buyer b. A seller c. A mortgage broker d. The sales associate's employer
D. The sales associate's employer
241. A broker has shown by his or her actions that he or she is an immediate danger to the public. What can be done? a. The license can be immediately revoked. b. The license can be immediately suspended. c. The chairperson of FREC can issue a writ of supersedeas. d. The secretary of the DBPR can issue a summary suspension.
D. The secretary of the DBPR can issue a summary suspension
422. All of the following statements apply to special assessments, EXCEPT: a. They are charged to the owner of the property. b. They are levied to finance specific improvements. c. They are charged only for improvements that will increase the value of the property. d. They are used to provide revenue for the county's operating budget.
D. They are used to provide revenue for the county's operating budget
147. What is the purpose of building codes? a. To set standards for the amount of land a building can cover b. To specify the style of building that may be built c. To regulate government properties d. To establish minimum standards of building design and construction
D. To establish minimum standards of building design and construction
294. Complete the statement. A deed must be acknowledged (notarized): a. Prior to being witnessed b. By an attorney c. To make it valid d. To make it recordable
D. To make it recordable
96. A property that measures 120' x 300' sold for $38,500. What was the price per square foot? a. $1.07 b. $1.31 c. $1.51 d. $1.70
A. $1.07
49. What is the maximum fine the Commission could impose against a licensee who was found guilty of two violations of Chapter 475, F.S.? a. $10,000 b. $7,500 c. $5,000 d. $1,000
A. $10,000
825. A court awarded a judgment to Mr. and Mrs. Brown against broker Smith for $30,000 that included $20,000 of actual damages and $10,000 of punitive damages. The bankruptcy court ordered Smith to pay $7,000. How much will the Real Estate Recovery Fund pay? a. $13,000 b. $23,000 c. $25,000 d. $30,000
A. $13,000
173. An investor purchased an office building for $655,000, with acquisition costs of $42,300. If the building represents 80% of the cost, what is the annual IRS depreciable allowance? a. $14,303.59 b. $16,794.87 c. $23,818.18 d. $25,356.36
A. $14,303.59
437. A mortgage is $55,000 with 12% interest for 30 years, and monthly payments of $565.74. If the loan is held to maturity, how much interest would the borrower have paid? a. $148,666.40 b. $198,000.00 c. $203,666.40 d. $403,333.33
A. $148,666.40
46. For multiple claims against a licensee, what is the maximum reimbursement from the Florida Real Estate Recovery Fund? a. $150,000 b. $50,000 c. $25,000 d. $15,000
A. $150,000
592. Calculate the gross income of an apartment building containing five units: three rented at $350 per month, one rented at $300 per month, and one at $75 per week a. $20,100 b. $19,800 c. $11,400 d. $8,700
A. $20,100
464. A buyer purchases Mr. Orange's home for $190,000, assuming the first mortgage, which covers 80% of the purchase price. Mr. Dis Count, a licensed mortgage loan originator, arranges a second mortgage for 46% of the difference. Mr. Dis Count wants 2½ points as an origination fee. What will the total down payment be, including the origination fee? a. $20,957 b. $17,480 c. $14,145 d. $437
A. $20,957
447. An investment property has 60 identical units. It can have an income of $566,000 annually. It has a monthly operating expense of $20,000 and 3% of potential gross income is in reserve. The usual vacancy is 3 units per month. How much is the net operating income (NOI)? a. $280,720 b. $306,662 c. $308,234 d. $500,720
A. $280,720
893. An apartment building has expenses of $700,000, effective gross income of $1,000,000 and a cap rate of 8%. What is its value? a. $3,750,000 b. $8,750,000 c. $12,500,000 d. $80,000,000
A. $3,750,000
815. A broker has an escrow account for his property management firm. How much of the broker's own money can be deposited to open and maintain the account? a. $5,000 b. $1,000 c. $200 d. $0
A. $5,000
897. Three-bedroom, two-bath homes in an area rent for $450 per month. In the same area, three-bedroom/one-bath homes rent for $400 per month. If the GRM is 120, what is the estimated value of a bathroom? a. $6,000 b. $5,500 c. $5,000 d. $4,167
A. $6,000
799. If a family could qualify to buy a home worth 2 1/2 times their annual income, what price home could they afford to buy if they earned $550 per week? a. $71,500 b. $66,000 c. $28,600 d. $26,400
A. $71,500
692. A property is purchased based on a $50,000 a year income, with a 15% cap rate (yield). If the new owner can sell the building based on a 12% yield, what would be his profit? a. $83,334 b. $60,000 c. $15,000 d. $6,000
A. $83,334
995. A comparable property sold 2 years ago for $80,000. Since then, properties have been appreciating at 5% annually. How much would the comparable property be worth today? a. $88,200 b. $88,000 c. $86,000 d. $84,000
A. $88,200
935. To be a member of FREC, a person must have at least how many years of real estate experience? a. 0 b. 2 c. 5 d. 10
A. 0
699. Mrs. Brown owns a 100-acre tract in Dade County. She wants to sell 20 lots, with each containing 21,780 square feet. How many acres will she be selling? a. 10 b. 15 c. 17 d. 20
A. 10
450. If a property was purchased for $200,000 with a $30,000 down payment and the PGI is $50,000, vacancies are 5% and the expenses are $25,500 (which includes $2,000 in reserves). What is the cap rate or capitalization rate? a. 11.0% b. 11.6% c. 12.9% d. 22.5%
A. 11.0%
420. Long-term capital gains can exist when the property has been held for more than how many months? a. 12 b. 18 c. 24 d. 36
A. 12
13. A property has a value of $240,000 and a net operating income of $30,000. What is the rate of capitalization? a. 12.5% b. 15.5% c. 16.3% d. 17.5%
A. 12.5%
85. The southeast corner of Section 31, Township 1 North, Range 3 West, is how many miles from Tallahassee? a. 17 b. 18 c. 23 d. 24
A. 17
599. A developer is building a subdivision on a 20-acre tract. The subdivision will have 40 equal size lots. Ten percent of the total tract will be allowed for a common recreation area. With access roads totaling 20 feet by 600 yards, how many square feet are contained in each lot? a. 18,702 square feet b. 19,602 square feet c. 20,000 square feet d. 21,780 square feet
A. 18,702 square feet
138. Failure to pay property taxes will lead to the sale of tax certificates. In order to force the sale of the property, how many years must the investor wait? a. 2 b. 3 c. 5 d. 7
A. 2
977. How many acres are contained in the NE 1/4 of the SW 1/4 of the SE 1/4 of the NE 1/4 of Section 9, Township 23 S, Range 32 E? a. 2 1/2 acres b. 5 acres c. 10 acres d. 13 acres
A. 2 1/2 acres
443. If 10,000 new households are expected in an area over the next 5 years, and each household will use about 1/4 acre of land, how many additional acres will the community have to service? a. 2,500 b. 5,000 c. 7,500 d. 12,500
A. 2,500
152. A property manager of an office building leases 2,500 square feet of space to a doctor's office, which is 12.5% of the total space. What is the total square footage of the building? a. 20,000 b. 40,000 c. 100,000 d. 200,000
A. 20,000
900. A square piece of property measures 938 feet around the perimeter. What are the dimensions of the property? a. 234.5 feet by 234.5 feet b. 469 square feet c. 234.5 square feet d. 269 feet by 200 feet
A. 234.5 feet by 234.5 feet
597. Current tax laws allow owners of investment properties to depreciate a portion of their investment over what period of time for the types of property listed? a. 27.5 years for residential properties and 39 years for non-residential properties b. 27.5 years for non-residential properties and 39 years for residential properties c. 27.5 years for all investment properties d. 39 years for all investment properties
A. 27.5 years for residential properties and 39 years for non-residential properties
126. What method can be used to depreciate residential real estate purchased after 1986? a. 27.5 years straight-line b. 39 years straight-line c. 27.5 years double declining d. 39 years double declining
A. 27.5 years straight-line
805. How many days does a buyer of a resale condominium have to cancel the agreement? a. 3 b. 7 c. 10 d. 15
A. 3
465. The quoted interest rate on a conventional loan is 12.5%, but after allowing for the origination fee, the true APR is 13%. Approximately how many points did the bank charge for the loan? a. 4 b. 5 c. 6 d. 8
A. 4
409. How many acres are in the following: The NW 1/4 of the NW 1/4 of the SW 1/4 of the SW 1/4 and the SW 1/4 of the SW 1/4 of the NW 1/4 of the SW 1/4 of Section 27. a. 5 acres b. 2.5 acres c. 1.25 acres d. Approximately .001 acre
A. 5 acres
793. A property has a net operating income of $20,000.00, and $15,000 in expenses that includes $2,000.00 in property taxes. If property taxes were to increase by 45%, by what percentage will the expenses increase? a. 6.0% b. 5.3% c. 4.5% d. 2.5%
A. 6.0%
78. How many acres are contained in 1/36 of a township? a. 640 b. 460 c. 160 d. 40
A. 640
903. With whom can a broker share a commission? a. A New Jersey broker who has not violated any Florida laws b. A person who gave a referral c. An attorney d. An auctioneer
A. A New Jersey broker who has not violated any Florida laws
902. Who may directly receive compensation for performing any of the eight services of real estate? a. A broker b. A sales associate c. An unlicensed person d. A broker associate
A. A broker
951. Which condition is most likely to occur when the demand is less than the supply of available housing? a. A buyers' market develops b. A sellers' market develops c. Interest rates will rise d. Rents will rise
A. A buyers' market develops
589. Which of the following provides "quiet enjoyment" on a deed? a. A covenant b. A noise restriction c. An encumbrance d. A noise variance
A. A covenant
728. After going through the complaint process, the administrative law judge found a broker guilty of two violations of F.S. 475. The Florida Real Estate Commission can impose all of the following penalties, EXCEPT: a. A fine of $15,000 b. A suspension of not more than 10 years c. A reprimand d. Revocation
A. A fine of $15,000
225. A licensed broker and one of his employed sales associates purchase a parcel of real estate together. What relationship have they formed? a. A joint venture b. A limited partnership c. A general partnership d. An illegal venture, since only brokers can be members of a real estate partnership
A. A joint venture
577. What is a tax shelter? a. A legal method of decreasing tax liability b. An illegal method for hiding taxable income c. An illegal method of hiding funds from the IRS d. A legal form of property tax exemption
A. A legal method of decreasing tax liability
540. Without specific authorization, it is a violation for a sales associate to accept which of the following as a deposit? a. A postdated check b. Cash c. Specie (coin) d. Valuable consideration
A. A postdated check
637. How can defects or clouds on a title be cleared? a. A quitclaim deed b. Title insurance c. An abstract d. A radon gas disclosure
A. A quitclaim deed
332. All of the following activities would be considered fraudulent, EXCEPT: a. A selling agent and a buying agent agree to split a commission with permission by all parties to the transaction. b. An agent for the buyer develops a scheme with the selling agent to obtain a contract with a higher purchase price. c. A buyer's agent chose not to inform the buyer about a planned airport extension adjacent to a prospective property. d. A broker arranges to collect commission from both parties in a transaction without informing the seller.
A. A selling agent and a buying agent agree to split a commission with permission by all parties to the transaction
747. What would most likely be required to build a church in a residential neighborhood? a. A special use exception b. A variance c. Approval of a regional planning council d. An appropriate buffer zone
A. A special use exception
75. Which method of describing property would NOT be utilized by a licensed surveyor in developing a legal description? a. A street number and address b. Reference to a recorded plat c. Description by metes and bounds d. Government survey
A. A street number and address
677. To whom does a deed of trust convey title? a. A third party b. The bank c. The mortgager d. The beneficiary
A. A third party
787. The Raymonde Corporation acquires 60 acres of ranch land, subsequently subdivides it into 5-acre ranchettes, and offers them for sale. The officers and directors of the corporation agree to pay themselves regular salaries. The corporation will pay each officer or director a commission of 15% of the sales price of any ranchette that said officer or director sells. Which is correct? a. All officers and directors of the corporation must be registered, licensed brokers with the FREC for this agreement to be legal. b. Since the corporation may sell its own land, this agreement is legal. c. The officers and directors are engaged in a syndicate. d. Civil action may be brought and enforced by the officers and directors if anyone stops this agreement.
A. All officers and directors of the corporation must be registered, licensed brokers with the FREC for this agreement to be legal
385. What is "price?" a. Amount actually paid in a real estate transaction b. Assessed value of a property c. Market value d. Actual or estimated amount to obtain, create, or reproduce a property
A. Amount actually paid in a real estate transaction
515. A real estate license is required for all of the following individuals, EXCEPT: a. An appraiser on salary with a financial institution b. A person showing timeshare condo units c. An out-of-state auctioneer selling Florida farmland d. A person selling business opportunities
A. An appraiser on salary with a financial institution
239. In the complaint process, if there is no dispute over material facts, how may the case be resolved? a. An informal proceeding b. Going to court and filing a bill of interpleader c. A formal hearing d. A binding arbitration
A. An informal proceeding
947. Which condition exists when the cost of an improvement exceeds the value? a. An over-improvement b. Physical deterioration c. External obsolescence d. Component obsolescence
A. An over-improvement
82. Who may the Department of Business and Professional Regulation subpoena? a. Anyone thought to have information or evidence pertinent to an investigation b. Any member of the public c. Only licensees and applicants d. No one
A. Anyone thought to have information or evidence pertinent to an investigation
421. You purchased two tax certificates at auctions. Three years later, what may you do? a. Apply for a tax deed b. Claim the property c. Force foreclosure d. Apply for a general warranty deed
A. Apply for a tax deed
607. Where will a metes and bounds description always start and finish? a. At the same point b. At different points c. At two points that are close to each other d. At points designated as appropriate by the surveyor
A. At the same point
605. All of the following cause forfeiture of a corporation's charter, EXCEPT: a. Bankruptcy b. Failure to pay the annual report fee c. Court action d. Action of the stockholders
A. Bankruptcy
498. What is necessary to qualify for the $500,000 exclusion from the capital gains tax realized from the sale of a principal residence? a. Be a married couple, filing jointly b. Neither spouse has previously used the exclusion c. The replacement residence must be of equal or greater value than the one being sold d. The home must have served as a principal residence at least 3 of the last 5 years
A. Be a married couple, filing jointly
184. What must a sales associate do to be eligible to take the broker examination? a. Be employed by one or more actively licensed brokers for at least 24 months within the preceding 5 years b. Work for one broker for at least 12 months as an active sales associate c. Have a total of 1 year as an active sales associate with a broker or owner- developer within the last 5 years d. Prove that they have been actively engaged in the selling of real estate within the last 5 years
A. Be employed by one or more actively licensed brokers for at least 24 months within the preceding 5 years
746. While using the cost-depreciation approach, the appraiser may compare the subject property to recently built buildings. What are these new buildings referred to as? a. Benchmark structures b. Contemporary structures c. Comparable structures d. Modern structures
A. Benchmark structures
305. Broker Bob has an exclusive listing. The owner calls and asks if Bob has any offers. Bob says no. Broker Charles submits an offer to the owner that is accepted. Which statement is correct? a. Bob can sue for unliquidated damages but not commission. b. Bob and Charles must share the commission. c. Bob receives no commission and can do nothing about it. d. Bob is entitled to full commission.
A. Bob can sue for unliquidated damages but not commission
198. Which items would be optional on a branch office sign? a. Branch office name b. The words, "Licensed Real Estate Broker" c. The name of the business entity d. The name of an individual broker
A. Branch office name
215. Broker Brown lists Smith's property for $20,000. Broker Brown hears from a friend on the planning commission that they are intending to put a highway right next to Mr. Smith's property, making his lot a corner lot. He tells another friend about what he has heard, and the friend buys the property for $20,000. Which statement is correct? a. Broker Brown's license may be suspended for not telling Smith. b. Broker Brown is not obligated to pass on rumors to the seller. c. Broker Brown has done nothing wrong. d. Broker Brown is guilty of culpable negligence.
A. Broker Brown's license may be suspended for not telling Smith
758. Who are the parties to the contract after a sales contract has been completed, and the money placed into escrow pending closing of the transaction? a. Buyer and seller b. Trustee and seller c. Buyer, seller, and broker d. Vendor, vendee and broker
A. Buyer and seller
539. Broker Bond sold buyer Christina a property and told Christina that, if she were not happy with the property within a period of 1 year, he would purchase the property back from her at the price she bought it for. Which of the following is correct if 10 months later Christina decided she did not want the property? a. By purchasing the property as promised, the broker would show good faith and eliminate any charge of false promise. b. If the broker had moved out of the state, the broker would not be liable to honor the terms and conditions of the contract. c. If the broker was actually a broker associate, and during the 1-year period had transferred to another broker's office, he would have no further liability on the contract. d. This is a fraudulent transaction.
A. By purchasing the property as promised, the broker would show good faith and eliminate any charge of false promise
908. How is the interest rate determined on an FHA insured mortgage loan? a. By the market b. By the Federal Reserve c. By the Secretary of the Department of Housing and Urban Development d. By the Congress
A. By the market
253. A broker is sued for misrepresentation. The court awards the buyer $100,000 in damages. What kind of penalty is this? a. Civil b. Administrative c. Criminal d. Civic
A. Civil
567. The principle of substitution is used in all appraisal approaches for estimating market value but is best illustrated with which valuation approach? a. Comparable sales b. Cost-depreciation c. Income d. 4/3/2/1
A. Comparable sales
222. Which of the following documents not only recommends that the principal sign it, but requires it? a. Consent to Transition to Transaction Broker b. Notice of Non-representation c. Single Agent Notice d. Transaction Broker Notice
A. Consent to Transition to Transaction Broker
631. Which type of lien may be retroactive to an earlier date, thus taking priority over other liens? a. Construction lien b. Judgment lien c. Vendor lien d. IRS lien
A. Construction lien
234. All of the following are required to be displayed at a broker's office, EXCEPT: a. Copies of each sales associate's license b. A fair housing poster c. A proper sign on or about the entrance d. The license status of any broker's listed on the office sign
A. Copies of each sales associate's license
389. Which appraisal approach would usually be requested by insurance companies? a. Cost-depreciation approach b. Sales comparison approach c. Income capitalization approach d. Land residual approach
A. Cost-depreciation approach
135. Who can assess property for tax purposes? a. County property appraiser b. County commission c. School board d. Special taxing district
A. County property appraiser
125. How would a purchase money mortgage appear on a closing statement? a. Credit the buyer and debit the seller b. Credit the seller and debit the buyer c. Debit the seller and debit the buyer d. Credit the seller and credit the buyer
A. Credit the buyer and debit the seller
912. How would a second mortgage, that does not involve the seller, be reflected on a closing statement? a. Credit to the buyer b. Debit to the seller c. Credit to the seller d. Debit to the buyer
A. Credit to the buyer
909. What is the term that is used to refer to the data that an appraiser accumulates and updates, including such things as maps, cost information, and previous appraisals? a. Data plant b. Database c. Data file d. Stock
A. Data plant
473. The buyer has agreed to assume the existing mortgage of $74,260.00 at 8 1/2% interest, with monthly payments of $622.60. The remaining term of the loan is 22 years, and the closing date is May 18 (prorate as of midnight the day prior to closing). Prorate the interest using the calendar year. How will the interest portion of the payment be prorated on the closing statement? a. Debit seller $288.46, credit buyer $288.46 b. Debit seller $288.46, credit buyer $237.56 c. Debit seller $341.43, credit buyer $341.43 d. Debit buyer $293.99, credit seller $293.99
A. Debit seller $288.46, credit buyer $288.46
741. Which term refers to the estimated time that an improvement will be profitably useful? a. Economic life b. Market age c. Effective age d. Actual age
A. Economic life
925. What is the principal of a broker also known as in the agency form of business? a. Employer in a single agency b. The one paying the commission c. Seller d. Buyer
A. Employer in a single agency
922. What is the term used to refer to the unauthorized use of another's property? a. Encroachment b. Easement c. Reliction d. Variance
A. Encroachment
18. Which term is used to refer to the difference between current market value of a property and the amount the owner still owes on the mortgage? a. Equity b. Down payment c. Escrow d. Interest
A. Equity
973. Which is NOT classified as a private restriction on the ownership of real property? a. Escheat b. Leases c. Liens d. Deed restrictions
A. Escheat
288. Which estate would NOT convey legal title? a. Estate for years b. Fee simple estate c. Life estate d. Estate by the entireties
A. Estate for years
514. Under what condition does the DBPR have the power to investigate complaints against unlicensed individuals? a. Even if it is only indicated that the real estate license law is probably being violated b. Only if it involves a dealing with a licensee c. Under no circumstances d. Only if it has first established that the real estate license law has, in fact, been violated
A. Even if it is only indicated that the real estate license law is probably being violated
64. What type of listing best protects the broker? a. Exclusive right of sale b. Exclusive c. Open d. Net
A. Exclusive right of sale
470. Which of the following is an entry on a broker's cash reconciliation statement? a. Expenses of the buyer are shown as a disbursement b. Expenses of the seller shown as a receipt c. Expenses of the buyer shown as a receipt d. Expenses of the broker shown as a disbursement
A. Expenses of the buyer are shown as a disbursement
669. Complete the sentence. When all terms and conditions have been clearly stated, a contract is said to be: a. Expressed b. Formal c. Parol d. Executed
A. Expressed
530. Recommendations regarding changes in educational curriculum come under the powers of which entity? a. FREC b. Florida governor c. Post-license commission committee d. Secretary of State
A. FREC
108. Which estate or tenancy is the most comprehensive? a. Fee simple b. Life estate c. Estate for years d. Free sample estate
A. Fee simple
83. What is the most comprehensive form of real property ownership? a. Fee simple estate b. Life estate c. Tenancy in common d. Tenancy for years
A. Fee simple estate
144. What must a person do in order to qualify for the homestead tax exemption? a. File for the exemption each year b. File for the exemption only once c. Live in the house all year d. Live in the house at least 6 months of the year
A. File for the exemption each year
26. To whom is the original judgment assigned when money is to be paid from the Real Estate Recovery Fund? a. Florida Real Estate Commission b. The courts c. Department of Business and Professional Regulation d. An administrative law judge
A. Florida Real Estate Commission
688. Complete the sentence. A joint venture is typically created: a. For a single project b. By filing the appropriate paperwork with DBPR c. By filing the appropriate paperwork with the secretary of State d. To avoid paying taxes
A. For a single project
490. Broker Dan and broker Fred both have an open listing on Gail's home. Broker Dan showed Gail's home to customer Paula. Six months later broker Fred shows Gail's home to Paula and Paula buys it. Which is correct? a. Gail owes Fred a commission. b. Gail owes Dan a commission. c. Fred and Dan must share the commission. d. Gail must pay both brokers a commission.
A. Gail owes Fred a commission
628. When a buyer withdraws an offer prior to it being accepted by the seller, what should the broker do? a. Give the deposit back to the buyer b. Give the deposit to the seller c. Retain the deposit as a commission d. Call the division of real estate for instructions Reference: Ch. 5, Escrow
A. Give the deposit back to the buyer
967. Which assets found with a business brokerage are NOT usually found with a real estate corporation? a. Goodwill and personal property b. Personal property and fixtures c. Personal property and timber sales d. Personal property and leases
A. Goodwill and personal property
391. Which characteristic is NOT normally taken into account when determining the value of a good? a. Homogeneity of the product b. Transferability of the product c. Scarcity of the product d. Utility of the product
A. Homogeneity of the product
784. A Georgia broker accompanies his prospects to Florida and shows them three homes. After finding a home that the prospects like, the Georgia broker finds a Florida broker to give the deal to. The Georgia broker requests 50% of the commission as a share for assisting in the sale. Which statement applies? a. If the Florida broker pays the Georgia broker, both will have violated F.S. 475. b. The Georgia broker can be paid, provided it is no more than 50%. c. If the Florida broker pays the Georgia broker, no laws will be broken. d. Provided that the check is mailed to Georgia, there is no violation.
A. If the Florida broker pays the Georgia broker, both will have violated F.S. 475
715. Complete the sentence. Real estate commissions are usually based on the total sales price: a. Including encumbrances b. Not including seller's closing expenses c. Not including encumbrances d. Including the commission, but not encumbrances or expenses
A. Including encumbrances
42. What is the effect on present value when net income increases? a. Increases b. Decreases c. Stabilizes d. Varies
A. Increases
47. Leverage is used with the expectation of which of the following? a. Increasing the yield on an investment by using borrowed money b. Decreasing the yield on an investment by using borrowed money c. Avoiding federal income tax d. Estimating the rate of return
A. Increasing the yield on an investment by using borrowed money
558. A real estate license is not renewed at the end of the license period. Provided this is not the first renewal, what is the license status? a. Involuntary inactive b. Voluntary inactive c. Revoked d. Suspended
A. Involuntary inactive
568. A broker was found guilty of fraud, and the broker's license was revoked by the Commission. What will the license status become for all sales associates registered with that broker? a. Involuntary inactive b. Revoked c. Suspended d. Reissued
A. Involuntary inactive
494. A broker has an abstract accompanied by an opinion of title by a qualified attorney in his files that was prepared one year ago. When potential buyers inquired whether or not the title to the property was merchantable, the broker gave them a copy of the abstract and opinion of title and assured them that the title was indeed merchantable. The broker a. Is in violation of the license law b. Is not in violation of the license law c. Has acted properly, and if a title problem arises, the purchaser may sue the attorney d. Should have delivered the original documents to the purchaser rather than copies
A. Is in violation of the license law
329. In order for a broker to appoint designated sales associates to represent the buyer and seller, all of the following conditions must be met, EXCEPT: a. It is a residential transaction. b. It is a nonresidential transaction. c. The buyer and seller must sign statements. d. The buyer and seller must have assets of at least 1 million dollars.
A. It is a residential transaction
505. If a licensee fails to renew his or her license at the end of the prescribed period, what is the status of the license? a. It may remain inactive for a maximum of 2 years. b. It may remain inactive for a maximum of 10 years. c. It is automatically suspended. d. It must be renewed as soon as possible.
A. It may remain inactive for a maximum of 2 years
730. Which statement correctly applies to a branch office sign? a. It must be easily observed and read by anyone entering the office. b. It must contain the words "branch office." c. It must have the names of all active sales associates. d. It may have the names of all active and inactive officers and directors.
A. It must be easily observed and read by anyone entering the office
319. Which statement best applies to a planned unit development (PUD)? a. It provides a higher number of dwellings and maximum utilization of open areas. b. It typically includes only residential use. c. It requires areas to be left open for future growth. d. It is a less efficient use of land than other types of communities.
A. It provides a higher number of dwellings and maximum utilization of open areas
731. How will a licensee's license status be affected when payment from the Real Estate Recovery Fund is necessary due to his or her wrongdoing? a. It will be suspended until repayment is made to the fund. b. It will be revoked on the date the payment is made from the fund. c. It will be canceled until FREC can determine what to do. d. It will be rendered null and void when the claim is made.
A. It will be suspended until repayment is made to the fund
285. If two or more persons have an undivided interest in real property, which estate cannot be created unless specific wording in the deed provides for the right of survivorship? a. Joint tenancy b. Tenancy in common c. Tenancy by the entireties d. Tenancy at will
A. Joint tenancy
64. Three friends buy a property together with equal shares at the same time. If they have the right of survivorship, what type of tenancy have they created? a. Joint tenancy b. Tenancy in common c. Tenancy for years d. Tenancy by the entireties
A. Joint tenancy
657. Bob and Mary have agreed to participate in a limited number of transactions. Bob and Mary have no right to obligate or bind each other. What business relationship have they formed? a. Joint venture b. Corporation c. Partnership d. Limited liability company
A. Joint venture
380. A house valued comparably to all houses in the neighborhood was assessed at a tax base $5,000.00 less than the others. Excluding any special tax exemptions, what should the property should sell for? a. Less than the others b. More than the others c. Same as the others d. The property will not sell at all
A. Less than the others
44. A house valued comparably to all houses in the neighborhood was assessed at a tax base $5,000 less than the others. Excluding any special tax exemptions, what should the property sell for? a. Less than the others b. More than the others c. The same as the others d. Insufficient information
A. Less than the others
636. What term is used to refer to damages that are specified in a contract? a. Liquidated damages b. Unliquidated damages c. Punitive damages d. Compensatory damages
A. Liquidated damages
195. Aaron Applicant has passed the state examination for becoming a sales associate. An hour later, Aaron has the opportunity to list his neighbor's house. Aaron may: a. List the house as long as he has an employing broker and both Aaron and the employing broker are properly registered on the records of the DBPR b. Not list the property until he has sent a copy of his pass slip and a copy of his employing broker's business tax receipt number to the Division of Real Estate for certification c. List the property as long as he has been properly preregistered with his new owner-developer, and the pass slip is physically in his possession d. Not list the property until he has joined and paid the required fees to the local Association of REALTORS®
A. List the house as long as he has an employing broker and both Aaron and the employing broker are properly registered on the records of the DBPR
314. The buyer signs an offer with a deposit, but the seller changes the price. What should the sales associate do? a. Make the necessary changes, have the seller sign and initial the changes, and then have the buyer initial the changes b. Make the changes, have the buyer sign, and then have the seller sign c. Prepare a new offer reflecting the changes and then have all parties sign d. Advise the seller that there can be no changes
A. Make the necessary changes, have the seller sign and initial the changes, and then have the buyer initial the changes
326. What is the role of the local planning agency in matters concerning site planning, subdivision plat approval, and sign acceptability? a. Makes recommendations that are subject to the local governing body b. Is accountable to no other authority c. Has no authority d. Is not concerned
A. Makes recommendations that are subject to the local governing body
667. What is the most probable price that a property will bring in an open and competitive market? a. Market value b. Cost c. Replacement cost d. Reproduction cost
A. Market value
394. What would be an investor's motivation for deducting depreciation? a. Maximizing cash flow b. Minimizing cash flow c. Maximizing liability d. Minimizing income
A. Maximizing cash flow
521. A broker sells Jayne, a prospective renter, a rental list for $100 on May 1. If Jayne wants a refund, by what date must Jayne request the refund? a. May 31 b. June 1 c. May 15 d. June 15
A. May 31
841. A property is described as follows. The point of beginning is described with a cement monument. All of the other points are arrived at by angles and directions until you return to the point of beginning. Which method of legal description has been employed? a. Metes and bounds method b. Lot and block method c. Government land survey method d. Assessor's method
A. Metes and bounds method
67. All of the following items must be disclosed when answering background questions on the application for sales associate, EXCEPT: a. Minor traffic violations b. Felony or misdemeanor convictions c. Driving under the influence (DUIs) d. Any offenses for which adjudication was withheld
A. Minor traffic violations
223. Which term refers to the misstatement, omission, or concealment of a factual matter? a. Misrepresentation b. Conspiracy c. Conversion d. Puffery
A. Misrepresentation
74. Which term refers to criminal conduct on the part of a licensee that is considered contrary to the standards of justice, honesty, or good morals? a. Moral turpitude b. Breach of trust c. Culpable negligence d. Misrepresentation
A. Moral turpitude
370. All of the following are primary lenders, EXCEPT: a. Mortgage loan originators b. Commercial banks c. Life insurance companies d. Savings associations
A. Mortgage loan originators
810. Primary lenders originate loans and include all of the following, EXCEPT: a. Mortgage loan originators b. Commercial banks c. Savings associations d. Life insurance
A. Mortgage loan originators
303. Mr. Able sold his home to Mr. and Mrs. Baker and gave them a warranty deed. The Bakers moved into the home but did not record the deed. Two days later, Mr. Able died, and his heirs up north sold the property without any knowledge of the previous sale. The heirs conveyed title to Mr. and Mrs. Charles, who did record the deed. Who owns the property? a. Mr. and Mrs. Baker b. Mr. and Mrs. Charles c. Mr. Able's heirs d. The Charles and the Bakers as joint tenants
A. Mr. and Mrs. Baker
37. A borrower applied for and received an adjustable rate mortgage (ARM). The interest rate increased more than the periodic cap would allow. The new payment does not cover the full interest that is added to the principal balance and deferred. What is this called? a. Negative amortization b. Index rate c. Margin d. Teaser rate
A. Negative Amortization
671. Which type of lease is typically used in commercial real estate where the tenant pays both rent and expenses? a. Net lease b. Gross lease c. Percentage lease d. Ground lease
A. Net lease
578. If a broker changes his or her business address, what change will be made to the license status for all the sales associates employed by that broker? a. No change; they remain in force as long as the change is reported to the Department within ten days. b. They become cancelled. c. They become suspended. d. They become revoked.
