FL RE study notes Flashcards
(146 cards)
1
Q
What is the composition of FREC’s 7 member board?
A
Four members must be licensed real estate brokers who have had an active license for the previous five years preceding appointments.
One member may be either a licensed broker or sales associate who has had an active license for at least two years preceding appointment.
Two members must never have held a real estate license. These members consider real estate issues from a consumer’s perspective.
At least one member must be 60 years old or older.
2
Q
Who appoints the FREC board?
A
FL governor
3
Q
What are the 8 compensated services for which one must have a RE license?
A
These services are appraise, auction, sell, exchange, buy, rent, lease, or advertise to perform a real estate service.
4
Q
When is it illegal for a licensee to give away part of their commission?
A
When it is not disclosed to all parties in the transaction - including the buyer, seller and lender.
5
Q
What type of felony is it for an unlicensed person to perform real estate services for others for compensation?
A
Third degree felony
6
Q
What is the punishment for an unlicensed person to perform real estate services for others for compensation?
A
Up to 5 years imprisonment
7
Q
Can you give candy or a meal to an unlicensed referral who are not buyers or sellers?
A
No, it’s illegal
8
Q
How many answers must be correct on a RE sales associate exam?
A
70 out of 100
9
Q
Who is exempt from the RE sales associate pre license course?
A
Members of The Florida Bar and graduates holding a four-year degree in real estate
10
Q
What must a broker candidate do as a sales associate before applying for exam?
A
Held a license under one or more brokers in any state or foreign jurisdiction for 24 months in the preceding five years (working under an owner-developer does not count unless the employer also holds a broker license); OR
working as a salaried employee of a governmental agency performing the duties authorized for real estate sales associates.
11
Q
How many answers must be correct for a broker pre license test?
A
The applicant must complete the broker prelicense course (FREC Course 2) by correctly answering at least 70 out of 100 multiple choice questions on the end-of-course exam.
12
Q
What is the time for re-taking the test if you fail the test?
A
Prelicense and post-license students who fail the end-of-course exam may take a different exam within one year without having to retake the entire course, but they must wait at least 30 days after failing the exam. A student who wants to avoid the 30-day wait can take another course and the exam for that course.
13
Q
If you move how long do you have to notify FREC?
A
6 days
14
Q
What 8 states have mutual recognition?
A
Alabama, Arkansas, Connecticut, Georgia, Indiana, Mississippi, Nebraska, and Oklahoma
15
Q
What is reciprocity?
A
Reciprocity allows a licensee in one state to work in another state with a reciprocity agreement by making an application and verifying that they have a valid license in their home state.
16
Q
How long do mutual recognition agreements last?
A
Five years unless renewed.
17
Q
Under what circumstances can a realtor licensed in another state practice in FL? For how long?
A
The spouse of an active duty servicemember assigned to duty in Florida may apply for and receive a six-month temporary license in Florida if the spouse is licensed in another state. The temporary license is not renewable.
18
Q
How long does an active duty armed forces member have to renew their license?
A
Any person licensed by the DBPR who is a member of the armed services on active duty is exempt from renewal requirements as long as that person is a member of the armed services and for a period of six months after discharge from active duty, provided the service member is not engaged in the profession for profit.
19
Q
When can a new sales licensee begin working?
A
Once they have been issued a license number by the DRE and the DBPR database site shows that the license is in active status under the brokerage entity.
20
Q
When can a broker begin working?
A
When the license number has been issued
21
Q
When must your FIRST RE license be renewed?
A
It must be renewed between 18 and 24 months after the license becomes effective because there are only two renewal dates each year: March 31 and September 30.
22
Q
What must one do prior to the first renewal of a sales associate license?
A
One must successfully complete a 45-hour sales associate post-licensing course or her license will become void.
23
Q
What is the 45 hour course is not taken?
A
You must START OVER - take the PRE-LICENSING course again and pass the state exam.
24
Q
What must one do prior to the first renewal of a broker’s license?
A
He must complete a 60-hour broker post-licensing course and renew before March 31, 2015, a little more than 19 months later. If he fails to do so, his license becomes void.
25
If a broker fails to renew in time, what can he do to maintain the license?
Take a 14-hour continuing education course and apply for sales associate status. If he wishes to become a broker again, he’d have to successfully complete the broker prelicensing course and pass the state exam
26
Is a 4 yr RE degree broker subject to the same POST licensing guidelines? Florida Bar members?
