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100 Cards in this Set
- Front
- Back
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Developer Kathy has completed the development of a subdivision in Daytona Beach. As part of the development plan, Kathy will turn over ownership of the streets and infrastructure to the county. This is known as: A. Eminent domain B. Police power C. Dedication D. Condemnation |
C. Dedication |
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Construction by a builder who builds a home from plans that were provided by the owner of the lot is known as: A. Speculative construction B. Custom construction C. Tract construction D. Specific construction |
B. Custom construction |
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Dan is planning to develop a subdivision in Jacksonville. Prior to construction, Dan must submit which of the following for approval to the local government? A. Subdivision plat map B. Topographical survey C. Deed restrictions and restrictive covenants D. Special exception permit |
A. Subdivision plat map |
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Tom is an active real estate broker who has been asked to do an appraisal. Which of the following situations best applies? A. Tom cannot do an appraisal unless he is also a state-certified appraiser B. Tom can do an appraisal provided he notifies the Florida Real Estate Appraisal Board prior to the start of the appraisal C. Tom cannot do an appraisal because he holds a real estate license D. Tom can do an appraisal because of his real estate license |
A. Tom cannot do an appraisal unless he is also a state-certified appraiser |
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The Florida Real Estate Commission was created to primarily: A. Discipline licensees B. Discipline anyone who has violated the real estate license law C. Ensure minimal competency of real estate practitioners D. Passes all laws regarding Chapter 475 F.S. |
C. Ensure minimal competency of real estate practitioners |
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After the license of a real estate sales associate has expired in the initial issue, what is the grace period to reactivate the license? A. Six months B. Twelve months C. Twenty-four months D. There is no grace period |
D. There is no grace period |
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To decide if an item is a fixture or personal property, the court will consider all of the following issues except: A. Intent of the parties B. Method of attachment C. Value of the item D. Agreement of the parties |
C. Value of the item |
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All of the following are required for a Florida sales associate to obtain a Florida broker’s license except: A. Complete the required 72-hour pre-license course B. Complete the required sales associate’s post-license course C. Work for one broker for twenty-four months out of the past five years D. Pass the state exam with a minimum score of 75 |
C. Work for one broker for twenty-four months out of the past five years |
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Sales Associate Roger has placed his license with Dolphin Development, an unlicensed owner/developer. How long must Roger be employed by Dolphin Development before he can qualify to take the state examination for his broker’s license? A. 6 months B. 12 months C . 24 months D. Working for an owner/developer does not count towards the experience requirement |
D. Working for an owner/developer does not count towards the experience requirement |
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The following are exempt for the real estate license law except: A. A salaried employee of an on-site apartment complex B. An attorney when listing properties C. A salaried employees of a corporation when selling corporate properties D. Individuals who are appointed by the court |
B. An attorney when listing properties |
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Susan is a student in a local real estate class. Prior to the class, Susan sold a property owned by a friend and is expecting a 3% commission as soon as she receives her real estate license. Which of the following statements best describes Susan’s situation? A. This is perfectly legal because the commission will not be paid until after her license is issued B. This is illegal because the transaction began prior to her completing the real estate course C. This is perfectly legal because she had not been employed by a broker yet D. This is illegal because the transaction began prior to her obtaining a real estate license |
D. This is illegal because the transaction began prior to her obtaining a real estate license |
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What makes a fiduciary relationship? A. Trust B. Trust and obedience C. Trust, obedience, and care D. Trust and obedience with both reciprocated |
C. Trust, obedience, and care |
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David gives a new home to his mother in a life estate with the condition that title will return to him upon his mother’s death. David is said to have a: A. Remainder estate B. Sole estate C. Reversion estate D. Life estate |
C. Reversion estate |
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The right that government has to take real property from the private sector is known as: A. Police power B. Seizen power C. Eminent domain D. Both a and c |
C. Eminent domain |
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Alex recently purchased a unit in an office building in Sarasota. As part of the agreement, Alex was required to enter into a proprietary lease. What type of ownership has Alex purchased? A. A condominium B. An apartment C. A cooperative D. Congregant living |
C. A cooperative |
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The process in which land that abuts waterways increases in size over time is known as: A. Erosion B. Reliction C. Eruption D. Accretion |
D. Accretion |
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Bill has signed a contract to rent an apartment for one month beginning July1, 2009 and ending July 31, 2009. What type of agreement is this known as? A. Tenancy at sufferance B. Tenancy for years C. Tenancy at will D. Tenancy in common |
B. Tenancy for years |