A. No change; they remain in force as long as the change is reported to the Department within ten days
635. A broker listed five condos for rent on the beach in Florida. Three of the units rented for $1,000 per month, and two of the units rented for $500 per month during the season. The broker placed an ad in a Chicago newspaper, reading "Beachfront condos for rent. $500 per month, call Ocean Front Realty (407) 368- 0044." The two $500 units were not available at the time the ad ran. Is this legal? a. No, as the $500 units were not available b. Yes, the broker has done nothing wrong c. Yes, but would be a violation if the ad was in a Florida paper d. No, because Florida brokers are not permitted to run ads in out-of-state newspapers
A. No, as the $500 units were not available
640. A broker followed the instructions in a FREC escrow disbursement order, but was the victim of a civil court judgment that resulted in a payment of $10,000 from the Real Estate Recovery Fund. What consequence will the FREC impose? a. None, the FREC will take no action against the broker b. The FREC will probably suspend the broker's license c. The FREC will probably revoke the broker's license d. The FREC is required by law to suspend the broker's license
A. None, the FREC will take no action against the broker
266. A Methodist church owns a nursing home for its members. They refuse to admit anyone to the home who is not a member of their church. This is: a. Not a violation of the Fair Housing Act b. A violation of the Civil Rights Act of 1866 c. A violation of the Civil Rights Act of 1968 d. A violation of the Fair Housing Act
A. Not a violation of the Fair Housing Act
871. Three brokers are partners in a real estate brokerage partnership. One of the brokers dies. What happens to the partnership? a. Nothing, since there is still at least one active broker to run the business. b. The other partners who are brokers have their licenses suspended during the period of reorganization. c. The partnership will need to reregister using the proper forms so that the business entity may continue to function. d. Once any of the partners die, that business entity may never be reformed.
A. Nothing, since there is still at least one active broker to run the business
678. What must a sales associate do when he or she changes employers? a. Notify the Department using a change of status form b. Take all of their listings and files with them c. Wait 30 days to begin to operate d. Nothing, no action is necessary
A. Notify the Department using a change of status form
958. A broker's legal duty to the principal includes all of the following EXCEPT: a. Obeying all instructions b. Acting in good faith c. Obtaining the best price d. Disclosing all material facts
A. Obeying all instructions
971. Complete the sentence. Real estate investment analysis is a determination of the extent to which certain real estate investments will fit an investor's: a. Objectives b. Gross income requirements c. Experience d. Operating expense ratio
A. Objectives
356. Which clause in a mortgage allows the borrower to borrow back up to the original loan amount? a. Open end clause b. Prepayment clause c. Reborrowing clause d. Escalation clause
A. Open end clause
646. What type of listing allows the seller to list their home with more than one broker? a. Open listing b. Exclusive listing c. Exclusive right to sell listing d. Exclusive right of sale listing
A. Open listing
87. What type of listing can be held by more than one broker? a. Open listing b. Exclusive right of sale listing c. Exclusive listing d. Net listing
A. Open listing
565. Which business structure holds title to land in its own name? a. Partnership b. Corporation sole c. Syndicate d. Corporation for profit
A. Partnership
451. Which characteristic of an adjustable rate mortgage limits any single adjustment amount, possibly resulting in negative amortization? a. Payment cap b. Teaser rate c. Index d. Margin
A. Payment cap
304. In the case of eminent domain, what should the owner expect to receive? a. Payment of fair compensation b. No compensation c. Payment of 50% of market value d. Payment of whatever he or she feels is appropriate
A. Payment of fair compensation
40. About what should an appraiser who estimates the value of a three-year-old home in a rural area be most concerned? a. Physical depreciation b. Functional obsolescence c. External obsolescence d. Straight-line depreciation
A. Physical depreciation
638. Which action by a broker is an example of commingling? a. Placing escrow money into his or her personal account b. Failing to disclose material facts c. Failing to give an agency disclosure d. Steering buyers to an ethnic neighborhood
A. Placing escrow money into his or her personal account
109. Which term refers to the government's right to limit or control the actions of citizens in the form of such things as zoning codes and building codes? a. Police power b. Eminent domain c. Escheat d. Taxation
A. Police power
139. Which governmental power authorizes a city to make zoning laws? a. Police power b. Eminent domain c. Escheat d. Riparian doctrine
A. Police power
283. What do homestead rights provide? a. Protection from the negligence of a spouse b. Protection from a prior judgment c. Compliance with fair housing laws d. Protection from property tax foreclosure
A. Protection from the negligence of a spouse
533. A qualified applicant from a mutual recognition state who is requesting a license by mutual recognition is required to do which of the following? a. Provide proof of licensure in a mutual recognition state b. Provide a notarized letter stating their intent to become a Florida resident c. Provide proof of Florida residency for a minimum of the last six months d. Pass a 100-question law exam
A. Provide proof of licensure in a mutual recognition state
673. Two brokers sharing space in a manner whereby the public presumes the brokers are partners may be engaged in what is referred to as a: a. Quasi-partnership b. General partnership c. Limited partnership d. Joint venture
A. Quasi-partnership
711. Which expense is an example of a fixed operating expense? a. Real estate taxes b. Maintenance c. Management d. Utilities
A. Real estate taxes
232. Broker Rick sold Janey a rental list on March 8 for $100.00. Janey inspected all the properties and found them to be occupied. On April 6, Janey demands a refund. What action should Broker Rick take? a. Refund $100 immediately b. Refund $100 within 30 days c. Refund $75 d. None, no refund is due
A. Refund $100 immediately
706. With what would an appraiser utilizing the cost-depreciation approach be most concerned? a. Reproduction cost b. Replacement value c. Assessed value d. The price the seller paid for the property
A. Reproduction cost
58. What is the main purpose of Regulation Z? a. Require lenders to disclose the true cost of credit to consumers b. Require lenders to disclose closing costs to borrowers c. Require brokers to disclose closing costs to buyers d. Require sales associates to disclose commissions to customers
A. Require lenders to disclose the true cost of credit to consumers
632. If you owned one section of land described as S25, T2S, R2W, what section would be two sections to the west of your section? a. S27, T2S, R2W b. S29, T2S, R1W c. S23, T2S, R2W d. S23, T2S, R1W
A. S27, T2S, R2W
113. The primary purpose of the Federal Home Loan Bank System is to provide support for which of the following? a. Savings associations b. Federal commercial banks c. Mortgage brokers d. Insurance companies
A. Savings associations
205. A broker, while looking for a deal for his best friend, gets a listing. The seller must sell because of a family emergency. What should the broker say to his best friend? a. Say nothing about the seller, and ask the buyer to make an offer b. Tell the buyer that the seller must sell quickly so that he would probably accept any reasonable offer c. Give the buyer only the suggestion that the seller is motivated d. Tell the buyer that a dual agency exists
A. Say nothing about the seller, and ask the buyer to make an offer
73. Which clause in a deed states that the grantor was in possession and has the right to sell the property? a. Seisin b. Granting c. Premises d. Habendum
A. Seisin
690. Which of the following terms refers to a purchase money mortgage? a. Seller financing b. Chattel mortgage c. HELOC d. Bank loan
A. Seller financing
24. What must be given to a seller who is about to enter into a fiduciary relationship with a brokerage firm? a. Single Agency Notice b. Transition to Transaction Broker Notice c. Transaction Broker Notice d. No Brokerage Relationship Notice
A. Single Agency Notice
258. Broker Smith, in selling building lots, offers each buyer the opportunity to purchase, for $5.00, a chance in a lottery in which (if 20 lots are sold by the end of the week) the winner would be entitled to one-half off the price of his lot. At the end of the week, only 16 lots were sold, so Smith decided to return the entrants' $5.00. Which statement is true? a. Smith is in violation because he conducted a device, lottery, scheme, or trick. b. Smith is not in violation since the monies were returned. c. This is not a violation of F.S. 475. d. This would be a violation only if Smith in fact gave the discount to the winner of the lottery.
A. Smith is in violation because he conducted a device, lottery, scheme, or trick
548. To which entity must the Florida Real Estate Commission report criminal violations of F.S. 475? a. State attorney general b. Sheriff's office c. Local court d. DBPR
A. State attorney general
9. A mortgagor defaulted on his loan payments. The lender foreclosed on the property. Some states allow the party that was foreclosed the right to redeem the property following foreclosure. What is the term used to describe this right? a. Statutory right of redemption b. Equitable right of redemption c. Due-on-sale redemption d. Declaratory redemption
A. Statutory right of redemption
923. A real estate sales associate is prohibited from which action? a. Suing the principal b. Suing their broker c. Working for anyone other than a broker d. Acquiring properties and listings to sell
A. Suing the principal
522. Janet has reached the end of her lease. She is unable to reach the landlord but stayed in the property anyway. What type of tenancy does Janet have? a. Tenancy at sufferance b. Tenancy at will c. Tenancy by the entireties d. Tenancy in gross
A. Tenancy at sufferance
753. Bob, Brian, and Betty were co-owners of a parcel of real estate. Bob passed away, and according to his will, his interest in the property passed to his wife. What form of tenancy did Bob have? a. Tenancy in common b. Tenancy by the entireties c. Joint tenancy d. Life tenancy
A. Tenancy in common
709. A broker fails to fulfill the terms and conditions as stated in the listing contract. The listing contract states that the broker will advertise weekly in the Palm Beach Post Times and the Palm Beach Shiny Sheet, which he or she has failed to do. What may the seller legally do? a. Terminate the listing contract with the broker since the broker has failed to perform b. Not terminate the contract since there has been no breach as far as the law is concerned c. Sue the broker in the equity courts for unliquidated damages d. Sue the broker in the District Court of Appeals for Interpleader
A. Terminate the listing contract with the broker since the broker has failed to perform
875. Regarding limited partnerships as real estate brokers, there must be one or more general and one or more limited partners in order to qualify as a licensed real estate brokerage. What does the real estate license law also require in Rule 61J2-4.007? a. That each general partner be registered, at least one of whom is an active broker b. Each general and limited partner to be licensed as active brokers c. That all of the general partners be licensed as active, but none of the limited partners d. That at least one general and at least one limited partner be registered as active
A. That each general partner be registered, at least one of whom is an active broker
633. Florida law requires that brokers place escrow deposits into an escrow account. What else is required by the law regarding that account? a. The broker be a signer on the account b. The office manager be a signer on the account c. The broker must appoint someone to oversee the escrow account d. FREC must be informed of the location of the escrow account
A. The broker be a signer on the account
216. A seller lists a property at $75,000 but tells the broker he will go as low as $72,000. Which statement is correct? a. The broker cannot tell the buyer of the lower price. b. The broker must tell the buyer of the lower price. c. The broker can accept a $72,000 offer for the seller. d. either b or c
A. The broker cannot tell the buyer of the lower price
343. A buyer takes over the seller's mortgage payments, but does not assume liability. Which statement best describes this situation? a. The buyer is purchasing subject to the mortgage. b. The buyer is assuming the loan with novation. c. This is legal only when the mortgage contains a due-on-sale clause d. This is an example of an assumption
A. The buyer is purchasing subject to the mortgage
985. Jones sold his principal residence after living in it for the statutory period. He realized a capital gain of $125,000 on the sale. Which of the following applies? a. The capital gain is not taxable. b. The gain is taxable in the year of sale. c. Jones may defer the capital gain, but only if the sale is an installment sale. d. Forty percent of the gain is excluded from taxation.
A. The capital gain is not taxable
396. Which definition best describes the equity a homeowner has in their home? a. The difference between the market value and the mortgage balance b. The amount of upfront cash paid upon purchase of the home c. The amount still owed on the home d. The value determined by an appraiser
A. The difference between the market value and the mortgage balance
32. To whom do listings obtained by a sales associate belong? a. The employing broker b. The listing sales associate c. The multiple listing service d. The local association of REALTORS®
A. The employing broker
366. Which condition would decrease the supply of loanable funds for real estate loans? a. The government bonds this year are 9% compared to 8% last year. b. There is a 3% increase in family income nationwide. c. People take money from their savings accounts to put into retirement accounts. d. There is an overall increase in consumer spending.
A. The government bonds this year are 9% compared to 8% last year
869. If a real estate licensee is involved in a personal real estate transaction, which of the following is correct? a. The licensee must disclose his or her license status prior to entering into any serious negotiations. b. The licensee must disclose his or her license status in any advertising. c. The licensee is not required to disclose his or her license status in a personal transaction. d. The licensee must disclose the license status on any yard sign using terminology such as "owner agent."
A. The licensee must disclose his or her license status prior to entering into any serious negotiations
686. Which of the following is a characteristic of a general partnership? a. The partners agree to share in the profits and debts of the partnership b. All partners must be brokers c. There must be at least one limited partner d. The shareholders agree to share in the profits and debts of the partnership
A. The partners agree to share in the profits and debts of the partnership
877. A corporation for profit was formed for brokering real estate. "A" held a broker license and became president. "B" and "C" financed 40% of the corporation and each was made a director, who was to assume normal office duties and functions. "D" and "E" held broker associate licenses with prior brokerage corporations and were employed as broker/sales associates. Which applies? a. The president must register as an active broker and the directors must register as nonlicensed registered persons. b. A corporation for profit cannot be formed to broker real estate. c. "D" and "E" cannot be hired as broker associates, but could be stockholders. d. None of the above
A. The president must register as an active broker and the directors must register as nonlicensed registered persons
769. What does the creation of a condominium require? a. The recording of a declaration in the public records b. Filing articles of incorporation with the secretary of state c. A common elements agreement d. The approval of the bylaws by the county commission
A. The recording of a declaration in the public records
48. Which party normally pays for documentary stamps on the deed? a. The seller b. The buyer c. The closing agent d. The listing broker
A. The seller
868. A seller sold a home to a buyer for $50,000. The buyer made a cash down payment of $25,000. The balance of the purchase price was secured by a pledge of $25,000 in stock certificates. The buyer defaulted on the balance of the sales price, which was pledged as security. Which statement is correct regarding the seller? a. The seller has a vendor's lien and may foreclose. b. The seller may foreclose provided that he or she has served constructive notice that he or she has reserved a primary vendor's lien. c. The seller may not foreclose because stock may be pledged only as an authoritative primary security. d. The seller may foreclose only because of the tertiary law regarding pledging of stocks as a means for securing chattels.
A. The seller has a vendor's lien and may foreclose
538. A tenant orally makes an offer to lease a house for 2 years at $600 a month. What makes this offer unenforceable? a. The statute of frauds b. The statute of limitations c. No witnesses d. No binder deposit
A. The statute of frauds
579. Which clause in a deed further assures the buyer that the present owner actually owns the property and has the right to sell? a. The warrant of seizin b. The warrant of further assurance c. The warrant of quiet enjoyment d. Warranty forever
A. The warrant of seizin
870. A broker has a friend in Michigan who refers prospects from time to time. The broker reimburses the friend for any expenses but does not pay the friend a commission or referral fee. Which statement applies? a. This is an unlawful practice. b. This is a lawful practice. c. This is lawful so long as the friend does not come to Florida. d. This is unlawful unless expenses are supported by receipts.
A. This is an unlawful practice
988. A broker has an office using the trade name ABC Realty and Associates. The broker now wishes to use another trade name for a new office: Easy as ABC. Which statement applies? a. This is legal, but the broker would need multiple licensure. b. This is illegal since a broker may only use one trade name. c. This is illegal since Easy as ABC does not indicate it is a real estate office. d. This is legal, but the broker would need a group license.
A. This is legal, but the broker would need multiple licensure.
708. Complete the sentence. The Department (or DBPR) has the authority to issue subpoenas: a. To anyone thought to have knowledge of the case at hand b. To real estate licensees only c. Whenever it deems appropriate d. To any DBPR licensee
A. To anyone thought to have knowledge of the case at hand
849. Why does the mortgagor need to execute a note or bond when a lender is making a loan? a. To insure that the mortgagor is aware of their obligation b. To let the world know that a loan has been given by the lender c. To override the default clause in a mortgage d. For the lender to be able to assess a lien against the mortgagor's property if in default
A. To insure that the mortgagor is aware of their obligation
320. What do zoning laws regulate? a. Type of use b. Structures and building materials c. Public right of way and easements d. Color of exteriors, type of roof tile, etc
A. Type of use
21. When may the equity of redemption be exercised? a. Until the time of foreclosure b. For 30 days following foreclosure c. For up to one year d. At any time
A. Until the time of foreclosure
54. What is deducted from potential gross income to calculate effective gross income when performing direct capitalization with the income approach to appraising? a. Vacancy and collection loss b. Sources of income other than rent c. Operating expenses d. Reserves for replacement
A. Vacancy and collection loss
661. Which of the following elements must an option contract contain? a. Valuable consideration b. A competent grantor c. A competent mortgager d. Good consideration
A. Valuable consideration
968. With the income approach to value, if the capitalization rate is decreased and the income remains constant, what is the effect on the value? a. Value increases b. Value remains constant c. Value decreases d. Value may increase or decrease
A. Value increases
145. If an owner felt that a zoning rule was causing an economic hardship, not of his or her own making, he or she may seek relief by requesting a(an): a. Variance b. Site plan exemption c. Special use exemption d. Nonconforming use exemption
A. Variance
762. What is the status of an option without valuable consideration? a. Void b. Voidable only by the optionor c. Voidable only by the optionee d. Unenforceable
A. Void
733. A broker loses $10,000 cash given to him or her by a customer. The broker is sued, resulting in a judgment of $10,000 against the broker. The Real Estate Recovery Fund paid the judgment on behalf of the broker. Payment from the recovery fund: a. Will result in a mandatory suspension b. Will result in mandatory revocation c. Will likely result in no penalty d. May result in criminal indictments
A. Will result in a mandatory suspension
99. When calculating housing and total obligations ratios, which income value does the lender use? a. Gross monthly income b. Net monthly income c. Gross annual income d. Net annual income
A. gross monthly income
16. Complete the sentence. A broker who holds more than one broker license: a. Holds multiple licenses b. Is in violation of the license law c. Must register one as a branch license d. Can have only one active at a time
A. holds multiple licenses
21. The Florida Real Estate Commission may do all of the following, EXCEPT: a. Impose imprisonment as a penalty b. Pass rules to implement the license law c. Make determination of violations d. Establish licensing fees
A. impose imprisonment as a penalty
40. Which step follows the investigation in the complaint process? a. Probable cause determination b. Administrative complaint c. Formal hearing d. Informal hearing
A. probable cause determination
5. What business is a licensee engaged in who markets, leases and maintains property for someone else? a. Property management b. Business brokerage c. Universal agency d. Estoppel
A. property management
6. In which service of real estate must a licensee disclose the agency relationship and the responsibilities of that relationship to the public? a. Residential sales b. Residential leasing c. Real estate appraisals d. Real estate auctions
A. residential sales
106. Which of the following is a characteristic of an amortized or level payment mortgage? a. The early payments are mostly interest b. The early payments are mostly principal c. Each monthly payment increases and the balance decreases d. With each monthly payment, the interest increases and the balance decreases
A. the early payments are mostly interest
9. Sandy works as a sales associate for a broker and has been asked to work weekends for a developer to sell new homes on commission. What must Sandy do to work for the developer? a. Transfer her license from the broker to the owner-developer b. Notify the broker where she can be found on weekends c. Contact the state and be issued a group license d. Contact the state and be issued multiple licenses
A. transfer her license from the broker to the owner developer
93. In states which operate under title theory, the borrower: a. Transfers ownership to the mortgagee or a third party until paid b. Transfers possession to the mortgagee or a third party until paid c. Pledges the property as security on the loan d. Creates a tenancy in common with the lender
A. transfers ownership to the mortgagee or a third party until paid
157. What amount of the second monthly payment would be applied to principal on a $180,000 loan with an annual interest rate of 6.5% for 30 years, with payments of $1,137.72? a. $162.72 b. $163.60 c. $974.12 d. $975.00
B. $163.60
453. The sales price is $62,300 and the brokerage fee is 7%. The commission will be split as follows: MLS 5%, with the remaining 95% split between the sales associate (65%) and broker (35%). How much commission will the sales associate receive? a. $2,834.65 b. $2,692.92 c. $1,526.35 d. $1,450.03
B. $2,692.92
796. A 20-unit building is rented for $2,000 a month less than the comparable buildings since it is too close to the railroad tracks. If the capitalization rate is 12%, how much is the loss of value? a. $333,333.33 b. $200,000.00 c. $57,600.00 d. $16,666.67
B. $200,000.00
705. Carol buys a rental list for $350, looks at over 40 available apartments on the list, but is not satisfied with any of them. After 3 weeks, she requests a refund of her money. What is she entitled to receive? a. $175.00 b. $262.50 c. $350.00 d. Nothing
B. $262.50
5. Broker Max agrees to pay sales associate Sally 60% of all sales commissions she generates for the office. If Sally sells a property for $72,000 at a 7% brokerage commission, what is her share of the commission? a. $5,040 b. $3,024 c. $2,520 d. $2,016
B. $3,024
898. A retail store is leased for $1,000 per month plus 2% of gross sales. If the rent for last month was $1,600, how much were the gross sales for the month? a. $20,000 b. $30,000 c. $32,000 d. $80,000
B. $30,000
999. A man wanted to buy a $39,000 house. He was told the sale price couldn't exceed 2.5 times his income. How much must he earn per week? a. $250 b. $300 c. $350 d. $375
B. $300
452. The owner of a 150-foot by 200-foot warehouse wants to subdivide each of its four floors into 10-foot by 20-foot bins and rent out each bin for $6.00 per month; 20% of each floor will be unusable because of elevators, closets, bathrooms and hallways. What will the owner's annual income be? a. $34,200 b. $34,560 c. $43,200 d. $43,560
B. $34,560
894. A property has a potential income of $100,000, with vacancies and expenses of $51,000 and debt service of $30,000. Based on a 14% rate, what is the value of the property? a. $140,000 b. $350,000 c. $364,286 d. $686,000
B. $350,000
1. A $40,000 mortgage for a term of 20 years was originated at an 8% interest rate, with monthly mortgage payments of $334.58. What is the principal balance remaining after the second monthly payment? a. $39,932.09 b. $39,863.72 c. $39,794.90 d. $39,725.62
B. $39,863.72
95. What is the principal balance of a $50,000 mortgage at 12% interest after two monthly payments of $514.31? a. $49,985.69 b. $49,971.24 c. $49,956.64 d. $49,941.90
B. $49,971.24
517. What is the maximum allowable payment from the Real Estate Recovery Fund as a result of one transaction? a. $10,000 b. $50,000 c. $75,000 d. $150,000
B. $50,000
776. Able, Baker, and Charlie form the ABC partnership to buy real estate. Each partner invests $25,000. The ABC partnership approaches broker Dave, who negotiates a sales contract with Evan. The partnership gives Dave a deposit check for $75,000. Broker Dave took the deposit money to Las Vegas and lost all of it playing blackjack. ABC sued the broker and obtained a judgment against him in the amount of $75,000. Dave could not pay the judgment, and a claim was filed with the Real Estate Recovery Fund. How much will FREC authorize the fund to pay? a. $75,000 b. $50,000 c. $50,000 each to Able, Baker, and Charlie d. $25,000 each to Able, Baker, and Charlie
B. $50,000
456. An apartment complex has three apartments rented for $600.00 each, six apartments rented for $400.00 each, and six apartments rented at $300.00 each. All apartments are rented on a monthly basis, with rental payments due on or before the first of each month. If the gross rent multiplier is 85, what is the value of the property? a. $612,000 b. $510,000 c. $425,300 d. $357,000
B. $510,000
439. A tenant pays rent at a cost of $5.00 per square foot. When he rents the property, the CPI (rent index) is at 1.5. The CPI goes up to 1.8. How much will his rent be increased to if it is based on the CPI? a. $5.50 per square foot b. $6.00 per square foot c. $7.50 per square foot d. $8.00 per square foot
B. $6.00 per square foot
151. A lawn service company sold for $125,000. The tangible assets amounted to the lawn equipment valued at $48,000. The intangible assets were the customer base and the company's good reputation. What is the value of the intangible assets? a. $173,000 b. $77,000 c. $48,000 d. $38,500
B. $77,000
998. A 1-year term loan for $300 at 7.5%, with simple interest paid at the end of the term, has been repaid 11 months at $22.25 per month. What would the amount of the last payment be? a. $75.00 b. $77.75 c. $55.00 d. $100.00
B. $77.75
53. Which two items are equivalent? a. Tier and section b. 1/36 and township/section c. Range and township d. Meridian and baseline
B. 1/36 and township/section
906. Which of the following pairs best describes 640 acres (more or less)? a. Tier, section b. 1/36 township, section c. Range, township d. Check, government lot
B. 1/36 township, section
950. Within what timeframe must real estate licensees notify the Department of a change of address? a. 5 days b. 10 days c. 60 days d. 30 days
B. 10 days
1000. An investor realizes a net income of $925 per month on a $111,000 investment. What is his yield (return on investment)? a. 9% b. 10% c. 11% d. 12%
B. 10%
100. If a lender charges four points on a loan with an interest rate of 11%, what would be the approximate yield to the lender? a. 11.25% b. 11.50% c. 11.75% d. 11.85%
B. 11.50%
99. If property value equals $120,000, operating expenses are $45,000, and the net operating income is $15,000, what is the capitalization rate? a. 12.25% b. 12.50% c. 12.75% d. 13.25%
B. 12.50%
169. What is the monthly gross rent multiplier for a house that sold for $269,500, and was rented for $2,000 per month? a. 11.23 b. 134.75 c. 145.25 d. 156.10
B. 134.75
737. How many years must a tax certificate holder wait before applying for a tax deed? a. 1 b. 2 c. 7 d. Any number of years
B. 2
598. Twenty-five mills means that the tax equals which of the following? a. 25% b. 2.5% c. .25% d. .025%
B. 2.5%
509. The defendant must file an answer to an administrative complaint within how many days? a. 15 b. 21 c. 30 d. 14
B. 21
895. Mrs. Smith purchases two adjacent 60- foot by 120-foot lots at a cost of $2 per square foot. She divides these lots into three lots and sells them at $300 per front foot. What will her percentage of profit be upon sale of the lots? a. 20% b. 25% c. 30% d. 35%
B. 25%
993. Mr. McDonald found a farm that was for sale under distress conditions. He bought the farm for 80% of market value and later resold the property for full market value. What percentage of profit did Mr. McDonald make on the transaction? a. 20% b. 25% c. 33% d. 50%
B. 25%
2. If the price of a lot is $9 per square foot, how many square feet are contained in a lot that sells for $27,000? a. 243 b. 3,000 c. 30,000 d. 33,333
B. 3,000
248. If FREC imposed a fine and issued a final order, how much longer does the licensee have to pay the fine? a. 10 days b. 30 days c. 60 days d. 90 days
B. 30 days
154. James, a potential buyer, is told by the lender that he can have a loan at an interest rate of 6%. When he goes to the closing, he notices that the Truth-in-Lending statement says the APR is 6.5%. Using the rule of thumb calculation, how many points were most likely charged? a. 3 b. 4 c. 5 d. 6
B. 4
84. How many acres does the following legal description contain? The S 1/2 of the SW 1/4 of the NW 1/4 and the N 1/2 of the NW 1/4 of the SW 1/4 of a Section a. 20 b. 40 c. 625 d. 640
B. 40
442. A corner lot measures 100 feet by 100 feet. The only restriction is a 10-foot setback from the road. What is the maximum usable square footage? a. 8,000 square feet b. 8,100 square feet c. 9,000 square feet d. 10,000 square feet
B. 8,100 square feet
795. Mr. Miller is going to purchase a property with the following financing: There is an existing first mortgage with a balance of $100,000 with an interest rate of 9%, and a second mortgage of $50,000 with an interest rate of 8%. What is the blended rate? a. 8.50% b. 8.67% c. 9.00% d. 17.00%
B. 8.67%
158. Sandy is purchasing a home for $570,000, with a down payment of $114,000. If she finances the difference, what is the loan-to-value ratio? a. 85% b. 80% c. 65% d. 60%
B. 80%
905. What type of commercial market would exist if there were an excess amount of office space for rent? a. A sellers' market b. A buyers' market c. A suppliers' market d. All of the above
B. A buyers' market
940. Prior to being sold as a timeshare, which type of building must it have been? a. A cooperative b. A condominium c. An estate for years d. A fee simple estate
B. A condominium
2. How is a real estate appraiser typically paid? a. A fee based upon seniority b. A fee based upon time and difficulty of the appraisal c. A fee based upon the value of the property appraised d. A commission based upon the value of the property
B. A fee based upon time and difficulty of the appraisal
757. Abby purchased a house with her son and daughter-in-law. The deed required that if one of the three partners died, the interest of the deceased would pass to the remaining tenants. Of which type of estate is this an example? a. A tenancy by the entireties b. A joint tenancy c. An estate in severalty d. A tenancy at sufferance
B. A joint tenancy
544. Under what condition may the FREC revoke a license without prejudice? a. An applicant fails the state exam b. A license was issued by mistake c. A sales associate had a real estate license revoked in another state d. An applicant did not correct errors or omissions on their application within 30 days
B. A license was issued by mistake
324. From which type of loss can zoning protect an owner? a. A loss in value due to decreased demand b. A loss in value in a residential area with urban encroachment c. A loss due to flooding d. A loss due to a change in market conditions
B. A loss in value in a residential area with urban encroachment
627. A valid real estate sales contract requires all of the following, EXCEPT: a. An offer and acceptance communicated to all parties b. A substantial earnest money deposit c. A written form d. The signatures of all parties
B. A substantial earnest money deposit
647. Complete the sentence. An oral lease, in excess of 1 year, may also be referred to as: a. Invalid b. A tenancy at will c. A tenancy at sufferance d. A freehold estate
B. A tenancy at will
43. To avoid an undue hardship imposed by zoning regulations, a property owner may request which of the following? a. A special exception b. A variance c. Grandfathering d. A designated exception
B. A variance
60. A broker receives a kickback or referral fee from a title insurance company. This practice is: a. Legal b. A violation of RESPA c. Legal; however, not recommended d. Illegal; however, FREC will allow it to continue as long as the broker is active
B. A violation of RESPA
943. What is the term used for the buyer of a mortgage in the secondary mortgage market? a. Assignor b. Assignee c. Vendor d. Vendee
B. Assignee
666. Under which agreement does a party give up all of their rights under a lease? a. Sublease b. Assignment c. Transfer of entitlement agreement d. Release of lien
B. Assignment
471. Which of the following items would typically appear as debits to the seller on the closing statement? a. First mortgage interest, purchase price, and expenses b. Assumed mortgage interest, taxes, and expenses c. Expenses, deposit, and purchase price d. Taxes, mortgage interest, and purchase price
B. Assumed mortgage interest, taxes, and expenses
148. What are the two most important financial summary statements of a business? a. Working capital and depreciation reports b. Balance sheet and income statement c. Cash flow and asset reports d. Tax returns and asset report
B. Balance sheet and income statement
61. Complete this statement. To be valid, a deed does NOT have to . a. Be in writing b. Be under seal c. Be delivered and accepted d. Stipulate a consideration
B. Be under seal
330. All REALTORS® are licensees, but not all licensees are REALTORS®. What must a licensee do to become a REALTOR®? a. File with FREC b. Become a member of a local Association of REALTORS® c. Complete a FREC educational program d. Complete 45 hours of post-license education
B. Become a member of a local Association of REALTORS®
573. Bob wishes to open a residential real estate corporation, along with a property management corporation. Bob wishes to be the active broker for both corporations. Which statement is correct? a. Bob will not be allowed to do this. b. Bob must hold multiple licenses. c. Bob will be allowed to do this only if he takes the state exam twice. d. Bob will have to hire another broker for the second corporation.