No, someone with a 4 yr RE degree is not subject to the post licensing requirements for Sales Associates or Brokers, but Fl Bar members MUST follow the same guidelines.
27
After the first renewal what is required?
Every two years a 14 hours of continuing education classes must be taken - online with a test or in person without testing.
28
What must the courses consist of?
3 hours of core law + 11 hours of specialty
29
What are FL Bar members exempt from ?
Pre-licensing course I and continuing education
30
What are 4 year licensees exempt from?
All preilicensing and post-licensing courses. They MUST take licensing exams and continuing education.
31
Do FREC meetings count?
Yes, as three hours of specialty credit
32
How many days prior to expiration does DBPR send out notifications?
90 days
33
What must a broker do when changing address?
Notify DRE through DBPR within 10 days along with names of licensees no longer associated with the firm preferably online for fastest results.
34
If a sales associate changes personal address, what is required?
Notify DRE within 10 days.
35
What is the fine for not updating your address?
Up to $500
36
Will the license be renewed by DBPR without the required education?
No.
37
How long is the pre-licensing course for a sales associate? Who is exempt? What else is required before 1st renewal?
63 hours; FL Bar members & those with a 4 yr RE degree; 45 hr post-licensure course and end of year exam; only those w 4 yr degree are exempt from post licensure course & exam
38
How long is the pre-licensing course for a broker? Who is exempt? What else is required before 1st renewal?
72 hours; Those with a 4 yr RE degree; 60 hr post-licensure course and end of year exam; only those w 4 yr degree are exempt from post licensure course & exam
39
What is the difference between continuing education for brokers and sales associates? Who is exempt?
No difference; only FL Bar members are exempt from CE
40
Can inactive licensees practice?
Only if they have maintained their education & renewal requirements and are paid to date. They must fill out an online form or mail to reactivate.
41
What is INVOLUNTARY INACTIVE?
When a license has expired without renewal and education required.
42
Once a license has become involuntary inactive, how can it become active again?
Within the first 12 months of the renewal date, one must take the 14 hours of CE, apply for renewal and pay the late fee. Between 12-24 months, one must successfully complete a 28 hour "reactivation" course and pay the required late fee.
43
To sell RE in FL, who must be licensed? Who must be registered?
Individuals who sell RE must be licensed; business entities must be registered.
44
Under what entity can a sales or broker associate be registered?
A professional corporation, an LLC, or professional LLC. They cannot have any ownership or membership in the brokerage company.
45
Can an associate own stock in a brokerage?
Yes, but IF they've been convicted of a felony w civil rights revoked for 5 years, had their licensed suspended or revoked & it is not reinstated yet or has an injection to stop practicing RE, they are then limited to 40%.
46
Under what condition may an associate receive commission from a closing agent?
Only if the broker gives written direction to do so with each closing. Otherwise they must be paid by the brokerage.
47
Under what conditions can a broker or sales associate give an appraisal without being licensed?
They must follow USPAP guidelines and it can not be a federally funded loan program.
48
What is a blind ad?
One that does not include the name of the firm/ brokerage.
49
What is required of internet ads for RE?
The firm's name MUST be directly adjacent to ANY contact information.
50
When must a sales associate deliver an escrow check to the broker? When must a broker deposit it?
Sales associate must deliver it by the end of the next business day; the broker has until the end of third day of business.
51
Within how many days must a broker notify FREC of conflicting escrow demands?
Within 15 days of last demand.
52
When must a broker initiate a settlement procedure?
Within 30 days of last conflicting demand
53
What is an EDO and how is it used?
For a conflicting escrow demand, an Escrow Disbursement Order is an order given by FREC for escrow of less than $50,000 when there is conflicting demands to determine who should be awarded the escrow.
54
Define interpleader and declaratory decree
If a broker claims no part of the deposit, the court action would be called an interpleader. If the broker were claiming part of the escrow deposit, the broker would ask the court for a declaratory judgment. [475.25(1)(d)1]
55
What is the cooling off period for the purchase of a condo?
15 days for a new condo, 30 days for used.
56
What must be done with security deposits upon conclusion of lease?
Must be returned within 15 days or a written notice must be issued within 30 days stating the claim
57
How often must an escrow reconciliation be done? What must be included?