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Alan purchased a condominium in Miami two years ago and recently contracted to sell it to Donna. How many days does Donna have to rescind the contract to purchase this condominium? A. 3 days after acceptance of the contract B. 15 days after acceptance of the contract C. 3-business days after receiving the condominium documents D. 15 days after receiving the condominium documents |
C. 3-business days after receiving the condominium documents |
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Real estate can best be defined as: A. Tangible assets such as land and buildings B. Intangible assets known as “a bundle of rights” C. Both a and b D. Neither a nor b |
A. Tangible assets such as land and buildings |
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Recording a deed in the public records achieves: A. Constructive notice B. Actual notice C. Legal notice D. Both a and c |
D. Both a and c |
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The type of title insurance that is non-transferable is known as: A. Mortgagor’s policy B. Lender’s policy C. Mortgagee’s policy D. All of the above |
A. Mortgagor’s policy |
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The requirements of a valid deed include all of the following except: A. Signature of the grantor B. Legal description C. Acknowledgement D. Two witnesses |
C. Acknowledgement |
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If Tampa Electric wishes to take private property for the purpose of creating power easements, this can be done through the process of: A. Taxation B. Escheat C. Eminent domain D. This can not be done |
C. Eminent domain |
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A house is listed at $75,000, but the principal seller tells the broker that he will accept $70,000. What is the best procedure for the broker? A. The broker cannot legally mention the $70,000 to a buyer B. The broker should encourage the buyer to offer just above $70,000 C. The broker should encourage the buyer to offer $70,000 D. The broker should encourage the buyer to offer $75,000 |
D. The broker should encourage the buyer to offer $75,000 |
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The legal description that requires a point of beginning is known as: A. Metes and bounds method B. Government survey method C. Lot and block method D. a and b only |
A. Metes and bounds method |
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A township contains: A. 36 square miles B. 24 square miles C. 6 square miles D. 1 square mile |
A. 36 square miles |
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Which section is directly north of section 8? A. Section 3 B. Section 4 C. Section 5 D. Section 6 |
C. Section 5 |
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How many acres are contained in the NW1/4 of the SW1/4 and the SE1/4 of the NE1/4 of Section 21? A. 2.5 Acres B. 20 Acres C. 40 Acres D. 80 Acres |
D. 80 Acres |
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Which of the following is a requirement for a broker’s office? A. Telephone B. Restroom C. At least one enclosed room D. All of the above |
C. At least one enclosed room |
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All of the following are required to be on the broker’s official sign except: A. The broker’s name B. The word Realtor, when appropriate C. “Licensed Real Estate Broker” D. The name of the business, when appropriate |
B. The word Realtor, when appropriate |
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How long is the registration period for a branch office? A. 6 months B. 1 year C. 2 years D. indefinitely |
C. 2 years |
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Cindy Smith, a sales associate for XYZ Real Estate, recently ran an advertisement in the local newspaper for a client that contained the following information: “Beautiful 3 bedroom home on a lake, call Cindy Smith at 555-1212 for information." This type of advertisement is known as: A. Concealment B. Blind advertisement C. False advertisement D. All of the above |
B. Blind advertisement |
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Sales Associate Keri accepts a $3,000 earnest money deposit from a buyer that was made out in her name. What action should Keri take? A. Deposit the check in her personal account and write a new check to her broker B. Endorse the check over to her broker C. Ask the buyer to write a new check to the broker D. Either b or c |
D. Either b or c |
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Broker Frank has an appointment to list the Miller’s home in Ft. Walton Beach. The policy that Frank has established for his office is to represent buyers and sellers as a transaction broker. When should Frank disclose this agency policy to the Millers? A. At first contact B. Prior to the home being shown by another agency C. Prior to showing the property or entering into a contract, whichever happens first D. Disclosures are not required for listing contracts |
C. Prior to showing the property or entering into a contract, whichever happens first |
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Broker Larry has an agency policy for his office that will allow sales associates to represent the seller as a single agent and, if necessary, work with both the buyer and seller in the same transaction as a transaction broker. Which of the following disclosure forms must be signed by Larry’s sellers? A. Single Agent Notice B. Consent to Transition to Transaction Broker C. Transaction Broker Notice D. All of the above |
B. Consent to Transition to Transaction Broker |
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Who should be given a “No Brokerage Relationship Notice”? A. Sellers who are working with an agent of another real estate company B. Buyers who are working with an agent of another real estate company C. Anyone who you believe will be representing themselves D. All of the above |
C. Anyone who you believe will be representing themselves |
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Broker Brad is representing Seller Beth as a single agent. Buyer Bob decided to employ Brad to represent him as a single agent in showing Beth’s home. Which of the following statements best describes this situation? A. Broker Brad cannot represent both Beth and Bob as a single agent in the same transaction B. Broker Brad can represent both Beth and Bob as a single agent provided that both parties are aware of the situation C. Broker Brad must first divest himself of undisclosed dual agency before proceeding with the negotiations D. Broker Brad must first transition to a dual agency before proceeding with the negotiations |