B. Bob must hold multiple licenses
482. A broker held up a bank and escaped with a large amount of cash. What is the consequence if the broker is apprehended? a. Broker's license must be revoked. b. Broker is subject to discipline by the Florida Real Estate Commission. c. Broker must be suspended. d. Florida Real Estate Commission may impose a fine of $1,000 and imprison the broker for no more than 1 year.
B. Broker is subject to discipline by the Florida Real Estate Commission
814. A buyer makes an offer, and the deposit is placed into the broker's escrow account. At this point, to whom does the deposit belong? a. Broker b. Buyer c. Seller d. Buyer and seller
B. Buyer
675. A Georgia broker and a Florida broker form a joint venture to sell a Florida property that a friend of the Georgia broker owns. The Georgia broker comes down to assist the Florida broker in the sale of the property. The Florida broker: a. May share the commission with the Georgia broker b. Cannot pay the Georgia broker part of the commission c. Can pay the Georgia broker only a referral fee d. Can pay the Georgia broker only for expenses and travel
B. Cannot pay the Georgia broker part of the commission
561. A seller sells an income-producing property for a $42,000 profit. What is the tax implication for the seller? a. No capital gains tax is required if the profits are reinvested within 24 months b. Capital gains tax must be paid on the entire profit, less any allowable depreciation c. Capital gains tax must be paid on 20% of the profit d. The alternative minimum tax must be paid
B. Capital gains tax must be paid on the entire profit, less any allowable depreciation
907. What is an abstract of title? a. Guarantee of title b. Chain of information c. Deed of restriction d. Warranty of title
B. Chain of information
219. A seller-listed property at a price that the broker knew was below market value. The broker had his wife buy the property in her maiden name and subsequently resold the property at a profit. What could the broker be charged with? a. Nothing b. Concealment and fraud c. Alienation of affection d. Culpable negligence
B. Concealment and fraud
936. What is the term used to refer to the process used by the government to exercise its power of eminent domain? a. Conversion b. Condemnation c. Concealment d. Estoppel
B. Condemnation
378. Which principle of value indicates that the value of a property is sustained when the property is harmoniously used with surrounding properties in the same area? a. Contribution b. Conformity c. Balance d. Highest and best use
B. Conformity
41. What appraisal principle states that homes in a neighborhood of similar homes should have similar values? a. Absorption b. Conformity c. Correlation d. Utility
B. Conformity
622. What term is used to refer to a lien imposed on a property for nonpayment of materials or labor to improve a property? a. Vendor's lien b. Construction lien c. Tax lien d. Judgment lien
B. Construction lien
983. What would a broker be guilty of if he or she takes escrow funds and places them a personal account? a. Concealment b. Conversion c. Culpable negligence d. Nothing; this is a legal act as long as the broker keeps accurate accounting of all funds
B. Conversion
560. Which business structure may NOT act as a real estate broker? a. Joint venture b. Corporation sole c. Corporation for profit d. A and b
B. Corporation sole
428. Factors of demand in residential real estate include all of the following, EXCEPT: a. Price b. Cost c. Income d. Credit
B. Cost
70. Complete this sentence. Valuable consideration . a. Can only be money b. Could be a promise c. Is a requirement of all contracts d. Refers to "love and affection"
B. Could be a promise
982. On a closing statement, how would a purchase money second mortgage obtained from the seller be entered? a. Credit to seller, debit to buyer b. Credit to buyer, debit to seller c. Debit to seller, receipt for broker d. Credit to seller, disbursement by broker
B. Credit to buyer, debit to seller
474. Mr. Smith agreed to sell his house to Mrs. Brown. The closing date was set for October 15. Smith agreed to pay for all charges incurred on the day of closing. The estimated taxes for the year are $4,800. Using the 365-day method, how would the taxes appear on the closing statement? a. Debit buyer $3,787.40, credit seller $3,787.40 b. Debit seller $3,787.40, credit buyer $3,787.40 c. Debit seller $1,012.60, credit buyer $1,012.60 d. Debit buyer $1,012.60, credit seller $1,012.60
B. Debit seller $3,787.40, credit buyer $3,787.40
67. The purpose of the homestead exemption is to protect the surviving spouse and children and to exempt property from foreclosure for: a. Property taxes b. Debts other than direct debts and federal liens c. Mortgage debts d. All debts
B. Debts other than direct debts and federal liens
48. Where must the appeals of FREC final orders be filed? a. Circuit Court of Appeals b. District Court of Appeals c. Offices of the Association of REALTORS d. Offices of the Department of Financial Services
B. District Court of Appeals
22. What type of planning study deals with local business activity? a. Physiographic b. Economic base analysis c. Thoroughfare d. Community facilities
B. Economic base analysis
382. An appraiser is appraising an apartment building in a college town and finds that the students' leases are below the market. What type of rental income would the appraiser use to value the property? a. Gross rent b. Economic rent c. Contract rent d. Base rent
B. Economic rent
486. Peggy and Joan wish to form a partnership to buy and sell real estate for others. Which statement is correct? a. Peggy and Joan must both be actively licensed brokers. b. Either Peggy or Joan must be an actively licensed broker. c. If Peggy is an actively licensed broker, Joan must be an inactively licensed broker or be registered as an unlicensed partner. d. If Joan is an actively licensed broker, Peggy must be an actively licensed sales associate or broker associate.
B. Either Peggy or Joan must be an actively licensed broker
554. George has a residence in Ft. Lauderdale and a summer home near Daytona Beach. He and his family spend every weekend as well as 2 months each summer in Daytona. On which property does the Florida homestead law allow him to qualify for homestead exemption? a. Ft. Lauderdale only b. Either property, but he can claim only one exemption c. Daytona Beach only d. Neither property
B. Either property, but he can claim only one exemption
301. Which covenant in a deed assures the grantee that there are no claims or liens on the property other than those specifically listed on the deed? a. Warrant of quiet enjoyment b. Encumbrance clause c. Seizin clause d. Warrant of further assurance
B. Encumbrance clause
775. A buyer gives a deposit check on a sale of a house to the sales associate and inadvertently makes the check out to the sales associate. What should the sales associate do? a. Cash the check and give the broker the cash b. Endorse the check and give it to employing broker c. Endorse the check and deposit it in a personal account d. Endorse the check and deposit it in their escrow account
B. Endorse the check and give it to employing broker
322. What is the term that is applied to the practice of keeping low-income people out of a particular neighborhood? a. Zoning b. Exclusionary zoning c. Nonconforming use d. Subdivision exception
B. Exclusionary zoning
6. What term is applied to the practice of keeping low-income people out of a particular neighborhood? a. Income zoning b. Exclusionary zoning c. Nonconforming use d. Subdivision exception
B. Exclusionary zoning
62. An owner promises to give a listing to only one broker, setting forth the price, terms, time, and commission, but reserves the right to sell the property without paying any commission. What type of listing has the seller given? a. Exclusive right of sale b. Exclusive c. Net d. Open
B. Exclusive
344. Which clause in a mortgage requires the lender to look to the mortgaged property only for satisfaction? a. Defeasance clause b. Exculpatory clause c. Cognovit clause d. Subordination clause
B. Exculpatory clause
664. Which would never appear in a real estate sales contract? a. Remedies for breach b. Exculpatory clause c. Time for occupancy and closing d. Financing provisions
B. Exculpatory clause
197. Which entity signs the certificates of the FREC meetings that reflect the actions of the Commission? a. Secretary of state b. FREC chairperson or vice chairperson c. Chief investigator of the DRE d. Any FREC commissioner
B. FREC chairperson or vice chairperson
920. What is the term used to refer to a real estate licensee who is specializing in a certain geographic area? a. Steering b. Farming c. Speculating d. Following-up
B. Farming
50. What does Freddie Mac stand for? a. Farmer's Home Loan Mortgage Corporation b. Federal Home Loan Mortgage Corporation c. Federal National Mortgage Corporation d. Farmer's National Mortgage Corporation
B. Federal Home Loan Mortgage Corporation
651. Which entity may insure home loans made by approved lenders? a. Federal Deposit Insurance Corporation b. Federal Housing Administration c. Florida Department of Insurance d. Department of Veterans Affairs
B. Federal Housing Administration
857. Which of the following acts like an insurance company? a. Federal Reserve System b. Federal Housing Administration c. National Association of REALTORS® d. Fannie Mae
B. Federal Housing Administration
361. Which entity controls the U.S. monetary policy? a. President of the United States b. Federal Reserve System c. Federal Trade Commission d. Federal Housing Finance Board
B. Federal Reserve System
275. Widow McFee found that her deceased husband left his entire estate, except for homestead, to his secretary. What can Widow McFee do? a. File for her dower share of one-third of all real property owned by her deceased husband b. File for an elective share of 30% of all real and personal property owned by her deceased husband c. File for 100% of his property under Florida's community property law d. Only file a civil suit to contest the will
B. File for an elective share of 30% of all real and personal property owned by her deceased husband
281. What would a developer do to help a development hold its value? a. File a plat map b. File subdivision restrictive covenants c. Order surveys d. Obtain a zoning variance
B. File subdivision restrictive covenants
918. How long may an unlicensed person be imprisoned if found to be in violation of F.S. 475? a. Not at all b. For up to 5 years c. For up to 6 months d. For up to 1 year
B. For up to 5 years
441. A person owns an acre of property. After allowing for a road 60 feet wide and 246 feet long, how many 80-foot by 90-foot lots could be developed? a. Three lots b. Four lots c. Five lots d. Six lots
B. Four lots
35. A relatively new four-bedroom home with only one bathroom is an example of which of the following? a. Physical deterioration b. Functional obsolescence c. External obsolescence d. Accrued depreciation
B. Functional obsolescence
387. A house has a bathroom built onto the side of the kitchen. The bathroom has a laundry tub but no room for a bathtub. What is this an example of? a. Physical deterioration b. Functional obsolescence c. External obsolescence d. Economic obsolescence
B. Functional obsolescence
829. A sales associate helps her aunt rent an apartment. To show her gratitude, the aunt gives her niece a $250 commission. What should the sales associate do with the $250? a. Give it back to her aunt. b. Give it to her broker. c. Keep it. d. Keep it, but only with her aunt's permission.
B. Give it to her broker
740. A broker receives a deposit on a property, but the seller rejects the offer. What should the broker do? a. Retain the deposit until he or she can talk the seller into accepting b. Give the deposit back to the buyer c. Keep the deposit while the buyer looks for another property d. Notify FREC immediately
B. Give the deposit back to the buyer
295. If an unrecorded deed is accidentally destroyed, who owns the property? a. Title holder of record b. Grantee c. Vendor d. Grantor
B. Grantee
121. The highest and best use of a parcel of land is the use that creates which of the following? a. Greatest density b. Greatest value for the land c. Greatest intensity d. Greatest tax base
B. Greatest value for the land
606. All of the following are factors of production in a free enterprise system, EXCEPT: a. Capital b. Growth c. Labor d. Management risk-taking
B. Growth
750. A broker sells a property to a buyer. The buyer asks if an attorney is needed to close. The broker tells the buyer that he has sold this same property on several different occasions without a problem, and that the property has never had a title problem. He therefore advises that an attorney is not required. The broker: a. Has done nothing wrong b. Has violated F.S. 475 c. Would be guilty only if a cloud shows up on title d. Should apologize to the buyer for the poor information
B. Has violated F.S. 475
260. A broker has a Texas securities license as well as a Florida real estate license. The broker commits fraud on a securities transaction in Texas and agrees to make full restitution. Most likely the broker will: a. Have nothing happen in Florida because it was an out of state securities matter b. Have the Florida broker's license revoked or suspended c. Have nothing happen because he made restitution d. Be sentenced to 90 days of community service by FREC
B. Have the Florida broker's license revoked or suspended
262. A buyer enters a broker's office and requests to be shown only houses in black neighborhoods. The broker advises the buyer that he will show him houses without regard to the racial characteristics of the neighborhood. The broker shows the buyer houses in both predominately black and predominately white neighborhoods. The buyer is interested in two of the houses in the predominately-black neighborhoods. If the broker had followed the buyer's initial instructions, he would: a. Have violated federal laws but not the Florida real estate license law b. Have violated the Civil Rights Act and Florida law and could have his license suspended or revoked c. Not have violated any laws since he must follow his seller's instructions d. Not have violated any laws since he must follow his buyer's instructions
B. Have violated the Civil Rights Act and Florida law and could have his license suspended or revoked
192. XYZ Development Corp. was developing a PUD (planned unit development) in Carol City. Sales associate Green, employed by XYZ Corp., was employed to sell vacant home sites. XYZ Corp. had a subsidiary company, the Sunshine Corp., in another city 200 miles away, developing another PUD. If sales associate Green is transferred to the Sunshine Corp., which statement is correct? a. He could apply for a multiple license and notify the FREC. b. He could apply for a group license and notify the FREC. c. This would be a violation of F.S. 475. d. As long as he notified XYZ Corp., this is legal.
B. He could apply for a group license and notify the FREC
945. A broker is confined to a hospital for a temporary mental incapacity. Which is correct? a. His or her license must be revoked. b. His or her license may be suspended for the period of incapacity. c. Nothing will be done or needs to be done with his or her license status. d. When the broker is discharged from the hospital, he or she will have to take the FREC I course over again.
B. His or her license may be suspended for the period of incapacity.
487. Broker Stan showed Benny a 30-year-old home owned by Chuck. Benny was concerned about the age of the house, but Stan convinced Benny to buy it for the listed price of $89,000 by promising to buy the home from Benny for the full price within 3 months if Benny found the home to be unsatisfactory. Which statement is correct? a. Stan's promise violates the license law, and he is subject to disciplinary action. b. If Benny asks Stan to purchase the home from him, and Stan refuses, Stan would be in violation of the license law. c. Stan would not be required under the license law to purchase the home from Benny. d. Chuck would be required to repurchase the property as the broker was acting as his agent in the transaction.
B. If Benny asks Stan to purchase the home from him, and Stan refuses, Stan would be in violation of the license law
702. A sales associate receives an offer from the buyer along with a postdated check. What action must the sales associate take? a. Return it, as postdated checks are illegal in Florida b. Immediately turn it over to the broker c. Cash the check on the appropriate date, and give the money to the broker d. Hold the check until the appropriate date, and deposit into the escrow account
B. Immediately turn it over to the broker
384. A man lives in a neighborhood of $50,000 homes. He decides to install expensive imported marble tile throughout the home. Of which type of depreciation is this an example? a. Incurable physical depreciation b. Incurable functional depreciation c. Curable functional depreciation d. Curable physical depreciation
B. Incurable functional depreciation
865. To what does blockbusting refer? a. Choosing which properties to show a prospect based on a protected class b. Inducing owners to sell because of a migration of ethnic groups into the neighborhood c. Avoiding lending mortgage money in certain neighborhoods because of a protected class d. Excluding protected classes from living in a particular neighborhood
B. Inducing owners to sell because of a migration of ethnic groups into the neighborhood
755. A broker sells a house to a buyer and recommends a particular title company. The title company forwards a referral fee to the broker. The broker: a. Has done nothing wrong as this is considered normal business practice b. Is in violation of the law c. May accept the fee if he or she advises the seller d. May accept the fee if he or she advises the buyer
B. Is in violation of the law
779. All of the following statements are correct regarding a corporation sol, EXCEPT: a. Title passes to the successor in office. b. It may broker real estate. c. It may list real estate with a broker. d. It may sell its own real estate.
B. It may broker real estate
507. Frank and Harry own a property. Frank dies, and the property passes to Harry. How was the property held? a. Tenancy by the entireties b. Joint estate c. Tenancy at will d. Community property
B. Joint estate
186. Jasper Judd is a salaried resident manager of the Golden Age Condominium complex. Adolph Ajax, an owner of one of the units in the condominium, has asked Jasper to lease his unit while he is away on an extended trip to Bulgaria. Jasper may: a. Lease out the unit for any period of time, as long as he is not compensated. b. Lease out the unit for Adolph for not more than 1 year, as long as he is not compensated in addition to his salary. c. Not lease out the unit since this would violate F.S. 475. d. Lease out the unit but may not be compensated more than $100.
B. Lease out the unit for Adolph for not more than 1 year, as long as he is not compensated in addition to his salary
286. Which type of interest in real property is created by a type of contractual agreement having all essential elements of a contract, plus a property description and a definite term of tenancy? a. Tenancy at will b. Leasehold c. Fee simple estate d. Life estate
B. Leasehold
965. What does the seller become when a property owner sells a property and immediately leases it back? a. Lessor b. Lessee c. Vendee d. Mortgagor
B. Lessee
424. When the county assesses property and collects taxes, what are they doing? a. Establishing the base rate b. Levying taxes c. Assessing taxes d. Establishing a millage rate
B. Levying taxes
749. Mr. Black listed his farm "Blackacre" as being 20 acres with broker Bob for sale at $200,000. Bob obtained an offer from Joe to purchase at $10,000 per acre. The survey showed the farm contained only 18 acres, and since Mr. Black had accepted the offer, the transaction was closed at an $180,000 sales price. Mr. Black is: a. Liable for a commission on the listed price of $200,000 since the farm was described in the listing as containing 20 acres b. Liable for the full and customary percentage on the selling price of $180,000 c. Not liable for the commission since the amount of the commission was not agreed upon, and broker Bob did not check the acreage d. Liable for a commission, but not the full and customary percentage, since the sale was for $20,000 less than the listed price
B. Liable for the full and customary percentage on the selling price of $180,000
250. A broker who is temporarily incapacitated in regard to his or her ability to act as a broker with regard to safety of the public will probably have which action taken? a. License revocation b. License suspension c. License made null and void d. Reprimand
B. License suspension
483. Which statement is true with respect to limited partners in a limited partnership formed to broker real estate? a. All limited partners must be brokers, either active or inactive. b. Limited partners are not allowed to perform management services. c. Actively licensed limited partners may perform management services for the partnership. d. All limited partners must be licensed as inactive brokers or inactive sales associates.
B. Limited partners are not allowed to perform management services
614. How does the Marketable Record Title to Real Property Act (MARTA) relate to curing defects in title? a. Requires the title examiner to search back to the original conveyance of title, in order to prove that the title is free and clear of any claims b. Limits the period of search required to establish valid and marketable "root of title" to at least 30 years c. Requires that if an unrecorded deed is accidentally destroyed, the grantee is recognized as having a marketable record of title d. Requires any recorded instrument or court preceding that affects title to any estate or interest in land and that sufficiently describes the land to identify its location and boundaries
B. Limits the period of search required to establish valid and marketable "root of title" to at least 30 years
952. Which term refers to the rights an owner has because their property is lakefront? a. Alluvion rights b. Littoral rights c. Allodial rights d. Accretion rights
B. Littoral rights
379. With the income approach to appraising, the value of the property today is: a. More than the future value b. Measured in future benefits c. Not considered in an appraisal d. To be paid to the appraiser
B. Measured in future benefits
602. What is the most effective method of describing real property? a. Monuments method b. Metes and bounds method c. Government land survey method d. Lot and block method
B. Metes and bounds method
478. Owner Tim was in need of cash and contacted broker Mildred to list his property. Mildred inspected the property and advised Tim that the house was worth $90,000. Since Tim had to sell quickly, he listed the property for $84,000. Mildred acquired a 60-day option for $1,500 consideration and sold the property 2 weeks later for $92,000. Which choice is correct? a. Mildred has committed fraud. b. Mildred may retain the difference. c. Tim only owes Mildred a commission. d. Tim should file a civil action against Mildred.
B. Mildred may retain the difference
346. The buyer receives all of the following items at closing, EXCEPT: a. Deed b. Mortgage c. Opinion of title d. Closing statement
B. Mortgage
44. Which punishment would FREC likely impose for a first offense against a broker found guilty of a minor violation? a. $500 fine b. Notice of noncompliance c. Citation d. Suspension
B. Notice of noncompliance
566. A new sales associate does not complete the post-license education before the first renewal. What is the sales associate's license status? a. Suspended b. Null and void c. Revoked d. Cancelled
B. Null and void
297. Complete the statement to make it correct. An easement is the legal right of use: a. Of another's property for any purpose b. Of another's property for a specific purpose c. For up to 7 years d. For up to 20 years
B. Of another's property for a specific purpose
414. What is one mill? a. One-hundredth of a dollar b. One-thousandth of a dollar c. One-hundredth of a penny d. One-tenth of a dime
B. One-thousandth of a dollar
7. Complete this statement. A transaction broker . a. Owes full disclosure to both parties b. Owes limited confidentiality to both parties c. Must be compensated by both parties d. Cannot work in a nonresidential transaction
B. Owes limited confidentiality to both parties
429. Building activity is related to the business cycle. When in the expansion phase of the business cycle, what is the next phase? a. Contraction b. Peak c. Revival d. Recovery
B. Peak
68. Building activity is related to the business cycle. If the current phase of the business cycle is expansion, what is the correct order of the next phases in the cycle? a. Contraction, peak, and trough b. Peak, contraction, and trough c. Trough, peak, and contraction d. Contraction, trough, and peak
B. Peak, contraction, and trough
840. Which survey method should be used when there are recorded subdivisions? a. Metes and bounds method b. Plat method c. Government land survey method d. Monuments method
B. Plat method
49. By what right does the government enforce zoning regulations? a. Laws passed by citizens b. Police power c. Eminent domain d. Condemnation
B. Police power
641. Under what authority are cities and counties allowed to enact zoning ordinances? a. The local planning commission b. Police power c. Eminent domain d. F.S. 475
B. Police power
74. What is actual notice? a. Recording the deed in the public records b. Possession of the property that can be seen and heard c. Less valid than constructive notice d. Notarizing the documents of transfer
B. Possession of the property that can be seen and heard
85. All of the following are required to obtain an active sales associate license, EXCEPT: a. Complete pre-licensing education and pass the state licensing exam. b. Provide proof of Florida residency. c. Obtain employment by an active, licensed broker or owner-developer. d. Submit an application along with the fee payment.
B. Provide proof of Florida residency
613. A sales associate represents a buyer in a transaction and is asked to give an opinion about the title. What may the sales associate do? a. Tell the buyer he is no longer interested in representing him or her b. Quote an opinion from a competent attorney c. Tell the buyer that he or she doesn't need a title opinion because it was just checked six months ago d. Tell the buyer that there will be an additional charge for the sales associate to give a title opinion
B. Quote an opinion from a competent attorney
133. What are ad valorem taxes? a. Special assessment taxes b. Real estate property taxes c. Income taxes d. Quasi-taxes
B. Real estate property taxes
866. What instrument must be recorded in order to convey a title back to the mortgagor in a deed of trust? a. Quitclaim deed b. Reconveyance deed c. Bargain and sale contract d. Special warranty deed
B. Reconveyance deed
603. A real estate broker asks his sales associate to commit an illegal act. What should the sales associate do? a. Comply, as the sales associate may lose his or her job b. Refuse to comply and withdraw from the relationship c. Notify the Florida real estate commission d. Comply, but inform the employer that he or she is complying under duress
B. Refuse to comply and withdraw from the relationship
771. If a REALTOR® has a sign in the office window indicating that the broker is a member of a particular organization, but in fact, the broker was dropped from the organization for failure to pay dues, what should the broker do? a. Pay the dues b. Remove the sign c. Have never had the sign in the window to begin with d. Keep the sign up, since he is a former member
B. Remove the sign
979. What do the Greenbelt Laws do? a. Encourage people to leave farming to move to the city b. Require agricultural land to be assessed at its current use rather than its highest and best use c. Increase the taxes farmers must pay on their land d. Result in appreciably higher tax revenues for cities adjacent to farmland
B. Require agricultural land to be assessed at its current use rather than its highest and best use
959. A seller listed his home with a broker, and the broker sold the property to a buyer. The buyer made an earnest money deposit of $10,000, which the broker promptly deposited in the escrow account. The sales contract contains a clause that makes the agreement contingent upon the buyer obtaining mortgage financing. The buyer is notified by the bank that his housing expense ratio exceeds the limit, and therefore his application has been rejected. What should the broker do? a. Hold the deposit until the bookkeeper returns b. Return the deposit immediately, provided the seller does not object c. Ask the FREC for an escrow disbursement order (EDO) d. Return the deposit only after receiving a court judgment
B. Return the deposit immediately, provided the seller does not object
102. What term refers to the right of a mortgagor to stop a foreclosure process by paying the entire balance, interest and so on? a. Equity of estoppel b. Right of redemption c. Right of defeasance d. Equity of disposition
B. Right of redemption
572. What is the name for the legal rights of property owners whose land borders a river? a. Civil rights b. Riparian rights c. Littoral rights d. Air rights
B. Riparian rights
611. What is opposite of N20°W? a. N20°E b. S20°E c. S20°W d. E20°N
B. S20°E
831. Sales associate Betty, who works for broker Sam, went on vacation to Key West for 2 weeks. While there, she ran into three couples from New Jersey, who were interested in buying waterfront condos. Betty sold condos to all three couples. Being that she was from out of town, she approached broker Tony, who ran the deals through his office. In appreciation for Betty's efforts, broker Tony paid Betty $15,000. Which statement applies? a. Sales associate Betty should have received more than $15,000. b. Sales associate Betty and broker Tony have both violated F.S. 475. c. Sales associate Betty and broker Sam have both violated F.S. 475. d. There was no violation of F.S. 475.
