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Florida Real Estate Exam (Complete) Questions and Answers (Already Graded A+), Exams of Real Estate Management

Florida Real Estate Exam (Complete) Questions and Answers (Already Graded A+)

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2023/2024

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Download Florida Real Estate Exam (Complete) Questions and Answers (Already Graded A+) and more Exams Real Estate Management in PDF only on Docsity! Florida Real Estate Exam (Complete) Questions and Answers (Already Graded A+) Samuel wants to do a 1031 exchange. He sold his investment property and has identified the property he'd like to buy next. Within how many days must he close on this property in order for it to qualify as part of the exchange? - ANSWER-a. 180 b. 30 c.45 d.60 a. He has 45 days to identify a property he would like to purchase and 180 days to close on it, from time of sale. In which form of co-ownership is a person's ownership inheritable? - ANSWER-a. Joint tenancy b. Tenancy by the entirety c. Tenancy in common d. Tenancy in severalty c. Tenancy in common allows for a persons share to be inheritable, it does not automatically pass forth to the rest of the owners like in joint tenancy (this is called the right of survivorship). How long do prospective tenants have to request a refund after purchasing a rental list? - ANSWER-a. 10 days b. 15 days c. 30 days d. 360 days C. 30 days.... tenants have up to 30 days to request a 75% refund if they do not purchase a rental Which method best describes the foreclosure process in Florida? - ANSWER-a. Caveat emptor b. Judicial c. Lis pendens d. Non-judicial b. The state of florida offers a judicial foreclosure process A judicial foreclosure is known as a lien theory process. Basically, the homeowner has legal title to the property... Unlike title theory, where as the owner has equitable title Which of the following statements about the Florida property tax disclosure is NOT true? - ANSWER-a. It can be included in the sales contract itself. b. It cautions buyers not to rely on the current year's tax to predict what they'll have to pay. c. It gives buyers a rough estimate of the property tax they'll pay in the coming year. d. It must be provided to sellers when they sign their agency agreement. c. This disclosure doesn't provide any estimates of future property tax amounts. Which act simplifies, clarifies, and modernizes consumer protection laws and makes them more consistent with federal trade laws? - ANSWER-a. Fair Housing Act b. Federal Duplicate Law Condensation Act c. Federal Trade Commission Act d. Florida Deceptive and Unfair Trade Practices Act d. The Florida Deceptive and Unfair Trade Practices Act is the act that simplifies, clarifies, and modernizes consumer protection laws and makes them more consistent with federal trade laws. To comply with the statute of frauds, an option contract must be ______. - ANSWER-a. In writing and signed by the optionee b. In writing and signed by the optionor c. In writing and witnessed by an attorney d. On file at the local courthouse b. To comply with the statute of frauds, an option contract must be in writing and signed by the optionor (seller). A cooperative is a(n) _____. - ANSWER-a. limited partnership b. LLC c. not-for-profit corporation d. sole proprietorship c. A cooperative is a joint venture with its shareholders, formed for their benefit and governed by them. It's a not-for-profit corporation. Compared with condominiums, the monthly fees for a cooperative owner are typically ______. - ANSWER-a. Higher b. Much less c. Slightly less d. The same Robin has great credit and was able to secure a loan for her ocean-side dream home. Her 30-year, fixed-rate loan is for an amount that's above conventional loan limits. What type of loan does Robin have? - ANSWER-a. A conforming Freddie Mac loan b. A government loan c. An FHA loan d. A non-conforming loan d. Loans that are outside of Freddie Mac and Fannie Mae guidelines, such as jumbo loans, are non-conforming loans. Which one of the following performs ministerial duties, such as recordkeeping, for the FREC? - ANSWER-a. DBPR b. DCPA c. DHR d. DRE d. The DRE is responsible for ministerial duties on behalf of the FREC. How long are the terms of the members of the FREC? - ANSWER-4 years The Richards family farm is located on a 10-acre parcel of land, which is very rare to come by in their area. However, the house is rundown and in need of many repairs. Buyers in the area looking for a move-in ready home would need to either look elsewhere or wait several months for the home to be renovated. Which factor is most negatively impacting the value of the Richards' property? - ANSWER-a. Demand b. Scarcity c. Transferability d. Utility a. Although large parcels in the area are scarce, the low demand of buyers willing to buy and wait to live in a property that needs significant repairs is affecting the value. In investments, each type of depreciation is defined by a particular event. Which of the following best describes a depreciation type and an event it's tied to? - ANSWER-a. Economic depreciation and cost recovery b. Economic depreciation and physical deterioration c. Operating depreciation and taxing authority d. Tax depreciation and physical deterioration b. Economic depreciation is often tied to physical deterioration. What are the two types of Real Estate Investment Trusts? - ANSWER-a. Debit and credit b. Mortgage and equity c. Mortgage and lease d. Residential and commercial b. The two major investment choices for REITs are mortgage and equity. If a property's income value is $200,000 and it's earning a net operating income of $40,000, what is the cap rate? - ANSWER-a. 20% b. 25% c. 40% d. 5% a. The cap rate is 20%. To calculate cap rate, divide the income by the property value. The formula for this is rate = income / value. Spark City has built a new city courthouse. The construction caused a landslide, which buried most of Joe's farmland; now it can no longer be used for farmland. Joe is bringing an action against the city for his property loss. What is this an example of? - ANSWER-a. Condemnation b. Eminent domain c. Foreclosure d. Inverse condemnation d. Inverse condemnation occurs when action is brought against the government when its police powers have caused an adjacent land owner's property to decrease in value. Joanie sees herself as a mover and shaker, a leader, someone who jumps in and gets things done. She likes to be involved and in charge. When she decides to start investing in real estate, which of these choices is she most likely to select as her investment vehicle? - ANSWER-a. A multi-family residential income property b. A real estate investment trust c. A real estate mortgage investment conduit d. A real estate syndicate membership a. Since Joanie seems like an active, hands-on sort of person, she's most likely to choose a residential income property where she'll be in charge of the property rather than passive options like the REIT, REMIC, or syndicate. Lien Theory What is Florida? Lien Theory or Title Theory? Who holds the title? - ANSWER--Florida is a Lien Theory State -In lien theory states the borrow holds the title and owns the house, but a promissory note signed by the borrower gives the lender the right to seize and sell the house should the borrow default -The document that places a lien on the property is a mortgage Title Theory Who holds the title to the property? Is it easier for a lender