A. Broker Brad cannot represent both Beth and Bob as a single agent in the same transaction |
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Broker Dave was able to increase the value of several properties by bringing them under one ownership. The concept of this value increase is known as: A. Appreciation B. Assemblage C. Plottage D. Appurtenance |
C. Plottage |
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Whenever a real estate market has more buyers than there are sellers, prices of properties tend to: A. Increase B. Decrease C. Stay the same D. Fluctuate |
A. Increase |
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The type of development that will result in a property having the greatest value is known as: A. Market value B. Highest and best use C. Assemblage D. Appreciation |
B. Highest and best use |
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A broker is working with a seller trying to sell a home for $70,000, and the broker joins with two other prospective buyers offering $65,000. Which choice best applies? A. It is wrong because the broker has less that 50% interest in the property B. It is okay for the broker to do this C. It is wrong because the broker did not inform the seller that he was a possible buyer D. The broker should terminate the agency and disclose that he is associated with the parties making the offer |
D. The broker should terminate the agency and disclose that he is associated with the parties making the offer |
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What effect does leverage have on a real estate investor? A. Increases buying power and may increase or decreases yield B. Increases buying power and increases yield C. Decreases buying power and decreases yield D. Decreases buying power and increases yield |
A. Increases buying power and may increase or decreases yield |
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Which of the following conditions is assumed in a real estate sale? A. Trust and obedience B. Arm’s-length transaction C. Listing price is negotiable D. Closing will take place within 30 days |
B. Arm’s-length transaction |
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Sales Associate Pam has been asked to appraise a home in her neighborhood. Is it permissible for Pam to perform the appraisal? A. No, because she is not a broker B. Yes, provided she does not charge a fee C. Yes, provided she does not misrepresent her credentials or abilities D. No, unless she is a licensed appraiser |
D. No, unless she is a licensed appraiser |
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Market value assumes which of the following about the buyer and seller? A. An informed buyer and an informed seller B. An informed buyer and an uninformed seller C. An uninformed buyer and an informed seller D. An uninformed buyer and an uninformed seller |
A. An informed buyer and an informed seller |
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Reconciliation is the property valuation process of: A. Correcting mistakes made in one or more of the three approaches so that the final value estimate is correct B. Averaging the values arrived at through the three approaches to determine the most likely sales price of a property C. Applying judgment and weighing the value arrived at by the approaches used to arrive at one final value estimate D. Using the results of a state certified appraisal to justify making a loan in connection with a federally related transaction |
C. Applying judgment and weighing the value arrived at by the approaches used to arrive at one final value estimate |
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In the comparable sales approach to appraising, value is estimated by: A. Using an appropriate capitalization rate to determine reproduction cost B. Using an appropriate capitalization rate to determine replacement cost C. Comparing comparable properties to each other but not to the subject property D. Comparing the subject property to other similar properties that have sold recently |
D. Comparing the subject property to other similar properties that have sold recently |
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Which of the following types of depreciation is entirely outside the boundary of the subject property? A. External obsolescence only B. Functional obsolescence only C. Both external and functional obsolescence D. Neither external nor functional obsolescence |
A. External obsolescence only |
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All of the following are considered operating expenses except: A. Real estate taxes B. Property management fees C. Mortgage payment D. Reserves for replacement |
C. Mortgage payment |
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The formula to calculate the Gross Rent Multiplier for a property is to: A. Divide the monthly gross rent by the sales price B. Divide the sales price by the monthly gross rent C. Multiply the sales price by the monthly gross rent D. Multiply the monthly gross rent by a capitalization rate |
B. Divide the sales price by the monthly gross rent |
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The concept that an informed buyer will pay no more for a property than the cost of acquiring an equally desirable substitute property is known as: A. The principle of anticipation B. The principle of conformity C. The principle of substitution D. The principle of replacement |
C. The principle of substitution |
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When applying the income capitalization approach to value, if the net income stays constant but the capitalization rate increases, what happens to the value? A. Decreases B. Increases C. Remains the same D. One is not related to the other |
A. Decreases |
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When buying real estate, all of the following are considered advantages except: A. Tax advantages B. Illiquidity C. Good rate of return D. Leverage |
B. Illiquidity |
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Which of the following approaches to value is unique to business brokerage? A. Income capitalization B. Cost depreciation C. Comparable sales D. Liquidation value |
D. Liquidation value |