B. Sales associate Betty and broker Tony have both violated F.S. 475
56. When a mortgage is paid in full, which document should be delivered to the mortgagor? a. Assignment b. Satisfaction c. Deed d. Estoppel
B. Satisfaction
480. A broker has been found guilty by the Florida Real Estate Commission of advertising in a fraudulent, false, deceptive, or misleading way. In addition to administrative penalties, what criminal violation has occurred? a. First-degree misdemeanor b. Second-degree misdemeanor c. Second-degree felony d. Third-degree felony
B. Second-degree misdemeanor
816. Printing false information is considered which criminal offense? a. Second-degree felony b. Second-degree misdemeanor c. First-degree felony d. First-degree misdemeanor
B. Second-degree misdemeanor
196. Before the rules and regulations enacted by the FREC become effective, with which entity must they be filed? a. Attorney general b. Secretary of state c. Secretary of the senate d. Governor's office
B. Secretary of State
529. What is the FREC authorized to do? a. Issue a writ of mandamus b. Seek an injunction c. Revoke a license automatically d. Issue a summary suspension
B. Seek an injunction
66. What is the only warrant found in a bargain and sale deed? a. Quiet enjoyment b. Seisin c. Habendum d. Reddendum
B. Seisin
914. Which item would you expect to see on the broker's closing statement? a. Broker's fee shown as a receipt b. Seller's expenses shown as a disbursement c. Buyer's expenses shown as a receipt d. Amount due the seller at closing shown as a receipt
B. Seller's expenses shown as a disbursement
986. What is the real estate market experiencing when the demand for available housing exceeds current supply? a. Buyers' market b. Sellers' market c. Recessionary cycle d. Hypothecation
B. Sellers' market
364. All of the following are tools used by the Federal Reserve to control the money supply, EXCEPT /;.ljhcx za. Changing the discount rate b. Setting fiscal policy c. Opening market operations d. Changing the reserve requirement
B. Setting fiscal policyQW1aq
267. Mrs. Murphy is a struggling small investor who owns a boarding house and rents rooms to tenants. Which statement is correct? a. She may advertise to attract tenants of a particular race or religion. b. She may refuse to rent to any tenant that she feels would be incompatible with existing boarders. c. She cannot refuse to rent to a boarder that she feels may be incompatible. d. Private owners are exempt from the Fair Housing Act
B. She may refuse to rent to any tenant that she feels would be incompatible with existing boarders
237. Buyer Smith gave a postdated check to sales associate Brown that the seller accepted. Smith told Brown to hold the check for 2 weeks until he (the buyer) could fly to New York and transfer the funds from a savings account to a checking account. On the date Brown received the postdated check, the broker was out of town, but returned the following business day. Following the buyer's instructions, Brown deposited the postdated check into the broker's escrow account 2 weeks later. Sales associate Brown: a. Acted properly as the seller had accepted the postdated check b. Should have turned over the postdated check to the broker the next business day c. Acted improperly since a post-dated check may never be accepted as a deposit d. Acted properly by following the principal's instructions
B. Should have turned over the postdated check to the broker the next business day
276. Mr. Reynolds inspects a piece of property. He notes a pile of fencing that the seller tells him he had purchased with the intent of fencing in the yard but has not gotten around to doing it yet. When Mr. Reynolds buys the house and takes occupancy, he finds that the fencing has not been installed and has been removed. Mr. Reynolds consults his lawyer who advises him that: a. Since he saw the fencing at the time of inspection, it is part of the sale and should have remained. b. Since it was not yet installed, it is personal property and the seller had the right to remove it. c. He ought to try to negotiate with the seller for its return prior to taking legal action. d. According to real estate license law, this is a fixture of the property and the seller's right to the fencing would probably be upheld in a court of law.
B. Since it was not yet installed, it is personal property and the seller had the right to remove it
926. The local planning agency, or planning commission, normally has the authority to approve which of the following? a. Comprehensive plans b. Site plans c. Developments of Regional Impact (DRIs) d. Variances
B. Site plans
3. A broker has an exclusive right of sale listing to sell an owner's property, with no other authority granted. What type of agency does the broker have with the principal? a. General agency b. Special agency c. Universal agency d. Trusteeship
B. Special agency
555. What type of advertising would a broker most likely use to sell a duplex? a. National b. Specific c. Institutional d. General
B. Specific
17. Who or what determines the rates for documentary stamps? a. Current interest rates b. State law c. Mortgage bankers d. The closing agent
B. State law
703. Which of the following is the best source of protection for consumers who are using the services of a real estate licensee? a. Complaint hotlines set up by the state government b. State licensing laws c. Severe punishment of offenders d. Citation authority given to state investigators
B. State licensing laws
618. The Florida Real Estate Commission oversees and enforces which of the following? a. The REALTORS® code of ethics b. State-licensing laws (F.S. 475) c. State condominium laws (F.S. 718) d. State mortgage banking laws (F.S. 494)
B. State-licensing laws (F.S. 475)
972. The period of time in which a contract may be legally enforced is governed by which of the following? a. Statute of frauds b. Statute of limitations c. Florida real estate law d. Statute of reliction
B. Statute of limitations
331. What does the term "follow-up" refer to in the real estate industry? a. A broker following up on his sales associates b. Staying in touch with a customer after the sale c. FREC following up on legally sufficient complaints d. Sales associates keeping up with "for sale by owners"
B. Staying in touch with a customer after the sale
620. A sales associate finds a buyer ready, willing, and able to purchase a home. The seller refuses to sell and will not pay the broker a commission. The broker does not pay the sales associate a commission. What may the sales associate do? a. Sue the seller b. Sue the broker c. Nothing, the sales associate has no remedy d. Sue the buyer and seller
B. Sue the broker
879. A sales associate procures a sale. The sales associate's broker dies before receiving the commission for the sale. What may the sales associate do? a. Sue the property owner b. Sue the broker's estate c. Place a lien on the seller's property d. Sue the buyer
B. Sue the broker's estate
120. What is the description of the township located due east of T4N, R3W? a. T4N, R4W b. T4N, R2W c. T3N, R2W d. T5N, R4W
B. T4N, R2W
734. A seller and a broker make an agreement that the broker may receive 100% of the deposit if the buyer defaults. In this locality, a 50/50 split of forfeited deposits is customary. What may the broker do? a. Take only 50% b. Take 100% c. Take only his or her customary commission d. Nothing, but they may be disciplined for unfair business practice
B. Take 100%
277. Which tenancy exists when a tenant remains in possession of a property after the termination of the lease without the landlord's agreement? a. Tenancy at will b. Tenancy at sufferance c. Tenancy for years d. Tenancy in common
B. Tenancy at sufferance
289. Which estate or tenancy shows an ownership interest in land? a. Tenancy for years b. Tenancy in common c. Tenancy at will d. Estate for years
B. Tenancy in common
552. Three members of a family purchase property without the right of survivorship. One family member dies. What type of estate do the two remaining members have? a. Joint tenancy b. Tenancy in common c. Tenancy by the entireties d. 100% fee simple ownership together
B. Tenancy in common
231. Six brokers wish to become partners in a real estate agency and each be active in real estate sales. What is required? a. That they register with the DBPR as inactive brokers b. That they all be licensed as active brokers c. That they have at least one active broker d. That they register the partnership with the Department of State
B. That they all be licensed as active brokers
954. A broker's responsibilities to the principal include securing which of the following? a. The highest price b. The best price c. The lowest price d. Any price
B. The best price
208. A broker lists a property for $30,000. The broker learns of a new development that will be built beside the listed property. The broker purchases the property from the seller for the full listed price and discloses the fact that he is a licensed broker. The broker then sells the property to the developer for $50,000. Which statement is correct? a. The broker acted ethically. b. The broker is guilty of concealment. c. The broker is guilty of failure to account. d. The broker is guilty of culpable negligence.
B. The broker is guilty of concealment
481. An investigator for the Department has audited a broker's escrow account and found a balance of $12,000. The trust liability totaled $30,000. If the broker's commissions on the pending transactions total $18,000, which statement is correct? a. The investigator will approve the audit. b. The broker may be disciplined by the Florida Real Estate Commission. c. No violation of the law is evident based on this audit. d. The broker will be required to deposit $18,000 into the escrow account within 3 working days of the audit.
B. The broker may be disciplined by the Florida Real Estate Commission
580. How does the Sherman Antitrust Act relate to real estate brokerage? a. Equal opportunity brokerage b. The fixing of commission rates c. The fixing of interest rates d. Disclosure of the true annual percentage rate
B. The fixing of commission rates
203. Homeowner Owen signed an exclusive right of sale listing with Bob, a registered broker. The listing states that Bob is employed to find a purchaser and that Owen agrees to pay a 10% commission to Bob or any person, partnership, corporation or firm that sells the property. The remainder of the listing deals with the terms and conditions of the sale and duration of the listing. While Owen was away on vacation, Percy made a written offer to purchase the property at the listed price, terms and conditions. Bob, on behalf of owner Owen, accepted Percy's offer and signed it for Owen. Which statement is correct? a. The listing authorized Bob to accept the best offer obtained for Owen. b. The listing did not give Bob the right to obligate Owen to Percy's offer. c. The listing gave Bob the equivalent authority of power of attorney. d. Bob can accept Percy's offer for Owen.
B. The listing did not give Bob the right to obligate Owen to Percy's offer
485. A broker lists an owner's property for 6 months on an exclusive listing agreement for $80,000 at a commission of 7%. Three months later the owner sells the property to a nephew for $74,400. Which statement is correct? a. The owner owes the broker a commission based on the listed price of $80,000. b. The owner does not owe the broker a commission. c. The owner is liable to the broker for damages. d. The owner owes a commission based on the sale price of $74,400.
B. The owner does not owe the broker a commission
190. A resident of Canada that has been denied a license in the Province of Ontario subsequently moves to Florida and applies for a real estate sales associate's license. Which would most likely apply? a. The applicant will automatically be denied a license in Florida. b. The person will be granted a hearing, and the application will be pending based on the result of the hearing. c. The Canadian denial will have no bearing in Florida. d. The previous problem does not need to be noted on the application as it took place outside the country.
B. The person will be granted a hearing, and the application will be pending based on the result of the hearing
427. Through what mechanism does the free enterprise system distribute goods and services in the marketplace? a. Government regulation b. The price system (market mechanism) c. Efficiency d. Production
B. The price system (market mechanism)
726. A sales associate lists a seller's house and sells it in 2 days. The seller is very appreciative and wishes to give the sales associate a bonus. Which statement is correct? a. The sales associate can receive the bonus if the broker does not object. b. The sales associate cannot receive the bonus from the seller. c. If the seller places the bonus in escrow, the sales associate can receive it. d. The sales associate can receive the deposit only if it is paid in cash.
B. The sales associate cannot receive the bonus from the seller
570. The buyer and seller agree in a contract to postdate the deposit check. Which statement is correct? a. The sales associate should hold it until it clears. b. The sales associate should immediately give the check to his or her broker. c. The sales associate should refuse the check. d. The deposit check should be put in escrow immediately.
B. The sales associate should immediately give the check to his or her broker
28. Who orders a summary suspension? a. The governor with affirmation by the senate b. The secretary of the department of Business and Professional Regulation c. The Division of Administrative Hearings d. The Florida Real Estate Commission
B. The secretary of the department of Business and Professional Regulation
360. What happens when the Federal Reserve orders financial institutions to increase their reserves? a. The supply of loans increases. b. The supply of loanable funds is reduced. c. Interest rates go down. d. The money supply increases.
B. The supply of loanable funds is reduced
91. What is stated in the Statute of Limitations? a. The sentencing guidelines for violations of the law b. The time frame in which a contract can be enforced c. To be enforceable, real estate contracts must be written d. Contracts must be notarized to be enforceable
B. The time frame in which a contract can be enforced
860. What happens in title-theory states that use deeds of trust? a. The mortgagor gives a deed of trust to the beneficiary. b. The trustor gives a promissory note to the beneficiary. c. The trustee gives a loan to the borrower. d. The beneficiary gives a mortgage to the trustor.
B. The trustor gives a promissory note to the beneficiary
883. Broker Bennett is trying to decide whether to operate as a sole proprietorship or charter as a corporation. Which of the following is an advantage of sole proprietorship? a. The broker would have limited liability for the debts of the firm. b. There would be less effort to legally create and maintain the ownership form. c. The potential exists to easily sell a part of the entity ownership in the business to raise additional capital for the firm. d. The ownership is easily transferable.
B. There would be less effort to legally create and maintain the ownership form
727. When an unlicensed person practices real estate, what criminal penalty can be imposed? a. First-degree felony b. Third-degree felony c. First-degree misdemeanor d. Second-degree misdemeanor
B. Third-degree felony
674. Farmer Jones meets broker Brown at a cocktail party. Jones and Brown agree that if Brown sells Jones's farm for $650,000 within 30 days, Jones will pay Brown a 6% commission. Which applies? a. A fiduciary relationship has been established. b. This is a contract, and Brown is entitled to a commission if the broker performs. c. Under the Statute of Frauds, this listing is not enforceable. d. This is an exclusive right of sale listing.
B. This is a contract, and Brown is entitled to a commission if the broker performs
774. Complete the sentence. All listings should be in writing: a. To be enforceable b. To avoid any misunderstanding c. Because F.S. 475, requires it d. Because the statute of frauds requires it
B. To avoid any misunderstanding
264. What is the purpose of the Real Estate Settlement Procedures Act (RESPA)? a. To ensure that land developers do not misrepresent the sale of subdivided lands b. To ensure that buyers are informed about the amount and type of charges they will expect to pay at closing c. To ensure that lenders disclose the annual percentage of interest charged to borrowers d. To ensure that lenders do not charge a usurious interest rate on mortgages
B. To ensure that buyers are informed about the amount and type of charges they will expect to pay at closing
738. Shelving and racks used in business and installed by the tenant are generally considered to be which of the following? a. Real property b. Trade fixtures c. Ostensible property d. Property of the landlord
B. Trade fixtures
142. What is the membership composition of the value adjustment board? a. Three school board members and two county commissioners b. Two county commissioners, one school board member and two private citizens c. Three county commissioners and the tax assessor d. Four county commissioners and three school board members
B. Two county commissioners, one school board member and two private citizens
313. Which of the following is a characteristic of an option contract? a. Executed b. Unilateral c. Bilateral d. Parol
B. Unilateral
189. Which is the best license status for practicing real estate? a. Valid b. Valid and current c. Current d. Valid and not current
B. Valid and current
492. A sales associate's license expires. If the associate immediately applies for a renewal, when will the renewal become effective? a. The day following expiration of the current license b. When the department receives the renewal application and fee payment c. The date the application is postmarked d. When the renewal license is received by the sales associate
B. When the department receives the renewal application and fee payment
57. A developer advertises homes for sale with a total down payment of $1,500. The developer knows that all of the houses with that amount of down payment have been sold. Is this transaction covered under truth-in-lending laws? a. No, because the advertising was done by a builder/developer, not a broker b. Yes, because this is bait and switch advertising and is illegal c. No, because single-family residence is exempt from regulation z d. Yes, because this is puffery and is illegal
B. Yes, because this is bait and switch advertising and is illegal
218. Can a broker be entitled to two commissions when consummating an exchange? a. No, as this would be a conflict of interest b. Yes, providing both parties are advised and approve c. Yes, but only if both brokers agree d. No, since a broker can only have one principal
B. Yes, providing both parties are advised and approve
33. A broker sells a rental list to a prospective tenant for $200. In a written agreement, the broker states that the fee is nonrefundable. This is: a. Legal because it was disclosed in advance b. Illegal under F.S. 475 c. Legal but not ethical d. Legal because the fee was less than $500
B. illegal under FS 475
70. What would the best bundle of rights with a timeshare include? a. Right to use b. Interval ownership c. Membership d. Leasehold
B. interval ownership
68. Which tenancy contains the right of survivorship? a. In common b. Joint c. Sufferance d. At will
B. joint
39. When there is a dispute over escrow funds, the procedures include four choices. Which choice involves a third person recommending a solution? a. Arbitration b. Mediation c. Litigation d. Escrow disbursement order
B. mediation
96. What is the name for the legal document that pledges a property as security for a loan? a. Promissory note b. Mortgage c. Title d. Bond
B. mortgage
88. Which action can terminate a contract? a. Novation b. Performance c. Rejection d. Subrogation
B. performance
75. Complete the sentence. A deed must be: a. Notarized b. Witnessed c. Recorded d. Signed by the grantee
B. witnessed
405. Which is best description of a township? a. 1 square mile b. 6 miles square c. 36 miles square d. 6 square miles
B.. 6 miles square
691. Three houses recently sold with the following amenities: (1) $84,500, three bedrooms, two baths, good location, family room, garage (2) $76,500, three bedrooms, two baths, fair location, family room, carport (3) $80,000, three bedrooms, two baths, good location, carport If a good location adds $5,000 and a garage adds $3,000, what would be the value of a family room? a. $1,000 b. $1,200 c. $1,500 d. $2,000
C. $1,500
440. A buyer is purchasing a home for $48,000 with an FHA loan. He borrows the maximum loan amount with the minimum down payment. How much of a down payment will the buyer need? a. $0 b. $800 c. $1,700 d. $4,632
C. $1,700
794. An appraiser appraised three lots for a total of $45,000. Lot B was appraised for $4,000 more than lot A. Lot C was appraised at $7,000 more than lot B. For how much was lot A appraised? a. $5,000 b. $7,000 c. $10,000 d. $20,000
C. $10,000
433. A sales associate collected a $4,800 commission on the sale of the NE 1/4 of the NW 1/4 of the SW 1/4 of a section. The broker's share of the 10% commission was 60%. How much did the property sell for per acre? a. $8,000 b. $10,000 c. $12,000 d. $120,000
C. $12,000
997. A tenant pays $1,400 a month for a 1,400- square-foot office. How much a square foot does the tenant pay annually? a. $10.00 b. $11.00 c. $12.00 d. $14.00
C. $12.00
791. You have a $19,500 mortgage at $8.50 per thousand principal and interest (P&I). Which of the following would be the monthly payment? a. $140.40 b. $150.60 c. $165.75 d. $180.10
C. $165.75
596. A building that cost $662,000 ten years ago would cost $770,000 to build today. The building is in excellent condition and looks only about 5 years old. The carpeting needs to be replaced for $20,000. What is the total accrued depreciation based on a 25-year useful life? a. $150,000 b. $154,000 c. $170,000 d. $174,000
C. $170,000
98. If a property's effective gross income is $44,000, operating expenses are $26,000, and the capitalization rate is 10%, what is the value of the property? a. $18,000 b. $80,000 c. $180,000 d. $220,000
C. $180,000
6. A buyer purchased a property for $65,000. A lending institution loaned the buyer 80% of the purchase price and charged a discount of 4 points. What is the amount of the discount paid? a. $13,000 b. $2,600 c. $2,080 d. $208
C. $2,080
696. If 350 feet of fence costs $1,575.00, what is the cost for 500 feet of fence? a. $3,150.00 b. $2,289.29 c. $2,250.00 d. $1,686.11
C. $2,250.00
91. If a sales associate is entitled to 60% of all commissions earned, and sells a property for $64,000 with a 7% commission due to the broker, how much should the broker pay the sales associate? a. $1,726 b. $1,792 c. $2,688 d. $4,480
C. $2,688
246. An investor lost $30,000.00 due to his broker's negligence. The investor sued the broker and awarded a judgment totaling $30,000.00. The broker went bankrupt, and the bankruptcy court forced the broker to pay the investor $8,000.00. What amount from the recovery fund may the investor obtain? a. $3,000 b. $10,000 c. $22,000 d. $25,000
C. $22,000
436. A licensee receives a monthly salary of $500, a 2% commission on all listings that sell, and 3% on all sales. Last month, none of her listings sold, but she did receive a total of $7,400 in salary and commissions. What is the value of the properties that she sold? a. $250,000 b. $246,667 c. $230,000 d. $148,000
C. $230,000
785. How much is provided by the Homestead Act for the basic tax exemption? a. $15,000 b. $20,000 c. $25,000 d. $30,000
C. $25,000
698. Broker Brown and broker Smith split a commission on a 50/50 basis on the sale of the S 1/2 of the NW 1/4 of Section 36, Township 3 North, Range 4 E, with a selling price of $ 170.45 per acre. The commission is to be calculated as follows: 5% of the first $10,000, 3% of the next $2,500 and 1 1/2% of the balance. If broker Brown must pay his sales associate James 12 1/2% of the commission for listing the property, how much net commission will Brown receive? a. $37.00 b. $129.51 c. $259.02 d. $296.02
C. $259.02
172. An 8-year-old building looks only 3 years old because it has been well maintained. The reproduction cost the building is $400,500, and the economic life is 45 years. The land is valued at $80,000. What is building's approximate depreciation? a. $2,700 b. $7,200 c. $26,700 d. $71,200
C. $26,700
159. Sarah made an escrow deposit of $8,500 on her sales contract. The sale price is $200,000, and she has arranged for an 85% loan. If her closing costs are $6,000, how much additional cash must she bring to the closing? a. $21,500 b. $24,200 c. $27,500 d. $36,000
C. $27,500
14. A tenant paid rent of $450 on the first of the month when due. The property sold on March 12th and the day of closing belonged to the seller. What is the amount of the rent proration, and how should it be entered on the closing statement? a. $174.19, debit seller, credit buyer b. $174.19, debit buyer, credit seller c. $275.81, debit seller, credit buyer d. $275.81, debit buyer, credit seller
C. $275.81, debit seller, credit buyer
600. A property measures 660 feet by 990 feet and sold for $12,000 per acre. The buyer can obtain 80% financing. How much is the intangible tax? a. $460.80 b. $360.00 c. $288.00 d. $270.00
C. $288.00
591. A bank gives a mortgage loan for 80% of the sales price at an interest rate of 8%. The interest portion of the first month's payment is $192. What is the selling price? a. $28,800 b. $32,000 c. $36,000 d. $72,000
C. $36,000
800. A broker sold an $85,000 house, charging the seller a 6% commission. Due to extenuating circumstances, the buyer defaulted on the contract and forfeited his 10% deposit. Based on custom, how much commission should the broker receive? a. $2,550 b. $3,400 c. $4,250 d. $5,100
C. $4,250
171. If a lot measures 125 feet by 225 feet, and the street in front is scheduled to be paved at a cost of $100 per front foot, how much would one homeowner's special assessment be if the county is paying 30%? a. $1,875 b. $2,187 c. $4,375 d. $7,875
C. $4,375
174. A comparable property recently sold for $429,000. The comparable property is built of superior materials valued at $25,000 but has less square footage than the subject property, valued at $35,000. What is the adjusted sale price of the comparable property? a. $369,000 b. $419,000 c. $439,000 d. $489,000
C. $439,000
160. A property that listed for $400,000 sold for 93% of the listing price with a 5% commission. It was sold by another office. The commission is to be split 50% to the listing office and 50% to the selling office. If the sales associate is to receive 40% of the listing office share, how much will the listing broker receive? a. $4,000 b. $4,650 c. $5,580 d. $6,000
C. $5,580
8. Broker Jones committed fraud in a real estate transaction that involved six investors in a limited partnership. What is the maximum recovery possible from the Real Estate Recovery Fund that results in a single judgment as a result of this fraudulent activity? a. $25,000 b. $30,000 c. $50,000 d. $150,000
C. $50,000
243. What is the maximum allowable payment from the recovery fund for any financial losses suffered due to a licensee's acts? a. $25,000 b. $75,000 for multiple transactions c. $50,000 per transaction, with a maximum of $150,000 for multiple transactions d. Any amount equal to the losses
C. $50,000 per transaction, with a maximum of $150,000 for multiple transactions
42. What is the maximum criminal penalty that a court could impose for a second- degree misdemeanor? a. $2,000 fine and/or 2 years in jail b. $1,000 fine and/or 1 year of jail time c. $500 fine and/or 60 days of jail time d. $5,000 fine and/or 5 years in jail
C. $500 fine and/or 60 days of jail time
693. A widow's property has an assessed value of $60,000 and she qualifies for a homestead exemption. The millage rates are 8 mills for the city, 6 mills for the county, and 9 mills for the school board. What is her tax levy? a. $1,380 b. $443.50 c. $653.50 d. $665
C. $653.50
458. If the documentary stamp tax on the deed was $520.10, and the note tax on the purchase money mortgage was $227.50, how much was the sales price and the purchase money mortgage? a. $150,000 and $55,000 b. $148,600 and $32,500 c. $74,300 and $65,000 d. $32,500 and $15,000
C. $74,300 and $65,000
457. 12,000 square feet of warehouse space is leased at $.075 per square foot per month. The gross income multiplier is 7.5. What is the market value of the property? a. $6,750 b. $10,800 c. $81,000 d. $108,000
C. $81,000
444. A broker was asked by a seller to appraise the seller's home in a residential neighborhood. The seller's home was a three-bedroom, two-bath house. Homes have been appreciating in this area at 10% per year. The broker estimates bedrooms in this area to be worth $12,000, and bathrooms are worth $5,000. Using the following three comparables, estimate the approximate market value of the subject home assuming that the comparables are weighted equally. x No. 1: 3/3 sold 1 year ago for $81,000 x No. 2: 4/2 sold 6 months ago for $91,000 x No. 3: 2/2 sold recently for $72,500 a. $82,000 b. $83,000 c. $84,000 d. $85,000
C. $84,000
807. How many days does the buyer of a new timeshare unit have to cancel the agreement? a. 3 b. 7 c. 10 d. 15
C. 10
254. What is the maximum time the license can be suspended on the first offense? a. 2 years b. 5 years c. 10 years d. No suspension is likely on the first offense
C. 10 years
455. A house is valued at $65,000.00. The monthly rent is $500.00, monthly debt service is $375.00, and annual taxes are $840.00. If there are no other expenses, what is the GRM? a. 75 b. 80 c. 130 d. 108.3
C. 130
653. If both the buyer and the seller make claims on the escrow money held by the broker, within how many days is the broker is required to notify FREC? a. 5 b. 10 c. 15 d. 20
C. 15
864. Fannie Mae is selling an FHA mortgage with an interest rate of 14% at 92% (8 points). What is the approximate yield for the new lender? a. 13% b. 14% c. 15% d. 16%
C. 15%
896. An investor put $50,000 down on a $200,000 property. The NOI is $30,000 and the mortgage payments are $22,000 per year. What is the capitalization rate? a. 26% b. 16% c. 15% d. 11%
C. 15%
408. How many townships are in a check? a. 36 b. 24 c. 16 d.4
C. 16
404. The southwest corner of Section 31, T1N, R4E is how many miles from Tallahassee? a. 6 b. 12 c. 18 d. 24
C. 18
963. When the city or county sells a tax certificate, a sale of the property may take place only after the certificate has been outstanding for how many years? a. 20 b. 3 c. 2 d. 1
C. 2
412. After what period of time may a tax certificate holder request a tax deed? a. 1 year, but not after 5 years b. 2 years, but not after 5 years c. 2 years, but not after 7 years d. 3 years, but not after 8 years
C. 2 years, but not after 7 years
161. A developer purchased two adjacent lots of 200 front feet each for $35,000 each. He then divided them into three lots and sold them for $225 per front foot. What was the percentage of profit? a. 14.5% b. 22.0% c. 29.0% d. 57.0%
C. 29.0%
9. Based on the information in the previous question, what is the operating expense ratio? a. 16.67% b. 25.37% c. 37.31% d. 59.52%
C. 37.31%
155. Carol is borrowing money to purchase her first home. The lender has agreed to a 5% loan with 2 discount points. What is the approximate yield on the loan? a. 3.00% b. 4.75% c. 5.25% d. 7.00%
C. 5.25%
11. A property is rectangular and measures 500' x 640'. How many acres does it contain? a. 5.21 b. 6.38 c. 7.35 d. 9.24
C. 7.35
170. What is the gross income multiplier for an investment property that has a gross income of $550,000 and a net income of $330,000 if the value is $4,125,000? a. 3.4 b. 4.7 c. 7.5 d. 12.5
C. 7.5
882. Broker Sam sells a list of rental properties to a prospective tenant, Michelle, on March 1. Michelle looks at several properties on the list and then changes her mind about living in that city and decides to move back up north. On March 31, Michelle requests a refund. How much of a refund will Sam have to give back to Michelle? a. 0% b. 25% c. 75% d. 100%
C. 75%
112. If a lender charges 8% interest plus 2 points, what is the approximate yield on the loan? a. 9.00% b. 8.50% c. 8.25% d. 8.13%
C. 8.25%
449. A property sells for $200,000 with a $30,000 down payment and debt service of $1,500 per month. What is the loan to value ratio? a. 9% b. 15% c. 85% d. 91%
C. 85%
416. Which circumstance would qualify for the $500,000 exclusion of capital gains tax on the sale of a principal residence? a. The seller had occupied it for 1 of the last 5 years with a gain up to $500,000. b. The accumulated capital gain is under $750,000. c. A couple has occupied it for 2 of the last 5 years with a gain up to $500,000. d. A couple has never taken the exemption before, and gain is up to $750,000.
C. A couple has occupied it for 2 of the last 5 years with a gain up to $500,000
714. The Florida legislature requires certain disclosures prior to the signing of a real estate sales contract or rental agreement. Which is correct? a. Property must be tested to be able to disclose radon gas levels prior to the closing of a sale. b. It must be disclosed if any member in the seller's household has been infected by the human immunodeficiency virus (HIV) or the acquired immune deficiency syndrome (AIDS). c. A definition of radon gas must be disclosed. d. The ethnic composition of the neighborhood must be disclosed.