to foreclose on a property? - ANSWER-- In title theory states, the borrower receives the deed, but the lender keeps the title and owns the house until the borrower pays off the loan -The borrower doesn't "actually" own the property until the mortgage is paid off and the lender releases the deed. -Since the lender already owns the property, it is much easier for a lender to foreclose on a property in a title theory state. Constructive Notice - ANSWER-Recordation ensures that the buyer's ownership is protected. It provides constructive notice of the sale/purchase, which means that the record is publicly available to anyone who does a records search. Actual Notice - ANSWER-Parties have personal knowledge of the particular event General Warranty Deed - ANSWER-A deed in which the grantor fully warrants good, clear title to the premises. Used in most real estate deed transfers, a general warranty deed offers the greatest protection of any deed. Special Warranty Deed - ANSWER-identical to a general warranty deed except that the covenant against encumbrances applies only to the time that the grantor owned the property Quitclaim Deed - ANSWER-A deed to relinquish any interest in property which the grantor may have, without any warranty of title or interest. Bargain and Sale Deed - ANSWER-A deed that carries with it no warranties against liens or other encumbrances but that does imply that the grantor has the right to convey title. The grantor may add warranties to the deed at his or her discretion Assignment of Contract - ANSWER-Transfer of all rights under a contract to a third party. Assignor remains secondarily liability. Novation - ANSWER-Substituting a new obligation for an old one or substituting new parties to an existing obligation. Exclusive Right to Sell Listing - ANSWER-Under this listing arrangement, the broker employed is entitled to a commission no matter who sells the property during the listing period. (Even the Seller) Tres owns a warehouse in an area that is zoned light industrial. With an increased demand for housing in the area, Tres wants to create loft-style condos and have his property designated as residential, even though the surrounding buildings will remain light industrial. What type of zoning is this? A. Aesthetic zoning B. Downzoning C. Incentive zoning D. Spot zoning - ANSWER-D. Spot Zoning "Spot zoning allows a specific property to be rezoned within an existing zoning area. Spot zoning is illegal in some states." Tom owns a construction company in a small southern town. Although national housing statistics have changed dramatically, his business hasn't increased or decreased at all. Which characteristic of the real estate market is described here? A. Highly influenced by governmental policy B. Indestructible C. Slow to respond D. Unique - ANSWER-C. Slow to respond "The real estate market is slow to respond. It's not centralized, and therefore changes at a national level may take a long time to be seen at a local level." What institution was formed in 1968 and took over the sale of the government loan market? A. Fannie Mae (FNMA) B. Farmer Mac C. Freddie Mac (FHLMC) D. Ginnie Mae (GNMA) - ANSWER-D. Ginnie Mae (GNMA) Ginnie Mae (GNMA or the Government National Mortgage Association) purchases government loans on the secondary market. Homeowners may transfer the SOH benefit to a subsequent home. In order to do this, their homestead exemption must have been in place on their current home for _________________ preceding years. A. One of the previous two B. The last 10 C. The last five D. The last two - ANSWER-A. One of the previous two "The homestead exemption must have been in place for one of the two preceding years, and the benefit transferred is limited to $500,000." How does the Federal Housing Finance Agency affect mortgages? A. It acts as a watchdog and focuses specifically on educating consumers about mortgage loans. B. It controls how much money is available to banks. It also controls interest rates, which affect how much mortgages cost. C. It lends money to other financial institutions (not end-users), which makes more money available for mortgages and keeps down the costs of borrowing money. D. It sets limits for conforming loans and controls the amount of money that lower- income people can borrow. - ANSWER-D. It sets limits for conforming loans and controls the amount of money that lower-income people can borrow. "The FHFA sets limits for conforming loans and controls the amount of money that lower-income people can borrow, which helps prevent housing market-related financial crises." In what year was the Americans with Disabilities Act made law? A. 1950 B. 1978 C. 1988 D. 1990 - ANSWER-D. 1990 What is the most likely effect when the Fed sells securities on the open market? A. Banks will have more money to lend. B. Interest rates will decrease. C. The economy may grow due to an increased money supply. D. The economy may slow down due to a decreased money supply. - ANSWER-D. The economy may slow down due to a decreased money supply. "When the Fed sells securities, it takes money out of the market. This decreases the supply of money in the market and potentially slows down the economy." Someone who's been given the authority to act on behalf of someone else is a(n) ______. A. Agent B. Client C. Mortgage lender D. Trustor - ANSWER-A. Agent "The term agent, though often used to refer to a real estate licensee, means someone who's been given the authority to act on someone else's behalf in some capacity." To comply with the statute of frauds, an option contract must be ______. A. In writing and signed by the optionee B. In writing and signed by the optionor C. In writing and signed by the optionor On file at the local courthouse - ANSWER-C. In writing and signed by the optionor To comply with the statute of frauds, an option contract must be in writing and signed by the optionor (seller). Which two duties of the transaction broker are shared with the single agent? Account for all funds and obedience Confidentiality and full disclosure Maintain limited confidentiality and deal honestly and fairly Present all offers and use skill, care, and diligence - ANSWER-Present all offers and use skill, care, and diligence Transaction brokers and single agents have two duties on common: present all offers and counteroffers and use skill, care, and diligence. Who is the owner of the property in a personal representative's deed? A deceased person A divorcee A legally incompetent person A minor - ANSWER-A deceased person A personal representative deed is the transfer of title on the conveyance of a deceased person's property. The personal representative is appointed in the will or by a court to handle the deceased individual's property. In the sale of a business, which generally involves 12 steps, something happens with the assets early in the process. What is it? Business assets and personal assets are combined. Business assets are separated from personal assets. Business assets are subtracted from liabilities. Business assets are subtracted from the value of the business. - ANSWER-Business assets are separated from personal assets. Business assets are separated from personal assets, which are not part of the sale. Sirius Shepard decided to open a brokerage in Azkaban. He's trying to decide between registering the trade name Sirius Shepard Realty or Sirius Seasoned Sales Realty. Which of the following statements is true? Misdeameanor of 1st degree = $1000 fine, 1 year in jail Spec Homes - ANSWER-built without