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The risk in which actual operating expenses may be higher than expected and income earned may be lower than projected is known as: A. Financial risk B. Cash flow risk C. Business risk D. Expense risk |
C. Business risk |
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An intangible asset of a business based upon the expectation of consumers or based upon the reputation of the business is known as: A. Goodwill B. Going concern C. Liquidation value D. Cash on cash |
A. Goodwill |
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The objective of most business appraisals is to estimate the value of a business as: A. A tax write-off B. A failed enterprise C. A collection of assets and liabilities D. A going concern |
D. A going concern |
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Each year the local property appraiser determines the value of real estate according to its fair and equitable value, known as: A. Market value B. Liquidation value C. Just value D. Assessed value |
C. Just value |
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A home is currently listed in which the previous owner was killed during a robbery. What disclosure does Florida statutes require for this situation? A. Florida statute does not require a real estate licensee to disclose this information B. Florida statute requires this information be disclosed prior to entering into a contract C. Florida Statute requires this information be disclosed prior to closing D. Florida Statute does not address this issue |
A. Florida statute does not require a real estate licensee to disclose this information |
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Franklin is court appointed to perform a real estate auction. What further authorization must he receive? A. Permission from FREC B. Authorization from the DRE C. Membership in the local board of REALTORS D. No further authorization is needed |
D. No further authorization is needed |
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Which of the following contracts are required to be in writing in order to be enforceable? I. Real Estate Sales and Purchase Contract II. Option Contract III. One-Year Lease IV. Exclusive Right to Sell Listing Contract A. I and II B. I and IV C. I, II, III, and IV D. I, II, and IV |
D. I, II, and IV |
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Florida law requires that a copy of a listing agreement be given to the seller within how many days of its execution? A. 24 hours B. Three days C. Three-business days D. Seven-business days |
A. 24 hours |
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Bob recently entered into a contract to purchase Steve’s home. One week prior to closing, Bob legally assigned the contract to Fred. One day prior to closing, Fred decides to withdraw from the transaction and defaults on the contract. What are Steve’s rights? A. Steve can sue either Bob or Fred for specific performance B. Steve can keep the deposit as liquidated damages C. Either a or b but not both D. Both a and b |
C. Either a or b but not both |
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Federal law requires that a lead-based paint disclosure be provide to potential buyer for properties that were constructed prior to: A. 1968 B. 1978 C. 1981 D. 1987 |
B. 1978 |
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Broker Frank shows Barbara a home for sale on Monday. The next day Broker Sam shows Barbara the same house at which point a written offer is made that is accepted by the seller. When Frank learns of the contract, he demands that the commission be paid to him because he was the first to show the home to Barbara. Which of the following statements is most accurate in this situation? A. Frank is legally entitled to the full commission because he was first to show the property B. Sam is legally entitled to the full commission because he is considered to be the procuring cause C. Florida law requires the brokers to equally divide to commission D. The seller is not required to pay either party a commission |
B. Sam is legally entitled to the full commission because he is considered to be the procuring cause |
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Seller Todd gives an open listing to only one broker. What type of listing does the broker have? A. An Exclusive Listing B. An Exclusive Right To Sell Listing C. An Open Listing D. A Net Listing |
C. An Open Listing |
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Which types of disclosures are supposed to be provided to buyers for homes built prior to 1978? A. Lead-Based Paint B. Radon Gas C. Energy Efficiency Rating D. All of the above |
D. All of the above |
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When a loan is sold to an investor the mortgage is transferred by: A. Novation B. Assumption C. Assignment D. Alienation |
C. Assignment |
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Jeff is a sales associate who wants to sell his home. His broker agrees that no commission will be paid to Jeff in exchange for a lower selling price. Which of the following statements about advertising is correct? A. The broker must pay for any advertising that uses the brokerage name B. The sales associate's name must appear in the advertisement C. The advertisement must contain the name of the brokerage firm, the advertisement must disclose that the owner holds a real estate license, and the broker must approve the ad before publication D. The advertisement must include the property’s address |
C. The advertisement must contain the name of the brokerage firm, the advertisement must disclose that the owner holds a real estate license, and the broker must approve the ad before publication |
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Bill purchased a home recently and was required to sign a legal acknowledgement of a debt. What type of document did Bill sign? A. Promissory note B. Mortgage C. Security Agreement D. Both b and c |
A. Promissory note |
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A provision in a mortgage which relieves the borrower of personal liability in the event of a deficiency judgment is called: A. Defeasance clause B. Exculpatory clause C. Subordination clause D. Redemption clause |
B. Exculpatory clause |
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Which of the following statements best describes a fully amortized, fixed-rate mortgage? |
Principal payments increase each month and interest payments decrease each month |