At least monthly. The minimum information required in the monthly reconciliation includes the following:
Reconciliation date
Bank name
Bank account name
Bank account number
Account balance
Dates and numbers of outstanding checks
An itemized list of the broker's trust liability (names of parties and the amounts owed to each)
Other items necessary to reconcile the account
Broker's checkbook balance
Other records showing the date of receipt and source of the funds
58
What records must be retained and for how long?
A broker must retain all escrow account records for at least five years from the date of receipt of any funds. The five-year requirement also applies to any listing agreement, offer to purchase, rental property management agreement, rental or lease agreement, or any other written or verbal agreement that engages the services of the broker. And two years AFTER any civil litigation.
59
When are brokerage audits performed? What is checked?
Every 5 years; The investigator checks for compliance in the following areas:
Office requirements. There must be at least one enclosed room in a stationary building.
Office entrance sign. The sign must be easily observed and read by anyone entering the office. The sign must have the name of the broker, a partnership or corporate name or trade name, if any, and the words "Licensed (or "Lic.") Real Estate Broker."
Brokerage relationship disclosures. Brokers must retain required disclosures on contracts for sale and purchase of residential properties for at least five years.
Licenses. Licenses and registration of the firm and all its members are verified to ensure that all persons involved in providing real estate services have current licenses.
Escrow accounts. The investigator reviews monthly reconciliation statements for several months as well as bank deposit receipts, pending sales contracts, and property management contracts.
60
At what point does FREC stop contributing to the recovery fund and reduce RE renewal fees?
When the fund has reached $1M
61
What is the max damages the recovery fund will pay for punitive damages? Compensatory damages?
Nothing for punitive. Up to $50,000 per claim with a max of $150,000 per licensee
62
What are treble damages?
reble damages are triple the actual damages suffered, which are often awarded by the court for things like violations of the antitrust statutes.
63
If payment is made from the recovery fund, what happens to the licensee for whom the claim was made?
Upon payment from the fund in settlement of a claim against a licensee, the license of the broker or sales associate is automatically suspended the same day. A hearing is not necessary. The license shall not be reinstated until the licensee has repaid in full, plus interest, the amount paid from the fund.
64
What are Department of Real Estate's Three Responses to License Law Violations
1. notification of noncompliance
2. citation
3. administrative complaint.
65
What are a first time offenders details?
Allow 15 days for compliance.
A minor violation is defined by the FREC as one that does not endanger the health, safety, or welfare of the public. This should be considered a warning, and the licensee who receives the notice should take corrective action within the required time limit or face more serious penalties
66
List citation details.
Citations usually require that a licensee either pay a fine from $100 to $1,000 within 30 days or dispute the charge and begin the formal hearing process.
All fines are payable to the "Department of Business and Professional Regulation—R.E. Citations" and are sent to the Division of Real Estate. A copy of the citation should accompany the payment. If not disputed within 30 days, the citation becomes a final order of the Commission.
67
What are the possible fines for violating license law?
The FREC has established a range of disciplinary guidelines from which penalties will be imposed on licensees guilty of violating Chapters 455 or 475, F.S. The maximum fine for an administrative complaint (formerly $1,000) has been increased to $5,000. The purpose of the guidelines is to give notice to the licensees of the range of penalties that will normally be imposed for each count during a formal or informal hearing. They may ALSO place a license on PROBATION.
68
List cure for offense: Broker fails to maintain office or a sign at the office.
$500 fine first time, $1000 next
69
List cure for offense: Failure to register a branch office
$500 fine first time, $1000 next
70
List cure for offense: fraud / negligence
$1000-2500 fine plus 30 day suspension or revocation; second time: $2500-5000 fine plus 60 day suspension or revocation
71
False advertising; failure to deliver escrowed property; guilty of RE crime or crime involving dishonest or fraud; shared commission with unlicensed other; obtained license by fraud
$250-500 fine plus 30-90 day suspension; second time: $1000-5000 fine plus suspension or revocation
72
How much notice must be given to introduce evidence of mitigating circumstances?
7 days notice
73
Cite changes to Condo Act
Recent changes to Chapter 718, F.S. include the following:
The requirement that individual unit owners carry hazard insurance was repealed.
Investors who purchase blocks of distressed condos are not considered "developers," nor do they take on developers' responsibilities or liabilities.
Condo associations may now decide whether to retrofit a building with sprinkler systems.