having a specific buyer in mind Tract homes - ANSWER-Residential construction; type of speculative building, a new subdivision will typically feature several model homes. Buyers select a floor plan from the models and a lot on which to build in the new subdivision Custom Homes - ANSWER-A custom builder constructs homes under contract with a buyer, often using building plans provided by architects or buyers. The FREC consists of 7 members, appointed by the governor... name them all - ANSWER--4members are active brokers licensed for at least 5 years -1 member is an active sales associate licensed for at least 2 years -2 members are consumers who have never been licensed -at least 1 member must be 60 or older General vs. Special Agents - ANSWER-General agents have an ongoing responsibility for all of the dealings related to a specific piece of property. an example of this would be a property manager Special agents: have limited authority to act on behalf of their clients. Buyer and seller agents fall into this category Sub-agent - ANSWER-sub agent works for another agent, who is representing the seller, so the sub agent indirectly works for the seller What are the three duties licensees owe to all customers and clients? - ANSWER-D ealing honestly and fairly A ccounting for all funds D isclosing all known facts that materially affect the value of the property (DAD) Transaction Broker - ANSWER-- Transaction broker is the presumed agency in florida and is the only relationship that does not require a written disclosure to be signed... A transaction broker is a broker who provides a limited form of representation to the buyer, a seller, or both in a real estate transaction but does not represent either in a fiduciary capacity. D ealing honesty and Fairly A ccounting for all funds D isclosing all known facts that materially affect the value of residential real property P resenting all offers and counter-offers in a timely manner U sing skill, care and diligence in all transactions M aintaining confidentiality A ny additional duties that are entered into written agreement Licensees who have no brokerage relationship still have duties to potential sellers and buyers - ANSWER-D A D debt service ratio - ANSWER-This is used to determine whether the a properties income will cover its monthly mortgage payments this is calculated by diving NOI/annual debt service A DCR of less than one indicates negative cash flow Prorated Expenses - ANSWER-Typically the seller pays the costs for property taxes, utilities, etc. on the day of closing Prorations can be calculated one of two ways 1). using a statutory year (360 days) 2.) calendar year (365 days) The real estate taxes assessed on the property are $785 for the year. The taxes arent due until the following january 1st. Closing is held on May 31st... Here is how that would look on the closing statement - ANSWER-Accrued period of taxes owed by the seller at closing using the statutory year: - $785.00/12 = $65.42 per month -$65.43 x 5 full months (jan 31st- May 31st) = $327.10 The seller will recieve a "debit" and buyer a "credit" the seller is paying for his 5 months of property taxes from january to may Now, what if the seller is closing mid month, lets say June 15th? Well... we would just divide that monthly fee of 65.42 and divide it by 30. that would get us a daily amount of $2.18, we then multiply that by 15 and add that to the previous 5 months... Documentary stamp tax - ANSWER-- Paid at a rate of 70 cents per $100 - Commonly paid by the seller Documentary stamp tax on notes - ANSWER-- calculated at a rate of 35 cents for every $100 of the unpaid balance once the note is executed Intangible Tax on New Mortgages - ANSWER-NEW loan amount x $.002 = cost of intangible tax Typical Accrued items that go in the sellers debit column - ANSWER--Unpaid real estate taxes -Tenants rent the seller collected for a period of time in which the buyer will own the property (prepaid) -Interests on the sellers mortgage assumed by the buyer Prepaid items go in the sellers credit column and the buyers debit column - ANSWER- Typical Prepaid items include: -Prepaid taxes -Rent paid by the seller under a lease assigned to the buyer -utilities billed and paid in advance -heating oil in the tank Civil rights act of 1866 - ANSWER-recognized all persons born in the U.S as citizens, regardless of racce or color and protexted the rights of every U.S citizen to buy, sell, convey, inherit and possess property Anastasia wants to get her real estate license and bring together buyers and sellers. This means she will be involved in which of the following? Agency Appraisal Brokerage Property management - ANSWER-Brokerage "This describes the business of real estate brokerage, in which agents bring together a buyer and seller and negotiate real estate transactions." Phyllis and Maury obtained a mortgage from Taylor Bank & Trust in 1998. In 2014, they obtained a second mortgage from Quail Loans. What's the loan with Taylor Bank & Trust considered? First mortgage Home equity line of credit Junior mortgage Subordinate mortgage - ANSWER-First Mortgage "The earlier of the two mortgages to be recorded is called a first mortgage." According to RESPA, what must the lender give to the borrower at either the time of loan application or within three days following application? Closing Disclosure Freddie Mac borrower disclosure Loan Estimate $50,000 $500,000 - ANSWER-$500,000 The SOH benefit transferred is limited to $500,000. The rate at which a bank can obtain an overnight loan from another bank without providing collateral is called the ______ rate. Adjustable Discount Federal funds Prime - ANSWER-When a member bank seeks a short-term loan from another bank, the federal funds rate applies. This is for short-term (overnight) loans without collateral. Federal funds Which of the following statements regarding "kickbacks" is true? The receiving party absolutely must have an active real estate license. They can be paid to another party in a transaction, but only with the broker's approval and with the full knowledge of all other parties. They can be paid to anyone who refers a client to a licensed agent. They're always illegal. - ANSWER-They can be paid to another party in a transaction, but only with the broker's approval and with the full knowledge of all other parties. "The party to whom the referral fee or kickback is paid doesn't have to have a real estate license. However, the person must be a principal in the transaction." A mortgage is a legally binding document that creates a lien on a piece of property and gives the lender the right to foreclose on the property if the borrower defaults. Who or what entity is considered the mortgagee? Borrower Lender Loan Property - ANSWER-Lender The lender holds the mortgage on the property, so the lender is the mortgagee. Chapter 475 of the Florida statutes sets forth the law regarding real estate brokers, sales associates, and real estate schools. What is this law called? Administrative Code Department of Business and Professional Regulation Organizational Structure Act Real Estate Professional Practice Act - ANSWER-Real Estate Professional Practice Act "The Real Estate Professional Practice Act was created by the Florida legislature to establish the legal rights and responsibilities of real estate licensees." Which of the following describes a tenancy at will? Tenancy after the lawful authority has expired, after which the landlord may evict Tenancy for an unknown period of time, with either party