C. A definition of radon gas must be disclosed
930. How is an appraiser compensated? a. A fee based upon the value of the property b. A commission based upon the value of the property c. A fee based on the time and difficulty involved d. A fee based on the seniority of the appraiser
C. A fee based on the time and difficulty involved d. A fee based on the seniority of the appraiser
642. In a lien-theory state, what will the borrower receive after making his or her final payment? a. Title b. A mortgage c. A letter of satisfaction d. A deed of reconveyance
C. A letter of satisfaction
269. All of the following are exempt from RESPA requirements, EXCEPT? a. A loan for the construction of a 10-unit apartment building b. A loan for a commercial property c. A loan to purchase a new home in a subdivision d. An all cash payment for a single-family home
C. A loan to purchase a new home in a subdivision
101. Which remedies are available when a seller breaches a contract? a. A suit for specific performance b. Buyer gets deposit returned c. A or b but not both d. Notifying FREC
C. A or b but not both
847. If a developer bought a large parcel of land and wanted to develop and sell off small parts of it, it would be advisable to have which clause in his mortgage? a. A subordination clause b. A prepayment clause c. A release clause d. An acceleration clause
C. A release clause
732. Which of the following individuals must have a real estate license to perform the action specified? a. An attorney at law when performing his or her normal duties b. An attorney in fact when executing conveyances and contracts c. A salaried apartment manager who leases units for more than 1 year d. A mobile home park manager leasing lots in the mobile home park
C. A salaried apartment manager who leases units for more than 1 year
665. Why can't a sales associate work for more than one broker or one ownerdeveloper at the same time? a. They owe it to the employer to work for at least 40 hours per week b. The DBPR would have a hard time keeping up with where they are working c. A sales associate or broker associate is an agent of the broker or owner that he or she is working for d. The Federal Trade Commission, under Rule 27-S, prohibits a sales associate or broker associate for working for more than one employer at the same time
C. A sales associate or broker associate is an agent of the broker or owner that he or she is working for
182. Which information is included in the public records? a. Real estate school test questions b. A licensee's test results c. A sales associate's application d. State exam answers
C. A sales associate's application
317. What is an option contract? a. A unilateral contract, binding on both parties b. A bilateral contract, binding only on the optionee c. A unilateral contract, binding only on the optionor d. A bilateral contract, binding on both parties
C. A unilateral contract, binding only on the optionor
770. What may a broker be guilty of if he or she does NOT perform under the terms and conditions of a listing contract? a. Larceny b. Bad faith c. Abandonment d. Renunciation
C. Abandonment
853. Which clause in a mortgage benefits the lender? a. Exculpatory b. Defeasance c. Acceleration d. Redemption
C. Acceleration
79. Complete this statement. To help prevent fraudulent documents from being placed in the public records, the documents are . a. Filed in duplicate b. Entered in the computer records c. Acknowledged by an officer of the state d. Witnessed by two persons
C. Acknowledged by an officer of the state
122. The subject property has a garage. The comparable property has no garage. If a garage has a value of $14,500, and the comparable property sold for $149,900, what adjustment should be made? a. Add a $14,500 adjustment to the subject property b. Subtract a $14,500 adjustment from the subject property c. Add a $14,500 adjustment to the comparable property d. Subtract a $14,500 adjustment from the comparable property
C. Add a $14,500 adjustment to the comparable property
11. Which of the following describes expenses on a closing statement? a. Prorated between parties b. Always entered as double entries c. Always entered as debit entries d. Entered as disbursements
C. Always entered as debit entries
220. In a real estate transaction, what type of relationship can a buyer and seller expect to have? a. A fiduciary relationship b. A relationship of trust c. An arm's length relationship d. A relationship of confidence
C. An arm's length relationship
777. A daughter deeded a property to her elderly mother, with the stipulation that the property would return to the daughter upon the mother's death. What type of estate does the daughter possess? a. A life estate b. A remainder estate c. An estate in reversion d. No legal estate
C. An estate in reversion
885. In a civil action, who must be named as defendant if money from the Real Estate Recovery Fund is sought? a. FREC b. DBPR c. An individual broker or sales associate d. Any of the above
C. An individual broker or sales associate
811. The DBPR will most likely issue a license to all of the following individuals that otherwise qualify, EXCEPT: a. A citizen of a foreign country b. A resident of Georgia c. An individual under investigation for violating F.S. 475 d. A broker who does not have enough funds to open an office
C. An individual under investigation for violating F.S. 475
315. What type of listing is held by two or more licensed brokers? a. A multiple listing b. An exclusive right of sale listing c. An open listing d. A net listing
C. An open listing
881. A broker has a main office and eight branch offices. One of the sales associates, Maria, works out of several of the offices but spends most of her time working out of branch office number five. From which office must Maria be licensed? a. The main office b. Any office, to be chosen by Maria c. Any office, at the broker's discretion d. Branch office number five
C. Any office, at the broker's discretion
949. When do real property taxes become delinquent? a. December 31 of the tax year b. December 31 of the year following the tax year c. April 1 of the year following the tax year d. April 1 of the tax year
C. April 1 of the year following the tax year
658. Which form of escrow settlement procedure requires the parties to abide by an objective third party's decision after a hearing? a. Escrow disbursement order b. Mediation c. Arbitration d. Litigation
C. Arbitration
670. A broker has two apartments listed and gives their unlicensed assistant a 3x5 card with printed information to read to any prospects who call to inquire about the apartments. Which statement is correct? a. F.S. 475, exempts unlicensed assistants. b. This is a violation of F.S. 475. c. As long as the assistant reads the printed information and does not give subjective opinions, there is no violation. d. The assistant may act in the same capacity as the broker when dealing with prospects.
C. As long as the assistant reads the printed information and does not give subjective opinions, there is no violation
98. What is it called when a buyer buys a property and takes over responsibility on an existing loan? a. Agreement for deed b. Subject to the mortgage c. Assumption of the mortgage d. Any of the above
C. Assumption of the mortgage
652. Which of the following is required in a real estate brokerage partnership? a. All general partners must be active brokers b. All officers and directors must be active brokers c. At least one of the partners must be an active broker d. All partners, officers, and directors must be active brokers
C. At least one of the partners must be an active broker
978. Complete the sentence. If a tenant with a lease is in possession of the property, a purchaser or judgment creditor will: a. Be subject to the rights of the tenant for 1 year only b. Not be subject to the rights of the tenant c. Be subject to the rights of the tenant d. Be subject to the rights of the tenant in eviction proceedings only
C. Be subject to the rights of the tenant
1. When must a written No Brokerage Relationship (nonrepresentation) Notice be provided to customers? a. Immediately upon the signing of a listing agreement b. At an open house when providing a brochure containing information about the property c. Before showing homes that are listed d. In every real estate transaction
C. Before showing homes that are listed
31. Who are the parties involved in a deed of trust? a. Beneficiary, mortgagee, and mortgagor b. Beneficiary, trustee, and mortgagor c. Beneficiary, trustee, and trustor d. Benefactor, trustee, and trustor
C. Beneficiary, trustee, and trustor
347. Who are the three parties in a trust deed? a. Benefactor, trustee, and trustor b. Beneficiary, mortgagor, and trustee c. Beneficiary, trustor, and trustee d. Beneficiary, mortgagee, and trustor
C. Beneficiary, trustor, and trustee
843. What type of mortgage allows for several parcels of land to be placed as collateral for a mortgage? a. Term b. Package c. Blanket d. Purchase money
C. Blanket
271. Which entity published Regulation Z? a. Federal Trade Commission b. Federal Housing Administration c. Board of Governors of the Federal Reserve System d. Department of Veterans Affairs
C. Board of Governors of the Federal Reserve System
495. Buyer Norma gave sales associate Julie a postdated check as a binder deposit and told Julie the check would not clear until the following week. The broker was tied up with negotiations on a large transaction, so Julie presented Norma's offer and disclosed to the seller that the check was postdated and would not clear until next week. The seller asked Julie to hold the check and deposit it when the funds were available. The broker was unaware of this arrangement. Which statement is correct? a. No violation occurred since Julie properly disclosed the nature of the deposit, and the seller allowed the check to be held subject to clearance. b. Julie is in violation of the law, but the broker was unaware of the arrangement and has not violated the law. c. Both Julie and the broker are in violation of the law. d. There is no violation since postdated checks cannot be deposited.
C. Both Julie and the broker are in violation of the law
655. Once an offer is accepted and the escrow deposit is in the broker's account, the broker holds the deposit on behalf of which party or parties? a. Seller b. Buyer c. Both the buyer and seller d. The title company
C. Both the buyer and seller
946. An offer can be terminated by all of the following actions EXCEPT: a. A counteroffer b. Acceptance c. Breach d. Withdrawal
C. Breach
610. A licensed sales associate receives a cash binder deposit from a buyer on a parcel of land. Before the sales associate can give the deposit to the broker, the sales associate loses the deposit. Who is responsible? a. Broker b. Sales associate c. Broker and sales associate d. Buyer
C. Broker and sales associate
200. A sales associate went on vacation. While gone, the broker moved the office around the block. When the sales associate returned, there was an urgent message that two serious prospects had called. Also, a sale closed in his absence and the broker owes him a commission. What should the sales associate do first? a. Demand the commission b. Forget the commission since the sales associate wasn't there c. Call the two prospects immediately d. Immediately request a reissue of license from FREC
C. Call the two prospects immediately
503. In Florida, what does the 10-mill cap apply to? a. Income taxes b. Intangible taxes c. City, county and school tax districts d. Sales taxes
C. City, county and school tax districts
84. Complete this statement. Following expiration of their licenses, sales associates may . a. Continue operating in an inactive status b. Take listings as long as they allow other licensees to sell them c. Collect a commission they legally earned before the expiration date d. Market listings taken before expiration
C. Collect a commission they legally earned before the expiration date
392. All of the following are types of depreciation, EXCEPT: a. Physical deterioration b. External obsolescence c. Commercial depreciation d. Functional obsolescence
C. Commercial depreciation
937. How would a property be transferred when an owner has been declared mentally incompetent? a. Widow's deed b. Referee's deed c. Committee's deed d. Personal representative's deed
C. Committee's deed
141. What results from zoning laws? a. Safer building methods are adopted b. Plat maps must be approved by the local planning agency c. Communities are divided into districts based on use d. Standards are set for style and compatibility
C. Communities are divided into districts based on use
373. Which combination of appraisal approach and property type would be agreeable to an experienced appraiser? a. Income approach: special-purpose properties b. Income approach: owner-occupied home c. Comparable sales approach: vacant land d. Cost-depreciation approach: residential land
C. Comparable sales approach: vacant land
110. Which process is used by the government to take private land for public use? a. Escheat b. Encroachment c. Condemnation d. Acknowledgment
C. Condemnation
917. If a complaint is withdrawn by the complainant to the DBPR, what will the DBPR probably do? a. Stop the investigation b. Fine the individual who made the complaint up to $1,000 and then drop the complaint c. Continue with the investigation d. Bring criminal charges against the complainant
C. Continue with the investigation
858. Which type of mortgage typically requires a higher down payment and interest rate than other common loan types? a. FHA b. VA c. Conventional mortgage d. Home equity line of credit
C. Conventional mortgage
876. A sales associate receives negotiable securities from the purchaser as earnest money. What should the broker do with these securities? a. Place them immediately into the office safe until the date of closing, at which point they should convert them into cash. b. Immediately give the securities to the seller, who has the right to do anything they want with the money. c. Convert the securities into cash at the earliest practical time, and then deposit the proceeds immediately into the escrow account. d. Give the securities to the Department of Banking and Finance for their safekeeping, until the title closing.
C. Convert the securities into cash at the earliest practical time, and then deposit the proceeds immediately into the escrow account
38. Which business entity may NOT register as real estate brokerage firm? a. Corporation b. Corporation not for profit c. Corporation sole d. General partnership
C. Corporation sole
630. Due to possible problems with clear and marketable title, a broker should avoid properties owned by which of type of business? a. Partnership b. Corporations for profit c. Corporation sole d. Limited partnership
C. Corporation sole
590. Which type of business relationship must be in writing? a. Corporations b. Partnerships c. Corporations and limited partnerships d. Joint venture
C. Corporations and limited partnerships
549. Multiple claims are made against one licensee's name, all requiring payment from the recovery fund. How is the priority of payment determined? a. Smallest first b. Largest first c. Date of claim d. Proration
C. Date of claim
94. Taxes for the year were $12,800. Closing is March 17th, and the seller has agreed to be responsible for all charges on the day of closing. Using the 365-day method, how would this proration appear on the closing statement? a. Debit Seller $2665.21, Credit Buyer $10,134.79 b. Debit Buyer $10,134.79, Credit Seller $2665.21 c. Debit Seller $2665.21, Credit Buyer $2665.21 d. Debit Buyer $2665.21, Credit Seller $2665.21
C. Debit Seller $2665.21, Credit Buyer $2665.21
476. Closing date is January 10, and the day of closing belongs to the seller. The buyer has arranged for a new $200,000 mortgage at an interest rate of 8%. The prepaid interest due at closing is $956. Which of the following would be a correct entry on the closing statement? a. Debit buyer $956, credit seller $956 b. Credit buyer $956, debit seller $956 c. Debit buyer $956 d. Credit seller $956
C. Debit buyer $956
682. How would the purchase price be correctly entered on a closing statement? a. Debit seller, credit buyer b. Debit seller, disbursement to broker c. Debit buyer, credit seller d. Debit buyer, disbursement to broker
C. Debit buyer, credit seller
472. An individual is buying an eight-unit apartment complex that closes on June 10 (closing day to the seller). If rent is $235.00 per month per unit in advance, how will the rent proration appear on the closing statement? a. Debit seller $626.67, credit buyer $626.67 b. Credit seller $1253.33, debit buyer $1253.33 c. Debit seller $1253.33, credit buyer $1253.33 d. Debit seller $1253.33, credit buyer $626.67
C. Debit seller $1253.33, credit buyer $1253.33
328. Under specific circumstances, real estate law allows a broker to appoint one sales associate to represent the seller and another to represent the buyer. What term is used for a sales associate who meets all the qualifications of these circumstances? a. Dual agent b. Transaction broker c. Designated sales associate d. Special agent
C. Designated sales associate
804. What term is used to refer to the rate that banks pay to the Federal Reserve? a. Overall capitalization rate b. Annuity capitalization rate c. Discount rate d. Federal Reserve reconciliation rate
C. Discount rate
221. What is a licensee with full representation to both parties in the same transaction referred to as? a. Transaction broker b. Single agent c. Dual agent d. Subagent
C. Dual agent
351. Which clause in a mortgage calls for the principal balance to be paid in full? a. Satisfaction clause b. Defeasance clause c. Due on sale clause d. Cognovit clause
C. Due on sale clause
293. The neighbors have used Farmer Jones' "ruts" (easement by necessity) for over 20 consecutive years. It may now be considered an: a. Easement appurtenant b. Easement in gross c. Easement by prescription d. Implied easement
C. Easement by prescription
86. If you begin at a point and go north 90° east, in what direction would you be traveling? a. North b. South c. East d. West
C. East
888. On behalf of which entity, can the Florida Real Estate Commission intervene? a. The applicant b. The Department of Business and Professional Regulation c. Either a or b d. Neither a nor b
C. Either a or b
434. MacBurger USA wants to purchase a piece of land for the purpose of constructing a 15,000-square-foot restaurant to accommodate 85 people. The zoning ordinances require one parking space for every 2 people and that each space be 6 feet by 12 feet. In addition, they must allow 10% of the paved area for lanes and dividing lines. There are two lots available. Lot A is 100 feet by 200 feet; lot B is 90 feet by 210 feet. Which of the two lots might MacBurger choose? a. Lot A b. Lot B c. Either lot A or B d. Neither lot A nor B
C. Either lot A or B
624. What keeps a landowner in a key locational position from preventing the progress of the entire community? a. Estoppel b. Ergonometric policy of the city or county c. Eminent domain d. Escheat
C. Eminent domain
957. Which term best describes foreclosure? a. Voluntary alienation b. A redemption action c. Enforcement of a mortgage d. A procedure taken by the mortgagor
C. Enforcement of a mortgage
377. What are the main steps in direct capitalization when using the income approach to valuation of real estate? a. Estimate the gross income, add in the operating expenses and capitalize the net operation income b. Estimate the capitalization rate, adjust the gross income for vacancies and divide c. Estimate gross income, deduct the vacancies and operating expenses and capitalize the net operating income into value by dividing by an overall rate d. Identify the gross income, plan the appraisal and collect the expenses
C. Estimate gross income, deduct the vacancies and operating expenses and capitalize the net operating income into value by dividing by an overall rate
718. Where are the rules of the Florida Real Estate Commission found? a. F.S. 455 b. F.S. 475 c. F.A.C. 61J2 d. F.A.C. 62Q1
C. F.A.C. 61J2
177. A, B, and C bought 640 acres of land with equal and undivided interest. A and B were brokers, and C was not. A and B were frequent business partners but decided to let C handle the resale of the tract. C had very little experience but was able to find a buyer willing to pay a good price. Because of this, A and B decided to give C 40% of the profits and divide equally the balance of the profit. Which applies? a. C can do this if C is an attorney b. C can do this because A and B are brokers c. F.S. 475, has been violated d. Since C is selling C's own land, C does not have to be registered
C. F.S. 475, has been violated
913. The DBPR issued a license in error to an applicant who actually failed the state exam. Which statement applies? a. The applicant may keep the license and go active b. FREC will immediately revoke the license with prejudice c. FREC will immediately revoke the license, but recommend the applicant apply for retesting d. FREC will likely suspend the license for 1 year
C. FREC will immediately revoke the license, but recommend the applicant apply for retesting
687. Brokers Troy and Gail agree to cooperate on the sale of Jackie's house. The deal is closed and Jackie pays the full commission to Troy, the listing broker. Troy refuses to pay Gail her share. Of what may Troy be guilty? a. Concealment b. Poor judgment c. Failure to account and deliver d. Misrepresentation
C. Failure to account and deliver
788. Which action would be considered a first degree misdemeanor? a. Advertising property in a fraudulent manner b. Failure to reconcile an escrow account c. Failure to comply with rules regarding rental lists d. Failure to give the required agency disclosure
C. Failure to comply with rules regarding rental lists
296. Under the laws of eminent domain, for what does an individual have the right for reimbursement? a. Personal anguish b. Assessed value c. Fair market value d. Intrinsic value
C. Fair market value
367. All of the following entities are secondary mortgage market participants, EXCEPT: a. Fannie Mae b. Freddie Mac c. Federal Reserve d. Ginnie Mae
C. Federal Reserve
987. A sales associate has a disagreement with the broker over a commission. The sales associate quits. What can the sales associate do to attempt to collect the commission? a. File a lawsuit against the owner of the property b. Ask FREC to settle the matter c. File a lawsuit against the former broker in civil court d. Collect from the Florida Real Estate Recovery Fund
C. File a lawsuit against the former broker in civil court
35. Jim is a sales associate applicant but has failed the state exam twice. After reviewing his most recent exam, he feels that some of the questions he missed were really correct and marked wrong in error. What may Jim do? a. File a complaint against the testing company b. Request a retest at no charge c. File a written objection to the questions during the scheduled question review d. Request an informal hearing before FREC
C. File a written objection to the questions during the scheduled question review
41. Complete the sentence. If a licensee does not dispute a citation, it has the same effect as a: a. Cease and desist order b. Reprimand c. Final order d. Formal complaint
C. Final order
318. A broker lists a property for $25,000, which must be all cash. A buyer makes an offer for $30,000, but asks the broker to show the additional $5,000 in the contract as a down payment, which the buyer does not intend to provide. The buyer does this to show a higher purchase price to the lender so that he can get approved for a $25,000 loan. Under this arrangement, the seller would only receive the $25,000, thereby meeting the seller's terms. What should the broker do? a. Charge a commission based on $30,000 b. Charge a commission based on $25,000 c. Find another buyer d. Withdraw from the listing
C. Find another buyer
247. If a licensee violates F.S. 475, the Commission is allowed to impose any of the following penalties, EXCEPT: a. Revoke the license b. Suspend the license c. Fine the licensee $10,000 d. Refuse to renew the license
C. Fine the licensee $10,000
244. Which court is the final court in the appeal process? a. Circuit court b. District court of appeals c. Florida Supreme Court d. Small claims court
C. Florida Supreme Court
736. Title insurance is designed to protect against which of the following? a. All defects in title b. Missing documents c. Forged documents d. Known defects
C. Forged documents
743. What property right does an individual have who owns a condominium unit? a. Tenancy at will b. Tenancy at sufferance c. Freehold estate d. Proprietary lease
C. Freehold estate
929. What is the landlord's first step in the eviction process? a. Contact the sheriff b. Go to court c. Give 3 days' notice d. Give 10 days' notice
C. Give 3 days' notice
334. The purchase price of a business, less the value of the tangible assets of that business, equals the intangible assets of the business. Which item would be an intangible asset of the business? a. Real property b. Office furniture c. Goodwill d. Personal property
C. Goodwill
298. Which of the following clauses in a deed names the parties, describes the property, shows legal consideration, and provides words of conveyance? a. Habendum clause b. Reddendum clause c. Granting clause d. Restriction clause
C. Granting clause
136. Which law requires farmland near an urban area to be valued the same as more distant farmland for tax purposes? a. Statute of limitations b. Estoppel law c. Green belt law d. Zoning laws
C. Green belt law
24. The 1988 Fair Housing Amendment Act expanded on the Civil Rights Act of 1968 to include banning discrimination on the basis of what? a. Age b. Sex c. Handicap d. Race
C. Handicap
187. George Portfolio is a stockbroker who does not hold a real estate license. He believes the stock of the Gasaway Corporation has high potential. Upon contacting the president of Gasaway to assist the corporation in listing its stock for sale, he learns that the success of the company hinges on the negotiation of an oil lease. George offers his assistance, and the company engages him to negotiate the lease with Slick Slacker, the owner. Upon closing the lease, the company employs George as its stockbroker. George subsequently sells the corporation's stock. The corporation pays George a commission on the stock sale and gives him 5 shares for handling the oil lease. George: a. Is exempt as a salaried employee b. Acted properly functioning as a stockbroker c. Has violated F.S. 475 d. Has not violated F.S. 475
C. Has violated F.S. 475
431. All of the following are physical characteristics of real estate, EXCEPT: a. Immobility b. Situs c. Homogeneous d. Heterogeneous
C. Homogeneous
553. The Florida Real Estate Commission has the power to impose any of the following penalties, EXCEPT: a. Impose a fine of not more than $5,000 per offense for a violation of F.S. 475 b. Impose a fine of not more than $5,000 per offense for a violation of Chapter 455, F.S. c. Impose a prison sentence of not more than 1 year d. Revoke the license
C. Impose a prison sentence of not more than 1 year
292. What type of easement must be obtained when a utility company wants to put power line poles through a property? a. By prescription b. By necessity c. In gross d. Appurtenant
C. In gross
662. When estimating the value of a business, an appraiser would normally use which approach? a. Market approach b. Liquidation approach c. Income approach d. GRM technique
C. Income approach
350. What is the effect of positive leverage? a. Increases the lender's yield b. Increases the lender's loan to value yield c. Increases the borrower's yield d. Allows an individual to lift a heavy weight
C. Increases the borrower's yield
37. What type of depreciation cannot be recovered? a. Intrinsic b. Inherent c. Incurable d. Innate
C. Incurable
838. What happens if the Real Estate Recovery Fund doesn't have enough funds to pay claims? a. The claimant(s) will be paid from the state treasury. b. The sales associate or broker responsible will have to pay. c. Installments will be paid from the recovery fund as funds become available and paid in the order the claims were made. d. The claims will not be paid.
C. Installments will be paid from the recovery fund as funds become available and paid in the order the claims were made
782. A mortgagor who purchases under the FHA 203(b) mortgage loan program may have monthly payments that include principal and what else? a. Interest b. Interest, taxes, and insurance c. Interest, taxes, insurance, and mortgage insurance premium d. Interest, taxes, insurance, mortgage insurance premium, and life insurance
C. Interest, taxes, insurance, and mortgage insurance premium
316. A broker has a 90-day listing with Mr. and Mrs. Jones and shows the property to Mr. and Mrs. Smith prior to expiration of the listing. The Smiths show an interest in the property but go back north without making an offer. Next season, the Smiths are back and happen to meet Mr. and Mrs. Jones while shopping. After several meetings, the Smiths make an offer and purchase the property. The broker: a. Is the procuring cause of the sale and is entitled to a commission b. Is entitled to damages c. Is entitled to nothing d. May request FREC to interplead
C. Is entitled to nothing
537. Which statement is correct regarding a corporation sole? a. It can broker real estate deals. b. It allows title to go to the heir of the clergy in place. c. It allows title to go to the successor to the clergy in place. d. It acts like a corporation for profit.
C. It allows title to go to the successor to the clergy in place
681. Which statement best describes a quitclaim deed? a. It guarantees that the seller has the right to convey title. b. It is the best deed from the grantee's point of view. c. It does not warrant the title. d. It is the same as a guardian's deed.
C. It does not warrant the title
467. The binder deposit shows on the seller's closing statement only under which condition? a. It is paid in cash. b. The deposit exceeds the commission. c. It is paid directly to the seller by the buyer. d. The closing will be handled by a title company.
C. It is paid directly to the seller by the buyer
504. The DBPR may investigate matters it considers a violation of the license law in which of the following situations? a. It may investigate only those individuals who are registered with the FREC as sales associates or brokers. b. It may investigate only upon court- ordered subpoenas. c. It may investigate any person having knowledge of the facts of the case. d. It may investigate only if jurisdiction has been established by a proper court of law.
C. It may investigate any person having knowledge of the facts of the case
81. Which statement correctly applies to owner's title insurance? a. It is transferable to new owners. b. It protects the mortgagee from title defects. c. It protects the buyer from title defects. d. It is required on all transactions.
C. It protects the buyer from title defects
191. Which of the following best describes the purpose of the real estate license law? a. It teaches salesmanship b. It aids licensees in understanding the basic practice of law c. It puts forth the fundamental principles of law that every licensee must adhere to in order to protect the public d. Both a and b
C. It puts forth the fundamental principles of law that every licensee must adhere to in order to protect the public
944. How would a father and son own property together with the right of survivorship? a. Tenancy by entireties b. Tenancy at will c. Joint tenancy d. Tenancy in common
C. Joint tenancy
327. The owner of an apartment building would be required to provide all of the following EXCEPT: a. Heat and hot water b. Garbage pickup c. Laundry service d. Pest control services
C. Laundry service
212. Which of the following limits the actions of brokers? a. Certificate of estoppel b. Statute of frauds c. Law of agency d. All of the above
C. Law of agency
763. A California broker refers a prospect to a Florida broker. The Florida broker sells the prospect a property in Boca Raton. Even though the California broker did not participate directly in the sale, and in fact was never even in the state, the Florida broker sends half the commission as a referral fee. This is: a. Legal only if the California broker attends the closing b. A violation since the California broker had no direct participation c. Legal d. A violation since the California broker is not licensed in Florida
C. Legal
821. A seller listed a house with a broker. The seller informed the broker that he has had a change of heart and refuses to pay the broker's commission. The broker immediately files suit and places a lien on the seller's house. How has the broker acted? a. Properly and efficiently b. Within the limits imposed under F.S. 475 c. Legally, if the listing contract with the seller allowed him or her to do this d. Illegally, regardless of what is contained in the listing contract
C. Legally, if the listing contract with the seller allowed him or her to do this
822. Where is the right of the broker to accept earnest money on behalf of the seller created? a. Sales contract b. Agency disclosure form c. Listing agreement d. Real estate license law
C. Listing agreement
257. Michael and Jerry are both brokers. They decide to share office space. They do not use a trade name or common letterhead, although they share a secretary. Prior to putting up their signs, Jerry defrauds a prospect who came into the office. Based on this information, which statement is correct? a. Michael and Jerry have committed estoppel. b. Michael and Jerry are general partners. c. Michael can be held responsible for Jerry's acts. d. Jerry alone is responsible for this fraud.
C. Michael can be held responsible for Jerry's acts
52. Which of the following is a two-party arrangement that uses the property as security, and creates a lien on the property that may be removed by foreclosure? a. Deed b. Conveyance c. Mortgage d. Deed of trust
C. Mortgage
676. What is the instrument that is used to pledge real property as security for a debt? a. Promissory note b. Sales contract c. Mortgage d. Security deposit agreement
C. Mortgage
846. What is the document entered into by two parties, which replaces a lien on a property? a. Construction lien (mechanic's lien) b. Lease c. Mortgage d. Option
C. Mortgage
980. Which would be a consideration in underwriting an FHA loan application but NOT considered for a VA loan? a. Borrower's monthly income b. Borrower's assets c. Mortgage insurance d. Borrower's credit history
C. Mortgage insurance
357. All of the following entities make loans, EXCEPT: a. Life insurance companies b. Mortgage lenders c. Mortgage loan originators d. Commercial banks
C. Mortgage loan originators
525. Sales associate Colleen, who works for broker Coco, was assigned the task of writing real estate advertisements in Coco's office. Is this a violation of F.S. 475? a. Yes, because only brokers can write real estate ads b. Yes, because only the listing sales associate under the direct supervision of the broker can write real estate ads c. No, because any sales associate may write an ad regardless of whether they took the listing or not, provided it is under the direct supervision of the broker and the broker's name appears in the ad d. No, because any sales associate may write an ad with the permission of the employing broker, provided it is under the direct supervision of the broker and the broker's name appears in the ad, and provided also that if a sales associate's name is used in the ad, it is the listing sales associate's name
C. No, because any sales associate may write an ad regardless of whether they took the listing or not, provided it is under the direct supervision of the broker and the broker's name appears in the ad
729. Broker Greer closed down his real estate office and sold his inventory of listings to M and M Realty, Inc., an office down the street. This is: a. Legal, since listings are assignable b. Not legal without the knowledge and consent of the listing sales associate c. Not legal, since listings are not assignable d. Legal, since the broker can do anything he wants with the listings because he owns them
C. Not legal, since listings are not assignable
939. An administrative complaint is filed against the subject of a FREC investigation. By law, how much notice must the respondent be given before an upcoming formal hearing, unless waived? a. Not less than 20 days b. Not more than 20 days c. Not less than 14 days d. Not more than 14 days
C. Not less than 14 days
493. Broker Paul was served a subpoena to testify in court. Paul introduced his license into evidence to support his qualifications to testify. What did Paul achieve by this action? a. It is a rebuttable presumption. b. It serves as prima facie evidence of the broker's license status. c. Nothing; it has no effect in a court of law. d. Nothing; it is not required to be presented since the broker had been served a subpoena.