The requirement of mandatory retrofits of sprinkler systems in condos over 75 feet high was repealed.
Lenders are required to pay more in past-due assessments on foreclosed properties.
Associations may deny owners or occupants the use of common areas and recreational amenities when the owner is more than 90 days delinquent in paying financial obligations due to the association.
Associations may divert rent paid by a tenant and use it to pay delinquent assessments owed by that unit's owner.
A mandate that any amendment to the condominium association's bylaws that restricts a unit owner's rights relating to the rental of units applies only to those unit owners who consent to the amendment, and unit owners who purchase their units after the effective date of that amendment. This was a response to court decisions allowing associations to restrict rentals by majority vote.
74
What is the recession period for a condo?
15 days for new, 3 days for used from when the buyer is given the condo docs or buyer signs the contract, whichever is later
75
What docs should you procure from a condo seller?
the dates of recent capital improvements,
a list of planned capital improvements and the estimated costs of each, and
a breakdown of how existing and future reserves are allocated.
76
What must be disclosed to timeshare buyers?
There is no guarantee that the time-share can be sold at a particular price or within any particular time. Other disclosures are required, including the amount of fees, the term of agreement, promotional efforts if any advance fee is to be paid, and a description of the service to be provided by the broker.
77
What are the disclosures required when selling a resale time-share period?
Licensees must disclose in the purchase contract the current year's assessment and the fact that it may be increased from time to time.
If ad valorem real property taxes are not included in the current year's assessment for common expenses, the licensee must include the amount of taxes, as well as information that failure to pay the taxes may result in loss of the ownership rights.
78
What is the recession period for new timeshares?
10 days with no penalty
79
What is penalty for not having appropriate licensing while selling timeshares?
FREC recommends revocations
80
What is the Florida Time-share Resale Accountability Act?
Effective July 1, 2012, the Florida Time-share Resale Accountability Act, makes it illegal for resale advertisers to charge an upfront fee greater than $75 within a 12-month period without a signed agreement. The agreement will give the customer 10 days to cancel the agreement with no questions asked. The resale company must refund the money within 5 days if the customer paid electronically, and 10 days if the customer paid by check. Penalties for violation of the new law include fines up to $15,000 per occurrence.
81
When does a subdivision have to be registered?
When it has 100 lots or more.
82
What report is required by The Interstate Land Sales Full Disclosure Act ?
The Interstate Land Sales Full Disclosure Act requires developers of 25 or more lots to disclose all relevant information in a property report and register subdivisions with 100 or more lots. The property report makes full and fair disclosure of what will be in the property at completion. Purchasers who receive a property report may receive a refund within seven days of the date of purchase. Purchasers who did not receive a property report are entitled to a refund for up to two years. The Act is administered by the new Consumer Financial Protection Bureau.
83
When must condo developments of 100 units or more be completed? What are the penalties?
Within 2 years. Buyers have the right to sue for specific performance and the right to sue for damages. A simple return of the buyers' deposit, in many cases, is not sufficient. Harsh penalties may also be invoked.
84
What is the Homeowners' Association Disclosure?
It states that the property owner must be a member of the community association;
That recorded covenants govern the use and occupancy of the property
That the property owner is obligated to pay an assessment to the association, and the failure to pay the assessment could result in a lien being placed on the property
Any land-use or recreation fees and the amounts of the obligations
Any contract or agreement for sale must refer to and incorporate the disclosure summary and shall include, in prominent language, a statement that the potential buyer should not sign the contract or agreement before having received and read the disclosure summary required by this section.
85
What is required to obtain a community association manager's license?
An individual must apply to DBPR's Division of Florida Condominiums, Timeshares, and Mobile Homes, pay appropriate fees, be of good moral character, successfully pass a prelicensing course that does not exceed 24 classroom hours, and pass a state examination. A community association manager may not perform real estate services outside the scope of association management unless that person has a real estate license.
86
What is the fine for a violation of the CAN- SPAM Act?
Up to $11,000
87
Under what condition can you send an unsolicited fax?
"established business relationship," or EBR.
If the sender had an EBR with the recipient and possessed the recipient's fax number before July 9, 2005 (the date the Junk Fax Prevention Act became law), the sender may send the fax advertisements without demonstrating how the number was obtained.
88
How does Amendment 1 to the Florida Constitution provide tax relief in four different areas?