permitted to terminate the lease by giving notice Tenancy for a specified period of time that automatically renews itself for the same length of time unless one party terminates Tenancy of definite duration that terminates automatically and is inheritable - ANSWER- "Tenancy for an unknown period of time, with either party permitted to terminate the lease by giving notice Tenancy at will is for an unknown period of time, with either party permitted to terminate the lease by giving notice. A real estate licensee in Florida could be found guilty of unauthorized practice of law for preparing this type of real estate contact. A. Broker representation Agreement B. Lease agreement with a term longer than one year C. Listing Agreement D. Purchase Agreement - ANSWER-B. Lease Agreement with a term longer than a year When prospecting and soliciting for new business, licensees should be familiar with what federal acts? A. Do not call implementation act, CAN-SPAM act, and Junk Fax prevention Act B. Do not call implementation act, sherman act, and unfair trade practices act C. Human relations Act, Fair housing act, and americans with disabilities act D. Sherman act, Clayton act, and unfair trade practices act - ANSWER-A. Do not call implementation act, CAN-SPAM act, and Junk Fax prevention Act These refer to solicitation via phone, email and fax Which of the following items is something a lender is prohibited from doing if the lender wants to write qualified mortgages? A. Amortization B. Balloon Interest C. Debt to income ratio less than 43% D. Payback terms longer than 30 years - ANSWER-D. Payback terms longer than 30 years Debt to income ratios may not exceed 43%. Payback terms may not exceed 30 years Its that time of the year again in real estate where things are really slow and properties just arent moving. In real estate, this period is referred to as a ________ A. Cyclical certainty B. Downcycle C. Downturn D. Slump - ANSWER-B. Downcycle Which of the following is a true statement about cooperatives? A. A cooperative is a fee simply type of ownership B. A cooperative is a joint venture with shareholders, formed for their benefit and governed by the developer. C. All cooperatives have specific criteria for residents D. Unlike a condominium, the cooperative corporation does not own the land, buildings, and all rights and interests in the corporation - ANSWER-c. All cooperatives have specific criteria for residents What is a real estate mortgage investment conduit (REMIC)? A. A company that owns, and usually operates, income-producing real estate B. An entity used to pool mortgage loans and issue mortgage backed securities C. An organization that manages income producing real estate properties D. An organization with many investors who jointly participate in a real estate investment - ANSWER-B. An entity used to pool mortgage loans and issue mortgage backed securities For an antitrust violation to occur, which element must be present? A. Agreement B. Coercion C. Cohesion D. Commission - ANSWER-B. Coercion Which term is used to define a search of public records going back at least 60 years to establish a property's title history? Correction deed limited search You've just purchased a rural property, and the attorney at the closing tells you, "You have a dominant estate." What does that mean to you? The property comes with an easement in gross granted to the utility company. You'll be using an easement across your neighbor Jim's property. Your property has an easement granted to your neighbor Jim, allowing him to cross your property to access his land. Your property has direct access to a road and doesn't require an easement. - ANSWER-You'll be using an easement across your neighbor Jim's property. The dominant estate or dominant tenement is the property that benefits from the easement. When you use an easement across your neighbor's property, your property benefits and is the dominant estate. Rhonda hasn't paid her HOA dues in two years. Her attorney recently informed her that her state grants HOA-related liens a super lien status. What does this mean? The HOA can collect twice the amount of the money that she owes. The HOA lien takes priority over all other liens. The HOA must involve an administrative law judge in order to collect. The lien can be attached to both her real and personal property. - ANSWER-The HOA lien takes priority over all other liens. Super lien status means that the lien is granted higher priority than all other liens, including mortgages, deeds of trust, or property taxes. Eloise is interested in buying a bungalow on the outskirts of the city. Her agent is reviewing the property details and informs her that there are several easements on the property. In particular, the gas company has a right of way because the natural gas line for the neighborhood runs through the back of the lot. What type of easement would this be? Easement appurtenant Easement by necessity Easement by prescription Easement in gross - ANSWER-Easement in gross An easement in gross is granted to a specific individual or company—in this case, the gas utility company. Elmer died and left a will. Before his estate can be distributed according to his wishes, it must go through ______. A lawyer Devise Escheat Probate - ANSWER-Probate A _______ is a piece of real estate owned by multiple unrelated individuals who, in addition to their ownership rights, each hold the right to occupy the dwelling unit based on the specific terms of a timeshare agreement, usually in one- to two-week intervals during the year. Campground membership Timeshare estate Timeshare use Vacation ownership - ANSWER-Timeshare estate A timeshare estate is a piece of real estate owned by multiple, unrelated individuals who, in addition to their ownership rights, each hold the right to occupy the dwelling unit in one- to two-week intervals during the year. How many additional days are brokers given to provide the seller notice from the attorney holding the escrow funds that the deposit was either received or not received? 10 days 15 days 20 days Five days - ANSWER-10 days What's the estimated value by cost approach for a property if the site value is $25,000, the new cost of improvements is $100,000, and the total depreciation estimate is $15,000? $110,000 $115,000 $140,000 $90,000 - ANSWER-$110,000 To estimate value using the cost approach, an appraiser adds the site value to the cost to replace improvements, then subtracts the amount of depreciation. Here, that gives us $100,000 + $25,000 - $15,000. Gabi owns one parcel measuring one square mile and another parcel measuring one mile x half a mile. She combined the parcels and sold them for $2.5 million. What price per acre did she receive for the land? $1,953.13 $2,604.17 $3,125.00 $3,906.25 - ANSWER-$2,604.17 When the Browns first purchased their home, the area was primarily agricultural. But over the years, as more homes were built, the area has undergone some major changes. What was once a quiet neighborhood is now on the corner of a major busy intersection with lots of traffic, noise, and light pollution throughout the night. What type of depreciation has the Browns' home undergone? A. Physical depreciation B. Functional obsolescence C. Incurable depreciation D. External depreciation - ANSWER-D. External depreciation You got it! External depreciation (or economic obsolescence) is a loss in value caused by an undesirable or hazardous influence offsite. Which of these situations represents reproduction cost in the cost approach