C. Nothing; it has no effect in a court of law
194. What should a sales associate do if he or she considers a rule to be invalid? a. Notify the state legislators b. Notify the local board of REALTORS® c. Notify FREC d. Ignore the rule
C. Notify FREC
911. A broker receives a binder deposit from a buyer who is making an offer on a property. Two days later, the property owner/seller makes a counteroffer, which is accepted by the buyer. The attorneys for buyer and seller disagree over the title to the property. Both buyer and seller make demands on the broker for the deposit. Based on this information, what should the broker do concerning the disputed deposit? a. Return it to the buyer b. Divide it between himself and the seller according to their agreement c. Notify the commission within 15 business days d. File for arbitration
C. Notify the commission within 15 business days
720. What kind of partnership exists when one or more parties cause a third party to believe a partnership exists when no partnership actually does? a. Actual b. Constructive c. Ostensible d. General
C. Ostensible
100. Which type of loan uses both real and personal property as security? a. Blanket mortgage b. Purchase money mortgage c. Package mortgage d. Chattel mortgage
C. Package mortgage
739. Broker Pat shows a home to a prospect. Pat offends the prospect by telling a dirty joke. The prospect advises Pat that he or she will not deal through them and goes to broker Terry who shows the prospect the very same house and closes the deal. The home was an open listing. Which statement best applies? a. Pat can collect a full commission. b. Terry must split the commission 50/50 with Pat. c. Pat cannot collect a commission. d. Neither Pat nor Terry is entitled to a commission.
C. Pat cannot collect a commission
18. Bill's license expired on September 30. On February 14, of the following year, he wants to renew it. If it is not his first renewal, what must Bill do? a. Start over with a pre-license course b. Pay a late fee and complete two 14-hour continuing education classes c. Pay a late fee and complete 14 hours of continuing education d. Pay a late fee and complete 45 hours of post-license education
C. Pay a late fee and complete 14 hours of continuing education.
813. A sales associate misplaced their license. What must he or she do? a. Request a new license, but pay no fee b. Wait for the license to be renewed at which time he or she will receive a new copy c. Pay the appropriate fee, file the appropriate paperwork and request a new copy d. Ask his or her broker for a photocopy of the office license
C. Pay the appropriate fee, file the appropriate paperwork and request a new copy
242. A broker has been found guilty of mail fraud by a court and sent to jail. The broker's license will: a. Automatically be revoked b. Automatically be suspended c. Probably be revoked because of the conviction d. Be renewed while he is in jail
C. Probably be revoked because of the conviction
765. Which document allows a buyer of a cooperative to occupy a unit? a. Lease b. Contract for deed c. Proprietary lease d. Deed
C. Proprietary lease
468. How are property taxes accounted for on a closing statement? a. Debited entirely to the buyer b. Prepaid entirely by the buyer c. Prorated between the buyer and seller d. Debited entirely to the seller
C. Prorated between the buyer and seller
11. In a brokerage corporation, the officers and directors can be active or inactive brokers or nonlicensed registered persons. If someone who is nonlicensed and registered wants to become a broker, what must he or she do? a. File an application with the secretary of state b. Only take a 40-question law exam c. Qualify for a broker license in the same way as anyone else d. Demonstrate 2 years of experience in the real estate business
C. Qualify for a broker license in the same way as anyone else.
569. Which type of deed is the most favorable from the grantor's point of view? a. Special warranty deed b. Warranty deed c. Quit claim deed d. Bargain and sale deed
C. Quit claim deed
51. The Fair Housing Act of 1968 (as amended) prohibits discrimination based upon: a. Race, color, citizenship, sex, family status, or religion b. Race, color, religion, sex, age, national origin, or handicap c. Race, color, religion, sex, national origin, family status, or handicap d. Race, color, age, residency, sex, national origin, or handicap
C. Race, color, religion, sex, national origin, family status or handicap
576. The annual percentage rate (APR) includes all of the following, EXCEPT: a. Interest b. Discount c. Real estate taxes d. Finance charges
C. Real estate taxes
748. Complete the sentence. Trees growing on property are typically considered to be: a. Chattels b. Personal property c. Real property d. None of the above
C. Real property
832. In the event of a foreclosure of an income producing property, who may collect rents? a. Marshal b. Broker c. Receiver d. Tenant
C. Receiver
376. What is the term used to refer to the process of arriving at a final estimate of value in appraising? a. Highest and best use b. Averaging c. Reconciliation d. Computation
C. Reconciliation
956. A broker sells a prospective tenant a rental list for $200. The prospective tenant decided not to rent in the area and did not use the list. The tenant then demanded a refund within 30 days. What action should the broker take? a. Refund $200 b. Refund $50 c. Refund $150 d. No refund needs to be made
C. Refund $150
756. A broker asks a sales associate to fill out documents in a manner that the sales associate knows is illegal. What should the sales associate do? a. Comply with the broker's request b. Ask FREC for instructions c. Refuse to comply d. Handle the matter in a way that he or she deems appropriate
C. Refuse to comply
62. The courts usually apply legal tests to determine if personal property has become a fixture. Which of the following is included in those tests? a. Date of purchase b. Extent of the parties c. Relationship of the parties d. All of the above
C. Relationship of the parties
981. Ownership rights are conveyed but not legal title with which type of estate? a. Tenancy at will b. Fee simple estate c. Remainder state d. Estate for years
C. Remainder state
962. What term refers to the amount of money necessary to duplicate an existing building? a. Actual cost b. Replacement cost c. Reproduction cost d. Market cost
C. Reproduction cost
27. In which instance must the agency disclosure forms developed by the state be used? a. Commercial leasing b. Residential leasing c. Residential sales d. Residential auctions
C. Residential sales
325. Health ordinances are local laws and rules created to protect the general welfare of the citizens in the community. These could include all of the following areas of coverage, EXCEPT: a. Limitations on type and number of pets b. Restrictions and rules for outside burning c. Restrictions on the legal use of land d. Restrictions on permissible noise levels
C. Restrictions on the legal use of land
823. A sales associate sells a listing of another broker. The buyer gives a check made payable to the sales associate. What should the sales associate do? a. Cash the check, and give the money to the employing broker b. Cash the check, and give the money to the listing broker c. Return the check to the buyer, and ask that it be reissued to the employing broker d. Return the check to the buyer, and ask that it be reissued to the listing broker
C. Return the check to the buyer, and ask that it be reissued to the employing broker.
19. Ron and his wife each have real estate licenses before he enters the military. Ron is stationed in Washington, D.C., and his wife accompanies him there. If they make their licenses inactive: a. Only Ron is exempt from renewal requirements until 6 months after he is discharged. b. Only Ron is exempt from renewal requirements until 12 months after he is discharged. c. Ron and his wife are exempt from renewal requirements until 6 months after Ron's discharge. d. Ron and his wife are exempt from renewal requirements until 12 months after Ron's discharge.
C. Ron and his wife are exempt from renewal requirements until 6 months after Ron's discharge
69. Jones sells a parcel of property to Mason, who thereafter leases the property to Jones. The seller has entered into which of the following? a. Sale-contract back b. Buy-leaseback c. Sale-leaseback d. Contract for deed
C. Sale-leaseback
723. Who may issue summary suspensions? a. FREC chairperson b. The court c. Secretary of the DBPR or his or her representative d. Probable Cause Panel of the Florida Real Estate Commission
C. Secretary of the DBPR or his or her representative
149. In which market would there be a shortage of housing? a. Buyers' market b. Housing market c. Sellers' market d. Deficit market
C. Sellers' market
188. Mr. White referred his sister to a real estate broker, and she purchased a $200,000 home. What may the broker do to show his thanks? a. Take Mr. White to dinner b. Give Mr. White a bottle of wine c. Send a thank you note to Mr. White d. Pay a referral fee
C. Send a thank you note to Mr. White
496. Sales associate Sandra wants to advertise her home for sale. What may happen if she advertises in her own name only? a. She may be charged with acting as a broker. b. This would be considered a blind ad, and she is subject to disciplinary action by the commission. c. She may do so but must reveal her licensed status prior to entering into serious negotiations. d. She may do so but must divulge her identity as a licensee in the ad.
C. She may do so but must reveal her licensed status prior to entering into serious negotiations
300. Which of the following is essential for a deed to be valid? a. Competent grantee, both legally and mentally b. Acknowledged and recorded c. Signed by the grantor and/or grantors d. Stipulates the exact amount of consideration involved
C. Signed by the grantor and/or grantors
751. How would intangible taxes typically appear on a closing statement? a. Double-entry debit to the buyer and a credit to the seller b. Double-entry credit to the buyer and a debit to the seller c. Single-entry debit to the buyer d. Single-entry debit to the seller
C. Single-entry debit to the buyer
752. How would intangible taxes typically appear on a closing statement? a. Double-entry debit to the buyer and a credit to the seller b. Double-entry credit to the buyer and a debit to the seller c. Single-entry debit to the buyer d. Single-entry debit to the seller
C. Single-entry debit to the buyer
583. Real estate brokers usually represent customers as what type of agent? a. Universal agent b. General agent c. Special agent d. Quasi-agent
C. Special agent
571. How would a new sidewalk be paid for? a. Ad valorem taxes b. Income taxes c. Special assessment taxes d. Property taxes
C. Special assessment taxes
556. What is a closing statement? a. Seller's statement of settlement costs b. Buyer's statement of settlement costs c. Statement of settlement costs between the buyer and seller d. Statement recorded in the public records evidencing title transfer
C. Statement of settlement costs between the buyer and seller.
53. A licensee picks the properties a particular buyer is shown based on the race of the buyer. What is this illegal act? a. Redlining b. Blockbusting c. Steering d. Commingling
C. Steering
848. What term refers to a written contract, often used in conjunction with a mortgage refinance, in which a lender and property owner agree to a change in lien priority? a. Prepayment agreement b. Reprioritization contract c. Subordination agreement d. Escalation agreement
C. Subordination agreement
969. If the comparable property were better than the subject property in size, what adjustment would be appropriate? a. Add to the comparable property b. Add to the subject property c. Subtract from the comparable property d. Subtract from the subject property
C. Subtract from the comparable property
201. Sales associate, Tim, received a signed contract from a buyer and mailed it to the seller. The seller agreed to the terms and the escrow deposit was deposited safely in the broker's escrow account. Tim has a disagreement with his broker and quits. The broker refuses to pay a commission since Tim was not in his employ when the contract was actually received and signed. What should Tim do? a. Notify the state b. Sue the seller for his share c. Sue the broker d. Forget it; he or she is not entitled to the commission
C. Sue the broker
880. Six people organize a business to buy and sell real property. The title is to be held in trust by a board of trustees or someone in a position of trust. They have been required to file a declaration of trust with the Secretary of State. What type of business is being formed? a. Corporation for profit b. Corporation sole c. Syndicate d. Limited partnership
C. Syndicate
261. Broker Smith owns a Real Estate Brokerage Corporation. When filing his 2014 tax return, he forgets to include a referral fee received from a Georgia broker. What will the Commission most likely do? a. Suspend the broker's license b. Not renew the broker's license c. Take no action if Smith files an amended return with the IRS and pays any penalties involved d. Cancel the corporation's license
C. Take no action if Smith files an amended return with the IRS and pays any penalties involved
518. Smith owns an orange grove and a warehouse. Smith died intestate, and the court appointed Brown to dispose of Smith's assets. What can Brown do? a. Dispose of these assets only if Brown has a real estate license b. May not dispose of these assets under any circumstances c. Take the necessary steps to sell the properties and be compensated for his or her efforts d. Take the necessary steps to sell the properties, provided Brown receives no compensation
C. Take the necessary steps to sell the properties and be compensated for his or her efforts
955. Two brokers are working on an exchange. The commission agreement for each property is the same percentage. The properties are of unequal value, and the brokers decide to combine their commissions and split 50/50. What must the brokers do first to make this legal? a. Nothing b. Tell the owners c. Tell the owners and get them to agree d. Notify the FREC in writing
C. Tell the owners and get them to agree
287. Jim, Matt, and Jack were co-owners of a parcel of real property. Matt died, and his co-ownership passed according to his will to become part of his estate. What type of tenancy did Matt have? a. Tenancy by the entireties b. Joint tenancy c. Tenancy in common d. Tenancy at will
C. Tenancy in common
760. Three members of a family purchase an office building without the right of survivorship. One dies. What type of estate do the remaining family members have? a. Tenancy by the entireties b. Joint tenancy c. Tenancy in common d. Tenancy for life
C. Tenancy in common
484. A Florida broker was arrested in Alabama and charged with possession of stolen property. The broker has confessed to a role in a theft ring and has provided the names of his accomplices. Should the FREC be made aware of this prior to the case going to trial, what action would it take regarding the broker's license? a. The Commission cannot take action against the broker until the broker is proven guilty in a court of law. b. The broker will be suspended pending the outcome of the trial. c. The Commission may revoke the broker's license. d. Since the activity does not involve real estate, and occurred outside the state of Florida, the Commission has no jurisdiction over the broker's actions.
C. The Commission may revoke the broker's license
931. Who must approve the appointment of the director of the Division of Real Estate by the secretary of the Department of Business and Professional Regulation? a. The governor b. The secretary of state c. The FREC d. The attorney general
C. The FREC
256. A person being investigated by the Department of Business and Professional Regulation must be notified in all of the following situations, EXCEPT: a. There is probable cause that there may have been a violation of F.S. 475. b. There is probable cause that there may have been a violation of Chapter 61J2, F.A.C. c. The act that is under investigation is a criminal offense. d. The investigation is ordered by the DBPR.
C. The act that is under investigation is a criminal offense
90. If a seller revoked an exclusive right of sale listing without cause and then sold the property to a neighbor, which statement would be true? a. A seller always has the right to revoke a listing. b. Only the broker may revoke this listing. c. The broker is due a commission based on the sales price. d. The broker may sue for damages for time and expenses.
C. The broker is due a commission based on the sales price.
204. Sales associate John attends a cocktail party with his friend Bill, where he introduces Bill to another friend, Jack. It turns out that Jack has a house for sale, and Bill agrees to purchase it. Sales associate John makes it clear that he wants no commission, but John's broker demands a commission. Which statement is correct? a. The broker is the procuring cause and is entitled to a commission. b. The broker should reduce his commission because of John's friendship. c. The broker is not entitled to a commission. d. The broker is entitled to a referral fee only.
C. The broker is not entitled to a commission
921. Complete the sentence. Before a FREC rule can be introduced into a court of law, a certificate of the rule must be presented with the signature of: a. The secretary of the DBPR b. Any member of the FREC c. The chairperson of the FREC d. The director of the DRE
C. The chairperson of the FREC
783. Before registration is granted to a "foreign" corporation to do brokerage business in the state of Florida, it must have at least one active Florida broker and: a. The corporation must reincorporate in the state of Florida. b. The corporation must get approval from the Governor's Office of Reincorporation. c. The corporation must receive a letter from the Florida Secretary of State, giving permission to do business in Florida. d. Nothing else; a "foreign" corporation may never do brokerage business in Florida.
C. The corporation must receive a letter from the Florida Secretary of State, giving permission to do business in Florida
751. Who normally manages a corporation for profit? a. The member stockholders working through the executive officers b. The executive officers working through the directors c. The directors of the corporation working through the executive officers d. The stockholders of the corporation working through the directors
C. The directors of the corporation working through the executive officers
839. From which of the following may a sales associate receive compensation, referral fees, or bonuses? a. Another sales associate b. Another broker c. The employing broker d. A FSBO
C. The employing broker
679. A farmer gives a $ 15,000 listing with a 90-day protection period to a broker for a 6-month term, agreeing to a 10% commission. After 5 months, the broker brings a prospect to see the property. The prospect refuses to pay $15,000. The farmer takes the prospect aside and tells him or her to come back in 30 days. After the 30 days, the farmer sells the property directly to the prospect for $14,000. Which statement is correct? a. The farmer owes the broker $1,500 as procuring cause. b. The farmer and the prospect each owe the broker as a result of the conspiracy to defraud the broker. c. The farmer owes the broker $1,400. d. The broker can do nothing as the listing has expired.
C. The farmer owes the broker $1,400
689. A broker gets a 90-day exclusive right of sale listing on a house for $50,000 and promises to advertise it for 2 weeks. The owner agrees to pay the broker a 6% commission if the broker is successful in finding a buyer. The broker advertises the property as agreed in the listing contract. Forty-five days into the listing contract, the seller sells the house himself to an old army buddy for $45,000. Which statement applies? a. The owner owes the broker $3,000. b. The owner does not have to pay the broker a commission. c. The owner owes the broker a $2,700 commission. d. The owner will owe the broker the usual and customary commission of the community.
C. The owner owes the broker a $2,700 commission
719. Mr. Smith makes an offer to buy a property. The offer is accepted. Two days before the closing, Mr. Smith says, "I am not Mr. Smith, I am Mr. Brown, and I do not want to close." Which statement applies? a. The broker can sue for commission. b. The buyer does not have to buy. c. The seller can sue for specific performance. d. The broker can sue for specific performance.
C. The seller can sue for specific performance
348. Which entity regulates a life insurance company in the primary mortgage market? a. RESPA b. The federal government c. The state in which it operates d. None, they are not regulated
C. The state in which it operates
181. Mary does not have a real estate license and works for AAA Syndicate, which buys, sells, manages, and leases its own property. Mary was hired to lease and sell AAA's property; she is compensated by a salary. Which statement is correct? a. Mary needs a real estate license. b. This activity is okay only if Mary is paid 50% on sales and 50% on leasing. c. There is no violation of F.S. 475. d. This activity is okay only if no
C. There is no violation of F.S. 475
81. Which of the following is true regarding general warranty deeds? a. They assure good title. b. They assure marketable title. c. They state that the grantor will defend against all lawful claims. d. They are used principally to cure defects in title.
C. They state that the grantor will defend against all lawful claims.
639. How would an owner show marketable title? a. A deed and tax certificate b. An abstract c. Title insurance d. A property tax bill
C. Title insurance
90.. What does the Statute of Frauds require? a. Lawsuits about oral contracts must be filed within 4 years b. All contracts must be in writing c. To be enforceable, a contract transferring an interest in real estate must be in writing d. Violations are punishable by fines not to exceed $1,000
C. To be enforceable, a contract transferring an interest in real estate must be in writing
238. What should a new sales associate expect his broker to provide? a. Salary b. Business cards c. Training d. Health insurance
C. Training
604. What is required for a transfer of title? a. Signature, under seal, and two witnesses b. Signature, two witnesses, and acknowledged c. Two witnesses, signed, and delivered d. Two witnesses and acknowledged
C. Two witnesses, signed, and delivered
268. A private club has a lodge in the mountains. The club refuses to rent rooms in the lodge to certain minority groups. Which statement applies? a. This is a violation of the Fair Housing Act. b. This is a violation of the Civil Rights Act of 1968. c. Under the Fair Housing Act, they may restrict rentals to members of their own club. d. Under the Fair Housing Act, they may discriminate.
C. Under the Fair Housing Act, they may restrict rentals to members of their own club
809. An appraiser using the direct capitalization technique would deduct which of the following from PGI to obtain the EGI? a. NOI b. DS c. V&C d. Depreciation
C. V&C
789. A buyer makes an offer, which the seller accepts. Before the broker can tell the buyer of the acceptance of his offer, the buyer dies. What is the most likely status of the contract? a. Valid because the buyer accepted b. Valid but will be voided at time of closing because the deed cannot be granted c. Void because the buyer did not know the offer was accepted before he died d. Void because the buyer did not initial the seller's acceptance
C. Void because the buyer did not know the offer was accepted before he died
884. When can a sales contract that is witnessed, executed, and acknowledged be recorded in the public records of the county in which the property is located? a. When the licensee thinks the seller may back out b. When the licensee hears rumor that the seller may accept a contract from someone else c. When the seller requests it d. When it will not delay the closing
C. When the seller requests it
551. A broker is the active broker for ABC Realty, Inc. He or she wishes to open a second office called XYZ Realty, Inc. and be the active broker for that office as well. Under what condition can the broker do this? a. Under no circumstances b. With a group license c. With multiple licenses d. After requesting a FREC hearing on the matter
C. With multiple licenses
542. A broker asks his secretary to attend an open house. The secretary quotes prices and terms to prospective buyers, as per the broker's instructions. Is this a violation of license law? a. No, as long as the secretary doesn't prepare the contract b. Yes, because the secretary is holding an open house c. Yes, because the secretary is doing things that require a license d. No, as long as the secretary only gives subjective comments
C. Yes, because the secretary is doing things that require a license
80. Private restrictions are enforced by private citizens. Which of the following is the strongest control they have over a property owner? a. Leases b. Easements c. Deed restrictions d. Liens
C. deed restrictions
30. Sales associate Glenn works for broker John. If Glenn receives an escrow deposit on Tuesday, what should he do? a. Deliver it to his broker by Friday (third business day) b. Hold deposit until contract is accepted c. Deliver it to his broker immediately (next business day) d. Deliver it to his escrow account immediately
C. deliver it to his broker immediately (next business day)
72. What term refers to the power that the government has to take land for the public good? a. Encumbrance b. Escheat c. Eminent domain d. Easement
C. eminent domain
10. What does the license law require that a licensee complete before the first renewal of a Florida real estate license? a. A continuing education course b. A minimum number of transactions c. A post-licensing course d. A REALTOR® orientation course
C. post-licensing course
36. Craig is a real estate sales associate working for ABC Realty, Inc. Craig decides to have refrigerator magnets made to give out to the public. What must he include on the magnets? a. Since Craig is paying for them, he can put anything he wants on them. b. They must contain Craig's license status. c. They must contain the name ABC Realty, Inc. d. They must contain the word REALTOR® or broker.
C. they must contain the name ABC Realty, Inc
54. Telling home owners that minority families are moving into their neighborhood in an attempt to get them to sell their home and move is referred to as which of the following? a. Steering b. Redlining c. Blockbusting d. Boycotting
C: Blockbusting
15. The income generated by a property is $20,000, and the rate of return is 10%. What is the value of the property? a. $100,000 b. $150,000 c. $175,000 d. $200,000
D. $200,000
165. A 10-year-old home is being appraised. The square footage of gross living area is 3,680 and there is also a 420-square-foot garage. If the construction cost is $70 per square foot for living area and $35 for a garage, what is the reproduction cost of the structure? a. $128,800 b. $158,200 c. $257,600 d. $272,300
D. $272,300
475. Closing date is June 5, and the day of closing belongs to the buyer. Annual real estate taxes are $730. Using the 365-day method, prorate the amount of taxes debited to the seller. a. $420 b. $418 c. $312 d. $310
D. $310
994. If you borrowed $40,000 for 30 years at a 10% rate of interest, and would pay a total of $86,370.80 in interest if the loan were held to maturity, what is the monthly payment? a. $239.92 b. $333.33 c. $346.22 d. $351.03
D. $351.03
4. A property has annual taxes of $450. The date of closing of October 12th is charged to the seller. Using the 365-day proration method, what is the amount of the tax proration, and how should it be entered on the closing statement? a. $ 98.63 credit seller, debit buyer b. $ 98.63 credit buyer, debit seller c. $351.37 credit seller, debit buyer d. $351.37 credit buyer, debit seller
D. $351.37 credit buyer, debit seller
3. What is the tax levy of a non-homestead property that is assessed at $36,000 with a tax rate of 11 mills? a. $110.00 b. $115.50 c. $121.00 d. $396.00
D. $396.00
438. Mr. Smith buys a house for $38,000. He pays 10% down and will take out a mortgage on the balance at 14% interest for 30 years. The monthly loan constant is .011849. What is the total amount of interest paid in the third month? a. $432.77 b. $399.00 c. $398.93 d. $398.85
D. $398.85
175. A homeowner purchased a primary residence for $395,500 including $15,000 in closing costs and $60,000 for the lot. After the closing, hurricane shutters were installed at a cost of $12,600. What is the adjusted basis for tax purposes? a. $348,100 b. $423,100 c. $382,900 d. $408,100
D. $408,100
7. A property sold for $90,000 and has an 85% mortgage. What is the total amount of the state documentary stamp tax on the note and intangible tax on the mortgage? a. $153.00 b. $261.75 c. $267.75 d. $420.75
D. $420.75
251. What is the maximum administrative fine for a violation of F.S. 475? a. $500 b. $1,000 c. $1,500 d. $5,000
D. $5,000
454. A seller wishes to net $55,000 after paying a 7% commission. What should the selling price be? a. $55,000 b. $58,000 c. $58,850 d. $59,140
D. $59,140
164. In November, the seller paid $1,375 for the annual property taxes. The closing date is December 14, and the day of closing belongs to the seller. Using the 365-day method, what prorated amount of taxes will be debited to the buyer? a. $1,310.96 b. $1,194.18 c. $180.82 d. $64.04
D. $64.04
798. If the commission on the sale is $4,599, and the broker charged 7%, what was the sales price? a. $32,193.00 b. $42,770.70 c. $49,451.61 d. $65,700.00
D. $65,700.00
461. The city tax rate is 8 3/4 mills, the county rate is 9½ mills and the school board rate is 7¾ mills. If the property is assessed at $50,000 and enjoys a homestead exemption, how much would the taxes be for the year? a. $1,300 b. $1,170 c. $780 d. $650
D. $650
992. An investor developed a PUD. He spent $20,000 per acre for the land, which is divided into the following three uses: x 3/8 of the tract for condominiums x 5/16 of the tract for townhouses x The rest of the tract for single-family homes If the portion of the tract used for singlefamily homes consists of 120 acres, what was the sales price of the entire tract? a. $3,490,909 b. $4,189,091 c. $5,280,000 d. $7,680,000
D. $7,680,000
432. Bob purchased two-fifths interest in joint property for $28,000. What was the total sale price of this property? a. $11,200 b. $35,000 c. $46,666 d. $70,000
D. $70,000
460. Mr. Smith qualifies for homestead exemption. He is a widower and has an additional exemption because he is blind. The county millage rate is 7¾ mills, the city millage rate is 6½ mills, and the school millage rate is 9¼ mills. If his property is assessed at $125,000, how much is his tax bill reduced by exemptions? a. $1,000.00 b. $365.25 c. $611.00 d. $967.25
D. $967.25
153. A homesteaded property has an assessed value of $249,000. If the county tax rate is 7 mills, the city is 8 mills and the school board is 9 mills, how much does the homestead exemption save the homeowner? a. $25,000 b. $6,000 c. $5,376 d. $975
D. $975
695. Michael has a loan on his house for $75,000. After the first year, he has paid $11,936.36 in interest and $124.26 in principal. After the first year, what portion of his loan is paid off? a. 16.50% b. 2.00% c. 1.65% d. .17%
D. .17%
684. An option contract is a right to buy a property during a specified period-of time at a specified price. How many days do you have to redeem an option once it has expired? a. 30 b. 15 c. 10 d. 0
D. 0
263. A seller refuses to accept an offer submitted by a broker on behalf of a buyer. The offer meets the terms of the listing contract. To what is the listing broker entitled? a. No compensation because offer was rejected b. 25% of the full commission c. 50% of the full commission d. 100% of the full commission
D. 100% of the full commission
852. Electronic fingerprints are mandatory for all real estate sales associate and broker applicants. For how long will the fingerprints be retained? a. Indefinitely b. Until the application is approved c. 2 years from the date received d. 12 months from the date received
D. 12 months from the date received
806. How many days does the buyer of a new condominium have to cancel the agreement? a. 3 b. 7 c. 10 d. 15
D. 15
236. Unless there is a reasonable benefit for the borrower, the Florida Fair Lending Act prohibits a lender from refinancing the same borrower within how many months? a. 6 b. 12 c. 15 d. 18
D. 18
890. In order to collect from the Real Estate Recovery Fund, the claim must be filed within what period of time after the act was or should have been discovered? a. 30 days b. 90 days c. 1 year d. 2 years
D. 2 years
594. According to the Tax Reform Act of 1986, what is the maximum percentage of depreciation that may be taken annually on an office building purchased in 1994? a. 6.67% b. 3.60% c. 3.17% d. 2.56%
D. 2.56%
156. Jack has an income of $85,000 per year, and Patricia, his wife, has an income of $75,000. They have car payments of $540 per month each, credit card payments of $600 and student loan payments of $1,000 per month. The loan they are applying for would have a monthly payment of $3,400. What is the housing expense ratio? a. 53% b. 45% c. 38% d. 26%
D. 26%
899. Taxes are $30,000 a year, and gross income is $237,000 a year, with other expenses and reserves of $20,000. If taxes go up 25% and all else remains the same, by what percentage will the net operating income be reduced? a. 25% b. 15% c. 4.2% d. 4.0%
D. 4.0%
10. Calculate the number of acres in a property with the following legal description: SW 1/4 of the SW 1/4 of the SE 1/4 and the E 1/2 of the E 1/2 of the SW 1/4 of Sec. 23 a. .625 b. 1.25 c. 2.50 d. 50
D. 50
79. What is a title? a. A deed of conveyance b. A legally binding contract c. A piece of paper d. A bundle of ownership rights
D. A bundle of ownership rights
524. What action will occur when the FREC imposes a fine against a licensee, and the individual is unable to pay the fine? a. The DBPR/FREC can force bankruptcy b. The DBPR/FREC will suspend or revoke the license c. They will allow the licensee to pay it when they have the money d. A civil action will be brought to recover and a judgment awarded
D. A civil action will be brought to recover and a judgment awarded
4. A licensee is being disciplined by the FREC for multiple violations of F.S. 475. Which penalty may the Commission NOT impose? a. Revocation b. Suspension for up to ten years c. A fine not to exceed $5,000 plus revocation d. A fine not to exceed $5,000 and/or imprisonment not to exceed one year
D. A fine not to exceed $5,000 and/or imprisonment not to exceed one year
245. A violation of F.S. 475 can result in any of the following actions, EXCEPT: a. Revocation b. Imprisonment c. Direct denial of compensation d. A fine of $10,000 per offense
D. A fine of $10,000 per offense
672. Which condition is an example of functional obsolescence? a. High unemployment in an area b. Damage due to infestation of termites c. Plumbing not functioning properly d. A five-bedroom house with one bathroom
D. A five-bedroom house with one bathroom
128. What is a contract for deed, or land contract? a. A type of ownership or tenancy b. A legal document that conveys title c. A purchase and sale contract for unimproved land d. A form of owner financing
D. A form of owner financing
612. Which of the following estates involves ownership of real property? a. A leasehold estate b. A tenancy for years c. A tenancy at will d. A freehold estate
D. A freehold estate
36. What is one example of external obsolescence? a. Missing roof shingles b. A one-car garage c. 60-ampere electrical service d. A freeway constructed adjacent to a lot
D. A freeway constructed adjacent to a lot
388. All of the following are examples of physical depreciation, EXCEPT: a. Peeling paint b. Termites in the woodwork c. Dry rot in the walls d. A garage detached from a single-family home
D. A garage detached from a single-family home
337. In a lien-theory state, what instrument would be conveyed by the mortgagee to the mortgagor when the mortgage has been paid in full? a. A reconveyance deed b. A notice of redemption c. A quitclaim deed d. A letter of satisfaction
D. A letter of satisfaction
369. All of the following entities may assign a mortgage, EXCEPT: a. Freddie Mac b. A mortgagee c. Fannie Mae d. A mortgagor
D. A mortgagor
129. What is required for a person who represents him or herself as a business broker? a. A business sales associate's license b. A business broker's license c. An appraiser's license d. A real estate license
D. A real estate license
3. What does the local planning agency have the authority to approve? a. Building permits b. Deed restrictions c. Escheat actions d. A subdivision plat map
D. A subdivision plat map
193. Robert, a sales associate, has been working with an investor that is looking for single-family properties for income. In order to get preferential treatment, the investor offers a $1,000 finder's fee directly to Robert for each suitable property he finds. This arrangement would be: a. A violation of the civil rights laws b. Acceptable since it is a finder's fee, not a commission c. A violation since finder's fees cannot exceed $50 d. A violation of F.S. 475, because it is not paid through his broker
D. A violation of F.S. 475, because it is not paid through his broker
55. Broker Bill has been hired to rent Mrs. Brown's apartment building located in a large college town. Broker Bill quotes lower rents and deposits to females because he has found through experience that they will cause less trouble than males, and females will maintain their apartments in much better condition. This is: a. True and therefore no problem b. A violation of the Civil Rights Act of 1866 c. A violation of the Equal Rental Opportunity Act of 1972 d. A violation of the Fair Housing Act of 1968