1. Increased homestead exemption
2. Portability of the "Save Our Homes" benefit
3. $25,000 exemption for tangible personal property
4. Ten percent annual assessment limitation for non-homestead property
89
When using "Transfer of Homestead Assessment Difference" how do you figure the benefit on a house that costs less than the exemption?
Divide the SOH dollar value by the just value of the old home to get the percentage of the benefit. Adjust the price of the new house by this percentage.
90
What is the exemption to businesses for tangible personal property?
It is $25,000.
Business owners must file their tangible personal property report with the property appraiser by April 1. If the value of the personal property is less than $25,000, the owner will not have to file a return the following year. If the value of personal property is, for example, $60,000, the owner would pay taxes on the assessed value of $35,000 ($60,000 – $25,000). A proposed constitutional amendment to the Florida Constitution, if approved by 60% of the voters, would increase the exemption to $50,000.
91
What is the max for tax increase on a non-homestead property?
No more than 10% of just value
92
What is the increase in assessment value allowed on a homesteaded property?
3% per year max
93
How are long term capital gains taxed?
0% for taxpayers who are in the 10% to 15% tax brackets
15% for taxpayers in the 25%, 28%, 33%, or 35% tax brackets
20% for taxpayers in the 39.6% tax bracket. This includes single filers earning more than $400,000, and married couples filing jointly making more than $450,000.
94
What changes are in capital gains for 2013?
Beginning in 2013, capital gains income is subject to an additional 3.8% Medicare tax for single filers making more than $200,000, or married couples filing jointly who make more than $250,000.
95
How is depreciation captured upon resale of an investment property?
When investment property is sold, any depreciation taken during the holding period is “recaptured” and is taxed at 25%.
96
What are the exclusions of gain from the sale of a personal residence?
An individual filer may exclude up to $250,000 of the gain on the sale of a principal residence.
Joint filers are entitled to a $500,000 exclusion. The home must be owned and used as a personal residence for a period of two of the past five years to qualify; the two years do not need to be consecutive. There is no limit on the number of times homeowners may use this exclusion.
97
When must a buyer withhold payment to a seller?
IF the seller is a foreigner, 10% of the sales price must be withheld for taxes.
98
From 2007 - 2013 what income is NOT taxable?
Any mortgage debt forgiven up to $2M per year on a personal residence.
99
When must cash payments be reported?
When it is over $10,000 in CASH for one transaction or two related transactions
100
Are sales associates allowed to deduct home office expenses?
No. An office must provided by their broker, so a home office deduction is not allowable.
101
How much of a home office deduction can a broker take?
Up to $24,000 if it is the primary place of business. To qualify, the home office must be an area used exclusively for business activity, and it must be the principal location used to conduct business or to meet with customers. If the broker uses this location to meet with customers, it should be registered with the DBPR as the main office or a branch office. A broker must comply with local zoning regulations.
102
What are the three major requirements to qualify for independent contractor status for a sales associate?
1. The sales associate must hold a real estate license.
2. The sales associate's gross income must be based on production rather than on the number of hours worked.
3. The sales associate's work must be done based on a written contract that states, among other things, that the sales associate will not be considered an employee for federal tax purposes.
103
What must be done to claim "innocent landowner defense"?
The landowner must have, on or before the date of acquisition:
carried out all appropriate inquiries into the previous ownership and uses of the property consistent with good commercial and customary standards and practices;
taken reasonable steps to stop any continuing release;
prevented any threatened future release; and
prevented or limited any human, environmental, or natural resource exposure to any previously released hazardous substance.
A Phase I Environmental Site Assessment (ESA) is one requirement to qualify for the innocent landowner defense to CERCLA.
104
What types of environmental audits can be done to avoid liability for a hazardous land condition?
The audit is broken into the following phases to minimize costs:
Phase I is a basic assessment.
Phase II follows to investigate specific problems found in Phase I.
Phase III is the actual cleanup.
Phase IV is a Land Disposal Restriction (LDR) rule that prohibits the land disposal of hazardous wastes unless the waste meets specific treatment standards.
105
What comprises a Phase 1 ESA?
A Phase I ESA is the evaluation of real property to learn if "recognized environmental conditions" (hazardous substances) exist. Among other things, the evaluation consists of the following:
A review of governmental records regarding environmental conditions on the property and adjacent properties
Site reconnaissance of the property
Interviews with the owners, occupants, and local governmental officials
Reporting on findings and presentation of conclusions, including documented history of the site dating back to 1940, or until the land was undeveloped
If the Phase I assessment shows actual or potential environmental problems, further investigation to determine the extent of the problem will be required in the form of a Phase II assessment.