to value? A. Jenning's historic property was mostly destroyed by fire. He rebuilds it with similar materials, square footage, and design. B. Kristina's antebellum mansion in New Orleans was severely damaged by a hurricane. She spends several years repurposing materials from other similar homes to rebuild it exactly as it was before the hurricane. C. Martin sold his beloved family home, then built one just like it, only with newer materials that were more environmentally friendly, in a warmer, drier part of the country. D. Ginger's parents built a new home when Ginger was just leaving for college. When she graduated, Ginger went back to her home town and hired a builder to build a similar but smaller house for her and her new husband. - ANSWER-B. Kristina's antebellum mansion in New Orleans was severely damaged by a hurricane. She spends several years repurposing materials from other similar homes to rebuild it exactly as it was before the hurricane. By when must a broker deposit escrow funds if the sales associate receives them on a Tuesday? A. Friday B. The following Monday C. The next day D. Thursday - ANSWER-A. Friday Assuming there are no legal holidays, the broker would have until Friday to deposit the funds. The sales associate would deliver the funds by the end of Wednesday, and the broker would have three days to deposit the funds, with the first day being the day the broker receives the funds from the sales associate. What must a broker do if escrow funds are deposited in an attorney or title company's escrow account? A. Nothing, the responsibility now lies with the attorney or title company to handle the funds appropriately. B. Request a notice of default from within 90 days of the time the deposit is made. C. Request a verification of deposit within 10 days of the due date stated in the sale agreement. D. Request that the attorney or escrow company provide a bond of 25% of the escrowed funds to the broker. - ANSWER-C. Request a verification of deposit within 10 days of the due date stated in the sale agreement. A broker must request verification of deposit within 10 days of the deadline stated in the sale agreement and notify the seller of the response. What type of foreclosure is commonly used when a deed of trust is the security instrument? Eviction Judicial Non-judicial Strict - ANSWER-Non-judicial One area of town has maximum building height requirements and setbacks for the front, side, and rear yards. These requirements are all indicative of ______. Bulk zoning Commercial zoning Density zoning Residential zoning - ANSWER-Bulk zoning Title VIII of which law prohibits discrimination in the sale, rental, and financing of housing? Civil Rights Act of 1866 Civil Rights Act of 1968 Equal Credit Opportunity Act of 1974 Housing and Community Development Act of 1974 - ANSWER-Civil Rights Act of 1968 What is the length of the statute of limitations to file a fair housing complaint with HUD? 10 years Five years One year Seven years - ANSWER-One year Sanjeev leases a house from Clara, and the lease has an option contract attached that permits Sanjeev to buy the house if he chooses to exercise the option within three years. How large does the option fee need to be in order to be legally binding? 10% of the purchase price 1% of the purchase price Any amount agreed to by the parties Conrad just closed on the house he's buying to fix up. Why should he follow up to be sure the deed has been recorded? He can't legally make any improvements to the property until the deed is recorded. He doesn't legally own the house until that occurs. Recording provides actual notice that he owns the property. Recording provides constructive notice that he owns the property. Ownership officially transfers when the grantor delivers the deed to the grantee, but recording provides constructive notice that Conrad owns the property, thereby permitting anyone who does a public records search to see the ownership information. - ANSWER-Recording provides constructive notice that he owns the property. Ownership officially transfers when the grantor delivers the deed to the grantee, but recording provides constructive notice that Conrad owns the property, thereby permitting anyone who does a public records search to see the ownership information. You need to perform a sales comparison for your clients. Comparable A's adjusted sales price is $277,000. Comparable B's adjusted sales price is $255,000. How might you use this data to determine a list price range for the clients' home? Find the average of the adjusted sales prices of Comparable A and Comparable B. Give more weight to the list price on Comparable A, because it's lower. Give more weight to the list price on Comparable B, because the subject property will likely sell more quickly at this higher price. Give more weight to the list price on the comparable that's most similar to the property. When faced with a range of prices, give more weight to the comparable that's most similar to the subject property. - ANSWER-Give more weight to the list price on the comparable that's most similar to the property. When faced with a range of prices, give more weight to the comparable that's most similar to the subject property. What type of notice results from publicly recording a title transfer? Actual notice Attorney notice Constructive notice Proper notice The purpose of recording is to give the public constructive notice of a transfer of ownership. Recording doesn't transfer title; it informs the public that a transfer of title has occurred. - ANSWER-Constructive notice The purpose of recording is to give the public constructive notice of a transfer of ownership. Recording doesn't transfer title; it informs the public that a transfer of title has occurred. Where can an agent report an antitrust violation? Citizens Complaint Center of the Antitrust Division The Department of Housing and Urban Development The Department of State The Federal Bureau of Investigation - ANSWER-Citizens Complaint Center of the Antitrust Division Which of the following is a true statement about deducting interest on mortgages taken out in tax years between 2018 and 2025? Interest on the first $500,000 of mortgage debt is deductible for married couples filing jointly or $375,000 for married couples filing separately. Interest on the first $750,000 of mortgage debt is deductible for married couples filing jointly or $375,000 for married couples filing separately. The loan can be used for purchase or making improvements, as well as for other purposes. The loan cannot be for more than the borrower's most recent year's salary. - ANSWER- Interest on the first $750,000 of mortgage debt is deductible for married couples filing jointly or $375,000 for married couples filing separately. For tax years 2018 to 2025, interest on the first $750,000 of mortgage debt is deductible for married couples filing jointly. James, a seller, signed a listing agreement that allowed him to contract with multiple agents but only pay a commission to the agent who located a buyer. This type of listing agreement is called ______. Exclusive agency Exclusive right to sell Open Seller's choice - ANSWER-Open What is a bound? A line that runs east to west A line that runs north to south A physical feature that defines the boundaries of the land The direction and distance of a line forming the boundary of a property - ANSWER-A physical feature that defines the boundaries of the land How many duties are owed by a designated sales associate? Nine The DBPR has issued