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Bill has entered into a sale and purchase agreement to sell his home to Becky. The closing has been set for next month. The classification of the contract is considered to be: |
Executory, since it has not closed |
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Mortgage bankers perform which of the following functions? |
Originate loans and sell them to investors |
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Which of the following statements best describes disintermediation? |
Depositors withdrawing funds from banks faster than funds are being acquired |
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Which of the following is typical of the activities of a mortgage broker? |
Taking applications from prospective borrowers, submitting the application to lenders, and handling the paperwork when the loan is approved |
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To determine the correct amount of property tax for each property, multiply the tax rate by the: |
Taxable value of the property |
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Special assistance to various housing subsidy programs, support of the secondary mortgage market through guarantees of mortgage backed securities, and managing and liquidating its portfolio of conventional and government underwritten mortgages are the functions of the: |
Government National Mortgage Association |
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FNMA buys and sells which of the following types of mortgages? |
VA, FHA, and conventional mortgages |
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The Real Estate Settlement and Procedures Act requires: I. lenders to provide prospective borrowers a good faith estimate of closing costs II. lenders to provide prospective borrowers with a booklet containing information on obtaining financing III. all closing costs to be reported on HUD Form 1 even when no financing is obtained in connection with the purchase |
I and II only |
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All of the following items are considered a pro-ration between the buyer and the seller except: |
Attorney’s fees |
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Which of the following closing expenses is typically a debit to the buyer? |
Recording of new mortgage |
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Which of the following statements applies to local planning commissions? I. Planning commission members act in advisory role II. Planning commission members are elected III. Planning commissions has responsibility insubdivision plat approval |
I and III only |
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A large property site which incorporates residential use along with multifamily, commercial, and common area use is known as a: |
Planned unit development |
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All of the following are protected classes according to the Fair Housing Act of 1968 except: |
Age |
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The Florida Uniform Land Sales Practice Act applies to certain subdivisions that require the delivery of a public offering statement and contain: |
50 or more lots |
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Angela was recently awarded a judgment that consists of $12,000 in compensatory damage and $20,000 in punitive damage because of a fraudulent real estate transaction. If Angela applies to the Real Estate Recovery fund for payment of the judgment, which of the following statements is(are) true? |
Both a and b |
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The following are considered to be misdemeanors of the 2nd degree except: |
Violation of rental list rules |
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What step occurs after the probable cause panel has concluded that probable cause does exist in a complaint? |
An Administrative Complaint is filed |
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Broker Andy was found guilty of defrauding a client out of $18,000. Since Andy had no personal assets to pay for the judgment, the plaintiff was able to recover the judgment from the Recovery Fund. What will happen to Broker Andy’s license? |
Suspended until the money is repaid |
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Broker Roy has taken a listing on a property for $295,000. The seller has agreed to pay Roy 6% for the first $250,000, 7% for the next $25,000, and 8% for the balance of the purchase price. If Roy is able to sell the property for $287,000, how much will he receive in commissions? |
$17,710 |
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Adam has purchased a new home for $350,000, and Beach Bank agreed to provide him a 90% loan in order to make the purchase. As part of the loan agreement, Beach Bank is charging Adam 1 ½ points to close the loan. How much will Adam pay for the points? |
$4,725.00 |
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How is $1,250 in property taxes pro-rated when the day of closing is July 15th and belongs to the buyer? |
$667.81 credit to buyer, $667.81 debit to seller |
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The city is going to pave your street at a cost of $100 per running foot and has agreed to pay 65% of the cost. Your property measures 130’x150’. What is the amount of the special assessment that you will pay for your property? |
$2,275 |
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A home costs $325,000, and the buyer’s down payment is $48,750. What is the loan-to-value ratio? |
85% |
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If the tax millage rate is 25 mills and the annual tax levy is $1975, how much is the taxable value of the property? |
$79,000 |
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The monthly net income for a property is $1,800, and the overall capitalization rate is 11%. What is the value of the property? |
$196,364 |
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A property is 400’x 526’ and costs $180,000. What is the cost per front foot? |
$450 |
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A home sells for $345,500. The buyer is able to obtain a new mortgage loan from Beach Bank for 90% of the purchase price. What are the state taxes that are due on this transaction? |
$4,128.90 |
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What is the interest rate on a $70,000 loan if the quarterly interest is $1,925? |
11% |