If the Phase II assessment shows contamination, Phase III describes cleaning up the contamination.
106
What levels of radon does the Environmental Protection Agency (EPA) recommend intervention?
If testing shows radon levels at four picocuries per liter of air. That is 10x that of outdoor air.
107
How has Burden of Proof shifted?
:Formerly, a developer had to prove that a project would not damage the environment or the quality of life of a community. In a major change, the burden of proof is now on the complaining party to prove that the development will be harmful.
108
What are Coastal Construction Control Lines (CCCLs) ?
The lines define the portions of the beach-dune systems that are subject to severe fluctuations based on a 100-year storm surge, storm waves, or other predictable weather conditions that may have additional restrictions that will affect land use.
109
Can an unlicensed worker do work on property?
As long as it is under $1000 in total billing, Nor can any work be done that requires a contractor's license or building permit.
110
Can a RE licensee contract for work on a property without a license?
If the amount is $5,000 or less, however, the licensee is exempt from the contractor's license requirement.
111
What is there are building code violations on the property?
Sellers who have been cited for building code violations, or who have citations pending, must disclose the facts in writing to buyers prior to closing a sale. The disclosure must:
state the existence and nature of the violations and proceedings;
provide a copy of the pleadings, notices, and other materials received by the seller; and
state the buyer's agreement to be liable for correcting the code violation.
Within five days after transfer of the property, the seller must provide the code enforcement agency with the name and address of the new owner, and provide copies of the disclosure notices given to the buyer.
A seller who violates this provision is guilty of fraud.
112
What are the legal responsibilities of ALL licensees, regardless of relationship?
All licensees have the legal duties of
fair and honest dealing with customers;
disclosure of known facts that materially affect the value of residential property and that are not readily observable to the buyer; and
accounting for all funds.
113
Define residential sales.
The sales of improved OR unimproved residential property of 4 units or less
and
agricultural property of 10 acres or less.
114
What is a transaction broker responsible for?
A transaction broker provides limited representation to a buyer, a seller, or both in a real estate transaction, but does not represent either in a fiduciary capacity. The licensee is not an advocate for either party. The licensee must treat the parties fairly and not work for one party to the detriment of the other. The customer is not the broker's principal and is not responsible for the acts of the licensee.
115
What do the duties of a transaction broker include ?
The duties include the following:
Dealing honestly and fairly
Accounting for all funds
Using skill, care, and diligence in the transaction
Disclosing all known facts that materially affect the value of residential real property and are not readily observable to the buyer
Presenting all offers and counteroffers in a timely manner, unless a party has previously directed the licensees otherwise in writing
Limited confidentiality, unless waived in writing by a party. The transaction broker may not reveal to either party the following information:
That the seller might accept a price less than the asking or list price
That the buyer might pay a price greater than the price submitted in a written offer
The motivation of any party for selling or buying property
That a seller or buyer will agree to financing terms other than those offered
Any other information requested by a party to remain confidential
Any additional duties that are entered into by this or by a separate agreement
116
When is a buyer considered a principal?
When a single agency creates a fiduciary relationship, only single agents may call their customers principal.
117
What are Single-Agent Duties?
The 9 specific duties to a buyer or seller:
1. Dealing honestly and fairly
2. Loyalty
3. Confidentiality
4. Obedience
5. Full disclosure
6. Accounting for all funds
7. Skill, care, and diligence in the transaction
8. Presenting all offers and counteroffers in a timely manner, unless a party has previously directed the licensee otherwise in writing
9. Disclosing all known facts that materially affect the value of residential real property and are not readily observable
118
How does a Single Agent differ from a Transaction Broker?
Obedience
Full disclosure
Confidentiality
Loyalty
119
Which requires a written notice to serve: Transaction Broker? Single Agent?
Only Single agent. Transaction Broker is assumed in FL.
120
What are the requirements for Designated Sales Associate?
This status may be used only in a nonresidential transaction. In this status, each designated sales associate is an advocate for the party he or she represents in the transaction, and each can actively help in the negotiations. To meet the requirements of the law, buyers and sellers must each have personal assets of at least $1 million, must sign disclosures that each person's assets meet the requirement, and must request this representation status. The licensees must give the parties the Designated Sales Associate Notice and a Single-Agent Notice.