a cease and desist order to Malika. Which of the following must be true? She is a certified public accountant. She is a commission member. She is a real estate licensee. She is unlicensed. - ANSWER-She is unlicensed. The DBPR issues citations to discipline licensees. The cease and desist order applies to unlicensed individuals. Which of the following accurately describes the Division of Real Estate? Oversees the DBPR, DRE, and real estate commission. Provides administrative services for Florida Real Estate Commission. Regulates Florida businesses Regulates the activities of real estate professionals and schools - ANSWER-Provides administrative services for Florida Real Estate Commission. The DRE is responsible for administrative services and ministerial duties for the FREC. When something is evaluated according to ______, this is called finding the value on an ad valorem basis. A. Its cost to build B. Its estimate C. Its value D. The majority - ANSWER-C. Its value Which of the following is true about the Florida Green Belt Law? A. It allows agricultural properties to be assessed at a lower rate. B. It allows all properties to be assessed at a lower rate. C. It allows investors to buy agricultural property at a lower rate. D. It makes agricultural properties exempt from property tax. - ANSWER-A. It allows agricultural properties to be assessed at a lower rate. The Green Belt Law protects agricultural properties by allowing them to be assessed at a lower rate. It also allows them to be appraised only on current use, and not highest and best use. Jessica and Eric's home has homestead status. The just (market) value of their home is $200,000, and they have $20,000 in SOH protections. What is the assessed value of their home after the SOH protections are applied? A. $160,000 B. $180,000 C. $200,000 D. $220,000 - ANSWER-B. $180,000 The assessed value is $180,000. The SOH amendment limits increase in assessed value to 3% per year. In order for Thom and Josie to exempt a portion of their primary residence's value from property tax, they must file a homestead application with the county appraiser's office before March 1. What other requirement must they meet? A. They must both be over the age of 65. B. They must have at least one other Florida residence on which they pay real estate taxes. C. They must have had legal title for at least one year. D. They must have had legal title since January 1. - ANSWER-D. They must have had legal title since January 1. Laura's property is subject to a special assessment. Which of the following is true? A. The amount of the special assessment does not become a lien against her property like ad valorem taxes. B. The special assessment is deductible for income tax purposes. C. The special assessment must benefit Laura's property. D. The special assessment will not accumulate interest. - ANSWER-C. The special assessment must benefit Laura's property. Gary and Anita wish to protest their property tax assessment. What is the time frame in which they must do this? A. Any time before the taxes are due B. Within 10 days of receiving the TRIM notice C. Within 25 days of the date the TRIM notice was mailed D. Within 30 days of the payment due date - ANSWER-C. Within 25 days of the date the TRIM notice was mailed The Gomez family just moved into their dream home. They purchased the home for $264,985, and it appraised at $272,402. The assessment ratio for their area is 25%, and the tax rate for their area is 2.8%. What is their annual tax bill? A. $1,262 B. $1,664 C. $1,854 D. $1,907 - ANSWER-First, lets find the assessed value, by multiplying the appraised value of $272,402 by .25, which gives us $68,100, then lets multiply that assessed value by their tax rate which is 2.8% and that leaves us with $1907 Mariel is buying a home and is looking forward to the tax deductions. She may deduct which of the following? Closing costs Furnishings purchased on credit Loan origination fee Utility costs - ANSWER-Loan origination fee Real Estate Professional Practice Act - ANSWER-Real Estate Professional Practice Act Flynt has a loan for a shopping center and is required to pay not only his mortgage payment but a percentage of the income he earns from the shops. What kind of a mortgage is this? Fee simple Freehold Leasehold Participation - ANSWER-Participation If Carol and Mike Brady died intestate, their children would all be _________ to the family home. Beneficiaries Devisees Heirs Testators - ANSWER-Heirs Who or what is a licensee's sphere of influence? A list of contacts, both personal and professional, who already know and trust the licensee Coworkers who work for the same brokerage as the licensee Family and friends to whom a licensee listens regarding business matters The code of ethics published by the National Association of REALTORS® - ANSWER-A list of contacts, both personal and professional, who already know and trust the licensee Kenneth entered into a contract to sell his home to Valerie, who put down a $5,000 earnest money deposit. At the last minute, Valerie backed out of the deal and Kenneth kept the earnest deposit. This is an example of ______. Accepting liquidated damages Accepting partial performance Suing for damages Suing for specific performance - ANSWER-Accepting liquidated damages Deanna has just submitted her application for a Florida real estate sales associate license. She zoned out and forgot to include her check for the fee. What's the worst thing that could happen as a result? Her license could be delayed. Her license could be denied. She may have to pay a penalty. She may have to re-apply. - ANSWER-Her license could be denied. According to the NAR Code of Ethics, which statement most accurately describes a licensee's responsibility related to written offers on a listing? A licensee is only required to present formal written offers that are equal to or more than the listing price. A licensee is only required to present formal written offers within a certain range of the listing price of the property. All formal written offers the licensee receives must be presented to the owner unless the owner has accepted a previous offer. All formal written offers the licensee receives must be presented to the owner until closing or execution of a lease unless the client waives this obligation in writing. - ANSWER-All formal written offers the licensee receives must be presented to the owner until closing or execution of a lease unless the client waives this obligation in writing. A caveat emptor state could best be described as which of the following? The seller does not have to disclose information on material defects or protect the buyer in any way. The seller is liable for providing a complete and accurate picture of the condition of the property. The seller must proactively have a home inspection conducted. The seller must provide a seller disclosure form containing information about any known defects. - ANSWER-The seller does not have to disclose information on material defects or protect the buyer in any way. Which condominium document creates the homeowners association? Articles of incorporation Bylaws Declaration of condominium FAQs - ANSWER-Articles of incorporation Gregory has been bombarded with emails from a local real estate licensee. He keeps opting out of these emails, but they just keep coming. What federal law is the licensee possibly violating? Anti-Spam Act of 2000 CAN-SPAM Act of 2003 No, because the buyer's consideration is the promise to buy. Yes, because it opens escrow. Yes, because