D. A violation of the Fair Housing Act of 1968.
178. Jerry was notified that he passed the state sales associate license exam. For which type of employer does his license allow him to perform real estate services? a. A broker b. An owner-developer c. A real estate brokerage corporation d. A, b or c
D. A, b or c
87. Complete this statement. A listing contract would not terminate as the result of . a. The death of the seller b. The death of the broker c. Destruction of the improvements d. Abandonment by the seller
D. Abandonment by the seller
355. Which mortgage clause calls for the entire balance to be paid? a. Cognovit clause b. Special-purpose and circumstance clause c. Defeasance clause d. Acceleration clause
D. Acceleration clause
615. A broker shows a house to a prospect, making a statement that they are going to love the elementary schools. This is a(an): a. Omission statement b. Extravagant statement c. Violation of the fair housing law d. Acceptable statement
D. Acceptable statement
516. A listing contract may be terminated in all of the following ways, EXCEPT: a. Cancellation of the contract b. Fulfillment of the contract c. Mutual abandonment of the contract d. Acceptance of an offer on the property
D. Acceptance of an offer on the property
407. Which of the following is equivalent to an acre? a. 1/640 of a section b. 43,560 square feet c. 208.71-foot square parcel d. All of the above
D. All of the above
901. Complete the sentence. A sales associate cannot: a. Change the policies of his or her employer without consent b. Change the terms and conditions of a sales contract without permission c. Change the terms and conditions of a listing contract without permission d. All of the above
D. All of the above
1001. After I have passed my state exam, I need to: a. Celebrate! b. Pat myself on the back; I've worked hard c. Sign up to take my post-license course immediately d. All of the above, in this order
D. All of the above, in this order
306. Broker Brown gets a listing from Mr. Jones. Broker Brown agrees to advertise, caravan and print material intended to help in the sale of the house. Mr. Jones agrees to pay a commission to Broker Brown no matter who sells the house. Which type of listing is in place? a. An exclusive listing b. An implied listing c. A general agency agreement d. An exclusive right of sale listing
D. An exclusive right of sale listing
545. What type of contract is formed when a buyer calls an agent on the phone wanting to buy a certain property? a. A unilateral contract b. A bilateral contract c. A valid contract d. An unenforceable contract
D. An unenforceable contract
904. When calculating the housing expense ratio, what do expenses include? a. Annual mortgage payments and federal taxes b. Property taxes and state income taxes c. Property taxes and insurance d. Annual mortgage payments, property taxes and insurance
D. Annual mortgage payments, property taxes and insurance
629. If the grantor is insolvent, which of the following deeds would be the best from the buyer's point of view? a. Quitclaim deed b. General warranty deed c. Bargain and sale deed d. Any deed
D. Any deed
802. Complete the sentence. An agreement between two parties for the purchase of real estate must be: a. An oral contract b. A parol contract c. An informal contract d. Any of the above
D. Any of the above
527. Which type of property can be purchased with a VA loan? a. An apartment building b. An income-producing investment property c. Commercial property d. Any owner-occupied residence, including condominiums and mobile homes
D. Any owner-occupied residence, including condominiums and mobile homes
134. When do property taxes in Florida become delinquent? a. April 15 of the following year b. January 1 of the tax year c. April 1 of the tax year d. April 1 of the following year
D. April 1 of the following year
274. A Hispanic buyer asks to see a home in a certain price range. What should a licensee show him? a. Homes in only a predominately-Hispanic area b. Homes in only a predominately- Caucasian area c. Six homes in each type of area d. Available homes in his price range, regardless of area
D. Available homes in his price range, regardless of area
512. All of the following are requirements for obtaining a Florida real estate broker's license, EXCEPT: a. Complete the required broker's pre- licensing course. b. Have a social security number c. Submit the proper application and fees to the Department d. Be employed for at least 12 months in the last 5 years by an actively licensed broker
D. Be employed for at least 12 months in the last 5 years by an actively licensed broker
180. The requirements for obtaining a Florida real estate license include all of the following, EXCEPT: a. Passing two exams b. Having a high school diploma or equivalency c. Completing a pre-licensing course d. Being a Florida resident
D. Being a Florida resident
975. All of the following are characteristics of the real estate market EXCEPT: a. Being heterogeneous b. Immobility c. Being inelastic in the short run d. Being a standard product
D. Being a standard product
735. After a transaction fails to close, the buyer and seller make conflicting demands upon the deposit held in escrow by the broker. The broker properly notifies FREC of the dispute. The parties to the contract refuse to resolve the dispute, and the broker elects to settle the matter in court rather than ask the Commission for an escrow disbursement order. If the broker has no interest in collecting a commission, which legal action should be filed? a. Writ of supersedeas b. Bill of declaratory judgment c. Suit for specific performance d. Bill of interpleader
D. Bill of interpleader
20. Concerning all FHA/VA mortgages, which statement is correct? a. FHA/VA loans have prepayment penalties. b. Neither type of loan is assumable. c. Interest rates are set by the government. d. Borrowers must meet minimum requirements.
D. Borrowers must meet minimum requirements.
176. Who may be compensated, directly by an owner, for performing any of the eight services of real estate? a. Broker b. Sales associate, if employed by an owner-developer c. Principal d. Both a and b
D. Both a and b
744. An owner of land offers an open listing to three Florida brokers. The brokers decide to cooperate on the sale and hold an auction as a means of selling. They retain a tobacco auctioneer from North Carolina and pay $1,000 plus expenses to auction off the property. The auction is held, but the owner rejects all offers. Which statement best applies? a. The auctioneer has violated the real estate license law. b. The brokers may have their licenses suspended. c. The owner is compelled to sell. d. Both a and b are correct.
D. Both a and b are correct
.240. A broker from Tampa sells a property listed by a Miami broker. At closing, the Miami broker refuses to pay the Tampa broker's share of the commission. Charges are filed by FREC against the Miami broker for failure to account. The Commission has the Miami broker subpoenaed, but the broker fails to appear. The Miami broker: a. Does not have to appear b. May be fined for contempt of court c. Could have license suspended or revoked by FREC d. Both b and c are correct
D. Both b and c are correct
65. Complete this statement. If a husband and wife both signed a note indicating that they are jointly and severally liable for a debt . a. Only the husband is liable b. Only the wife is liable c. Neither party is individually liable d. Both parties are liable collectively
D. Both parties are liable collectively
499. A broker gave a number of business cards to a hotel registration clerk and asked the clerk to refer customers to him. For each customer the clerk refers, the broker promises to pay a fee of $20. What will happen if this fee is paid? a. The broker will be in violation of the law. b. The hotel clerk will not be in violation of the law. c. Neither the broker nor the clerk will be in violation of the law. d. Both the broker and the clerk will be in violation of the law.
D. Both the broker and the clerk will be in violation of the law
23. A real estate broker has entered into a single agency relationship with the sellers of a three-bedroom, two-bath house. One of the agents in that broker's office has found an investor wanting to hire the brokerage firm as a single agent. For the investor to be shown this seller's house: a. The broker can work as a dual agent for both the buyer and the seller. b. This would be legal as long as the broker assigns a designated agent for each party. c. The seller must be informed that the brokerage firm is representing the buyer. d. Both the seller and the investor must agree to transition to transaction broker status.
D. Both the seller and the investor must agree to transition to transaction broker status
210. John Smith is the broker of ABC Realty. He is preparing to open a branch office. All of the following items are required on the branch office sign, EXCEPT: a. Licensed real estate broker b. ABC Realty c. John Smith d. Branch office
D. Branch office
528. What is an individual referred to as who is fully qualified as a real estate broker, but chooses to work for another employer in the capacity of a sales associate? a. Active broker b. Inactive broker c. Active sales associate d. Broker associate
D. Broker associate
582. What is the name for an individual who passes the state broker examination but continues to operate as a sales associate? a. Active broker b. Inactive broker c. Sales associate d. Broker associate
D. Broker associate
32. Which type of valuation is typically requested to determine the selling price of a property in a short sale transaction? a. Appraisal by a licensed appraiser b. Appraisal by a real estate licensee c. Comparative market Analysis (CMA) d. Broker price opinion (BPO)
D. Broker price opinion (BPO)
601. All of the following are services of real estate requiring a license, EXCEPT: a. Showing b. Selling c. Counseling d. Building
D. Building
15. All of the following are exempt from F.S. 475, EXCEPT: a. Trustees for an estate b. Personal representatives for an estate c. Mortgage brokers engaged in financing activities d. Business brokers
D. Business brokers
45. Prior to acceptance of an offer, to whom does the earnest money deposit belong? a. Broker individually b. Buyer and seller mutually c. Seller only d. Buyer only
D. Buyer only
362. What is the function of a secondary lender as opposed to a primary lender? a. Provides money for purchase money mortgages b. Lends money directly to borrowers c. Provides second mortgage financing d. Buys existing mortgages
D. Buys existing mortgages
574. How can an easement be extinguished? a. By giving the required notice b. By installing a driveway over the easement c. By an owner no longer using the easement d. By court action
D. By court action
381. The steps in the cost-depreciation approach to estimating market value include all of the following, EXCEPT: a. Finding the current cost to reproduce the building as new b. Finding the land value using comparables c. Subtracting the accrued depreciation from the reproduction cost d. Calculating the net operating income
D. Calculating the net operating income
227. Broker A and Broker B are working exclusively for one developer on adjoining projects. They agree to hire a sales associate between them for a half week each. The sales associate: a. Must be licensed to both of them b. Must be licensed with the developer c. Must be registered with both the brokers and the developer d. Cannot have two registered employers
D. Cannot have two registered employers
844. Which description best describes an earnest money deposit? a. Cash, securities, or promissory note b. Cash, securities, or personal check c. Specie, securities, or personal check d. Cash, securities, personal check or any medium of exchange that can be converted to cash
D. Cash, securities, personal check or any medium of exchange that can be converted to cash
63. Which disciplinary action could the Department of Business and Professional Regulation impose for a violation of F.S. 475? a. Imprisonment b. Injunction c. Suspension d. Citation
D. Citation
123. All of the following are basic types of depreciation, EXCEPT: a. Physical deterioration b. Functional obsolescence c. External obsolescence d. Component depreciation
D. Component depreciation
933. When two or more people scheme to defraud someone, of what are they guilty? a. Concealment b. Culpable negligence c. Misrepresentation d. Conspiracy
D. Conspiracy
745. Which of the following is a required characteristic of a broker's office sign? a. Be a billboard on the roof which can be seen from I-95 b. Have letters at least 2 inches in height, if an interior sign c. Contain the names of the sales associates and the words "We Aim to Please" d. Contain the name as on the broker's license and the words "Licensed (Lic.) Real Estate Broker"
D. Contain the name as on the broker's license and the words "Licensed (Lic.) Real Estate Broker"
374. Which appraisal method values the land separately from the improvements? a. Gross multiplier b. Income c. Comparable sales d. Cost-depreciation
D. Cost-depreciation
419. When a property owner does not agree with his tax assessment, what is the proper order for a review? a. Value adjustment board, county tax assessor, circuit court b. Circuit court, county tax assessor, value adjustment board c. County tax assessor, circuit court, value adjustment board d. County tax assessor, value adjustment board, circuit court
D. County tax assessor, value adjustment board, circuit court
162. A real estate closing for a duplex is scheduled for September 7, with the day of closing charged to the buyer. Monthly rent is $1,300 per unit. Which closing statement entry is correct? a. Debit the buyer $520.00 b. Credit the buyer $520.00 c. Debit the buyer $2,080.00 d. Credit the buyer $2,080.00
D. Credit the buyer $2,080.00
685. A broker receives a deposit check on Monday and deposits it in his escrow account the following Monday. The check subsequently is returned with nonsufficient funds (NSF). What fraud has the broker committed? a. Concealment b. Conversion c. Culpable negligence by failing to check to make sure the check was good d. Culpable negligence by failing to deposit the check "immediately"
D. Culpable negligence by failing to deposit the check "immediately"
393. Which condition would NOT indicate functional obsolescence? a. Too few electrical outlets b. A house with one bathroom c. A poor floor plan d. Damaged carpet
D. Damaged carpet
115. What would the Federal Reserve do when it wants to increase the supply of loanable funds? a. Sell government securities b. Increase the reserve requirement c. Increase the discount rate d. Decrease the reserve requirement
D. Decrease the reserve requirement
585. A previous owner, upon selling a property, specifically required the buyer to use the property for only one purpose. What type of restriction is this? a. Seller's lien b. Estoppel agreement c. Subdivision restrictive covenant d. Deed restriction
D. Deed restriction
118. What may the lender request the court to grant when there is a foreclosure and the auction sale does not provide enough proceeds to pay the entire mortgage debt? a. Estoppel judgment b. Novation judgment c. Satisfaction judgment d. Deficiency judgment
D. Deficiency judgment
33. What is the first step in an appraisal? a. Gather data b. Adjust comparable sales c. Reconcile value d. Define the problem
D. Define the problem
974. Residential zoning restrictions are designed to regulate which of the following? a. Intensity of land use b. Economic development c. Environmental abuse d. Density of structures per acre
D. Density of structures per acre
342. Complete the sentence. The maximum loan permissible for a VA loan is: a. $104,250 b. Determined by location c. Determined by the VA d. Determined by individual lenders
D. Determined by individual lenders
469. What would you expect to see on a broker's reconciliation section of the closing statement? a. Disbursements equal the receipts, minus the brokerage fee b. Broker's fee is prepaid by the buyer c. Disbursements equal receipts plus brokerage d. Disbursements equal receipts
D. Disbursements equal receipts
28. Which duty does a broker owe to a customer? a. Full disclosure b. Avoid adverse interests c. Obedience d. Disclose known facts affecting the value of residential property
D. Disclose known facts affecting the value of residential property.
863. What is it called when investors put their money directly into real estate instead of into financial institutions? a. Estoppel b. Leverage c. Intermediation d. Disintermediation
D. Disintermediation
712. If a broker is suspended, who can the broker appeal the final order to? a. DBPR b. FREC c. Circuit court d. District Court of Appeals
D. District Court of Appeals
488. Ernie is a licensed broker in Chicago who had a customer for a condominium in Tampa. Ernie accompanied the customer to Tampa and introduced him to broker Dora, a licensed Florida broker. Ernie went to the beach while Dora showed the customer condominiums and was successful in obtaining a contract. Ernie returned to Dora's office a short time later and demanded a share of the commission. Which is correct? a. Ernie violated the license law by accompanying the prospect to Florida. b. Both Ernie and Dora are in violation of F.S. 475. c. If Dora pays Ernie a commission, she would be in violation of the license law. d. Dora may pay Ernie a commission.
D. Dora may pay Ernie a commission
402. A line from a POB running N90°E would be best described as a(an): a. North/south line b. North line c. Westbound line d. East/west line
D. East/west line
395. Under Truth in Lending, "triggering terms" include information regarding all of the following, EXCEPT: a. Amount of down payment required in a credit sale transaction b. Amount of finance charge c. Number of loan payments d. Easy monthly payments
D. Easy monthly payments
625. In a partnership, each partner does NOT necessarily have which of the following? a. Power to bind the others by his or her activity b. A share in the management of the business c. Liability for the debts of the partnership d. Equal shares of the profits of the partnership
D. Equal shares of the profits of the partnership
336. What title does a buyer have when he or she signs a sales contract (or has purchased under contract for a deed)? a. Ostensible title b. Real title c. Actual title d. Equitable title
D. Equitable title
119. What results in a decrease of land mass? a. Accretion b. Littoral c. Riparian d. Erosion
D. Erosion
83. If an owner dies intestate with no known heirs, how can the state can take the property? a. Elective share b. Dower rights c. Eminent domain d. Escheat
D. Escheat
861. All of the following types of estates may be mortgaged, EXCEPT: a. Fee simple estate b. Life estate c. Estate for years d. Estate at sufferance
D. Estate at sufferance
386. Amenities, or features, used to compare properties in an appraisal could include all of the following, EXCEPT: a. Intangible amenities b. Tangible amenities c. Location d. Ethnic makeup
D. Ethnic makeup
224. An Illinois corporation is transferring its employees to Florida. The firm retained a Florida broker to find homes for its employees. The attorney representing the Illinois corporation, notifies the Florida broker that in the state of Illinois, an attorney is recognized as a real estate broker. Therefore, the attorney wants a referral fee. What should the Illinois attorney do? a. Produce a certified statement to the Florida broker that Illinois attorneys are recognized as brokers b. Not expect a referral from the Florida broker c. Notify FREC prior to expecting any referral fee d. Expect to receive a referral fee because he is recognized as a broker in Illinois
D. Expect to receive a referral fee because he is recognized as a broker in Illinois
383. Which type of depreciation is usually incurable? a. Physical deterioration b. Physical obsolescence c. Functional obsolescence d. External obsolescence
D. External obsolescence
851. Which statement is correct regarding the FHA loan program? a. FHA guarantees loans, but does not insure them. b. FHA loans are made by HUD. c. FHA determines the interest rates for FHA loans, not the market. d. FHA insures loans, but does not guarantee them.
D. FHA insures loans, but does not guarantee them
13. Which entity provides the best protection for the public during a real estate transaction? a. The National and State Association of REALTORS® b. The punishment of licensees dealing dishonestly c. The NAR Code of Ethics d. FREC and the license law
D. FREC and the license law
772. What is the maximum fine that FREC can impose against a licensee found guilty of a first-degree misdemeanor? a. FREC can impose a fine of up to $1,500. b. FREC can impose a fine of up to $3,000. c. FREC imposes only civil fines, not criminal fines. d. FREC imposes only administrative fines, not criminal fines.
D. FREC imposes only administrative fines, not criminal fines
497. Broker Tom collected a commission, a portion of which was due to sales associate Dave. Tom did not pay Dave his share of the commission. What could Tom be charged with? a. Larceny b. Commingling c. Embezzlement d. Failure to account
D. Failure to account
228. Unless exempt, performing a service of real estate for someone else for compensation in Florida without an active license is considered to be which of the following criminal violations? a. Misdemeanor of the first degree b. Misdemeanor of the second degree c. Felony of the first degree d. Felony of the third degree
D. Felony of the third degree
842. What must a broker do in order to open a brokerage firm under a trade name? a. File the name of the corporation. b. Register all officers, but not directors. c. File the name with the Department of Commerce. d. File the name with the Division of Real Estate.
D. File the name with the Division of Real Estate
581. A licensee who has been voluntarily inactive for 5 years wishes to become active. What must the licensee do? a. Complete14 hours for each year of inactivity b. Complete 45 hours of post-licensing c. Must take the FREC I course and state exam again because 5 years is too long d. Find an employer and file a change of status form
D. Find an employer and file a change of status form
17. Complete the sentence. General partners in a brokerage partnership that are not qualified to perform the services of real estate must be registered: a. As inactive sales associates b. As ostensible partners c. As inactive broker associates d. For identification purposes
D. For identification purposes
989. A home has a poor interior traffic pattern. What type of adjustment might be applied when valuing the property? a. Physical deterioration b. External obsolescence c. Locational obsolescence d. Functional obsolescence
D. Functional obsolescence
131. Which asset is the most difficult to set a dollar value on for a business? a. A leasehold estate b. Existing equipment c. Corporate stock d. Goodwill
D. Goodwill
302. Which set of terms is NOT synonymous? a. Vendee, purchaser b. Mortgagee, lender c. Lessor, landlord d. Grantee, seller
D. Grantee, seller
634. Which clause in a deed contains the grantor's name and the legal description? a. Habendum clause b. Tenendum clause c. Defeasance clause d. Granting or premises clause
D. Granting or premises clause
801. Which deed would be considered a special-purpose deed? a. Warranty deed b. Quitclaim deed c. Deed of trust d. Guardian's deed
D. Guardian's deed
213. To help his customers sell their property a mortgage broker agrees to hold an open house and prepares an offer to purchase on a standard contract for a fee of $250. Which statement is correct? a. He is exempt from real estate licensure if the property owners requested this service. b. He is exempt from the real estate license law because he is a mortgage broker. c. He is exempt from the real estate license law because he used a standard contract. d. He is guilty of a third degree felony.
D. He is guilty of a third degree felony
183. An owner of a service station who holds an inactive sales associate's license has been appointed by the court to appraise another service station. Which statement is most correct? a. Since he or she has registration status, that person may be compensated for this service of real estate. b. He or she must have an active license to be compensated. c. He or she may be compensated by a licensed broker. d. He or she may be compensated directly for this service.
D. He or she may be compensated directly for this service
233. A discount broker has opened an office in town. Two sales associates from fullprice, full-service offices agree not to show the discount broker's listings. This practice is: a. Illegal because it constitutes discrimination against the discount broker b. Acceptable because sales associates may show any properties they choose c. Required because discount brokerage is illegal d. Illegal because it constitutes price fixing among the sales associates.
D. Illegal because it constitutes price fixing among the sales associates
519. For violating F.S. 475, the Commission may discipline with all of the following penalties, EXCEPT: a. Sanction or probation b. Invoke forfeiture c. Impose a fine d. Impose a prison sentence
D. Impose a prison sentence
701. What approach is most often used for the valuation of a business? a. Comparable sales approach b. Cost-depreciation approach c. Market approach d. Income approach
D. Income approach
700. A house rents for $350 per month in an area where the GRM is 134. A similar home next door just sold for $55,000. On this basis, the rent could be: a. Decreased by $119 b. Increased by $119 c. Decreased by $60 d. Increased by $60
D. Increased by $60
97. What does the FHA do with respect to mortgage lending? a. Purchases existing loans b. Makes loans c. Guarantees loans d. Insures loans
D. Insures loans
20. What is the status of a sales associate's license if the sales associate works for a broker, and that broker loses his license? a. Unaffected b. Suspended c. Revoked d. Involuntary inactive
D. Involuntary inactive
584. Which method might the county use to enforce building codes? a. Issuing nonconforming use certificates b. Issuing of variances c. Issuing of special exception d. Issuing certificates of occupancy
D. Issuing certificates of occupancy
14. Which of the following best describes an acknowledgment of a deed? a. It is the same as the seal. b. It is not required before recording. c. It cannot be taken by a notary public. d. It can be taken by an officer of the state.
D. It can be taken by an officer of the state.
372. All of the following statements apply to an estoppel certificate, EXCEPT: a. It may also be called a letter of estoppel. b. It is used to confirm that a lien or obligation exists. c. It is used to confirm the outstanding loan balance as of a given date. d. It forms a lien against the property.
D. It forms a lien against the property
754. After negotiating all terms of a contract with a seller, a buyer signs the contract and then makes a minor change in the terms and conditions before it is presented to the seller for signatures. What is the status of the offer? a. It is now void. b. It is still in effect. c. It is now executed. d. It is now a counteroffer.
D. It is now a counteroffer
508. What was the major impact of the Jones v. Mayer Supreme Court case in 1968? a. It protected borrowers from fraudulent lending practices. b. It added handicap and familial status to the list of protected classes. c. It created the USPAP standards for appraisal. d. It strictly prohibited discrimination based on race, with no exceptions.
D. It strictly prohibited discrimination based on race, with no exceptions
520. Before Smith dies, Jones is made executor. If Jones wants to actively participate in the sale of Smith's property and be compensated for the efforts. Which statement is correct? a. Jones must become a licensed real estate sales associate. b. Jones must become a licensed real estate broker. c. Jones must hire the services of a licensed real estate broker. d. Jones may sell Smith's property without a real estate license.
D. Jones may sell Smith's property without a real estate license
397. Depreciation can be taken on all of the following, EXCEPT: a. An office building b. A warehouse building c. A garage d. Land
D. Land
56. Which is correct according to the Florida Landlord and Tenant Act? a. Deposits may be held in an interest- bearing account, and the landlord keeps the interest. b. Deposits may not be held in a non- interest-bearing account. c. Deposits may be commingled into the landlord's personal account, provided the landlord has posted a surety bond with a notary public. d. Landlord must inform tenant within 30 days how the deposit is being held.
D. Landlord must inform tenant within 30 days how the deposit is being held
872. A sales associate leaves a broker's office and takes an original copy of a document from the broker's records. What is this action considered to be? a. Bad faith b. Legal c. Extremely stupid d. Larceny
D. Larceny
780. What is another name for a tenancy for years? a. Joint tenancy b. Tenancy in common c. Tenancy in the entireties d. Leasehold estate
D. Leasehold estate
835. What should a valid mortgage contain? a. Granting clause b. Reddendum clause c. Promissory note d. Legal description
D. Legal description
938. What term is used to refer to the use of borrowed funds to finance the purchase of real estate? a. Conspiracy b. Conversion c. Commingling d. Leverage
D. Leverage
547. All of the following are requirements for obtaining continuing education credit by attending a FREC meeting, EXCEPT a. Licensees must obtain prior approval before attending and obtaining credit. b. Licensees must attend the entire first day of the meeting to obtain credit. c. Licensees may obtain 3 hours continuing education credit each renewal period. d. Licensees may obtain credit by attending any three hours of the meeting.