121
Is a seller's Property Disclosure required?
No it is not a legal requirement.
122
What are the qualifications of FL Home Inspectors?
The law requires inspectors to have a high school diploma, be of good character, complete a 120-hour prelicense course, and pass the National Home Inspector Exam.
Licenses are effective for two years, and licensees must take 14 hours of continuing education before renewing.
123
What are prohibited actions discriminating against a protected class?
Steering by using language in real estate ads or in showing properties in such a way that homebuyers are either encouraged or discouraged from certain neighborhoods based on the racial or ethnic character of the neighborhood
Blockbusting a neighborhood by attempting to frighten a homeowner into selling by spreading information that persons who have different racial or ethnic characteristics are moving into the neighborhood
Redlining by lenders who have different conditions and terms for loans made in certain areas
Refusing to rent to, sell to, or negotiate with a party
Quoting different terms or conditions for buying or renting
Making a false statement about the availability of housing
Denying membership in any real estate service
Making discriminatory statements about the availability of housing
Steering
124
What "Adult Only" designations are permissible?
"Adults only" designations are prohibited by the familial status provision, with one exception: communities with the status of "housing for older persons." Requirements for such a community are as follows (either number 1 or number 2, not both):
1. The housing must be specifically designed and operated to assist elderly persons and is intended for, and solely occupied by, persons 62 years of age or older, or
2. The housing is intended and operated for occupancy by persons 55 years of age or older who meet the following requirements:
At least 80% of the occupied units are occupied by at least one person 55 years of age or older.
The facility or community publishes and adheres to policies and procedures that demonstrate its intent to in fact be a provider of housing for older persons.
The facility or community complies with rules established by HUD for verification of occupancy.
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How is a disability defined by the ADA?
A disability is defined by the ADA as a physical or mental impairment that substantially limits a major life activity, such as walking, seeing, hearing, learning, breathing, caring for oneself, or working.
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According to ADA, how many accessible parking spaces should be included?
One accessible space for every 25 total regular parking spaces - 8' wide for car or van, 5 ft aisle for car, 8 ft aisle for van
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According to ADA, what are ramp dimensions?
For every inch of height, ramps should have at least one foot of length (1:12) and have a railing at least 34 inches high. There must be a five-foot-long level landing at every 30-foot horizontal length of ramp, at the top and bottom of the ramp, and at switchbacks.
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In Response to Florida's Mortgage Fraud, what penalties were added? What are the max fines?
1. Attempting to manipulate or influence an appraiser's evaluation of a property.
2. Being convicted of, or entering a plea of guilty or nolo contendere to, regardless of adjudication, any felony.
3. Having a loan originator, mortgage broker, or mortgage lender license, or the equivalent of such license, revoked in any jurisdiction.
4. Engaging in unfair, deceptive, or misleading advertising.
Maximum fines for violations of Chapter 494 have been increased to $25,000 for each count or separate offense. Persons who are guilty of unlicensed activity may be fined up to $1,000 per day to a maximum $25,000. The Office of Financial Regulation must report disciplinary actions to the NMLS.
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As of April 1, 2009, what must be added to an appraisal report?
It must include the Market Conditions Addendum to the Appraisal Report
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What must be included with an FHA Appraisal ?
FHA appraisers must now provide
The Market Conditions Addendum (Fannie Form 1004MC/Freddie Form 71)
At least two comparable sales that occurred within 90 days of appraisal date
A minimum of two active listings or pending sales in addition to the three closed comparables
Bracketed listings using both dwelling size and sales price when possible
Adjusted active listings to reflect the list-to-sales price ratio
Adjusted pending sales to reflect contract sales price when possible
The original list price and any revised list prices
Reconciliation of adjusted values of active or pending sales with adjusted values of closed comparable sales
Absorption rate analysis
Known or reported sales concessions on active and pending sales
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What are the six principal areas of the RESPA as amended in 2010?
1. Good-Faith Estimate (GFE) within 3 days
2. Settlement Cost Booklet
3. Selection of the Closing Agent
4. Purchase of Title Insurance
5. No Kickbacks
6. HUD-1 Uniform Settlement Statement (3 pgs)
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What is missing from the new GFE form?