it's the buyer's consideration. - ANSWER-No, because the buyer's consideration is the promise to buy. Ari owned acreage in a rural area. He sold a small portion of it to a neighbor in an informal transaction but made no record of the sale or change of ownership. A developer offered Ari several million dollars for the entire acreage, and Ari eagerly accepted the offer. What covenant is Ari in danger of violating? Against encumbrances Quiet enjoyment Seisin Warranty - ANSWER-Seisin The covenant of seisin guarantees that the grantor owns the property that appears in the deed. Because the sale of property to Ari's neighbor was never recorded, his deed still shows that he owns the entire parcel. In Florida, which of these describes self-dealing? A licensee lists her own property and informs all parties that she's licensed. A licensee sells a property without broker supervision. A licensee sells a property with the understanding that she will make all pertinent decisions on her client's behalf. A licensee sells her own property for personal use without the knowledge of the principal broker. - ANSWER-A licensee sells her own property for personal use without the knowledge of the principal broker. Jerry is a business enterprise broker. Which of the following must be true? He deals with the sale and purchase of larger businesses. He deals with the sale and purchase of smaller businesses. He does not deal with the sale and purchase of personal property. He is not required to have a real estate license. - ANSWER-He deals with the sale and purchase of larger businesses. Which condo document must be created before beginning development Articles of incorporation Bylaws Declaration of condominium FAQs - ANSWER-Declaration of condominium *think declaration of independence.. must be created before something can begin What is the correct calculation to figure out a commission rate? List price ÷ total commission List price × total commission Sales price ÷ total commission Total commission ÷ sales price - ANSWER-Total commission ÷ sales price Which type of legal description do courts prefer? Benchmark Lot and block Metes and bounds Rectangular government survey - ANSWER-Lot and block According to custom, who pays the costs on the day of closing for property taxes, utilities, etc.? The buyer The buyer and seller split these costs. The seller Typically, the broker pays the costs on the day of closing. - ANSWER-The seller Sarah owns her own home. As part of her basic property rights, she has the right to decide who may or may not access the property. Which right is this? Disposition Enjoyment Exclusion Possession - ANSWER-Exclusion She can EXCLUDE anyone she wants too Sunshine Surveyors Inc. created a lot and block survey for a new residential development, Happy Acres. The first thing the surveyor did when he surveyed the new neighborhood was to reference what type of description? Map Transaction brokerage - ANSWER-Transaction brokerage Property owners who wish to request a meeting with the property appraiser to protest their property tax assessment, exemption status, tax deferral, or portability decision must do so within ______ days of receiving their TRIM notice. 10 15 25 30 - ANSWER-25 *they say it is 15 but I am almost positive this is wrong https://floridarevenue.com/property/Documents/pt101.pdf Evan has his home and cell number on the Do Not Call Registry. He received an unwanted solicitation call from a new real estate licensee in the city. He told the licensee his number is on the Do Not Call Registry and that he does not wish to do business with the licensee. A few days later, he got another unwanted call from the licensee. What federal act is the licensee possibly violating? A. Anti-Telemarketer Act of 2000 B. CAN-SPAM Act of 2003 C. Do Not Call Implementation Act of 2003 D. Junk Fax Prevention Act of 2005 - ANSWER-C. Do Not Call Implementation Act of 2003 Rental companies and brokerages that charge a fee for providing rental listing information must give prospective tenants ______. .A. A guarantee that they will find a property B. A list containing at least 10 rental properties C. A new list if they don't find a property they like within the first 10 days D. A receipt with a disclosure about refunds with the approved language - ANSWER-D. A receipt with a disclosure about refunds with the approved language In the state of Florida, online remote notaries can ______. Are to be used exclusively Can be used any time Can be used only with special permission Never be used - ANSWER-Can be used any time Which of the following is a true statement about how adjustments are made in the sales comparison approach? Adjustments are made to the subject property, not the comparables. Appraisers adjust downward when a comparable is missing a feature found in the subject property. Appraisers adjust upward when a comparable is missing a feature found in the subject property. Only three adjustments per comparable property are allowed; otherwise it's not considered sufficiently similar. - ANSWER-Appraisers adjust upward when a comparable is missing a feature found in the subject property. "All adjustments are made to the comparable properties' sales prices to make them as similar as possible to the subject property." If a seller is concerned about an appraisal, what can a buyer do to address this need when structuring the offer? Allow an escalation clause. Offer a quick close. Offer full price or more than full price. Waive the appraisal. - ANSWER-Waive the appraisal. Which of the following is regulated by the Federal Housing Finance Agency? Fannie Mae Farmer Mac Ginnie Mae Real estate licensees - ANSWER-Fannie Mae Property manager Mrs. Babish has just returned $200 to Laverne and Shirley, her former tenants. Their security deposit was $800 when they moved in. What else, if anything, must Mrs. Babish do? She must send a letter to the tenants that confirms the end of the lease in writing. She must send the bank a notarized statement saying that she returned $200 of the deposit. She must send the tenants an itemized statement that details how the missing money was spent. She must take the missing $600 and spend it on fixing the damage caused by the tenants' normal wear and tear. - ANSWER-She must send the tenants an itemized statement that details how the missing money was spent. Exclusive right to sell Net Open - ANSWER-Exclusive agency "It's easy to confuse exclusive agency and exclusive right to sell. With exclusive agency, the seller retains the right to find a buyer and avoid paying the commission, but the seller's listing will likely receive more attention from the agent than it would with an open listing." Cam is a broker. His licensees, Jane and John, represent two sides in a single transaction. Jane represents the seller; John represents the buyer. What relationship does Cam have to the buyer and the seller? Cam is a designated agent to both the buyer and seller. Cam is a designated agent to the buyer and a dual agent to the seller. Cam is a designated agent to the seller and a dual agent to the buyer. Cam is a dual agent to both the buyer and seller. - ANSWER-Cam is a dual agent to both the buyer and seller. Which of the following is illegal commingling? Failing to keep appropriate records Having more in an escrow account than could be accounted for by escrow funds Placing client funds in the firm's general business account Stealing a client's trust funds - ANSWER-Placing client funds in the firm's general business account In a title theory