D. Licensees may obtain credit by attending any three hours of the meeting
668. Which business structure incorporates limited as well as unlimited liability? a. Sole proprietorship b. Corporation for profit c. General partnership d. Limited partnership
D. Limited partnership
836. Which of the following business structures incorporates limited as well as unlimited liability? a. Sole proprietorship b. General partnership c. Corporation d. Limited partnership
D. Limited partnership
546. What relationship does a transaction broker have with his or her employer? a. Nonrepresentation b. Caveat emptor c. Full fiduciary d. Limited representation
D. Limited representation
764. Complete the sentence. Discount points that are charged by lenders are a percentage of the: a. Borrower's equity b. Real estate commission c. Sale price d. Loan amount
D. Loan amount
323. Which entity would an owner approach when seeking to subdivide his or her land? a. Florida Real Estate Commission b. Division of Florida Land Sales c. Department of Housing and Urban Development d. Local planning board or the appropriate government agency
D. Local planning board or the appropriate government agency
873. A broker has an office at 250 North Orange Ave., Orlando, in the Citrus Bank Building. The bank must make extensive repairs, and the broker moves to 244 Orange Blossom Trail, Orlando. What should the broker do? a. Apply to the Department for an initial issue b. Notify the Department by registered mail of this change c. Write the new address in ink on his license d. Make application on the proper form, attach no fee, make a copy of the current license and forward them to the Department for a reissue
D. Make application on the proper form, attach no fee, make a copy of the current license and forward them to the Department for a reissue
827. Which appraisal approach would carry the most weight in the appraiser's final decision when appraising a vacant lot? a. Building residual approach b. Income capitalization approach c. Cost-depreciation approach d. Market or sales comparison approach
D. Market or sales comparison approach.
491. Broker A has an exclusive agency listing on Mary's property. Broker B showed Mary's home to a customer and succeeded in obtaining a full price contract, which Mary accepted. Mary paid broker B a commission. Which is correct? a. Mary owes a commission to broker A. b. Broker B must share the commission with broker A. c. Mary owes both brokers a commission. d. Mary is liable to broker A for damages.
D. Mary is liable to broker A for damages
713. Complete the statement. Members of the FREC Probable Cause Panel: a. Must be real estate licensee members b. Must be consumer members c. Must be broker members d. May be licensed or consumer members
D. May be licensed or consumer members
29. What are the Federal Reserve actions taken to affect interest rates? a. Capital recovery policy b. Variance policy c. Intermediation policy d. Monetary policy
D. Monetary policy
862. In a lien-theory state, what is the ownership status of the mortgagee? a. Mortgagee has the right of possession. b. Mortgagee has the right to any rents collected. c. Mortgagee acquires ownership "automatically" upon default by the mortgagor. d. Mortgagee holds a lien on the property.
D. Mortgagee holds a lien on the property
536. Mrs. X appoints Mrs. Y to sell her house in the event that she dies. Which statement applies? a. Mrs. X needs a sales associate license. b. Mrs. Y needs a sales associate license. c. Mrs. Y needs a broker license. d. Mrs. Y can sell the estate without a real estate license.
D. Mrs. Y can sell the estate without a real estate license
230. What must be included on a real estate brokerage sign? a. Sales associate's name b. Office phone number c. Brokerage firm's license number d. Name of the brokerage firm
D. Name of the brokerage firm
179. Owner A and friend B meet on the street. A says, "I would like to sell my house." B takes the information and says "I'll find you a buyer; I've done it several times for our friends." B finds a buyer for A's house, and the transaction is closed. Based on the above facts, which of the following applies? a. A has violated F.S. 475 b. B has violated F.S. 475 c. Both A and B have violated F.S. 475 d. Neither have violated F.S. 475
D. Neither have violated F.S. 475
966. Which of the following would be the proper formula for the capitalization rate? a. Purchase price divided by the net operating income b. Effective gross income divided by the sales price c. Net operating income divided by the original equity investment d. Net operating income divided by the total sales price
D. Net operating income divided by the total sales price
55. What is the maximum amount of a VA guaranteed loan? a. $36,000 b. $60,000 c. $89,912 d. No maximum
D. No maximum
778. Which type of loan, also known as a subprime loan, is offered to borrowers who do not qualify for loans underwritten using certain criteria and standards established by Fannie Mae and Freddie Mac? a. VA guaranteed loan b. Conventional loan c. Conforming loan d. Nonconforming loan
D. Nonconforming loan
140. A convenience store existed at a location prior to zoning law changes that would have disallowed it. Under which type of exception can the store remain? a. Hardship exception b. Special use exception c. Variance d. Nonconforming use
D. Nonconforming use
265. Which phrase would be legal to use in advertising property? a. Minority neighborhood b. Integrated neighborhood c. Caucasian neighborhood d. None of the above
D. None of the above
249. A sales associate has a fight with a seller and hits the seller on the head with a canoe paddle. What penalty will the Commission administer on the sales associate? a. Suspend the canoe paddle for 30 days b. Revoke the sales associate's license c. Suspend the sales associate's license indefinitely d. None, since assault and battery is not a violation of F.S. 475
D. None, since assault and battery is not a violation of F.S. 475
76. The city of Sunnydale, Florida, owns onethird of all the real property within the city limits including schools, highway right-ofways, public buildings, and common areas. How is the city taxed on these properties? a. 2/3 b. 1/2 c. 1/3 d. Not at all
D. Not at all
307. What is the most likely consequence for a broker who negotiates a contract for the sale of a house between the owner and purchaser in violation of the Statute of Frauds? a. Have his or her registration suspended b. Have his or her registration revoked c. Lose his or her commission on the sale d. Not be disciplined
D. Not be disciplined
92. The essential elements of a contract include all of the following, EXCEPT: a. Consideration b. Offer and acceptance c. Competent parties d. Notarized
D. Notarized
71. If a broker is the escrow agent, and a dispute arises concerning the disposition of escrowed funds, what should the broker's first action be? a. Ask the Florida Real Estate Commission for an escrow disbursement order. b. Give the deposit to the seller. c. Collect the broker's portion of the deposit as damages. d. Notify the Florida Real Estate Commission.
D. Notify the Florida Real Estate Commission.
185. Which action would cause an applicant's request for licensure be denied without prejudice? a. Cheating on the state exam b. Having been convicted of fraud c. Having been disbarred from the legal profession d. Omitting one or more answers to questions on the application
D. Omitting one or more answers to questions on the application
766. A broker had a listing in which part of it was oral and part of it was written and signed above the initials "L.S.," but all parties understood all of the terms and conditions and agreed to them. Which best describes this agreement? a. Parol b. Formal c. Unilateral d. Parol and formal
D. Parol and formal
390. Who must pay any points that are due on a VA guaranteed loan? a. Seller b. Buyer c. Lender d. Party specified in the contract
D. Party specified in the contract
563. Paul is a captain in the Air Force. While stationed in Florida, Paul obtained a real estate license. Shortly thereafter, Captain Paul was transferred to Oklahoma. Five years later, he retires and returns to Florida where he wishes to sell real estate. Which statement applies? a. Paul would be required to take the state licensing exam again. b. Paul would be required to take the 45- hour post-license course. c. Paul would be required to take 42 hours of reactivation education. d. Paul can request a reissue of his license within 6 months of his discharge.
D. Paul can request a reissue of his license within 6 months of his discharge
23. A broker may deposit all of the following into escrow, EXCEPT: a. Cash b. Personal checks c. Securities that can be converted to cash d. Personal funds in excess of FREC limits
D. Personal funds in excess of FREC limits
511. A broker was convicted of securities fraud also causing FREC to revoke his license. If he is the only broker in a sole proprietorship, what would the license status become of the sales associates registered under him? a. Revoked b. Suspended c. Cancelled d. Placed involuntary inactive
D. Placed involuntary inactive
132. John has the opportunity to invest in a property with a 9% return. He can borrow the money at an interest rate of 7%. Which investment characteristic exists? a. Liquidity b. Negative leverage c. Neutral leverage d. Positive leverage
D. Positive leverage
272. A tenant is 2 months delinquent on the rent. What is the first step available to the landlord to remedy the situation? a. Disconnect the utilities b. Ask the sheriff to evict the tenant c. Ask the court for a writ of possession d. Post a 3-day notice to pay the rent or vacate
D. Post a 3-day notice to pay the rent or vacate
127. What is the name for the annual income that an investment property could make with no vacancies or collection losses? a. Annuity gross income b. Effective gross income c. Net operating income d. Potential gross income
D. Potential gross incomes
501. A broker has a listing on a seller's house. The seller goes on vacation. During this time, the broker gets an offer for $78,000 and another offer for $80,000. What should the broker do? a. Present the $80,000 offer upon seller's return b. Accept the $80,000 offer on behalf of the seller c. Reject the $78,000 offer d. Present both offers upon the seller's return
D. Present both offers upon the seller's return
25. The monthly payment under FHA 203(b) may NOT include what? a. Mortgage life insurance b. Property taxes c. Fire insurance d. Private mortgage insurance (PMI)
D. Private mortgage insurance (PMI)
88. What is the legal instrument that includes the borrower's promise to repay a loan with interest according to the terms and conditions specified? a. Mortgage b. Lien c. Deed of trust d. Promissory note
D. Promissory note
1. In which area of brokerage has absentee ownership increased the demand? a. Business opportunity brokerage b. Commercial sales c. Agricultural sales d. Property management
D. Property management
619. Hewitt, a wealthy landowner, wishes to donate a large tract of land to his university alma mater. Hewitt does not want to be responsible for any claims. What type of deed will Hewitt probably use? a. Bargain and sale deed b. Special warranty deed c. General warranty deed d. Quitclaim deed
D. Quitclaim deed
82. Which deed contains no warrants or promises? a. General warranty deed b. Bargain and sale deed c. Special warranty deed d. Quitclaim deed
D. Quitclaim deed
52. What law requires that buyers be given a good faith estimate of closing costs prior to closing? a. Florida Statute 475 b. Truth-in-Lending Act c. Sherman/Clayton Antitrust Act d. RESPA
D. RESPA
358. Which mortgage clause permits the mortgagee to have a third party appointed to collect income and manage the property until foreclosure proceedings have been accomplished? a. Personal representative clause b. Administrator's clause c. Redemption clause d. Receivership clause
D. Receivership clause
523. Sally is a licensed real estate broker in a state that has a mutual recognition agreement with Florida. Sally wishes to obtain a Florida license. Her choices include all of the following, EXCEPT: a. Taking a 40-question law exam and be issued a Florida broker license by mutual recognition if she is not a Florida resident b. Taking the broker course and state exam if she is a Florida resident c. Taking the sales associate course and state exam if she wishes to become a Florida sales associate d. Receiving a Florida license by reciprocity if she is not a Florida resident
D. Receiving a Florida license by reciprocity if she is not a Florida resident
39. What document would be used to return title to the trustor when a deed of trust is satisfied? a. Bill of sale b. Quitclaim deed c. Sheriff's deed d. Reconveyance deed
D. Reconveyance deed
927. Which clause in a deed would include the deed restrictions? a. Premises b. Granting c. Habendum d. Reddendum
D. Reddendum
878. A customer requested that a broker locate a rental for $500 per month. The broker requested $200 in an upfront fee from the customer to pay for time and effort while locating this type of property. The broker was able only to find a unit renting for $600 per month. What must the broker do? a. Keep 75% of the $200 b. Keep 25% of the $200 c. Keep the $200 d. Refund the $200 to the customer
D. Refund the $200 to the customer
59. F.S. 475 identifies certain activities that are classified as first-degree misdemeanors. This includes violation of which of the following? a. Timeshare disclosure requirements and false advertising b. Rental fee requirements and concealment of a material fact c. False advertising d. Rental fee requirements
D. Rental fee requirements
359. Which type of mortgage allows a homeowner, age 62 or older, to receive a lump sum or monthly advance based on the equity in their home? a. HELOC b. Home equity loan c. Purchase money mortgage d. Reverse mortgage
D. Reverse mortgage
759. An office policy manual typically contains all of the following, EXCEPT: a. Commission splits b. Office procedures c. Telephone usage d. Salary ranges for independent contractors
D. Salary ranges for independent contractors
423. To which of the following entities do real estate taxes provide revenue? a. Local, state, and federal governments b. City, county, and state governments c. City and county governments d. School boards, city, and county governments
D. School boards, city, and county governments
859. Which clause in a deed states that the seller is in possession of the property and has the legal right to convey the property? a. Granting b. Receivership c. Further assurance d. Seisin
D. Seisin
15. The Federal Reserve Board is charged with the responsibility of monitoring and controlling the supply of money and cost of credit. What actions could it use to cause an increase in interest rates? a. Buy government securities, increase the reserve requirement, and increase the discount rate b. Buy government securities, decrease the reserve requirement, and increase the discount rate c. Sell government securities, decrease the reserve requirement, and decrease the discount rate d. Sell government securities, increase the reserve requirement, and increase the discount rate
D. Sell government securities, increase the reserve requirement, and increase the discount rate
650. An owner employed a broker to sell his property. The broker subsequently negotiated a contract whereby the owner agreed to sell to a buyer. The contract was long and involved. Since the amount of the deposit was equal to the amount of the commission that the broker would receive, in the middle of one of the long paragraphs, the broker inserted the phrase, "in the event the buyer defaults, the deposit will be retained by the broker as his compensation." At the time the broker presented the contract to the seller and buyer he made no mention of this phrase. However, he did not in any way try to influence them not to read it. The seller and buyer signed the contract without reading it. In their area, a 50/50 split of defaulted deposits is customary between sellers and brokers. The buyer subsequently defaulted, and the seller asked the broker for half of the deposit. The broker refused and showed the seller the phrase in the contract that allowed him to retain the deposit. What should the broker do? a. Give the seller an amount equal to his expenses and keep the rest b. Share the deposit 50/50 with the buyer c. Retain all of the deposit since the buyer and seller signed the contract d. Share the deposit 50/50 with the seller
D. Share the deposit 50/50 with the seller
680. Sales associate Sally decides to use a post office box for all of her mail even though she has not actually moved out of her house. Which statement applies? a. She need not notify the Department since she is living at the same location. b. She need not notify the Department if her e-mail address has not changed. c. She must notify the Department of her address change within 30 days. d. She must notify the Department of her address change within 10 days.
D. She must notify the Department of her address change within 10 days
311. Which statement is correct regarding a lease agreement for 12 months or less? a. Must be in writing to be valid (enforceable) b. Must be in writing to benefit the lessee c. Must be in writing to benefit the lessor d. Should be in writing to avoid misunderstanding
D. Should be in writing to avoid misunderstanding
510. A sales associate must do all the following to renew a current and valid license, EXCEPT: a. Complete 14 hours of continuing education, for renewal periods after the first renewal b. Complete the proper renewal request form and pay the required fee c. Pass a 45-hour post-licensing course, if renewing for the first time d. Show Florida residency.
D. Show Florida residency
352. What is included in the annual percentage rate (APR)? a. Annual interest b. Finance charge c. Simple annual interest d. Simple annual interest plus finance charges
D. Simple annual interest plus finance charges
608. A broker is in a full representation relationship with a principal. What is the name for this relationship? a. General agency b. Transactional brokerage c. Dual agency d. Single agency
D. Single agency
398. To which type of transaction does Regulation Z apply? a. Single-family home used for rental income b. Building used for a gas station c. Vacant land used for a parking lot d. Single-family home used as residence
D. Single-family home used as residence
291. Which type of deed warrants title only against claims made by the grantor, his or her heirs, assignees, executors, administrators, or others who represent them? a. Specific warranty deed b. General warranty deed c. Quitclaim deed d. Special warranty deed
D. Special warranty deed
10. The sales comparison approach usually CANNOT be used when estimating the value of which of the following? a. Income-producing industrial property b. Income-producing commercial property c. Residential property d. Special-purpose properties
D. Special-purpose properties
72. All of the following describe the real estate market, EXCEPT: a. Influenced by externalities b. Unorganized and inefficient c. Local in nature d. Supply and demand are usually in balance
D. Supply and demand are usually in balance
209. Which township is immediately west of T1N, R1E? a. T2N, R1E b. T2N, R1W c. T1N, R2E d. T1N, R1W
D. T1N, R1W
207. If a broker is aware of a construction lien on a piece of property, what should he or she do? a. Make the buyer aware b. Tell the buyer before the closing c. Not disclose the lien d. Tell the buyer before going to contract
D. Tell the buyer before going to contract
773. Which of the following estates contains the least rights? a. Tenancy by the entireties b. Leasehold estate c. Joint tenancy d. Tenancy at sufferance
D. Tenancy at sufferance
934. Which tenancy would exist for ownership by a husband and wife? a. Joint tenancy b. Tenancy in common c. Tenancy for years d. Tenancy by the entireties
D. Tenancy by the entireties
559. Tom, Brian, and Bill purchase an office building in fee simple. Which form of ownership would Tom's family prefer? a. Tenancy by the entireties b. Joint tenancy c. Tenancy at will d. Tenancy in common
D. Tenancy in common
513. Florida real estate law requires that the buyer be informed of all of the following, EXCEPT: a. If they are required to join a homeowner's association b. That they have the right to have an energy-efficiency rating performed c. That they are allowed to test for radon gas d. That the seller is HIV-positive
D. That the seller is HIV-positive
500. All of the following statements are correct regarding the Consumer Credit Protection Act, EXCEPT: a. The Act was designed to give borrowers the ability to shop wisely for credit. b. Borrowers must be shown the actual amount paid for credit in a percentage form called the annual percentage rate (APR). c. Borrowers must be given 3 working days to rescind a loan. d. The Act was implemented by the Board of Governors of the Federal Reserve System through Regulation B.
D. The Act was implemented by the Board of Governors of the Federal Reserve System through Regulation B
964. If a seller lists a house with a broker and discriminates against a buyer based on religion, the seller would have violated which regulation? a. F.S. 475 b. The Truth-in-Lending Act c. The Civil Rights Act of 1866 d. The Civil Rights Act of 1968
D. The Civil Rights Act of 1968
575. Real estate brokerage commissions are based on which of the following? a. MLS rule b. Custom c. The seller's equity d. The actual sales price
D. The actual sales price
477. All of the following statements are correct with respect to a broker registered with a real estate brokerage corporation, EXCEPT: a. The broker may be a stockholder. b. The broker has to be an officer or director. c. The broker does not have to be a resident of Florida or a citizen of the United States. d. The broker can be an active broker and officer in one corporation and an inactive broker in another corporation.
D. The broker can be an active broker and officer in one corporation and an inactive broker in another corporation
211. Broker Jones takes a listing on a condominium from Mr. Charles. Mr. Charles notifies Jones that the roof leaks. Jones negotiates the sale of the condominium to Smith without disclosing the leak. Smith, a year later, sells the condominium for a profit. Which statement applies? a. This was a legal transaction since it was the buyer's responsibility to check for leaks. b. This would have been an illegal sale if the property had not been sold at a profit. c. The broker would have been liable had the property sold at a loss. d. The broker could be disciplined for concealment.
D. The broker could be disciplined for concealment.
550. A sales associate successfully finds a ready, willing, and able buyer for a listing and is entitled to part of a $5,000 commission. Just prior to the closing, it is necessary for the sales associate to go out of town. Upon returning, it was discovered that the employing broker has had a lot of unexpected expenses, and the money is just not available to pay the sales associate. Which statement is correct? a. The sales associate is not entitled to the commission because he or she missed the closing. b. The broker's priority is keeping the office open; therefore, he or she has the option of paying the sales associate at a later date. c. The broker may be charged with larceny. d. The broker may be charged with failure to account and deliver.
D. The broker may be charged with failure to account and deliver
489. Which statement is correct regarding a broker acting as a transaction broker? a. The broker has fiduciary duties to both parties. b. The broker has fiduciary duties to the seller, but not to the buyer. c. Both parties must give their prior written consent before the broker may act as a transaction broker. d. The broker must treat both parties with honesty and fairness.
D. The broker must treat both parties with honesty and fairness
259. In pursuit of an unpaid commission, a broker hires an attorney to attempt to obtain a judgment lien against the seller. In the course of the action, and on the advice of the attorney, the broker filed a lis pendens against the seller's property. What action may be taken against the broker? a. None, since no violation has occurred b. FREC could fine the broker up to $10,000 c. FREC could impose a criminal penalty d. The broker's license may be suspended or revoked
D. The broker's license may be suspended or revoked
648. What is the deadline for a broker to deposit all earnest money funds? a. The next business day b. The next calendar day c. The third calendar day d. The close of the third business day following receipt
D. The close of the third business day following receipt
19. Who determines the form for the closing statement? a. Florida Real Estate Commission b. Department of Business and Professional Regulation c. The broker d. The closing agent
D. The closing agent
310. A broker accepts a listing that has an unmerchantable title. A sales contract is signed, and a deposit is obtained contingent upon the owner clearing title. At closing, the owner cannot give a clear title. The deposit is returned to the buyer. Which statement applies to this situation? a. The broker is entitled to a full commission. b. The owner can sue the broker and the buyer. c. The buyer can sue the owner. d. The contingency was not met, so the contract is dead
D. The contingency was not met, so the contract is dead
854. Jack defaulted on his mortgage payments, and the lender instituted foreclosure proceedings. If the foreclosure sale does not bring enough to cover the debt, what is the impact to the lender? a. The lender may seek a cognovits judgment. b. The lender may seek a reconveyance judgment. c. The lender automatically gets ownership of the property. d. The lender may seek a deficiency judgment
D. The lender may seek a deficiency judgment
146. All of the following are characteristics of real estate, EXCEPT: a. The market is local in nature. b. The market is slow to respond to changes in supply and demand. c. There is no central control over the market. d. The market is homogenous.
D. The market is homogenous
830. Concerning the characteristics of real estate, which statement is true? a. A change in demand for real estate in Oregon affects Florida real estate prices. b. A change in demand for real estate in Florida affects Oregon real estate prices. c. It is okay to take advice from an Oregon broker concerning Florida real estate. d. The markets in Florida and Oregon are unrelated, so prices in one have no effect on prices in the other.
D. The markets in Florida and Oregon are unrelated, so prices in one have no effect on prices in the other
105. Which statement is correct in a lien-theory state such as Florida? a. The borrower will obtain title only after the loan is paid. b. Foreclosure will take place much quicker than in title theory states. c. The borrower conveys title to the lender using a deed of trust. d. The mortgage serves as a lien against the property.
D. The mortgage serves as a lien against the property
643. Sue Douglas wishes to open a real estate brokerage corporation, Sunshine Realty, Inc. When ordering her sign, she is required to include all of the following items, EXCEPT: a. Sunshine Realty, Inc. b. Sue Douglas c. Licensed real estate broker d. The office phone number
D. The office phone number
656. Which of the following is required in a real estate brokerage limited partnership? a. All officers and directors must be registered b. All limited partners must be active licensees c. All general partners must be active licensees d. The partnership must be registered with DRE
D. The partnership must be registered with DRE
421. All of the following statements apply to special assessments, EXCEPT: a. They are charged to the owner of the property. b. They are levied to finance specific improvements. c. They are charged only for improvements that will increase the value of the property. d. They are used to provide revenue for the county's operating budget.
D. They are used to provide revenue for the county's operating budget.
742. In the course of listing the seller's house, the sales associate noticed that minor repairs were necessary. The sales associate suggested that the sellers use ABC Contractors, Inc., to handle the repairs. ABC forwarded the sales associate a 10% referral fee. Which statement applies? a. This is common in the industry and therefore legal. b. This is illegal, as the referral fee should have been paid to the broker. c. This is unethical, but legal. d. This is a violation of real estate license law.
D. This is a violation of real estate license law
535. During the week, a sales associate works for XYZ Real Estate, Inc. On the weekends, the sales associate moonlights for an unconnected development company and is paid on a transactional basis. Which statement is correct? a. This is a violation of the Federal Trade Commission law. b. The sales associate may work for both companies. c. This is allowable provided the sales associate obtains a group license. d. This is illegal under the license law.
D. This is illegal under the license law
401. Which government survey legal description is the closest to the Tallahassee Principal Meridian? a. Tier2S, Range3E b. Tier1N, Range4W c. Tier2N, Range2E d. Tier4S, Range1E
D. Tier 4 S, Range 1 E
58. What is the purpose of an estoppel certificate? a. To establish the mortgagee's position b. To establish a lien on the property c. To provide the right of foreclosure d. To provide information to the mortgagee or mortgagor
D. To provide information to the mortgagee or mortgagor
86. The horizontal strip of land 6 miles wide immediately north of the Tallahassee baseline would be: a. Township 1 East b. Section 1 North c. Range 1 North d. Township 1 North
D. Township 1 North
312. Florida has established three authorized brokerage relationships. Unless otherwise established by agreement, what is the broker's relationship with the public? a. Nonrepresentation b. Single agency c. Dual agency d. Transaction brokerage
D. Transaction brokerage
817. To what term does "subleasing" refer? a. Changing a lease termination date b. Adding an addendum to a lease c. Transferring all rights to a property d. Transferring less than all rights to a property
D. Transferring less than all rights to a property.
217. Complete the sentence. A fiduciary relationship is one of: a. Trust b. Confidence c. Trust and confidence d. Trust and confidence when accepted
D. Trust and confidence when accepted
543. How long may commissioners sit on the Real Estate Commission? a. Only one 2-year term b. Only one 4-year term c. Two consecutive 2-year terms d. Two consecutive 4-year terms
D. Two consecutive 4-year terms
526. Under which condition may a sales associate be employed by two brokers? a. If FREC grants a special exception b. If both employers agree c. If the public agrees d. Under no circumstances
D. Under no circumstances
725. When may a sales associate take a deposit without his broker's permission? a. When the broker is out of town b. When the buyer insists c. When no lender is involved d. Under no circumstances
D. Under no circumstances
874. A prospect steps into a broker's office and tells the broker that he or she wants to buy property in an area called Everglades Estates. The broker informs the prospect that he does not have the property listed, but that he will take the prospect over to meet the owner. The owner tells the broker that he will NOT deal through real estate brokers. The next day, the owner contacts the prospect and a deal results. What may the broker do? a. Collect a commission from the seller as the seller cannot make use of the "fruit of the broker's labor" b. Sue the buyer c. Bring court action against the seller d. Under the circumstances, do nothing
D. Under the circumstances, do nothing
77. If no clause appears in a contract concerning damages, what are any damages awarded as a result of a breach of contract? a. Revocable b. Extraordinary c. Liquidated d. Unliquidated
D. Unliquidated
502. In case of a financial hardship due to a zoning requirement, for what should the homeowner apply? a. Nonconforming use b. Special use exception c. Easement d. Variance
D. Variance
564. Which covenant in a deed is a warrant by the grantor that they will sign any documents in the future that would be necessary to maintain quiet title? a. Warranty forever b. Warrant of seizing c. Warrant of quiet enjoyment d. Warrant of further assurance
D. Warrant of further assurance
116. When is intermediation in financial institutions most likely to occur? a. When demand and supply of funds are both decreasing b. When demand and supply of funds are both increasing c. When supply of funds is decreasing, and the demand is increasing d. When supply of funds is increasing, and the demand is decreasing
D. When supply of funds is increasing, and the demand is decreasing
833. An involuntarily inactive sales associate sends in a renewal along with the required fee and the change of status form. When will his or her license be considered active? a. When the sales associate puts the form and fee in the mail b. When the sales associate signs his license c. When the check to the DRE clears the bank d. When the DBPR receives the form and fee
D. When the DBPR receives the form and fee
960. When does disintermediation occur? a. When deposits exceed withdrawals b. When withdrawals exceed loans c. When loans exceed deposits d. When withdrawals exceed deposits
D. When withdrawals exceed deposits
837. Sales associate Sally sells a home. When must Sally's broker pay her commission? a. Within 5 days of the closing b. Within 10 days of the closing c. At the closing d. Within a reasonable period of time
D. Within a reasonable period of time
659. All of the following are essential elements of a real estate contract, EXCEPT: a. Consideration b. Offer and acceptance c. In writing and signed d. Witnessed and under seal
D. Witnessed and under seal
80. Complete this statement. A licensee who has appealed a decision by the Florida Real Estate Commission regarding a disciplinary decision may have his or her license privileges restored by . a. Injunction b. Warrant c. The administrative law judge d. Writ of mandamus
D. Writ of mandamus
557. To determine the potential use for a vacant lot, which entity would you contact? a. Value adjustment board b. Health department c. Building department d. Zoning department
D. Zoning department
143. Local planning agencies have the final authority for all of the following, EXCEPT: a. Subdivision plat approval b. Site plan approval c. Sign control d. Zoning variances
D. Zoning variances
12. Who would be exempt from the real estate licensing law? a. An apartment manager in an on-site rental office renting for 2 years b. A condominium manager leasing units for 2 years on salary c. A mortgage broker negotiating a lease for 1 year d. A person who rents mobile home lots
D. a person who rents mobile home lots
645. When should a broker earn commission when employed to find a purchaser? a. When a successful closing is completed b. When a signed offer from a ready, willing and able buyer is brought to the seller c. When the terms are acceptable to the seller d. b and c
D. b and c
50. What charge may be filed against a broker who fails to pay his or her sales associate? a. Culpable negligence b. Concealment c. Commingling d. Conversion
D. conversion
4. What is it called when a developer gives land to a governmental body? a. Eminent domain b. Condemnation c. Lis pendens d. Dedication
D. dedication
25. What should a sales associate do if his employing broker instructs him or her not to show properties to people of a certain race? a. Ignore the broker's instruction b. Follow the broker's instruction c. Ask the broker to put the instruction in writing d. Find a new employer
D. find a new employer
47. Complete the sentence. The Florida Real Estate Recovery Fund: a. Is replenished from state taxes if needed b. Covers punitive damages c. Is to protect licensees d. Is funded from licensing fees
D. is funded from licensing fees
78. What is the purpose of a title search? a. Locate all important documents for a closing b. Issue title insurance c. Give constructive notice d. Run a chain of title
D. run a chain of title
365. For which of the following are Fannie Mae and Freddie Mac responsible? a. Offering nonconforming loans b. Finding new sources in the primary mortgage market c. Insuring loans made by approved lenders d. standardizing lending practices and forms
D. standardizing lending practices and forms
66. What type of tenancy exists when a tenant remains in possession of a property after his or her rights have expired? a. Joint tenancy b. Tenancy by the entireties c. Tenancy at will d. Tenancy at sufferance
D. tenancy at sufferance
26. Which form requires the signature of all parties? a. No Brokerage Relationship Notice b. Transaction Broker Notice c. Single Agent Notice d. Transition to Transaction Broker
D. transition to transaction broker