Five very important items are missing from the form:
1. Only the principal and interest portion of the mortgage payment is shown, not the total monthly mortgage payment (including taxes and insurance)
2. Total settlement costs are shown, but not the total cash needed to close
3. The purchase price of the house is not in the disclosure
4. The form does not detail the type of mortgage for which was applied
5. The borrower is not requested to sign a receipt showing it was given in the required time frame
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When a licensee advertises certain information, called triggers, the licensee must disclose all the components of the financing. What are the triggers?
For example, any of the following information in a real estate ad is a "trigger":
The amount or percentage of the down payment (e.g., "5% down"; e.g., "$4,000 down")
The amount or percentage of any payment ("payments $896.54 monthly")
The number of payments or the period of repayment ("15-year or 30-year mortgages available")
The amount of any finance charges ("less than $1,800 interest in year one")
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When is PMI required?
When the downpayment is less than 20%
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What is The FHA 203(K) Program?
The FHA 203(k) loan is designed to help individuals who want to purchase, repair, and live in these homes that have been gutted and stripped. The loan is endorsed by FHA to encourage lenders to make loans on what they would normally consider risky investments. Interest rates are generally higher because of the increased risk.
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What are the benefits of the 203(K)?
The loan lets the buyer include the money needed for purchase along with money needed for repairs, such as materials, labor, and permits. The loan also can include a contingency reserve for unexpected expenses, as well as up to six months of mortgage payments so that the borrower does not have to make a double mortgage payment during the repairs.
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What is the downpayment req'd for 203(K)?
The down payment is 3.5% of the purchase price plus the cost of repairs. The maximum mortgage amount is the lesser of the as-is value of the property, plus rehab costs, or 110% of the expected value of the house after rehab. All persons who can qualify to make the mortgage payments are eligible to apply for a 203(k) loan.
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What is a short sale?
In a short sale, the lender agrees to accept less than the total amount due so that the house can be sold.
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What must occur for an agreement to be enforceable in FL?
To be enforceable in Florida, an agreement or promise that cannot be performed by both parties within one year after the contract date must be written. Also, an agreement to sell or the actual sale of any interest in real property must be in writing and be signed by all parties bound by the contract.
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What are the exception to the Statute of Frauds?
Two common exceptions to the statute of frauds are recognized: (1) if an oral contract has been completed, or (2) if the buyer has given a down payment and either moved in or made repairs.
A sales contract is valid if the transaction has been closed and a deed delivered, as it clearly shows the intent of the parties.
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What do title agents like to see in a buyer file for title insurance?
1. A properly signed and dated sales contract
2. A previous title insurance policy on the property
3. Enough information about the sellers, buyers, property, and lender to process and close the transaction:
The sellers' and buyers' marital status
A complete legal description for example, lot, block, subdivision name, unit, recording information, and county
Street address including zip code
Terms of any purchase-money mortgage the title company must prepare
Closing date and information about whether all parties will attend or whether the documents must be mailed for signature
Commission to broker and information on commission splits between brokers
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For the purpose of giving evidence of title to a buyer, What is the difference between title and an abstract?
An attorney uses the abstract to give an opinion of title.
An abstract summarizes the material parts of all recorded documents affecting title to property in chronological order. In the strict sense of the word, abstracting is becoming a lost art. With the development of microfilm, photocopying, computers, and the internet, copies of the actual document can be inspected.
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What are the Exclusions from a title policy?
A title insurance policy does not cover:
Police power of the government, such as zoning, building restrictions, setback requirements, and so on
Rights of eminent domain
Liens or encumbrances created by the insured person, or known to the insured person at the time of purchase, but not known by the title insurance company
Liens or encumbrances attaching to the property after the policy date
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What is an ALTA policy?
An American Land Title Association (ALTA) policy, gives more coverage. For instance, it will protect against defects that may be discovered by a property inspection, rights of parties in possession, examination of a survey, and certain unrecorded liens. Most lenders require a lender’s ALTA policy.
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What Exceptions do title policies not cover?
Typical policy exceptions include:
Rights of a party in possession of the property that are not shown in the public records, such as a rental tenant
Encroachments that could have been found if a survey had been made
Easements not shown in the public records, such as an old roadway on the property (prescriptive easement)
Construction lien rights not shown in the public record
Ad valorem taxes or special assessments not shown as existing liens
Restrictive covenants
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What is a deed?
The deed is the document that transfers ownership of the real property.