state, which of the following is a true statement? A promissory note creates a lien against the property used as security for the loan. It's generally much easier for a lender to foreclose on a property. The lien makes non-judicial foreclosure typical. The mortgage creates a lien against the property used as security for the loan. - ANSWER-It's generally much easier for a lender to foreclose on a property. Which of the following is a type of zoning action? Aesthetic Bulk Moratorium Rural - ANSWER-Moratorium The Druid Hills neighborhood sits firmly within a single-family residential zoning area. Most of the lots are one-third of an acre or larger. A 20-acre parcel on the edge of the neighborhood sold recently. The buyer wants to build condominium flats since multi- family housing is in short supply in the area. The town is considering rezoning that parcel to allow this development because the developer plans to also include a public park and a walking trail. What kind of zoning is this? Aesthetic zoning Downzoning Incentive zoning Spot zoning - ANSWER-Incentive zoning Which economic characteristic of land contains the concept that a land's value can be affected by the changes made to it, such as construction of a home or shopping center? Improvements Permanence of investment Scarcity Situs (location) - ANSWER-Improvements A property owner wishes to protest her property tax assessment, so she did not make the required payment on her taxes by the due date. The property taxes are now delinquent. Which of the following is true? The owner is not liable for the taxes until the VAB makes a determination. The owner must pay her taxes by the date of her hearing with the VAB. The owner's petition to the VAB will be denied. The owner will be given additional time to pay her taxes once the dispute is settled. - ANSWER-The owner's petition to the VAB will be denied. How much are Doc stamps on the Note? - ANSWER-35 cents per $100 How much are doc stamps on the deed? - ANSWER-70 cents per $100 If you buy a 200,000 dollar house in cash, you will pay $1400 in stamp tax When a broker receives commission for the sale of a property even though she did not sell it, she most likely has what type of agreement with the property owner? A. Transaction broker B. No broker relationship C. Exclusive right to sell D. Exclusive agency - ANSWER-Exclusive right to sell How many consumer members are there of the FREC? - ANSWER-2! Property management is becoming more common because of what? A. Market fluctuation B. Development "Mortgage loan originators also known as mortgage brokers find loans for borrowers" In which market are loans created? A. Federal market B. Primary market C. Secondary market D. Treasury market - ANSWER-B. Primary market Which market buys and sells existing mortgages? A. Federal market B. Treasury market C. Primary market D. Secondary market - ANSWER-Secondary market "The secondary market is an investor market where participants like Fannie Mae, Freddie Mac and ginnie mae purchase mortgages from the primary market Ginnie Mae approved mortgage-backed securities _____________. A. Carry the full faith and credit guarantee of the federal government B. Are to be paid on closing date C. Are sold to the primary market D. Do not have to pay fees - ANSWER-A. A. Carry the full faith and credit guarantee of the federal government At the time of the mortgage loan application The Real Estate Settlement Procedures Act (RESPA) requires A. Good faith estimate B. Insurance C. Lien D. APR - ANSWER-A. Good faith estimate The federal reserve regulation z requires lenders disclose the annual percentage rate in appliance with A. The real estate procedures act B. Equal credit opportunity act C. The truth in lending act D. The civil rights act of 1866 - ANSWER-C. The truth in lending act Financial institutions must make credit available without discrimination of race in accordance with A. The civil rights act of 1866 B. The real estate procedures act C. The truth in lending act D. The equal credit opportunity act - ANSWER-D. The equal credit opportunity act Potential gross income minus vacancy and collection losses is A. Effective gross income B. Net income C. Total income D. Potential income - ANSWER-A. Effective gross income A developer of 20 or more new residential units must give a ______ to a buyer A. Interval B. Time share C. Plat map D. Prospectus - ANSWER-D. Prospectus "A developer must give a purchaser a prospectus which gives condominium details" Drew the tenant pays the landlord rent in advance and a security deposit, the landlord puts the funds in his personal account A. The landlord must put the funds in an interest bearing account B. The landlord is allowed to put the funds in his personal account C. The landlord is not allowed to put the funds in his personal account they must be put in a separate account D. The landlord is allowed to put the funds in his personal account as long as he does not spend them - ANSWER-The department of business and professional regulation is under which Florida statute A. Chapter 61j2 B. Chapter 475 C. Chapter 455 D. Chapter 20 A member of the US armed forces is transferred to active duty in Florida. The service members spouse holds a valid New York real estate license. The service members spouse desires a Florida real estate license. Which is true? A. The spouse must complete the prelicense education B. The spouse must pass the Florida specific real estate exam C. Upon application for license, the DBPR must issue license D. The spouse is eligible for Florida license because if mutual recognition with state of New York - ANSWER-C. Upon application for license, the DBPR must issue license Which statement is false regarding mutual recognition agreements? A. The agreements are intended to recognize the education and experience that real estate licensee's have acquired in other states are nations B.Mutual recognition applicants are required to take an examination on Florida real estate laws C. Mutual recognition applicants maybe Florida residents or non-residents D.Mutual agreements allow Florida real estate licenses to have an equal opportunity for licensure in jurisdictions with which agreements are concluded - ANSWER-C Mutual recognition applicants may be Florida residents or non-residents Which of the criteria listed below is not required to hold a Florida real estate? A. Proof of US citenzship B. 18 years of age or older C. High school diploma or GED D. US social security number - ANSWER-Proof of US citenzship A man who died without leaving a will owned 2 farms and a home. The court appointed a personal representative to dispose of the decendents estate. The representative? A. Must have the clerk of the circuit court auction property B. Must register with the DBPR if he expects to be paid C. Is exempt from a real estate license D. Must dispose of all real property through a real estate broker - ANSWER-C. Is exempt from having a license quasi-legislative powers - ANSWER-Power to adopt rules to implement chapter 475 and chapter 455 Executive Branch - ANSWER-Authority to regulate and enforce real estate license law quasi-judicial - ANSWER-Power to discipline licensees (reprimand, fine, probation, suspend, revoke license) The licensee status that results when a license is not renewed at the end of the license period is referred to as A. Canceled B. Delinquent C.involuntary inactive D. Voluntary inactive - ANSWER-Involuntary inactive A broker wishes to be issued several broker licenses for business reasons. She may